LONDON (MNI) – The Bank of England’s Monetary Policy Committee has
not lost faith in asset purchases and the MPC voted not to increase QE
at its November meeting because of the inflation outlook and the
monetary easing coming from the decision to transfer excess cash from
the BOE’s gilt holdings to the Treasury.
At the press conference following the November Inflation Report
King stressed that the MPC did not believe QE is ineffective,
highlighting other reasons why the committee had not extended it.
The Inflation Report projections “explain exactly why we did
pause,” King said.
He said that in the current environment “there are limits to the
ability of domestic policy to stimulate private sector demand … But
the Committee has not lost faith in asset purchases as a policy
instrument, nor has it concluded there will be no more purchases.”
–London newsroom: tel+44 207 862 7491; e-mail: drobinson@marketnews.com
[TOPICS: M$$BE$]
