MPC must act boldly to increase benefits of QE, says BCC
05 Apr 2012
- ‘Keeping rates and QE programme on hold was the right decision’
- ‘QE has not led to meaningful increases in lending to businesses’
Commenting on today’s Monetary Policy Committee (MPC) decision, David Kern, Chief Economist at the British Chambers of Commerce (BCC), said:
“Following the February increase in Quantitative Easing (QE), the decision to keep interest rates and the QE programme on hold was widely expected. With QE still being implemented, and given the MPC’s self-imposed practice of only buying gilts, this was the right decision. However, last month two MPC members voted for an increase in QE to £350bn. While support for this may be strengthening, we believe that adding to QE would be unnecessary.
“We supported past increases in QE because they eased pressures on the banking system and helped to underpin financial stability. However, this has not led to meaningful increases in lending to small businesses, and the benefits to the real economy have been limited. Increasing QE now would only have a marginal effect. There is ample liquidity in the financial system and there is no need to drive down yields on government bonds further.
"The main policy aim must be boosting the unduly low rate of economic growth by increasing lending to viable businesses. To achieve this, it is vital to make the new credit-easing scheme more substantial. But the MPC also has a part to play. The committee should reconsider its reluctance to include assets other than gilts in the QE programme, such as securitised SME loans. This will make the banks less risk averse, and will help to improve the flow of lending to credit-worthy firms.”
10 Feb 2016
92% of employers say pensions attract and motivate staff
Some 92% of employers believe that workplace pensions attract, retain and motivate workers, according to research by the Confederation of British Industry (CBI) and Mercer.
The report, A view from the top: CBI/Mercer pensions survey 2015, which surveyed 166 organisations, also found that 96% of respondents believe that there is a strong business case for providing a workplace pension.
10 Feb 2016
The Port of Felixstowe has confirmed that it will offer a container weighing service to ensure UK shippers are able to comply with new international regulations that will come into effect on 1 July 2016.
10 Feb 2016
The February networking event for marketing agency thebestof Haverhill takes place on Thursday 18th February at Days Inn Haverhill from 10.00am until 11.30am.