Bank of England united in freezing interest rates

Bank of England policymakers voted unanimously in favour of holding interest rates at a record low level this month, but one member called again for more stimulus, the BoE said on Wednesday. Minutes from the central bank's Monetary Policy Committee (MPC) meeting on May 9-10 showed that all nine members voted to keep the key lending rate at 0.50 percent, where it has stood since March 2009. The MPC meanwhile voted 8-1 to maintain the size of the bank's asset purchasing programme at £325 billion (388 billion euros, $514 billion). Policymaker David Miles, voted for a third month running to increase the so-called quantitative easing (QE) programme by an additional £25 billion -- and other members came close to joining him. "For several members, the decision not to expand the asset purchase programme at this meeting was finely balanced," the minutes read. Under QE, the central bank creates new cash which is used to purchase assets such as government and corporate bonds in the aim of giving a boost to lending and economic activity. The minutes were published one day after the International Monetary Fund called on the BoE to cut interest rates and pump more cash into the recession-hit economy, which has been hit hard by the eurozone debt crisis. "The minutes of the May MPC meeting suggest that the Bank of England is very much keeping the door open to more quantitative easing," said IHS Global Insight economist Howard Archer. But he added: "While the IMF has suggested that the Bank of England should consider cutting interest rates from 0.50 percent, for now at least there seems to be little appetite within the MPC for doing this. "There has been no discussion in the MPC minutes of the case for lower interest rates since last September."