Investing.com - The pound fell to session lows against the dollar on Thursday after the minutes of the Bank of England’s August meeting showed that just one monetary policy committee member voted in favor of a rate hike this month.
GBP/USD was down 0.6% to 1.5499 from around 1.5609 ahead of the report.
The minutes showed that eight members were in favor of leaving the key interest rate at a record low of 0.5%. All nine members voted to stand pat on rates in July.
Ian McCafferty was the lone dissenter, voting for a quarter percent hike in the benchmark rate for the first time in eight months.
The minutes came as a surprise to market participants, who had expected two or possibly even three members of the MPC to back a rate increase this month.
It was the first time the minutes were published at the same time as the monthly monetary policy decision.
“The near-term outlook for inflation is muted. The falls in energy prices of the past few months will continue to bear down on inflation at least until the middle of next year”, the minutes said.
The bank said it now expects inflation to remain at around zero for at least the next two months, before rising to its 2% target at the end of two-year forecast period, if interest rates are increased in line with the market’s expectations.
Sterling also fell to session lows against the euro, with EUR/GBP advancing 0.6% to 0.7031 from around 0.6983 earlier.
BoE Governor Mark Carney was to hold a press briefing on the bank’s quarterly inflation report later Thursday.