LONDON (MNI) – If things turn out as the Bank of England’s November
Inflation Report predicted, there will be a very strong case for more
quantitative easing in February, Monetary Policy Committee member Martin
Weale said in a Financial Times interview.
The Inflation Report forecasts showed CPI heading well below its
2.0% target, to stand around 1.3% in two years’ time. This has raised
debate among analysts over whether the MPC will wait until February
before providing further stimulus, or increase QE before then.
In the interview Weale comes out in favour of February, when the
next Inflation Report will be issued and when the current Sg75 billion
round of asset purchases expires.
“If things evolve as the forecasts suggest, there will be a very
strong case (to extend QE) in February,” Weale said.
In the interview Weale also left open the possibility of the UK
going back into recession.
“It would be foolish to say that there’s no significant risk of
output contracting,” he said.
— London Bureau +20 7862 7491; drobinson@marketnews.com
[TOPICS: M$$BE$]
