Minutes: Bank of England Far From Additional Stimulus Measures
Minutes from the Bank of England’s latest meeting show that the bank has moved further away from providing an additional stimulus package, Reuters reports.
At its meeting earlier this month, the Bank of England voted to keep interest rates as historic low levels of 0.5 percent. In addition, it voted for no additional quantitative easing, maintaining the 375 billion-pound total that has so far been enacted. Minutes from the meeting, which were released Wednesday, confirm that the bank was optimistic about the latest data concerning the British economy and that it views the situation as one in which taking more action would do more harm than good.
This suggests that the bank is committed to its policy of forward guidance, whereby Mark Carney, the governor of the institution, has stated that interest rates will remain at their current levels at least until unemployment drops below the 7 percent threshold; it currently sits at 7.7 percent.
Members of the bank’s policy committee, such as Paul Fisher and David Miles, called for additional quantitative easing during the bank’s meetings earlier this summer, but this time, they felt that such a move would be unwarranted. Signals from manufacturing and service sector numbers, as well as a drop in unemployment, have hinted that the U.K. economy may be on its way to turning itself around.