More money to go into UK economy in October?

The Bank of England indicated yesterday it was close to pumping more money into the economy, after economic conditions around the world took a turn for the worse.

This could lead to quantitative easing measures being implemented within a few weeks, minutes from the Bank’s meeting in September have shown.

This came after more warnings from the International Monetary Fund (IMF) that a double-dip recession was becoming increasingly more likely, with the organisation also announcing its growth forecasts for Britain and Europe had been lowered.

If the bank were to act in October, Britain would be one of the first countries to take such strong action soon after the gloomy growth forecasts and the financial crises that have been occurring in the Eurozone in the last few weeks.

Chief economist for the Bank said in a speech after the meeting, “If the economic situation continues to deteriorate, some additional loosening in monetary policy might be needed."

Business Secretary Vince Cable has been a vocal backer of quantitative easing plans, as economists now start to believe it’s more of a case of when, not if, quantitative easing plans come into place.

The next quarterly inflation report is released in November, so any action may not occur until after this, but if more bad news comes out in the next few weeks, the Bank may be forced into acting quickly.