By Marcus Leach

The minutes from the Bank of England's Monetary Policy Committee (MPC) show that they believe the risk of a 'severe dislocation' to the banking system has been reduced.

The latest meeting minutes, released today (Thursday), revealed that all members voted unanimously to hold interest rates and continue with quantitative easing (QE).

"The immediate risk of a more severe dislocation in the euro area arising from banking sector difficulties appeared to have been mitigated by the ECB's actions," the committee said.

The minutes did go on to say that there was a split amongst the members as to whether the bank should increase QE in 2012.

“It was no surprise to see all nine policymakers voting to leave the current QE programme on hold till February, which has long been earmarked as the month to step up asset-purchases," Richard Driver, analyst for Caxton FX, said.

“The MPC rarely gives such clear indicators that they intend to extend QE as they have done in the minutes and this morning’s poor GDP figure only underpins this.

“High inflation will no longer be an issue in 2012 and the UK economy needs more from the Bank of England printing presses.”

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