Wednesday, September 23, 2009
MPC Minutes: QE Pause (100%); no discussion on deposit rate reduction
Sterling rallied on Wednesday after Bank of England minutes showed no policymakers voted to increase its asset buying plan and that cutting the interest paid on bank reserve deposits was not discussed. BoE Monetary Policy Committee members voted unanimously to keep the asset purchase programme at 175 billion pounds in September and to keep interest rates at a record low 0.5 percent, the minutes showed. They gave no indication the MPC had considered cutting the remuneration rate on commercial banks' deposits with the BoE -- an issue aired by Governor Mervyn King last week in testimony that markets took as offering a grim view on the UK economy.