MPC votes 8-1 for rate cut

The Bank of England voted by eight to one for a rate cut of 0.25 per cent this month, it was revealed today.

Minutes of the monetary policy committee (MPC) meeting showed that all the members wanted to see lower rates, but one - David Blanchflower - backed a 0.5 per cent reduction, believing stronger action was needed to boost the economy.

While such a move may help reduce mortgage rates, however, there is no certainty over the future direction of interest rate policy.

The minutes stated that the view had to be taken in the light of the need to balance the risks of higher inflation with lower inflation.

Should the upside risks increase this may stop further cuts for the time being, making self build a cheaper option for many aspiring homeowners.

The next meeting of the MPC is scheduled for March 5th and 6th.


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