Bank holds again but analysts expect MPC to act in November

 
Ben Southwood
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THE BANK of England held tight on both QE and interest rates in its meeting yesterday.

Analysts said the Bank was continuing its “wait and see” approach, analysing the effects of the £50bn package of asset purchases that will last through October, and the government's Funding for Lending scheme, before intervening in the market again itself.

However, given the gloomy state of the economy, analysts continue to expect action from the Bank once the current programme finishes.

“With the economy contuing to remain lacklustre, the euro area crisis ongoing and the global economy slowing, we expect a further £50bn increase in asset purchases to be announced [in November],” said Grant Lewis at Daiwa Capital Markets.

Vicky Redwood at capital economics agreed that November would be the next meeting when monetary policymakers were likely to announce more monetary action.

Yesterday’s decision was the first for new MPC member Ian McCafferty, formerly at the CBI.