Minutes released from the MPC meeting showed the Bank of England governor voted for GBP75 billion worth of quantitative easing, while other committee members opted for a "more moderate" GBP50 billion increase. The revelation was a surprise to markets this morning and led sterling exchange rates to decline against the US dollar and euro.
The Bank has now injected a total of GBP175 billion into the economy in an attempt to increase money supply and stimulate the economy. The split in the MPC reveals the committee is divided on the depth of the recession and the amount it will take for the UK to recover. Following France and Germany's exit from recession, UK investors are growing nervy the economy is lagging behind.
Sterling exchange rates slipped 0.8% against the US dollar and euro, currently trading at USD1.64 and GBP1.16.
The rates quoted above are interbank rates. Client rates may vary according to the volume and timing of the trade.