Bank declines to turn on monetary taps
The Bank of England declined to pump more stimulus into the economy yesterday, despite signs that the GDP bounce registered in the third quarter of the year is fading.
The Monetary Policy Committee announced there would be no additions to the £375bn pile of government bonds that it has purchased since 2009 in order to support spending.
The MPC also kept interest rates at their record low of 0.5 per cent.
Some analysts had predicted that the MPC would vote for a £25bn increase as surveys of puchasing managers (PMIs) in the construction, manufacturing and services sectors over the past week have pointed to slowing momentum.
The economy grew by a healthier than expected 1 per cent between July and September, according to the Office for National Statistics, although some of this was due to temporary factors such as Olympic ticket sales.
"If the recent trend in the PMIs continues, then further easing would seem likely," said George Buckley of Deutsche Bank.
The European Central Bank also kept monetary policy on hold yesterday, despite multiplying expectations of a deterioration in the eurozone. Its main interest rate was kept at 0.75 per cent. The European Commission this week cut its 2013 growth forecast for the 17-member bloc from 1 per cent to just 0.1 per cent. The ECB's president, Mario Draghi, hinted that the Bank is preparing to downgrade its own forecasts next month.
- 2 Harry Potter fans can apply to the Hogwarts-inspired College of Wizardry
- 3 Jessica Chambers: 19-year-old woman 'doused with lighter fluid and burned alive' in the US
- 4 Russell Brand calls Nigel Farage 'poundshop Enoch Powell' in BBC Question Time debate
- 5 Orange Wednesdays are no more
Weather bomb in pictures: Storms cuts power for tens of thousands – and snow is on the way
Jessica Chambers: 19-year-old woman 'doused with lighter fluid and burned alive' in the US
Russell Brand calls Nigel Farage 'poundshop Enoch Powell' in BBC Question Time debate
Russell Brand was rendered speechless on Question Time by this man
Fury at Airbus after it hints the super-jumbo may be mothballed
Disgruntled RBS worker writes hilarious open letter to Russell Brand after anti-capitalist publicity stunt leaves him hungry
Nigel Farage's approval rating hits 'record low' as popularity suffers in wake of Ukip sex scandal
Nigel Farage defends Kerry Smith 'ch***y' comment: 'If you are going for a Chinese, what do you say you’re going for?'
Pakistan school attack live: Taliban kill at least 132 children in 'horrifying' massacre
Sony hack: Angelina Jolie branded 'seriously out of her mind' in further embarrassing leaked email saga
Panic Saturday: 13 million Britons spend £1.2bn – while 13 million others across the country live in poverty unable to afford food
iJobs Money & Business
$200 - $350 per annum: Carlton Senior Appointments: Managing Producer Office...
$125 - $225 per annum: Carlton Senior Appointments: San Fran - Investment Advi...
Up to £70,000 per annum + benefits: Sheridan Maine: Are you a qualified accoun...
Up to £65,000 per annum + benefits: Sheridan Maine: Are you a qualified accoun...