EMERGING expectations that the first rise in UK base rates could be further away than had been thought, amid signs that economic growth is weakening, have been reinforced by minutes of the latest meeting of the Monetary Policy Committee.
Minutes of the Bank of England committee's October 7 and 8 meeting, published yesterday, signal that the majority on the committee felt even less inclined to vote for a near-term rise in benchmark UK interest rates than they had in September.
Capital Economics pushed its forecast timing of the first rise in rates back from February to May 2015 after the minutes were published.
The minutes highlight a view among MPC members that weaker economic news from the eurozone had increased the risks to the durability of UK expansion in the medium term.
They also signal a worry among MPC members that a premature tightening of monetary policy could leave the UK economy vulnerable to shocks.
The minutes show seven MPC members, including Bank of England Governor Mark Carney, continued to vote for base rates to remain at their record low of 0.5 per cent.
These members saw few signs of inflationary pressure in the UK, and flagged the headwinds facing the economy. They highlighted weak pay growth.
The other two members, Martin Weale and Ian McCafferty, continued to vote unsuccessfully for an immediate quarter-point increase in base rates.
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