The Bank of England is to increase its quantitative easing programme by £50bn to £325bn, while interest rates will stay at their record low of 0.5%. The Bank’s Monetary Policy Committee today voted for the measures to boost the UK’s economy after news that growth slowed in the final quarter. The bank said that “without further monetary stimulus, it was more likely than not that inflation would undershoot the 2% target in the medium term”, and economic stimulus was needed. “The pace of expansion in the United Kingdom’s main export markets has also slowed and concerns remain about the indebtedness and competitiveness of some euro-area countries. A gradual strengthening of output growth later this year should be supported by a gentle recovery in household real incomes as inflation falls, together with the continued stimulus from monetary policy. “But the drag from tight credit conditions and the fiscal consolidation together present a headwind. The correspondingly weak outlook for near-term output growth means that a significant margin of economic slack is likely to persist.”