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Bank of England calls time on quantitative easing
General News |
05/02/2010
The £200 billion quantitative easing programme has been brought to an end by the Bank of England.
Members of the Monetary Policy Committee chose against extending the government asset purchase scheme, which had been running since March 2009.
In an expected move, the committee also froze interest rates at their historic low for the 11th consecutive month.
Howard Archer, chief UK and European economist at IHS Global Insight, said the decision to halt quantitative easing represented "a significant policy development".
However he noted that the decision to keep interest rates down at their record low level was "a stone dead certainty".
Last week, the Office for National Statistics reported that Consumer Price Index inflation rose a whole percentage point from 1.9 per cent last month alone.
Stuart Law, chief executive of Assetz, commented: "It really does look like we are at the beginning of a classic inflationary period, where real assets rise in value for a sustained period, assisted by low interest rates."
Posted by John Lynes
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