Minutes from the Bank of England’s Monetary Policy Committee show that only one MPC member voted in favor of a rate increase at the committee’s meeting on September 9th. The Bank is required to maintain a target inflation rate of 2 percent but latest figures has inflation at 3.1 percent.
Despite the increase in inflation, Britain’s recovery remains fragile and while an increase in interest rates is the typical response to high inflation, the fear is that a rate increase could further erode business and consumer confidence.
Source: Associated Press
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