Bank of England announces end to QE

by Richard Kilner

Story link: Bank of England announces end to QE

The Bank of England’s Monetary Policy Committee (MPC) has today chosen to retain the British interest rate at 0.5%, the lowest in its history.

The MPC has held rates steady since March 2009.

In addition, the MPC elected to stop the quantitative easing programme of asset purchases at its present level of £200bn, despite some speculation that it might be enlarged.

The quantitative easing scheme had previously been increased twice in size, and was originally scheduled to have ended in August last year.

Although the UK has emerged from recession, it was at the miniscule rate of 0.1% in the last quarter, with many forecasters predicting that a return to recession is a real possibility.

CPI has risen to 2.9%, partly due to rising fuel prices and also due to the return of VAT to its 17.5% rate, after a year at 15%.