Bank of England 'should learn from Japan'

The Bank of England should learn from Japan when it comes to quantitative easing measures, it has been suggested.

Economist at Defaqto Michael Baxter explained that many people believe the Asian country took too long over the decision to cut interest rates to zero.

As well as taking too greater length of time to do this, it also did not achieve much, he continued, saying that Britain should certainly consider the experiences of Japan.

Once rates are at the bare minimum, Mr Baxter continued, "you have got to start contemplating quantitative easing".

In a recent Treasury Committee press notice, chairman John McFall explained interest rates in Britain have fallen considerably and soon they will be unable to decrease any more.

He said the UK needs to be "prepared for the worst case scenario" and the authorities need to ensure that businesses and the public know they will "take firm action".

Under quantitative easing – when central banks hand out money to the banking system to promote spending – usually occurs after lowering rates is no longer effective because they are already at zero.