Bank of England
Economists are predicting a further interest rate cut to be announced this week by the Bank of England, creating an all time low rate of 0.5% and the sixth cut in as many months.
Despite the interest rate cuts made so far, there is little sign that banks are any more willing to lend than they were six months ago and with that in mind an extraordinary meeting of the Monetary Policy Committee (MPC) is likely to take place to discuss plans of ‘quantitative easing‘ to drag the UK economy out of recession.
Bank of England governor Mervyn King has already written to the chancellor to ask permission to begin quantitative easing and is ready to move on the strategy whenever he is given the go ahead.
However the unconventional policy measure will need to be agreed first, in this weeks meeting of the MPC.
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