Interest rates 'held at 5%'

The Bank of England has voted to keep interest rates at five per cent this month.

Governor Mervyn King invited the committee to vote on the proposition to maintain the current rate, with the majority of policymakers deciding in favour of doing so.

According to the meeting's minutes, Mr King, Charles Bean, John Gieve, Kate Barker, Tim Besley, Spencer Dale, Andrew Sentance and Paul Tucker all voted in favour of the proposition.

The Telegraph reported that Mr Beasley withdrew his recent calls for an increase in rates while only David Blanchflower voted against, calling for a 50 basis-point cut.

Citing economists, the newspaper said the central bank is moving closer toward a rate cut by the end of the calendar year.

Meanwhile, MarketWatch claimed that credit markets see a 50 per cent chance of a cut by 25 basis points in October and a 125 per cent chance of a similar-sized cut in November.