Osborne says QE support vital to economy

LONDON (Reuters) - Chancellor George Osborne said on Thursday that the Bank of England's quantitative easing played a key role in supporting the economy at a time of fiscal consolidation, after he approved a 50 billion pound expansion of the programme.

In a letter to BoE Governor Mervyn King, Osborne said the BoE had provided evidence of QE's effectiveness in supporting the economy.

"Monetary policy continues to have a critical role in supporting the economy as the government delivers on its commitment to fiscal consolidation and it remains the primary tool for responding to changes in the economic outlook," Osborne wrote.

(Reporting by Fiona Shaikh)