Pound climbs after MPC holds off printing money
Friday 08 March 2013
Sterling rallied yesterday as the Bank of England shrugged off fears of a triple-dip recession and held fire on pumping billions extra into the UK's flatlining recovery.
The pound, down 7 per cent against the dollar this year, jumped nearly a cent in the immediate aftermath of the Monetary Policy Committee's decision.
The vote is likely to have been a nail-biter after three members called for another £25bn in quantitative easing last month. The no-change call leaves QE at £375bn. Interest rates, held again yesterday at 0.5 per cent, have been lodged at their present record low since March 2009.
Nida Ali, the economic adviser to the Ernst & Young Item Club, said the decision was "a little surprising" following dovish comments from MPC members, although factors such as a stronger February for the UK's dominant services sector may have swayed the committee.
Ms Ali said: "There is a real sense of 'if not now, then when?' The MPC are sending mixed signals which are adding to the sense of uncertainty. We would be strongly in favour of looser monetary policy and had been encouraged by the MPC's recent comments and by signs that they were starting to think outside the box. But talk is cheap and it is time that they delivered."
Despite a buoyant start to the year for stock markets on both sides of the Atlantic – and inflation well above the Bank's 2 per cent target at 2.7 per cent – the economy has been in reverse for four of the past five quarters.
Are beards attractive? Ryan Gosling says yes, but science says no. Take the A-list facial hair challenge and find out who's right
South Korea ferry: Four dead and almost 300 missing as mass rescue gets underway
Oscar Pistorius trial: Reeva Steenkamp told athlete she 'loved him' for first time in Valentine's Day card
Oscar Pistorius trial: Reeva Steenkamp standing with 'hand on the door handle' when she was shot dead
Lunar eclipse 2014: Images of the spectacular 'blood moon'
The food poverty scandal that shames Britain: Nearly 1m people rely on handouts to eat – and benefit reforms may be to blame
US Navy christens huge $3 billion destroyer ship USS Zumwalt that appears as a fishing boat on enemy radar
Nigel Farage fatigue? Half of voters ‘immune’ to Ukip’s appeal
Scottish independence: It is the English who should be on their knees, begging the Scots to vote ‘No’
Nigel Farage on Have I Got News For You: Ukip leader ridiculed over expenses and party 'fruitcakes'
Refugee facing deportation from Sweden saved by fellow passengers refusing to let plane leave
- 1 Poveglia: 'World's most haunted island' up for auction...is anyone brave enough to buy it?
- 2 Refugee facing deportation from Sweden saved by fellow passengers refusing to let plane leave
- 3 Naked yoga: the bare truth - it's already big in the US, and has now landed here
- 4 24 people applied for the 'world's toughest job', here are their interviews
- 5 Scientists warn we've hit 'peak beard': The more people grow facial hair, the less attractive it is
iJobs Money & Business
£40000 - £50000 per annum + BONUS + BENEFITS: Harrington Starr: A leading, Cit...
£35000 - £50000 per annum + Bonus + Benefits: Pro-Recruitment Group: You must ...
£45000 - £60000 per annum + BONUS + BENEFITS: Harrington Starr: Corporate Acti...
£350 - £400 per day: Harrington Starr: An opportunity has arisen at a FCA regu...