Our MPC-ometer forecasts an 8-1 vote for unchanged rates in September with one lonesome dove seeking a quarter-point cut. No great surprise there. The bigger issue is whether the next move in rates will be up or down. Assuming GDP growth and inflation follow the MPC’s forecasts and other inputs remain at current levels, the MPC-ometer assigns a 20% probability to another rate rise before year-end, with a 10% chance of a cut. I think rates are on hold for the foreseeable future but money growth needs to moderate to convince me that the next move will be down. Historically rate peaks have usually been signalled by a slowdown in narrow money growth as measured by “non-interest-bearing M1” – currency in circulation and conventional current accounts. M1 has picked up recently, its annual increase jumping from 2% in May to 10% in July. Broad aggregates are even stronger: the widest M3 measure grew by an annual 16% in July – the highest since 1996. Tighter credit market conditions should contribute to a slowdown but rates of monetary expansion need to fall significantly to be compatible with the inflation target over the medium term.