Friday, 23 August 2013

More QE could be needed, says MPC ‘hawk’ Martin Weale

In an interview with The Daily Telegraph, Martin Weale, one of four external members of the committee, said he could “certainly envisage circumstances in which it would be sensible to undertake further asset purchases” on top of the Bank’s recently announced policy of “forward guidance”.

These circumstances might include further shocks from the eurozone or, with fresh turmoil in emerging markets, from the developing world. It was also “perfectly possible consumers will start paying more attention to saving again”, thereby snuffing out the recent recovery in consumption.

“As far as I am concerned, asset purchases remain a tool available to the committee if it feels the economy needs further support”, he said. “I would hope the recovery is well entrenched, but anyone who thinks the future will unfold smoothly is not taking account of everything that has happened in the past five years.”

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