Governor King said that the possibility of a rate cut below the current 0.5% level is still on the table, although there are arguments against such a move, the most important being little impact on the economy. MPC Member Miles supported this view saying that it would decrease bank funds available for lending. An extension of the bond purchase program would be a more effective strategy in their opinion.
The MPC is in favor of the Bank Funding Scheme, that would provide funding to banks for several years, at rates below current market rates. It could be made operational in the nearest future. Governor King said he believes that the EU Commission would not oppose it.
He also expressed his concerns with the developments in the EU debt crisis as well as the worsening situation in Asia and other markets.