LONDON (Reuters) - The Bank of England may inject more stimulus in the economy next week as inflation looks set to fall as forecast, Bank of England policymaker Adam Posen told Bloomberg TV in an interview on Thursday.
“I am certainly leaning towards doing more QE if we don’t change the forecast,” Posen said.
When asked if another injection of 75 billion pounds would be needed, Posen said: “If you’re looking at what the market rate projections are, that seems reasonable. I thought 75 billion was a good slug last time and I think there’s a case to do it again.”
Posen said he could not predict the other eight Monetary Policy Committee members’ votes.
But he added: “I think the governor came out pretty clearly in his recent public statements, and other members of the committee such as Ben Broadbent and Martin Weale have given public statements recently. I think there is reasonable consensus on the committee about the broad outline of the forecast.”
Bank predicted in November that inflation would fall below its 2 percent target in the second half of this year, and governor Mervyn King said in a recent speech that the fall in inflation provided the scope for further quantitative easing if needed.
Reporting by Sven Egenter