HOT: Bank of England Reactivates QE

The Bank of England fired the first salvo to the much expected (or may I say much awaited) series of credit easing policies by global central banks

From the Bloomberg,

The Bank of England restared bond purchases two months after halting its expansion of stimulus as the deteriorating outlook spurred policy makers to ramp up efforts to kick start a recovery.

The Monetary Policy Committee led by Governor Mervyn King raised its asset-purchase target by 50 billion pounds ($78 billion) to 375 billion pounds…

The resumption of quantitative easing is a part of a twin- pronged effort by the central bank to pull Britain out of a recession that includes a new credit-boosting program. With inflation easing and reports this week showing that factory,services and construction activity weakened in June, policy makers were spurred to act…

Policy makers also left their benchmark rate at a record low of 0.5 percent today, a move forecast by all but one of 50 economists in a Bloomberg survey. Within the QE survey, two forecast no change, one forecast a 25 billion-pound increase and eight predicted an addition of 75 billion pounds.

The ECB has likewise been widely expected to cut interest rates today.

The last time the BoE delivered the QE (BoE's balance sheet from the Bank of England), this boosted UK’s major equity benchmark, the FTSE, for about one quarter or for about the same time until the program expired.

The Bank of England’s action has not been about the economy but of the saving of the skins of bankers and stock market investors. This is the Bernanke Put in motion.