With inflation dropping to just 0.5% in December, MPC members were also concerned about the risk of deflation, or falling prices, which are good news for consumers, but can cause severe economic damage if they last for a long period.
Kristin Forbes, new arrival of the Bank of England's monetary policy meeting (MPC) instead opted for a Powerpoint presentation of edited highlights when addressing the 100 Women in Hedge Funds conference on Wednesday.
As the only member of the MPC to vote for more quantitative easing this month, Miles clearly feels the UK economy is in a bad way..... 5.43pm: So, what did we learn from the Dutch debate?
He pointed out that on both previous occasions, the bank's monetary-policy committee (MPC) had said that inflation would come back down again; both times they had been proved right.
For this reason, the MPC is likely to tread carefully.
IN NOVEMBER 2003 the Bank of England's monetary-policy committee (MPC) raised interest rates by 0.25%, the first increase in almost four years.
If spending suffers unduly, "the MPC would be able to deal with it," he says.The polarisation of household finances that makes the impact of a rate rise so uncertain also helps to explain why some MPC members feel the need to act.
Estimates based on business surveys have consistently pointed to stronger service-sector growth over the past year or so than the official figures.The MPC is also expecting a healthy recovery in GDP growth.
This triggered an unprecedented open letter from Mervyn King, the bank's governor, to Gordon Brown, the chancellor of the exchequer, explaining why the overrun had occurred.This week's dose of monetary medicine may have been predictable, but the City's rate-diviners are divided about what the MPC will do next.
Adam Posen was the only member of the Bank of England's nine-strong monetary-policy committee (MPC) who voted for a second dose of QE, according to the minutes of its meeting this month.
The question the MPC must now answer is whether the financial malaise will infect the wider economy.
