BOE Minutes Show 7-2 Vote on Rates

Two members of the Bank of England’s Monetary Policy Committee (MPC) voted to raise interest rates in August, the first time in three years that policymakers have done so.

The minutes of the meeting on 6-7 August show Ian McCafferty and Martin Weale voted for a 0.25% rise to 0.75%.

It means the nine-member MPC voted 7-2 to hold interest rates at their historic low of 0.5%.

The pound jumped in expectation that rates may rise sooner than expected.

Sterling rose 0.20% against the US dollar to $1.66.

If follows official data on Tuesday which showed inflation fell to 1.6% in July.

It is the first time there has been a split on the MPC since July 2011. Interest rates have been unchanged since March 2009.

The minutes came a week after the Bank of England published its quarterly inflation report in which it halved its forecast for average wage growth, saying it now expects average salaries to rise by 1.25% this year.

via BBC

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