BigNews.Biz - Mar 15,2010 - “Iberia Securities”: The weakening of the British Pound has failed to lift exports as anticipated according to the Governor of the Bank of England, Mervyn King.
Mr. King’s comments came as he gave evidence in front of the Treasury Select Committee.
“Iberia Securities” analysts pointed out that the weakness of the pound had been expected to make the goods that Britain exports cheaper abroad and, in doing so, provide a boost to the economy but as this plan required demand from overseas markets, the most profound effect had been to make the cost of importing goods more expensive which had pushed inflation up to 3.5% in January.
Mr. King said that the Eurozone was Britain’s largest export market and that growth in the region had slowed markedly to the point where it had “stalled”.
It also emerged that one of the members of the Bank of England’s Monetary Policy Committee (MPC), David Miles had considered his decision to vote for a pause in the Bank’s £200bn quantitative easing program in February to be a "pretty finely balanced decision" which markets interpreted to augur the return of the controversial money printing policy.
Sterling fell on the revelations but recovered later during the session.
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