The Bank of England on Thursday conceded it had run out of ammunition with conventional monetary policy after its move to cut rates close to zero, and created £75bn of new money to pump into the economy over the next three months to ward off deflation. Gilts prices jumped on news that the Bank planned to purchase nearly a third of the outstanding 5- to 25-year government bonds. With few precedents, however, the Bank’s monetary policy committee is uncertain of the likely effects of the moves.

This entry was posted by Gwen Robinson on Friday, March 6th, 2009 at 4:58 and is filed under Capital markets. Tagged with bank of england. Edit this entry.