The Bank of England's Monetary Policy Committee had already set the bank rate as low as possible at 0.5 %, but decided that in order to meet the inflation target of 2 % further action was needed. (politics.co.uk)
Opponents claimed that it would lead to a poorly co-ordinated economic policy and could potentially lead to conflict in fiscal and monetary policy aims, resulting in particular from an over-emphasis in setting rates to meet inflation targets at the expense of other factors such as the exchange rate. (politics.co.uk)
But he insisted the economy was on course to meet its inflation target of two per cent, house prices were stabilising, employment was high and interest rates were also stable. (politics.co.uk)