Alistair Darling has implemented procedures that would enable the Bank of England to begin quantitative easing - printing money.

With the Bank of England's interest rate cuts to 1.5% having a limited impact on the economy, it is predicted that this new measure could occur in the next few months.

The chancellor has exchanged letters with the Bank's governor, Mervyn King to work out a timetable for such a procedure. Mr King has argued that the Bank's monetary policy committee should maintain a high level of independence.

The government hope that the measure will stimulate the UK economy and provide a boost to lending.