LON­DON

The Pak Banker - - COMPANIES/BOSS -

The Bank of Eng­land is about to move one step closer to an in­ter­e­strate in­crease as pol­icy mak­ers' warn­ings on the risks to in­fla­tion har­den into votes.

While the key in­ter­est rate is forecast to stay at 0.5 per­cent, a ma­jor­ity of econ­o­mists say that at least two of the nine-mem­ber Mon­e­tary Pol­icy Com­mit­tee will vote for tight­en­ing next week. Both the de­ci­sion and the votes will be pub­lished si­mul­ta­ne­ously on Aug. 6 in Lon­don as part of a new com­mu­ni­ca­tions for­mat un­der Gover­nor Mark Car­ney.

The MPC are meet­ing against a back­drop of ac­cel­er­at­ing wage growth and the long­est streak of con­tin­ued eco­nomic ex­pan­sion since be­fore the re­ces­sion that started in 2008. Ex­ter­nal head­winds over which the coun­try has lit­tle con­trol, in­clud­ing weak­ness in Europe and China, along with the strength of ster­ling, may stay the ma­jor­ity's hand for now.

"We have some mem­bers of the MPC who have over the last few months been rather hawk­ish," said Ge­orge Buck­ley, an economist at Deutsche Bank AG in Lon­don, who pre­dicts one or two MPC mem­bers will vote for an in­crease. "It's very dif­fi­cult to see a lot of mem­bers vot­ing for a hike, es­pe­cially with China on the cards as well."

MPC mem­bers Martin Weale and Ian McCaf­ferty are seen by econ­o­mists as the most likely to vote for a rate in­crease. They were push­ing for tight­en­ing last year, be­fore drop­ping their call in Jan­uary as in­fla­tion tum­bled.

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