Bank voted 7-2 for no rate cut

Minutes published by the Bank of England today have revealed that the vote not to cut interest rates was passed by seven votes to two.

Deputy governor of the monetary policy committee John Gieve was one of the two who voted against the majority to cut interest rates by a further quarter of a per cent - which would have been the fourth such cut in as many months.

While the report acknowledged a slowdown in the UK economy, it also stated: "Indicators of activity in the current quarter have given mixed signals, but, if anything, pointed to less of a slowdown than expected at the time of the February inflation report."

The minutes of the meeting, which was held on the 5th and 6th of March and may affect those in the propertyindustry, showed fears about sparking panic in the UK economy of a US-type recession was also an influential factor in not cutting the rates.

Another influence on the decision revealed by the minutes was that several international market interest rates had risen over the past month.

Publication of the minutes follows news today that consumer inflation hit 2.5 per cent last month, its highest level in nine months, which could cause problems with cutting the interest rates further if the UK economy continues to slow.


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