Tight decision likely to go against fresh easing

 
Ben Southwood
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A KNIFE edge rate-setting decision is likely to go against any expansion in accommodative monetary policy, analysts said yesterday.

The Bank of England’s monetary policy committee (MPC) are likely to decide not to re-start the quantitative easing (QE) money printing scheme when they vote today, commentators said, though the decision would be tight.

“We consider it more likely that the committee will vote to keep the QE target at £375bn as well as the Bank rate steady at 0.5 per cent,” said Investec’s Philip Shaw.

This chimed with the decision from City A.M.’s Shadow MPC, who voted unanimously against cutting rates from their current level, and six to three against a further expansion of the QE programme.

However, like at the Bank, three members thought that the weak economy justified buying £25bn or even £50bn of extra financial assets.