Afternoon:
14°c
The chief economist of the Bank of England today launched a staunch defence of its decision to pump billions of pounds of new money into the economy.
Spencer Dale rejected claims the programme of quantitative easing was not working although he conceded it was still too early to declare it a success.
"It is still early days in terms of judging the ultimate success of the programme in stimulating nominal spending, but initial indications remain encouraging," he said.
The Bank started printing money in March and has so far pledged to pump £125 billion into the economy although it is likely to rise to £150billion.
Dale's defence came as figures from the British Bankers' Association showed 31,162 mortgages were approved for house purchase last month.
It was up 7% on April and the highest level for 13 months, but still pitifully low.
BBA statistics director David Dooks said: "Steady monthly increases since last November have seen the number of loans approved for house purchase recover to levels seen in early 2008, although gross and net mortgage lending show a subdued wider mortgage picture."
