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MPC split fuels prospect of interest rates rise
TWO members of the Bank of England's Monetary Policy Committee voted to raise interest in August, the first time in three years policymakers have backed a rise.
The split decision is the first under governor Mark Carney's tenure.
Minutes of the last MPC meeting showed that Ian McCafferty and Martin Weale voted for a 25 basis point rise in interest rates.
These members noted that the continuing rapid fall in unemployment, alongside survey evidence of tightening in the labour market created a prospect that wage growth would pick up.
The MPC voted 7-2 to hold interest rates from their historic low of 0.5%.
The pound jumped in expectation of an earlier rate rise than first thought.
Sterling rose 0.20% against the US dollar to $1.66.
If follows official data on Tuesday which showed inflation fell to 1.6% in July.
It is the first time there has been a split on the MPC since July 2011.
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