Mervyn King wanted to add £50bn to QE programme
Bank of England governor Mervyn King voted to increase the asset purchase facility by £50 billion earlier this month and was backed by two other members of the central bank’s monetary policy committee.
King was joined in calling for the £50 billion increase by Adam Posen and David Miles, the only member to call for more quantitative easing at the committee’s previous meeting in May. Committee member Paul Miles also voted for an increase of £25 billion.
However, the four were outweighed by the five remaining members of the MPC, according to the latest minutes from June’s MPC meeting.
The minutes revealed a consensus among members of the committee that further stimulus was “likely to become warranted at some point”, however, most members felt it was better to wait on developments in the euro area and the meeting of the financial policy committee at the end of the month.
According to the committee, there was no advantage to be had from lowering the base rate over an expansion of the asset purchase programme. It also felt iffelt if interest rates were to fall further, it could impair the functioning of money markets.