The Monetary Policy Committee has delivered a minimal further easing of policy by raising its gilt-buying programme by £25 billion to £200 billion. The additional purchases will be spread over three months, implying a slowdown to half the recent pace, and no additional authority beyond £200 billion has been requested. The message seems to be that this will be the final slug barring an economic shock. The statement contained no reference to any change in current arrangements for paying interest on bank reserves.

Today's decision is questionable in two respects. First, an additional £25 billion of buying spread over three months will have minimal effects relative to a policy of suspending purchases now. If the MPC really believes that further stimulus is required, the debate should have been between £50 billion and £75 billion, as it was in August.

Secondly, the suggestion that additional buying is warranted by the MPC's updated inflation projection lacks credibility. In August, it forecast that inflation would be above 2% and rising in two years' time. Since then, inflation outturns have been higher than expected, sterling has weakened and commodity prices have strengthened. By lowering its projection, the MPC appears to be placing even more weight on a simplistic "output gap" inflation model, despite its recent forecasting failure.