The committee responsible for setting the Bank of England's interest rates was split over whether or not to cut the cost of borrowing this month, minutes of its meeting have revealed.
Monetary Policy Committee members Christopher Allsopp and Stephen Nickell wanted rates dropped to 3.75 per cent but were out-voted by the other seven members of the committee, including the Bank's governor-in-waiting, Mervyn King.
The verdict, which was identical to November's vote, meant the Monetary Policy Committee kept rates at a 39-year low of four per cent for a 13th consecutive month.
Most members were worried that another cut would stoke household borrowing and affect inflation targets.
The report said: "The persistent strength of consumption growth and the continued rapid pace of household borrowing and house price inflation suggested that there remained an upside risk to inflation from stronger-than-projected consumption growth."
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