Wednesday, February 17, Bank of England published the minutes of the meeting held on 3-4 February, at which the Committee on monetary policy has kept the rate of compulsory reserves of commercial banks at 0.50%. The decision was taken unanimously. At the same meeting it was decided to keep the volume of purchases the assets of the private sector by the central bank's reserves at 200 billion pounds.
Economic activity recovered slightly and future prospects are still uncertain under the action of opposing forces. On the one hand, the current monetary policy and low exchange rate of pound sterling has a stimulating effect. On the other hand, credit conditions will be tough for some time, and the need to strengthen the financial condition of public and private sectors is likely to put pressure on costs.
The minutes noted that the preservation of the base rate at the current level would allow the Committee more thoroughly assess the effects of cumulative easing in monetary policy, which takes place from September 2008. At the same time, the Committee will determine the strength of the nascent economic recovery on the basis of more reliable data.
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