21 Jan

Minutes show continued strong rate-cutting sentiment

Minutes show continued strong rate-cutting sentiment

The Bank of England's monetary policy committee (MPC) were all agreed that the base rate should fall again this month, minutes of the latest meeting have revealed.

All but one of the nine members voted in favour of the 0.5 per cent reduction in the rate to its lowest ever level of 1.5 per cent.

The dissenting voice was that of David Blanchflower, who wanted to see a larger reduction of one per cent.

Such a clear display in favour of monetary loosening may suggest that the MPC is likely to cut again soon, something that could help bring down the cost of mortgages.

In related news, the Bank's governor Mervyn King has said in a speech that the priority of monetary policy should remain targeting the inflation rate, while other devices should be used to control the level of debt in the economy.

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