MPC 'considered interest rate rise'

An interest rate rise was considered by a majority of the Bank of England's monetary policy committee (MPC), it has been revealed.

In news which could have implications for the future direction of inflation, during the June meeting of the MPC most members considered increasing rates from their current level of five per cent, reports the Financial Times.

"There is a sizeable risk that the MPC will hike in coming months, especially if inflation expectations continue to rise," said Michael Saunders, an economist at Citigroup.

Kate Barker, an external member of the MPC, added: "I think it would have been hard not to have considered the case for a rate rise ... given the very large change in the short-term inflation prospects we face."

In spite of a target rate of two per cent, the UK's inflation rate is current at a higher level of 3.3 per cent.

Revised inflation figures will become available on July 15th.