Commenting on today’s MPC decision to make no change to the base rate or QE, Tom Hooper, economist at KPMG, said:
‘It comes as no surprise that the Monetary Policy Committee has decided to sit on its hands. After all, it was only last month that they decided to embark on another round of QE – and it will take some time for the effects of that injection to feed through. For now – the Committee has sensibly opted to wait and see.
But the overall picture remains bleak. Output has gone nowhere for the past two years and remains over 4% below its previous peak. And the economy is currently shrinking, rather than recovering.
Looking ahead, more imaginative monetary policies - and perhaps even a fiscal stimulus - may be required to counteract the contractionary forces which are now gripping the economy. ‘
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Notes to Editors:
KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and operates from 22 offices across the UK with over 11,000 partners and staff. The UK firm recorded a turnover of £1.7 billion in the year ended September 2011. KPMG is a global network of professional firms providing Audit, Tax, and Advisory services. We operate in 152 countries and have 145,000 professionals working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. KPMG International provides no client services.