FURTHER action from rate-setters to kick-start the ailing economy became more likely today after figures showed a record slump in money growth.
The Bank of England’s preferred measure showed money growth shrinking by 0.9% in September - compared with anaemic 0.1% growth in August - despite efforts to pump in £175 billion through quantitative easing (QE).
Money growth is also falling at an annualised quarterly rate of 1.7%, the biggest drop since the Bank’s records began in 1998.
Daiwa Securities economist Colin Ellis predicted that QE would be expanded by £50 billion at the Bank’s monthly meeting next week - especially in the light of last week’s shock fall in third-quarter GDP.
"It is a clear signal that the Bank needs to do more," he said.
Vicky Redwood of Capital Economics said: "While the monthly figures can be volatile, it is clear that money growth is still well below rates needed for a decent economic recovery."