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Bank of England expands bond-buying program by 50B pounds, leaves key rate at 0.5%

LONDON, England – The Bank of England expanded its bond-buying program, Thursday, injecting another 50-billion pounds ($79-billion Cdn.) into the ailing British economy.

It also left its key interest rate unchanged at 0.5 per cent.

The move by the Monetary Policy Committee was widely-anticipated and raises the amount it is pumping into the British economy since March 2009 to 375 billion pounds ($592 Cdn.). It is the first stimulus since February.

Under the so-called quantitative easing program, the Bank purchases government bonds from banks, in the hope that they will use the money to lend to businesses and consumers. The new purchases are expected to take four months to complete.

Britain is officially in recession, defined as two consecutive quarters of negative growth.