No great surprise that the Bank of England’s MPC have sat on their hands for another month. UK monetary policy is firmly on hold until new man Carney comes in to head up the monetary policy committee next month. Then we will see if the monetary sparks start to fly again. With some early signs of recovery starting to bud in the economy, it might be a good few months until Carney launches any new monetary initiative. Carney is unlikely to hit the ground running and will probably prefer to watch, wait and see whether QE needs another top up. There is probably an evens chance whether another £25bn top up will be required later this year. In all probability, the new emphasis of MPC policy will probably steer towards microeconomic initiatives like the Bank’s Funding for Lending Scheme. Ready and available access to cheap credit for personal and small and medium company borrowers will probably be a key means for the BOE to help lubricate recovery ahead, especially while the government’s austerity policies continue to take their toll.
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