All nine members of the Bank of England's Monetary Policy Committee voted for this month's quarter-point rise in interest rates, minutes of their June 9 and 10 meeting showed today.
The decision to raise borrowing costs by a quarter-point for the second month in a row appears to have been fairly clear-cut for most of the MPC, who had thought that their inflation projections could have even warranted a half-point rate rise the month before.
But the June decision remained 'finely balanced' for one member, who neverthless still reckoned that a rate rise this month was consistent with the path of interest rates set out in the BoE's market rate projection published in May.
But there was little in the minutes to suggest how quickly any further rate rises may follow. Markets are pricing in anything up to a full percentage point of monetary tightening by the end of the year.
The minutes said that on balance the news since May suggested stronger external demand and inflation, particularly in UK-weighted terms. The euro zone was looking stronger while recovery in the US and Asia was more firmly established.
Oil prices, which had risen sharply so far in 2004, were expected to have only a modest impact on the British economy, the MPC noted.
And while house price inflation had turned out stronger than expected, there were some tentative signs of it easing.
