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By keeping the bank rate low at a value of 0.1%, it becomes cheaper to borrow money from the Bank, so households are more willing and able to buy goods and services, increasing consumption, and businesses are in a better position to purchase items to expand their businesses, such as property and equipment, increasing investment and therefore increasing aggregate demand. Businesses can also hire more workers, which reduces cyclical unemployment and helps the government to achieve its macroeconomic objective of low unemployment. Quantitative easing was used to help increase economic growth and decrease the level of cyclical unemployment in the UK, so if the Monetary Policy Committee decides to taper quantitative easing, cyclical unemployment will increase as a result.

However, there are many factors that affect the unemployment rate of a country such as geographical immobility, occupational immobility, automation and the level of aggregate demand, so a low bank rate will not necessarily decrease unemployment. Moreover, the level of unemployment depends on where the country is in its business cycle, in a recession unemployment tends to rise quickly whereas in a boom unemployment will usually be lower.

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Monetary policy impacts the money supply in an economy, which influences interest rates and the inflation rate .
A country's importing and exporting activity can influence its GDP, its exchange rate, and its level of inflation and interest rates.
Balance of trade is the difference between the value of export an import.
when interest rate is low, Bank of England will lose hot money , and the export price cheaper, and there is the trade deficit happens
when inflation rate increase, the price of export will increase, and there is a trade surplus happens

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Pros

- If interest rates are low, government’s interest on debt will reduce and so it will be easier to pay off, therefore reducing the budget deficit.
- If money supply increases, tax can be raised, tax revenue increases, budget deficit improves.

Cons

- under maintenance

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Tapering quantitative easing would help decrease inequality. This is because quantitative easing causes an inflation of asset prices, which generally benefits investors from the higher socioeconomic groups because they can afford to buy these new bond prices. Thus, increasing inequality of wealth. QE also contributes to the decrease in the value of money due to more being made, so increased cost of living due to inflation and a decreased in the value of money negatively impacts the lower socioeconomic groups because a higher proportion of their income will have to go on purchasing the same amount of goods and services.

However, it can be argued that quantitative easing is positively redistributional because asset purchases increase market liquidity. This ultimately increases employment, which benefits the lower socioeconomic groups more. So, while asset prices might increase wealth inequality, this effect is offset by an increase in employment and low interest rates – which quantitative easing helped promote. Therefore, tapering might decrease wealth inequality but it will increase unemployment which equally contributes to an inequality gap.