Fading hopes of an early cut in benchmark UK interest rates were dealt another blow yesterday when publication of minutes of the Bank of England Monetary Policy Committee's May 7 and 8 meeting signalled some of its nine members are in hawkish mood.

Fading hopes of an early cut in benchmark UK interest rates were dealt another blow yesterday when publication of minutes of the Bank of England Monetary Policy Committee's May 7 and 8 meeting signalled some of its nine members are in hawkish mood.

The minutes show only David Blanchflower, the MPC's arch-dove, voted for a quarter-point cut in base rates at a meeting at which they were held at 5%. The other eight members preferred no change.

Writ large in the minutes, however, is a split of opinion within the no-change camp between those expecting growth to remain resilient and others fearing a weakening UK housing market will hit the wider economy hard.

The minutes give little clue as to how the no-change camp is split in this regard. It is the balance of power within this grouping which will hold the key to when, or even if, the MPC cuts base rates again.

The MPC has cut rates by a quarter-point three times so far this cycle, in December, February, and April.

A majority of economists was earlier this month predicting another cut in June. However, few now expect such a cut, following figures last week showing an unexpected jump in annual UK consumer prices index inflation to 3% and forecasts from the Bank that it could rise towards 4% later this year.

The MPC appeared, two weeks ago, to have addressed the question of whether it should be raising rates to stem inflation before dismissing this notion.

Citing the committee's expectations that inflation would move higher, because of rises in energy and import prices which would remain in the CPI measure for the next 12 months, the minutes state: "The committee agreed that to try to bring inflation to the target within this period would result in an undesirable degree of volatility in output."

The minutes reveal that members noted "reducing inflation from persistently high levels had in the past required prolonged periods of subdued economic growth".

The minutes add: "For most members, a reduction in Bank Rate this month would make it more difficult to keep inflation expectations in line with the target (2%). A further reduction in Bank Rate this month could create the impression that the committee was trying to stabilise output growth rather than maintaining its focus on the inflation target."

Highlighting the split within the no-change camp, the minutes cite the danger that "a sharp slowing in the economy associated with weak growth of real disposable income and the tightening supply of credit could pull inflation below the target", and a "range of views amongst members about how much weight to attach to this risk".

Referring to the more hawkishly-inclined, the minutes state: "For some members, the economy had shown considerable resilience in the face of variation in credit conditions. It was possible that spending would...be little affected by the current pressures on banks' balance sheets."

And, of the rest of the no-change camp, the minutes say: "For some other members, there was a significant risk that the impact of weakening property markets on the rest of the economy could be more substantial than implied by the central projection." Blanchflower, who voted unsuccessfully for a half-point cut in base rates in April when the MPC reduced them from 5.25% to 5%, hammered home his view two weeks ago that it was "particularly important to look through the short-term spike in inflation".