The Bank of England has kept interest rates at 0.5% and will inject £50 billion into the UK economy over the next four months through quantitative easing (QE).

The Bank will buy more assets like Government bonds in an attempt to increase commercial banks’ lending.
The QE stimulus programme has injected £325bn in total.

Interest rates have been held at 0.5% for a record low for more than three years.

The Bank said UK output has barely grown for a year and a half and is estimated to have fallen in both of the past two quarters.

The Bank of England said: “The pace of expansion in most of the UK’s main export markets also appears to have slowed. Business indicators point to a continuation of that weakness in the near term, both at home and abroad.

“In spite of the progress made at the latest European Council, concerns remain about the indebtedness and competitiveness of several euro-area economies, and that is weighing on confidence here.

“The correspondingly weaker outlook for UK output growth means that the margin of economic slack is likely to be greater and more persistent.”

Consumer price index inflation fell to 2.8% in May and is likely to edge down further in the near term.