LONDON (AP) — The Bank of England could start buying assets from banks with newly created money as early as this week to boost lending in the economy, Treasury chief Alistair Darling said in an interview published yesterday.

The Bank of England revealed last month it had sought government approval to increase the amount of money to kick start the economy as historically low interest rates, at one percent, leave the central bank with little left to cut.

Darling said that the request had been granted and strongly hinted that the bank's monetary policy committee could begin so-called quantitative easing later this week when it meets for its monthly meeting to decide the level of interest rates.

"We've given them the levers," Darling told The Daily Telegraph newspaper. "They may decide this month that it's appropriate to do so." While the Bank of England may not be physically printing bank notes, it would be increasing the amount of money in the economy by buying assets from banks without borrowing to fund its purchases — effectively creating new money.

Economists widely expect the bank to reduce official interest rates to 0.5 percent, from the current 1 percent. They are also speculating about the extent of the quantitative easing, suggesting the central bank could create about £150 billion of new money.

The bank has said it could buy gilts — government bonds — which should boost private sector demand, and also corporate bonds and commercial paper with the new funds, which should help the economy by easing credit conditions.

With such moves, the bank would be influencing the quantity, instead of the price, of money as it reaches the limits of what it can do with interest rates.