Inflation fears and robust growth reinforce split in MPC

Minutes of the monetary policy committee's (MPC) November meeting showed that while the majority voted to keep rates and money-boosting efforts on hold, there were opposing calls once more for an increase in rates and additional stimulus.

MPC member Adam Posen reiterated his call for another 50 billion in quantitative easing (QE) efforts to support the economy, but failed to gain backing from any of his rate-setting colleagues. And Andrew Sentance maintained his vote for a quarter point rise in rates to calm inflation.

Details of the meeting follow Tuesday's disappointing inflation figures confirming another rise further above the central bank's 2 per cent target, to 3.2 per cent in October.

This came after the BoE's quarterly forecast last week - which the MPC would have had in time for the November decision - warned of further rises in inflation over the coming months.

Experts said the minutes reinforce expectations for the Bank to remain in "wait and see" mode next month.

But economists believe that despite inflation fears, policymakers have left the door open to more QE even if it is not on the cards for the next few months.

Jonathan Loynes, at Capital Economics, said while the minutes showed "few signs" of the committee wanting to change policy, "if we are right in expecting those signs to materialise over the coming months, more QE may yet arrive in February".