Pound retreats as MPC split over QE debate

The pound has retreated in forex trading this morning (February 20th), as the Bank of England's (BoE) policymaking council appears divided over whether or not to sanction further monetary easing to stimulate the economy.

According to minutes from the Monetary Policy Committee (MPC) meeting at the beginning of the month, six individuals voted against expanding the bank's current programme of quantitative easing (QE), while three people elected in favour of upping the current £375 billion total.

Governor of the BoE Sir Mervyn King was in favour of increasing asset purchases, but he was in the minority.

Despite this defeat, the markets believe the vote is indicative of a chance QE could be increased at a later date.

The last time the MPC elected to raise its bond-buying programme was in July 2012, when the committee upped the total by £50 billion.

At 11:15 GMT, the pound was lower against the majority of its trading partners, sliding by 0.7 per cent against the dollar to $1.531 and retreating by 0.7 per cent against the Chinese yuan to 9.560 yuan.

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