Members of the Bank of England’s Monetary Policy Committee say the fiscal policy measures announced by the chancellor in the Autumn Statement are only likely to have a small impact.
Minutes from the meeting on 5 and 6 December show a preliminary analysis by MPC members judged the measures to have little potential in terms of affecting growth over the committee’s forecast horizon.
The minutes say: “The committee noted the fiscal policy measures announced by the chancellor in the Autumn Statement. Preliminary analysis had suggested that their impact on the outlook for growth over the committee’s forecast horizon was likely to be small.”
The MPC says the underlying state of the UK economy is difficult to judge, given the influence of temporary factors such as the boost delivered by the Olympics.
MPC member David Miles reiterated his call to increase the size of the asset purchase programme by a further £25bn to £400bn in December.
The eight remaining members judged the current £375bn programme to be sufficient.
All nine members voted unanimously to maintain the base rate at 0.5 per cent.