May 06 BoE Interest rate meeting minutes |
The minutes of the BoE’s rate meeting have been released today; showing that this months decision to keep rates at 4.5% was made up of 6 votes of no change, one to raise by 0.25% and one to lower by 0.25%.
The majority of the members of the Committee felt that the factors of the current economy that might suggest a rise may be necessary were broadly counter-balanced by those that suggested a drop was necessary.
This is the first time since May 2005 that any members have voted for an increase in the repo rate. Also, Stephen Nickell, who has been voting for a drop in rates for several months, has now ended his membership of the Monetary Policy Committee (MPC).
This three-way result of voting has lead people to believe rates will remain at 4.5% throughout 2006. Howard Archer, chief European economist at Global Insight, said the voting spread meant it was now likely “interest rates will remain unchanged through 2006”. He added, “The overall tone of the minutes are still relatively balanced, and there is clearly considerable uncertainty within the MPC over the growth and inflation outlook.”
