MPC meeting highlights QE case, says BofA Merrill Lynch

BofA Merrill Lynch Global Research publishes report on the Monetary Policy Committee August meeting.

As BofA Merrill Lynch Global Research analysis highlighted, the minutes from the meeting suggested diverging views within the BoE. Some members thought that there was still a compelling case for more QE, but they were happy to implement forward guidance and see what impact it had first.

The BoE has voted 9-0 to leave both QE and interest rates on hold at their August meeting and held a one-off vote on the introduction of their forward guidance , which saw an 8-1 vote result.

BofA Merrill Lynch expects that they could potentially return to voting for more QE within the next few months, in our view.

“But on the more hawkish side, alongside Weale’s dissenting vote, some members judged that the rises in market interest rates in recent weeks were not obviously out of line with their view of the outlook,” the analysis also said.

Click here to read full analysis.

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