King & Co split over impact of more QE

Bank of England rate setters are divided over the impact of more quantitative easing (QE).

The latest minutes from the Bank's monetary policy committee (MPC) meeting revealed a split among the UK's key policy makers over the benefits of extending the £375 billion programme.

Before the minutes were released it was thought the MPC would be swayed by the Bank's agreement to return some £35 billion generated through the scheme to the finance ministry.

The vote between members was also expected to be tight.  In fact, only one member was in favour of adding to QE.

'Views differed over the exact impact of the MPC's asset purchases, the committee agreed demand and output would have been significantly weaker in their absence,' members said, however the minutes revealed the group placed different emphasis on each of the arguments in favour of more QE.

This persuaded Mervyn King (pictured), Charles Bean, Paul Tucker, Ben Broadbent, Spencer Dale, Paul Fisher, Ian McCafferty and Martin Weale to vote in favour of holding asset purchases constant.

David Miles wanted to extend the programme by £25 billion, taking it to £400 billion.