Eight members of the Monetary Policy Committee voted in favour of this month’s 0.25 per cent cut, with one member voting for a 0.50 per cent cut in bank rate.
MPC member David Blanchflower voted for bank rate to be cut by 0.50 per cent. He had previously been the only one to vote for a cut of 0.25 per cent for January.
Minutes for February’s MPC meeting show that the committee felt there was a need to balance the risk that a sharp slowdown in activity would pull inflation below the target in the mediumn term against the risk that elevated inflation expectations would keep inflation above target.
It says that for a majority of committee members, balancing these risks required an immediate reduction in bane rate of 25 basis points.
One member felt that more weight should be placed on the risk of a very sharp slowdown in UK growth. For this member, a larger, precautionary reduction in bank rate was warranted, bringing forward cuts already built into the yield curve.