Greek crisis dampens support for rate hike

BANK of England officials considered voting for higher interest rates this month but were put off by the Greek crisis, a report showed yesterday.

All nine members of the monetary policy committee agreed to leave rates at 0.5pc – where they have been since March 2009 – at the end of the July meeting.

A record of the meeting published yesterday showed that the decision was ‘clear cut’. But rather than only ‘two’ mulling rate rises as in June, the most recent minutes referred to ‘a number of members’ suggesting the ranks of so-called hawks may be swelling.

‘For these members, the uncertainty caused by recent developments in Greece was a very material factor in their decisions,’ the minutes said.

The MPC vote was held on July 8 – just days after Greece held a referendum rejecting the conditions for a bailout. Since then, it has secured a new £60bn bailout.

Bank Governor Mark Carney last week appeared to prepare the ground for higher rates.