Bank of England Decided Not to Increase Asset Purchase Plan Now

July 9, 2009

A terse statement from the Bank of England 9-person Monetary Policy Committee revealed a wait-and-see stance but gave no explanation of latest thinking about current conditions and the economic outlook.  The Bank Rate remains at 0.5%, where such has been since March, and the Bank’s Gbp asset purchase plan was not expanded even though it will be exhausted by the end of this month.  Analysts had been about evenly split on whether the program might have been raised to Gbp 150 billion, the ceiling already authorized by the British Treasury.  Minutes of today’s meeting will be published on July 22nd and will be eagerly awaited for clues to where policy goes from here.  Following the Bank’s announcement at 11:00 GMT, sterling slightly extended its rebound earlier today and is now trading 1.0% higher against the dollar than its closing levle in New York on Wednesday.

Copyright Larry Greenberg 2009.  All rights reserved.  No secondary distribution without express permission.



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