For the second month in row, policymakers at the Bank of England were locked in a three-way split on their interest rate decision at the start of August.
Minutes from the meeting indicated that seven members from the nine-strong Bank’s Monetary Policy Committee (MPC) wished to freeze the rate at five per cent.
However, Daniel Blanchflower was in favour of a cut to 4.75 per cent to help people secure financial solutions such as best buy loans, while Timothy Besley believed an increase to 5.25 per cent is required.
The MPC has recently faced difficult deliberations on UK interest rates as the economy stagnates and growth slows with many people struggling to secure best buy mortgages.
However, David Page, an economist with Investec, told the Independent there is a “seemingly softer tone to the committee’s discussion” and “more muted outlook in the Inflation Report”.
David Kern, economic adviser to the British Chambers of Commerce (BCC), stated his belief on the BCC website that the rate will stay at five per cent for at least two to three more months.
“However, we remain convinced that the threats of recession are more immediate and severe than the risks of higher inflation. Once it is clear that inflation has peaked, the MPC must cut rates without delay in October or November,” he added.
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