Bank of England Retains 0.5% Bank Rate and Asset Purchase Guidelines
April 9, 2009
The Bank of England announced nothing dramatic as expected. A brief statement said its benchmark rate, which was cut by 50 basis points in March and by 450 basis points from October to March, will remain at 0.5%. Officials are not inclined to cut such further, fearing more drag than stimulus from such a move, and have switched their orientation to quantitative easing. Just over a third of Gbp 75 billion of financial assets to be bought with newly created reserves during March-May was engineered during the first month, and all is on schedule to complete that task within two more months. Today’s actions no doubt were decided by unanimous vote, but we’ll know that for sure when minutes of the meeting get published on April 22nd.
Copyright 2009 Larry Greenberg. All rights reserved. No secondary distribution without express permission.
Tags: Sterling
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