Bank of England holds UK interest rates at 0.5%, QE at £275bn

12 January 2012 12:07  [Source: ICIS news]

LONDON (ICIS)--The Bank of England on Thursday again held UK interest rates at 0.5% and maintained its quantitative easing programme (QE) at £275bn.

In October last year, the Monetary Policy Committee (MPC) raised its fiscal stimulus programme by £75bn from £200bn in a bid to stimulate the weak economy and boost the recovery.

The British Chambers of Commerce (BCC) had called for the bank to raise QE by £50bn this month. Its quarterly economic survey found that the economic situation in the UK could further deteriorate with signs of stagnation in the first quarter of 2012. 

“A new recession is not a foregone conclusion. However, action is needed urgently to tackle short-term stagnation and a lack of business confidence, damaged by the ongoing eurozone crisis,” said John Longworth, Director General of the BCC.

The European Central Bank (ECB) is later expected to hold its key lending rate at 1%.

($1 = £0.65, $1 = €0.79, €1 = £0.83)

By: Leigh Stringer
+44 208 652 3214

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