4 July 2008
Interest rates will not be altered by the Bank of England's monetary policy committee (MPC) when it meets next week, all the economists polled by Adfero have said. Senior UK Economist at Barclay's Capital Simon Hayes suggested that the MPC could have been "caught between two posts" as inflation was growing in the earlier part of the year. But, according to statistics, he noted, this has dropped and therefore the body would be worried that it rates were raised, then an "output gap" would be opened up, news that may concern those with current accounts. His comments were matched by Economist at the Centre for Economic and Business Research Richard Snook, who revealed that inflation will "comeback quite sharply" in the next few months. "The Bank of England's monetary policy committee (MPC) seems most likely to keep interest rates unchanged at 5% next Thursday at the conclusion of its July meeting," added Managing Director of Western European finance at Global Insight Howard Archer. Other officials questioned included Halifax's Martin Ellis, HSBC's Karen Ward and Paul Dales from Capital Economics. Last month, the MPC held the base rate of interest at 5%. It was last cut in April.
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