Bank of England keeps interest rates and QE unchanged

The Bank of England has kept its stimulus programme of quantitative easing (QE) unchanged and also held interest rates at 0.5%.

The decision had been widely predicted, with most analysts not expecting any change in policy until the new Bank governor, Mark Carney, arrives in July.

The first quarter GDP figures, showing growth of 0.3%, were also felt to have reduced the need for more QE.

In addition, recent data has suggested the UK economy is picking up.

 Figures from the Office for National Statistics released earlier on Thursday, said industrial output rose 0.7% in March from February, a bigger increase than forecast. Manufacturing output rose by 1.1%.

In addition, recent sector surveys have indicated that conditions improved last month in the service, manufacturing and construction sectors.

The Bank's Monetary Policy Committee has been split in recent months over whether to increase its QE programme from the current level of £375bn.

Three members - including governor Sir Mervyn King - of the nine member MPC have voted for an extra £25bn of QE at the past few meetings.

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Article source : http://www.bbc.co.uk