THE Bank of England appears to have edged further away from raising interest rates this month after its newest member voted against a hike.

The minutes of the latest Monetary Policy Committee rate-setting meeting showed Ben Broadbent replaced arch-hawk Andrew Sentance on the Bank’s rate-setting committee earlier this month and joined six other members who opted to keep interest rates at their record low of 0.5%.

Mr Sentance had previously voted for a 0.5% increase in the Bank rate in a bid to beat down soaring prices, which are squeezing household budgets.

This meant that out of the nine members of the Monetary Policy Committee (MPC), the number voting for a rise in interest rates declined to two from three the previous month.

The minutes also revealed that the MPC was still worried about the rise in inflation, with the consumer prices index (CPI) measure of inflation having stayed at 4.5% – more than double the 2% target – in May. But they said there remained little sign that higher inflation was leading to demands for higher wages.

Ross Smith, North East Chamber of Commerce head of policy, said: “The MPC minutes give us reassurance that it does not want to rush to raise interest rates. Despite high inflation, the impact on pay claims remains muted and there is no evidence that an increase in interest rates now would have any effect on that in the short term.

“There is still a real need to inject confidence into businesses. We need to see investment strengthened and while firms are reporting that access to credit is getting easier, the cost of borrowing is still a significant barrier.”

NECC will be raising issues around access to credit and the cost of lending at the Better Business Finance Conference being held in Gateshead on July 7.