Bank Rate Rise Vote Remains 8-1 Against

The Bank of England's monetary policy committee (MPC (KOSDAQ: 050540.KQ - news) ) has voted 8-1 against a rise in the base rate of interest for the third month in a row.

External member Ian McCafferty remained the lone voice in backing an increase from the historic low of 0.5% to 0.75% - arguing that a slow and gradual increase should now begin.

The MPC is under no pressure to act given concerns about the sustainability of UK economic growth and low inflation - with the core CPI (Other OTC: CPICQ - news) measure currently running at an annual rate of zero as oil costs remain weak.

While it saw a resilient service sector, manufacturing has been hurt by the strength of the pound and economic woes in main export markets.

Financial markets are currently pricing in a UK rate rise for late 2016, largely because world economic recovery remains so fragile.

The MPC marked a "gentle deceleration" of UK growth from its post-crisis peak last year.

Minutes of its meeting , released at the same time as the decision to leave bank rate on hold, showed it continued to see "acute" risks from weakness in emerging markets but noted recent data had showed no deterioration in the slowdown in China.

However, in the minutes of its latest policy meeting, the European Central Bank warned of risks to the euro zone economy from the problems in emerging markets.

The central bank commentary comes on the back of the International Monetary Fund's prediction on Tuesday that weakness in China and other developing nations risked plunging the world back into recession .

Most economists think the Bank of England will wait for the US Federal Reserve before deciding to raise rates.

The Fed gave a nod to financial market turmoil and the impact a rate rise would have on emerging market economies when deciding to keep its rates on hold last month.

More clues on the Fed's thinking may emerge later on Thursday when minutes of its September meeting are published.

Many economists are expecting no action until next year because of the economic fragility abroad, though financial markets still believe December remains the most likely time.