'Three-way split ahead' for MPC's rate-setters

BANK of England rate-setters face their toughest test in months this week as evidence pointing to an economic retrenchment mounts.

Members of the bank's nine-strong monetary policy committee (MPC) are widely expected to leave interest rates at their historic low of 0.5 per cent.

But this month's meeting comes amid a flurry of data suggesting Britain's economic recovery has peaked.

This has heightened expectations that the central bank will extend its programme of quantitative easing, effectively printing money to stimulate growth.

Analysts see this week's meeting throwing up a possible three-way split among members. It follows MPC member Adam Posen's call for more cash to be pumped into the economy to stop a double-dip recession.

Howard Archer, chief UK economist at IHS Global Insight, said: "With (rate-setter] Andrew Sentance conversely indicating that he still favours an immediate small interest rate hike, a three-way split among the MPC looks on the cards."