MPC advised to pause quantitative easing program
The Times Monetary Policy Committee, a committee of experts predominately set up to review decisions by the Bank of England MPC, have today recommended that the Bank of England should pause the quantitative easing program which is costing UK taxpayers billions of pounds. There is a growing belief that a pause in the program would give experts the opportunity to see how the economy performs on its own 2 feet and ultimately whether there is strength in depth.
The growing concern is that the excessive funds which have been poured into the UK banking system are effectively supporting the UK economy and once this tap is switched off we could see a fallback in economic activity. It is becoming ever clearer that despite the billions of pounds poured into the system we have yet to see any significant increase in bank lending in the UK. This has put both consumers and businesses at risk of failure and caused the UK government to publicly denounce the UK banking sector and call for greater assistance.
The problem which the Bank of England MPC has is that if the quantitative easing tap is switched off it may not have the same effect if it needs to be switched back on.
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