Pound Plunges On New Easing From The Bank Of England

Following an increase in quantitative easing from the Bank of England, the pound has dropped to 1.570 against the dollar, down from 1.587 yesterday.

The pound weakened to a year-to-date low against the Euro of 0.843.

The BOE voted 7-2 in favour of a £50 billion increase in easing. Two members, Miles and Posen, voted for a larger £75 billion increase.

The BOE voted unanimously not to change rates. They also said in a statement that the ECB’s LTRO had reduced risk in Europe.

BOE Governor Mervyn King said they expect a “zig-zag” pattern of quarterly growth, up 0.2 per cent from Q4 to Q1 and flat from Q1 to Q2, according to MNI.

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