London — The Bank of England (BoE) said it was likely to raise interest rates in coming months if the economy and price pressures kept growing, flagging Britain’s first rate hike in a decade. Policy makers voted 7-2 on Thursday to keep rates on hold for now at a record-low 0.25%, as expected. But in a week when data showed UK prices rising faster and unemployment falling to a four-decade low, they said their tolerance for above-target inflation was lessening. The Brexit vote has put the BoE in a dilemma as it sought to balance the need to support the economy through the shock of leaving the EU in March 2019 while also keeping a grip on fast-rising inflation. It said that if the trend towards shrinking spare capacity and rising underlying inflation continued, "some withdrawal of monetary stimulus was likely to be appropriate over the coming months". Sterling leapt by 1c against the dollar after the statement and 10-year gilt yields increased four basis points to 1.18%, their highest ...
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