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Bank of England starts another round of QE

[LeGagneur]

The Bank of England said it will pump tens of billions of pounds into the economy to prevent the euro crisis from torpedoing Britain’s faltering recovery.

The Monetary Policy Committee today announced plans to inject an extra £75 billion into the financial markets, as it restarted its Quantitative Easing scheme, bringing the total to £275 billion.

The pound tumbled after the Bank’s move, retreating from $1.5476 against the dollar immediately before the announcement to $1.5300.

The latest bout of money printing will take four months to complete, the Bank said. It also confirmed that interest rates would be kept on hold at the record low of 0.5 per cent for the 32nd consecutive month.

Forty-five minutes after its announcement, the European Central Bank said it would keep its official rate unchanged at 1.5 per cent, confounding hopes that it would ease policy to support flagging growth in the single currency region.

Shares lost some of their gains after the ECB’s announcement. Economists had expected the Bank of England to relaunch its QE programme, but many expected it to hold fire until next month.

However, revised data yesterday revealed that the economy expanded by just 0.1 per cent in the second quarter, instead of the previous estimate of 0.2 per cent, suggesting that Britain is dangerously close to slipping back into recession. Meanwhile, tensions have been rising in financial markets amid continued uncertaint
https://www.thetimes.co.uk/tto/news/