Bank is urged to expand qe early
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The Bank of England’s Monetary Policy Committee (MPC) meets this week but is expected to keep both interest rates and QE on hold. Interest rates are at a record low of 0.5 per cent and are
expected to stay at that level all year. Most economists predict a £50 billion increase in QE, an asset buyback programme often likened to printing money, in February when the current £75
billion tranche ends. ** CLICK HERE TO CLAIM A FREE COPY OF ONE OF OUR MONEY & FINANCE GUIDES ** David Kern, chief economist at the BCC, said: “At a time when fiscal policy is being
tightened and our exporters are facing major challenges, UK monetary policy must remain as expansionary as possible. “A further £50 billion increase in the quantitative easing, to £325
billion, will limit adverse effects on domestic demand. It will also provide support to exporters by helping to keep the sterling exchange rate competitive. “Many commentators expect the MPC
to wait until February before acting. But we believe that an announcement next week would boost confidence and ease concerns around the fate of the eurozone.” He said that other ways to
improve the flow of credit to businesses should also be examined.