The Monetary Policy Committee (MPC) may be closer to issuing a call for the standard base rate to rise as the newest member, Martin Weale, has stated that it may be time for a change to halt any further rise in the inflation rate. The inflation rate currently stands at 3.7%. That is 1.7% over goal, almost double of the Bank of England's goal of 2%. With analysts expecting both an increase in the inflation rate and a further decline in economic growth reports Weale may indeed see the other members vote for the increase in months ahead.

In January Weale was the first member to join the usual increase vote seen from MPC member Andrew Sentance. According to the January meeting minutes, both voted for an increase of a 0.5% which would double the rate to a level of 1.0%. In a recent analysis writing in the Guardian, Weale sees the increase as not only necessary to combat the inflation but a "one-off" battle against it. There were five members that voted against an increase in the rate, two that voted for an increase, and one, Adam Posen, that voted to keep the rate unchanged for years to come.

Should the interest rate increase there are approximately 12 million mortgage holders that will face an increase in their mortgage payments. There are already many households on the verge of financial failure due to the lower real income when compared against inflation. The government has relied on the MPC to maintain lower rates as public spending cuts are made and taxes increased. Both should have their own impact on rising inflation and a move to increase the rate too soon could have a reversal movement on the economy's recovery.

The warning of interest rates soon to rise has moved many homeowners to seek remortgage deals in which to secure either a fixed rate involving the current standard of 0.5% or a tracker rate that could help them should rates rise drastically in the next few years to combat inflation. Most fixed rate deals that were being offered to lure homeowners in weeks ago have now been pulled as the demand for them increased.

Weale stated in his writing: "Much of the increase in inflation has been a consequence of sterling's depreciation, sharply rising commodity prices, and increased VAT. Unlike the experience of earlier decades, it has not been generated by rises in domestic costs. Given the potential consequences for the real economy of attempting to return inflation to the target rapidly, there is therefore a powerful argument that such 'one-off' influences on the inflation rate should simply be accommodated and inflation allowed to rise temporarily above the target - just as it might fall below target if the exchange rate rose sharply as in the late 1990s. This is consistent with the MPC's mandate."

He added: "A major risk is that the longer inflation remains above target and the more it exceeds its target, the greater the adverse effects on output of bringing it down. Each month's MPC decision needs to be made on its own merits, but this risk is a substantial one that I will continue to balance against others over the coming months."