The Bank of England (BoE) has today decided to extend its quantitative easing (QE) programme by another £50bn in order to try and prevent a second recession.

Its decision, which many economists had widely predicted, has taken the total amount of QE stimulus to £325bn. Interest rates have been left at 0.5 per cent.

The BoE said that the cash injection was decided upon as a direct result of rising unemployment levels, falling import prices and energy rates. Industry figures believe that the Monetary Policy Committee (MPC) will agree another cash injection in May.

Whilst the government has emphasised that this latest injection into the economy is absolutely vital if the economic slump and eurozone crisis are be tackled, many pension experts have warned that the decision will cause annuity rates to fall leaving pensioners tackling higher living costs and low returns.

This claim was yesterday supported by Hargreaves Landsdown who warned that the combined effect of QE, Solvency II and increases in life expectancy would all contribute in pushing annuity rates downwards.

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