Minutas Banco de Inglaterra . BOE: Inflation to Exceed Forecasts

LONDON—The Wall Street Journal
The rate of inflation in the U.K. could soon rise above 5% but Bank of England policy makers remain concerned that higher borrowing costs could harm the U.K.'s economic recovery, the minutes of the bank's April policy meeting showed Wednesday.
The BOE's rate-setting Monetary Policy Committee voted to maintain the bank's benchmark rate at a record low of 0.5% in April and its stock of assets purchased under a stimulus program unchanged at £200 billion ($286.6 billion).
The minutes show policy makers expected the rate of inflation to keep rising in the near term despite a surprise drop in the 12-month rate in March.
Consumer price inflation slowed to 4% in March, from 4.4% in February, but remains double the BOE's medium-term target rate of 2%.
The minutes show rising prices for energy, commodities and imported goods led the committee to believe that near-term inflation will exceed the bank's forecasts as set out in its February inflation report, and that "there remained a significant risk that inflation would exceed 5% in the near term."
However, the April minutes show the committee believed risks to the U.K.'s economic recovery remain and a rise in the benchmark rate may dent consumer confidence and crimp spending.
Policy makers noted that the prospects for consumer spending have weakened.
In all, the committee judged that "there continued to be merit in waiting to see how the various factors evolved before adjusting the stance of monetary policy."
Some economists detected a more dovish tone in the April minutes compared with previous policy meetings, where interest-rate hawks appeared to be in the ascendant.
A rise in the benchmark rate next month is unlikely although not out of the question, said Vicky Redwood senior U.K. economist at Capital Economics.
Key to the rate outlook will be the first release of gross domestic product for the first quarter, due for publication April 27, which will enable the MPC to gauge the strength of the U.K.'s economic rebound following its surprise contraction at the end of last year.
The economy shrank 0.5% quarter-to-quarter between October and December.
The minutes show no change in the voting pattern of the nine committee members compared with March. Six policy makers, including Governor Mervyn King, voted to keep the benchmark rate on hold and maintain the stock of asset purchases.
Andrew Sentance, Martin Weale and Spencer Dale voted for an increase in the benchmark rate, while Adam Posen once again advocated a £50 billion extension to the bank's "quantitative easing" program of asset purchases.