Stronger data unlikely to prompt rate hike

There are still few signs that Andrew Sentance’s view that interest rates need to rise is gathering much support from the rest of the Monetary Policy Committee (MPC). In fact, the minutes of the last meeting contained the strongest steer for a while that policy might yet be loosened further. As it happens, the stronger tone of the latest data suggests that the MPC is likely to keep policy on hold at August’s meeting. But we still think that an extension of quantitative easing (QE) is likely further ahead.