The Bank of England’s Monetary Policy Committee left rates unchanged Thursday but decided to expand its asset purchase program by £50 billion to £125 billion.

The MPC voted to maintain the official Bank Rate at 0.5%, and to boost its program of asset purchases financed by the issuance of central bank reserves by £50 billion, noting that the world economy “remains in deep recession”.

“Output has continued to contract and international trade has fallen precipitously. The global banking and financial system remains fragile despite further significant intervention by the authorities,” it said. Although it did note that “surveys at home and abroad show promising signs that the pace of decline has begun to moderate.”

The committee said that there is considerable fiscal and monetary stimulus in the pipeline that should lead to a recovery in economic growth, but that the timing and strength of that recovery is highly uncertain.

IE