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Bank rate and QE held by Bank of England

Bank rate and QE held by Bank of England

Category: Economy

Updated: 14/12/2012
First Published: 08/12/2011

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

The Bank of England has confirmed that it has held interest rates at 0.5%.

The announcement came after the Bank's Monetary Policy Committee (MPC) completed its monthly meeting where it analyses the state of the economy and other financial happenings.

It also confirmed that it would not be adding any funds to its £275 billion programme of quantitative easing (QE).

The programme was only recently increased by £50 billion, with the MPC saying that it would take another two months to complete.

"The scale of the programme will then be kept under review," said the Bank.

Some analysts expect that QE will be increased again in early 2012.

The British Chambers of Commerce (BCC) said while the decision to freeze rates was expected, the MPC should have considered increasing its QE programme.

"The decision by the Monetary Policy Committee to leave interest rates unchanged was widely expected. However, the committee's decision to leave quantitative easing (QE) at current levels is disappointing," said David Kern, chief economist at the BCC.

"In light of the risks facing Britain 's recovery, a further £50 billion increase in QE to £325 billion would be welcomed by business. While many commentators expected the MPC to wait until the New Year, an early announcement would have strengthened confidence.

"Crucially, it would help to contain sterling rises against the euro, at a time when we must maintain the competitiveness of our exports."

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