- Members who opposed rate hike but saw greater inflation risk want to see if Q4 GDP decline sustained
- Q4 GDP weakness could be temporary or early signal of worsening outlook for growth
- High inflation could persist due to commodity prices or accomodative monetary policy in emerging markets
- Inflation expectations a risk, though limited evidence they have risen materially yet
- Dale and Weale favour smaller rate rise due to economic uncertainty
- Sentance favoured larger rate hike due to mounting evidence firms are passing on higher costs, nominal demand growing
- Posen accepted rising global demand or shift against sterling could outweigh domestic downward prssure on CPI, but not there yet
So the rumuors were right, another MPC member has joined the dark side and voted for a rate hike. And Sentance upped the ante calling for larger 50 bps.
