Measures may be needed to boost growth says Bank’s Bean

| December 13, 2010 | 0 Comments

Deputy Governor of the Bank of England, Charles Bean, has said the outlook for economic growth “remains highly uncertain” and measures may be required to boost the recovery.

The Deputy Governor said it was possible that the central bank could inject further money into the economy via its quantitative easing (QE) scheme if growth shows signs of slowing.

The Bank embarked on its £200 billion QE programme in March 2009, when the economy was in the midst of its worst recession in more than five decades.

Many experts fear that the Government’s spending cuts will hamper growth and, therefore, the economy is expected to slow in the next few quarters as household spending is likely to take a hit.

Speaking at an event organised by Market News International in London today, Mr Bean said QE may need to be restarted if the euro zone debt crisis worsens.

Mr Bean also said stubbornly high inflation has increased the risk to price expectations. Despite inflation hovering around the 3% mark, the Monetary Policy Committee (MPC) has opted to keep interest rates at the record low of 0.5%.

However, at the last six rate-setting meetings, policymaker Andrew Sentance has voted for interest rates to be lifted from their current historic low to curb inflation.

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