Bank of England Mulls Return to QE

“There had been significant downside news on activity over the month, including in the U.S. and the core euro-area countries, which had pointed to a synchronized slowing in global growth,” the minutes said, and specified the consideration of “changing the maturity of the portfolio of assets held” and even the possibility of further lowering the interest rate or providing “explicit guidance” on the direction that rate might take. In the end, however, the minutes said, “At the current juncture, none of these options appeared to be preferable to a policy of further asset purchases should further policy loosening be required.”

That said, the future looks to hold the probability of further QE, with most MPC members taking the view that it was “increasingly probable that further asset purchases to loosen monetary conditions would become warranted at some point,” adding, “For some members, a continuation of the conditions seen over the past month would probably be sufficient to justify an expansion of the asset purchase program at a subsequent meeting.”