All nine policymakers vote for rate freeze
Minutes of the Bank of England’s August 3-4 meeting have been released today and have revealed all nine members of the Monetary Policy Committee (MPC) voted to keep interest rates at the historic low of 0.5%.
For several months, Martin Weale and Spencer Dale have been lone voices on the Committee by voting to hike rates to combat stubbornly high inflation.
However, Weale and Dale have now joined their fellow members by opting to keep rates low as the economic recovery appears to be losing momentum.
Yesterday, the Office for National Statistics revealed inflation rose more than expected in July to 4.4% – more than double the 2% target.
Many central banks throughout the world are hiking interest rates to bring inflation down but the Bank of England has already hinted that rates will stay low for “some time to come”.
In the meantime, Adam Posen, again, called for an injection of £50 billion via the QE scheme to boost the economy.
The minutes said: “The slowing in world demand growth and the heightened tensions in financial markets meant that the balance of risks to the medium-term inflation outlook had clearly shifted to the downside.”