CITY A.M. | SHADOW MPC SPLIT ON QE VOTE
ALLISTER HEATH | CITY A.M.
“Hold rates and QE – the economy has shown some signs of beginning to recover and manipulating aggregate demand further won’t work. However it is important to watch the money supply, which slowed sharply last quarter.”
SIMON WARD | HENDERSON
“Stop QE. The economy is lifting and inflation is unlikely to return to target this year. Address any monetary weakness by easing pressure on banks to deleverage rather than forcing more cash into overvalued gilts.”
GEORGE BUCKLEY | DEUTSCHE BANK
“I vote to hold rates and boost QE by £50bn. Business surveys have been stronger of late but with output still well below its pre-recession peak, the risks to inflation going forward remain to the downside.”
TREVOR WILLIAMS | LLOYDS
“We should hold rates – the economy is struggling as the sharp fall in M4 shows. QE should be extended by £75bn and we should be prepared to do more in the event of more serious fallout from the Eurozone crisis.”
VICKY REDWOOD | CAPITAL ECONOMICS
“It is time to increase QE again. Despite the stronger tone of the economic data of late, I think that another £75bn is required – the most the Committee thinks is possible without distorting the markets.”
GRAEME LEACH | IOD
“Again we need to vote for more quantitative easing – the only question is £50bn or £75bn. My hunch is that with the money supply so weak, we should vote for £75bn.”
HOLGER SCHMIEDING | BERENBERG BANK
“I vote for £50bn more QE over six months, with a review after three months. Leading indicators have started to recover, but the economy remains fragile and sluggish demand points to slower inflation, warranting more QE.”
ROSS WALKER | RBS
“£50bn more QE. Although there has been some improvement, the risks for the economy remain skewed to the downside. Further loosening is safest. A stronger-than-expected recovery would be a nice problem to have.”
VICKY PRYCE | FTI CONSULTING
“Hold rates and consider more QE. Despite some recent signs from domestic survey data, there is a sense we may near crunch point on the euro, so the monetary stance needs to stay accommodating to sustain confidence.”