Adam Posen calls for new quantitative easing programme
Adam Posen, a member of the powerful MPC, has today come out with a keynote speech suggesting that the Bank of England needs to inject further capital into the UK economy sooner rather than later. He believes that now is the time to reintroduce the quantitative easing programme which has already swallowed up £200 billion although a statement on the additional investment potentially required has not yet been released.
While the Bank of England has yet to even confirm that quantitative easing will be reintroduced it seems almost inevitable when you bear in mind the recent comments associated with various members of the MPC. Many economists and analysts are now waiting for official confirmation that quantitative easing is back on the agenda, something which could come as soon as next month. So what options does the Bank of England have?
In many ways quantitative easing is the final throw of the dice from the UK government and the Bank of England. This is the process by which cheap capital is injected into the UK economy to oil the wheels of business and keep the money markets moving. However, at some point the UK business arena will need to take up the slack which will inevitably be left behind once the quantitative easing programme is over.
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