Interest rates and QE left on hold

The Bank of England has left UK interest rates at 0.5%, and has decided not to extend its Quantitative Easing (QE) programme – yet. The Pound has gained around a cent against the Euro and US dollar this morning.

More QE may be used in the coming months to prop up the UK’s ailing economic recovery. The last round was completed in February 2010 and, since effectively printing money reduces the value of sterling, had decimated the value of the Pound.

We will find out in 2 weeks how near the Bank were to extending QE this month, and any signals that they may do so in October will be likely to send exchange rates tumbling. The only possible saviour, for those of you looking to send payments overseas, is that high inflation could cause the Bank to pause for thought for a little longer. Therefore, as well as the minutes in 2 weeks, any inflation data published during September will also likely have a strong influence on the direction of exchange rates.

Do contact us for an award winning currency transfer service at Currency Index and for the latest live rates and quotes on your own transactions.