It would be understandable if some Monetary Policy Committee (MPC) members felt wary about the Osborne-King deal, under which the Chancellor believes he has bought off interest rate rises by acceding to the Governor's demands for accelerated fiscal tightening while transferring supervisory powers to the Bank, including new "macro-prudential" tools to be wielded by a rival Financial Policy Committee. They might, in addition, be uncomfortable with Mr. King's unilateral reinterpretation of the MPC's target as "2% inflation at some point in the future excluding the impact of temporary factors and ignoring any price-level overshoot in the interim".

Such frustrations, perhaps, contributed to external MPC member Andrew Sentance's surprise decision to vote for an immediate quarter-point rate hike this month, despite financial fragility in the Eurozone and the imminent emergency Budget. His view – that accelerating real and nominal growth, persistently high inflation outcomes and doubts about the dampening impact of spare capacity warrant some withdrawal of current exceptional stimulus – is shared, however, by a significant minority of economists, including the four members of the Sunday Times Shadow MPC who also favour immediate tightening (see David Smith's blog for the minutes).

The "MPC-ometer" model – which attempts to forecast the monthly vote based on the latest economic and financial indicators, with indicator weights derived from regression analysis of historical decisions – similarly predicted a three-member minority to hike this month. Yet the minutes suggest little support for Dr. Sentance's argument, with an opposing minority even claiming that downside inflation risks have increased. The Governor, it seems, exerts an iron grip. A decision by the Chancellor to fill the external MPC vacancy with another neo-Keynesian sympathizer will seal the Osborne-King deal and confirm that the inflation-targeting regime has changed.