Bank of England Divided on Interest Rates

Concerns over soaring inflation and the sluggish rate of economic recovery have baffled the members of the Bank of England's Monetary Policy Committee.

According to the minutes from the Monetary Policy Committee’s (MPC) rate-setting meeting for this month, one member has called for a £50bn more quantitative easing (QE) of the £200bn already completed in a view to consolidate the rate of economic recovery. Besides, a majority of them pointed that further stimulus would be required in the coming months.

"Some... members felt the likelihood that further monetary stimulus would become necessary in order to meet the inflation target in the medium term had increased in recent months," the minutes read.

This month’s meeting was the sole meeting till date that witnessed the Bank segregated on its view related to the rates.

Andrew Sentance is reported to have voted in favor of introducing a 0.25 % point rate hike to 0.75pc, with no change to be implemented for the QE for a fifth successive month.

However, the seven other MPC members voted in favor of leave rates and QE unchanged.

The National Institute of Economic and Social Research has called on the policymakers not to pose any decision on the same until February.