October 26, 2011 / 3:20 PM / 8 years ago

UPDATE 1-BOE'S Posen defends size of quantitative easing

WASHINGTON, Oct 26 (Reuters) - The Bank of England’s 75 billion pounds of quantitative easing is the right amount of monetary stimulus given the deteriorating economic outlook, BoE policymaker Adam Posen said on Wednesday.

“What’s right for the United Kingdom is to do ... 5 percent of GDP, which is a big number, but it’s not an enormous number,” Posen said on CNBC television.

He said the British economy would be shrinking were it not for central bank policies, and he predicted inflation — which recently hit a three-year high of 5.2 percent — will fall below 2 percent in a year.

“It’s peaked. I’ll bet you tuppence, I’ll even bet you three pence that a year from now it’s going to be below 2 percent,” he said.

The BoE surprised financial markets at a meeting earlier this month by voting unanimously to support the economy with quantitative easing and to keep rates at a record low 0.5 percent.

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below