BoE: QE has lost its bite

28 September 2012

An official at the Bank of England (BoE) has indicated the prospect of more quantitative easing being introduced before the end of 2012 is unlikely.

Paul Tucker, deputy governor of the BoE, said that even though its money-printing programme - which has so far been worth in the region of £375 billion - still works, "it does not have the same bite it used to have".

Speaking to EuroWeek magazine, Mr Tucker revealed the Bank is hesitant with regard to introducing more of this type of stimulus.

He explained that while the BoE could technically do more, "it's just a question of what we think the risk to inflation would be".

Despite the benefits to be had through bringing in more QE, there are concerns that such a move might trigger inflation, even though the Money Policy Committee - the part of the BoE that sets interest rates - is keen to make credit cheaper.

By Tony Aynsley

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