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Bank Of England Raises Asset Purchase Programme

The Bank of England increased its quantitative easing programme and left its record low interest rate unchanged on Thursday.

The monetary policy committee headed by Andrew Bailey, decided to lift the asset purchase programme by GBP 100 billion to GBP 745 billion.

Eight members including Bailey voted to raise the QE as they judged that a further easing of monetary policy is warranted to meet its statutory objectives, while Andrew Haldane preferred to maintain the programme at GBP 645 billion.

The MPC expects the programme to reach GBP 745 billion, around the turn of the year.
The nine-member committee unanimously decided to hold the interest rate at 0.10 percent, as widely expected.

Policymakers said they are ready to take further action as required to support the economy and ensure a sustained return of inflation to the 2 percent target.

Inflation has fallen to 0.8 percent in April, triggering the explanatory letter from the BoE Governor to the Chancellor alongside this monetary policy announcement. Inflation then fell further to a four-year low of 0.5 percent in May.

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