At its latest meeting, the IEAs Shadow Monetary Policy Committee (SMPC) voted by six votes to three to keep UK Bank Rate at 5% on 7th August. All the members of the SMPC were concerned about the current UK economic situation. Rising inflation and collapsing indicators of real activity presented the MPC with a difficult dilemma though most members regarded this as a dilemma largely of the MPCs own making. The grim prospects for future inflation led most members to want to hold interest rates. However, there was a significant minority who wanted to cut rates now as a result of the worsening situation. One of the cutters, Patrick Minford described the Bank of England as showing a total lack of leadership.
The majority who wanted rates to be held w