Bank of England expected to vote against more QE
The Bank of England’s Monetary Policy Committee is expected to vote against pumping more money into the economy via Quantitative Easing when it meets this week, despite previous forecasts of a further £50bn injection.
Bank of England policymakers (including governor Mervyn King, pictured) are expected to leave QE unchanged at £375bn and interest rates on hold at 0.5% on Thursday, UK newspaper the Telegraph reports.
The Monetary Policy Committee’s (MPC) mood appears to have changed as the economy grew more strongly than expected in Q3 and the Bank’s deputy governor, Charlie Bean, questioned whether QE could boost growth in the current economic climate.
Meanwhile, economists at a UK research centre – the Centre for Economics and Business Research – said Britain’s economy would perform better than its eurozone peers over the next couple of years.
It predicted the eurozone recession would continue in 2013, with only marginal growth in 2014. However, it forecasts the UK economy would grow by 0.8% and 1.4% respectively.
“The economic situation in some parts of Europe is moving from bad to catastrophic. There is a danger that the economic problems will spill over into social breakdown in many areas of Europe as unemployment soars and governments run out of money,” said Douglas McWilliams, chief executive of CEBR.
This article was first published on Investment Week