The Governor of the Bank of England said he fears active exchange rate management could potentially start a currency war among some of the world's leading economies.
The UK's four biggest banks may need up to £35bn of fresh capital to insulate themselves against future losses, according to the Bank of England.
Sir Mervyn King, the Bank of England's Governor, told the Chancellor that £37bn cash the Treasury claimed from the QE programme will not help the UK's finances.
Paul Tucker, the deputy governor of the Bank of England, could take the top job at the Bank as early as this week.
A loophole in planned banking reforms could leave taxpayers on the hook for billions of pounds in the event of another financial crisis, Bank of England governor Sir Mervyn King has warned.
Global credit ratings agency Moody's has warned the UK is at risk of losing its AAA status should the economy slide into a triple-dip recession.
Bank of England governor Mervyn King has said the UK economy may contract once again in the fourth quarter of 2012 despite moving out of recession in Q3.
Weaknesses in the Bank of England's forecasting process have been highlighted in a review by an ex-Federal Reserve official.
Over the last three months, UK bank shares have enjoyed a strong rally, helped by the ECB's and US Federal Reserve's liquidity moves.
Bank of England governor Mervyn King has called the end of the recession in the UK and pointed to signs of growth returning to the economy.