Bank of England considered more QE
19 October, 2011
This morning’s Bank of England minutes revealed that the new Quantitative Easing (QE) announced earlier in October was voted for unanimously. Worryingly for exchange rates, there was a possibility that more than the £75bn announced may have been injected into the economy; expectations were that some committee members may have opposed QE altogether, so it appears that there may well be more on the way in the coming months.
QE is generally negative for the Pound as it effectively dilutes sterling, reducing its value and therefore causing exchange rates to fall.
Today we did not see a huge negative reaction to the news, perhaps in particular against the Euro, which was overshadowed by anti-austerity strikes and disturbances in Greece, and worries that the Greek debt crisis may not be solved as quickly as was hoped. Tomorrow the Greek parliament is likely to pass a string of tough measures, but whether they will be able to implement them without a serious public backlash remains to be seen. We could be in for more Euro volatility therefore.
The Pound was relatively flat against other currencies, as we await tomorrow morning’s retail sales figures.
- 2020 (59)
- 2019 (190)
- 2018 (229)
- 2017 (253)
- 2016 (254)
- 2015 (253)
- 2014 (252)
- 2013 (287)
- 2012 (270)
- 2011 (576)
- Brexit deal to be done, or going, going, gone? 25 November, 2020
- Sterling starts the week down from the highs of last week 16 November, 2020
- Votes are in – albeit still being counted, will Donald trump Joe? 4 November, 2020
- No categories