Reuters logo
Bank of England decides not to restart gilt purchases
March 7, 2013 / 12:06 PM / in 5 years

Bank of England decides not to restart gilt purchases

LONDON, March 7 (Reuters) - The Bank of England decided not to pump more money into Britain’s ailing economy on Thursday in what is likely to have been a close-run decision.

The central bank’s Monetary Policy Committee opted not to add to the 375 billion pounds of government bonds bought with newly created money between March 2009 and October 2012.

It also left interest rates at their record-low 0.5 percent.

A Reuters poll of economists last week showed a 40 percent chance of the bank opting for more quantitative easing this week and a 60 percent chance before the year is out.

Last month, three policymakers unexpectedly voted to restart the bond-buying programme. Details of the voting at the two-day March meeting, which concluded on Thursday, are only due to be released in two weeks’ time.

Britain’s economy is teetering on the edge of its third recession in four years, although solid data on the services sector on Tuesday suggested that it may manage to eke out modest growth in the first three months of this year.

Moreover, inflation is running at 2.7 percent and the central bank forecasts it would take three years before it returns to target.

Last month Bank of England Governor Mervyn King and markets expert Paul Fisher joined external MPC member David Miles in supporting a further 25 billion pounds of asset purchases, and since then other officials had seemed open to further stimulus.

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below