Bank of England Governor Andrew Bailey could hold key to rate cut decision

Andrew Bailey could cast the deciding vote next week when the Bank of England considers whether to cut interest rates.

The nine-member Monetary Policy Committee will meet on Thursday to vote on whether to cut interest rates for the first time in four years.

But there is now growing talk of a close vote, in which Governor Bailey, who chairs the group, may have to make the final decision.

Analysts at investment bank Citigroup expect the rate to fall by a quarter of a percentage point to 5 percent, which would be a major relief for millions of hard-pressed homeowners.

Benjamin Nabarro, Citigroup’s chief UK economist, told The Times the decision would be “difficult to make”.

According to him, the slowdown in the labour market and the fall in prices of some goods could justify a cut. “The bank’s silence leaves the meeting open,” added Stefan Koopman, an economist at Rabobank.

He also predicted a cut, but warned: “There is a risk that officials will want to see another month of data first.”

Last month, seven members voted to keep the project. Two of them, Sir Dave Ramsden and Swati Dhingra, voted to cut it. They will need to be joined by three other committee members to tip the balance.

Bailey, Sarah Breeden and Clare Lombardelli are the candidates most likely to support a cut.

Higher-than-expected inflation figures this month have dashed hopes of a reduction. Inflation in June was 2% but had been expected to fall to 1.9%.