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May 20, 2009    

BoE considered extra £25bn to boost economy

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by Kay Murchie

Minutes from the Bank of England’s Monetary Policy Committee (MPC) meeting, published today, revealed that extra money supplies were being considered to boost the economy and encourage lending.

According to the minutes, all members of the MPC voted in favour of increasing the quantitative easing plan by £50 billion, taking the total to £125 billion.

According to economists, this suggests that further stimulus is available should the future economic outlook deteriorate.

The minutes also revealed that all nine members of the MPC voted unanimously to keep interest rates on hold at 0.5%.

In related news today, the International Monetary Fund (IMF) concluded that “aggressive action” taken by the Government “succeeded in containing the crisis and avoiding a breakdown.”

The IMF believes that Britain may be over the worst of the recession after signs suggest that the pace of the slowdown is easing.

However, the IMF warned that high levels of household and bank debt meant the pace of any recovery was still uncertain and is calling on the Government to implement more ambitious plans to reduce the huge scale of public borrowing.

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