While the result of the 10 July meeting was yet another nine to zero vote to hold rates steady, the minutes offered some insight into exactly how united the members are.
With inflation a fraction under the target of 2% there is little room to move before price rises would become undesirable by the Bank’s own reckoning.
The nine members put ‘different weights’ on various elements, the minutes said. It was also recorded that while it was agreed unanimously that no rate increase was yet warranted, for some members the decision had become 'more balanced in the past few months' than earlier this year.
The minutes also offer possible explanations for the divergence of wage and employment data seen, with unemployment falling to 6.5% but wages staying flat overall.
The first possibility the MPC raised was simply that the lag between tightening in the labour market and an increase in wages is longer than it had previously judged, and it is only a matter of time before wages rise.
The other explanation discussed was that the ‘effective supply’ of labour had actually increased even though jobless numbers are falling, due to a greater willingness among people in work to accept lower hourly wages than before, longer hours and older retirements ages.
