The bank’s monetary policy committee (MPC) hailed a “modest improvement in global growth prospects” and overwhelmingly voted to take no action in January. Members were unanimous on the need to keep interest rates at a record low and only David Miles continued to push for more bond buying.
Philip Shaw, economist at Investec, said the minutes reinforced his view that the MPC would not sanction more quantitative easing (QE), this year.
He said: “Although [governor] Sir Mervyn King confirmed in his speech on Tuesday that the committee could potentially unlock further stimulus from reopening the asset purchase programme, we judge that members would only back this option if there were clear signs that the economy was beginning to slide again.”
Howard Archer, chief UK economist at IHS Global Insight, said that with Britain’s economic recovery likely to remain “fragile and limited”, there is still a real possibility that the bank will give the economy a final push in the right direction with one last £50 billion injection in the coming months.
But with inflation on the rise the MPC will likely hold fire.