After several recent pieces of key UK data came in lower-than-expected investor eyes turned to the Bank of England with interest.
At this month’s BoE policy meeting the Monetary Policy Committee, headed by Governor Mervyn King, voted to keep the central bank’s key interest rate at its all time low of 0.5 per cent.
The BoE officials also decided to meet economist’s expectations and leave the bond-purchase target unaltered at 375 billion Pounds.
Although many officials have stated that needing to implement more stimulus is a distinct possibility further quantitative easing was not forecast by economists. Chief economist Spencer Dale previously warned that prolonged loose policy carries significant risks and policy maker Ben Broadbent lately commented that such a strategy has been restricted by faster-than-predicted inflation.
This month’s meeting may not have triggered anything momentous but November’s gathering could prove to be key. By the time the BoE officials meet again every last shiny penny of the 50 billion Pound round of quantitative easing initiated in July will have been spent. Whether or not more immediate fiscal stimulus is necessary will then be a decision which can no longer be delayed.
The Pound to Euro exchange rate is currently trading at 1.2432
The Pound to US Dollar exchange rate is currently trading at 1.6118
The Pound to Australian Dollar exchange rate is currently trading at 1.5760
The Euro to US Dollar exchange rate is currently trading at 1.2960
The Euro to Pound exchange rate is currently trading at 0.8043
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