All nine members of the Bank of England's Monetary Policy Committee voted to leave base interest rates steady at 4.75 percent earlier this month, as expected, though some members did consider arguments for a hike. Minutes of their September 8-9 meeting showed on Wednesday that the Committee judged the economic news over the month had been on balance slightly weaker and so it saw no need to hike rates again after lifting them five times since November. "It seemed that the pace of UK growth in Q3 might be a little slower than had been envisaged, although it was too soon to judge with any certainty at this stage," the minutes said. The MPC noted, however, that recent labour market data had been "surprisingly weak" even though inflationary pressures were still evident in the supply chain.
Also more signs of a cooling in the housing market may have increased the risk of a more abrupt correction, which could have a bigger effect on consumption than the MPC had previously anticipated. The MPC was also concerned that future U.S. economic growth might be weaker if consumer spending picked up less briskly. But the MPC noted in the minutes that inflationary pressures could pick up if sterling's depreciation over the month persisted -- "which would tend to offset the slightly weaker news about economic activity." Arguments for a rate rise included that the economy was most probably set to grow at or above trend while inflationary pressures would have been increased by the weaker pound and a shift down in the money market yield curve. Some MPC members said consumer spending might get an unwelcome boost if the lower level of market yields persisted. "Taken as a whole the Committee did not find these arguments sufficient to justify a rise in the repo rate." Most analysts still expect another quarter point rate rise later this year.///