8-1 vote keeps rate at 5%

The interest rate was kept at five per cent this month due to an eight to one vote by members of the Bank of England’s monetary policy committee (MPC).

In releasing the minutes from the two-day MPC meeting at the start of May, the Bank has revealed that only David Blanchflower, a renowned dove, called for a quarter-point cut.

Worries over rising inflation were named as the main influence behind the MPC decision to hold the interest rate at five per cent.

The next MPC meeting will be held on June 4th and 5th, which may herald a cut, as the Bank has reduced the rate by a quarter-point on alternate months since December 2007.

A reduction in the interest rate could mean that some mortgage holders see a fall in their monthly repayments.

The Bank of England is searching for a new deputy governor, following the announcement that MPC member Rachel Lomax is to step down.

© Adfero Ltd

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