BoE governor outvoted on QE proposal

21 February 2013

Sir Mervyn King has been outvoted in his attempt to get the Bank of England (BoE) to implement further quantitative easing (QE), it has emerged.

The minutes of the central institution's last policy meeting - which took place on 6 and 7 February - have revealed that the governor was one of three members of the Monetary Policy Committee who were in favour of introducing more monetary stimulus.

Along with Paul Fisher and David Miles - who has consistently voted for additional QE over the last few months - Sir Mervyn indicated that he wanted to boost the BoE's asset-purchasing budget by £25 billion ($37.9 billion) to a total £400 billion.

However, the other six panelists on the MPC preferred to maintain QE at its current level of £375 billion. Meanwhile, all nine members voted in favour of keeping the base rate at its historic low of 0.5 per cent.

Samuel Tombs of Capital Economics said the minutes provide "another clear demonstration of the committee's increasingly flexible approach to inflation targeting".

By Gary Cooper

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