The Bank of England has decided to hold interest rates but increase quantitative easing.

Dr Brian Sloan, Chief Economist at Greater Manchester Chamber of Commerce, said: "The Bank's decision today to hold interest rates at 0.5% is correct but to inject a further £50bn of quantitative easing in to the UK economy risks adding to inflationary pressures for business and consumers in the months ahead.

"Having just completed the last round of purchases we need time to evaluate the impact of these and must be mindful of the encouraging signs for the global economy's recovery; so today's injection is unnecessary and premature. This will act as a drag on growth, damage confidence and could lead to the Bank having to take steps to address inflation before the end of the year.

"Early signs of the global recovery are likely to boost prices of raw materials and commodities as the year progresses, therefore the inflationary impact of quantitative easing will not be welcome and could led to inflationary problems in the future. We would have preferred to see no action and rather more done to stimulate investment in infrastructure and by businesses, and Government needs to take bolder steps and action previous announcements on credit easing."