LONDON (MNI) - The minutes of the December Monetary Policy Committee meeting showed that the MPC was united in sticking to its current pace of asset purchases, respecting a speed limit imposed by markets.
Analysts believe the MPC could step up the pace of quantitative easing a little, and the minutes support that view, but the committee cannot put its foot down hard on the policy accelerator. Sanctioning a three month round of Stg75 billion in QE in February is reckoned to be as fast as the BOE could go, and even that might prove uncomfortably fast.
The problem the MPC faces is it does not have complete freedom of choice over the size and pace of its quantitative easing policy, as it is curtailed by market participants' propensity to sell it gilts.
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