The Bank of England sent a clear signal today that any rise in interest rates is still some way off, but Jean-Claude Trichet, the president of the European Central Bank, warned increases could be imminent for eurozone economies.

Minutes released today of the Bank of England's rate-setting Monetary Policy Committee meeting on June 7 and 8 reveal that members voted 7 to 1 to keep rates on hold at 4.5 per cent for the tenth consecutive month.

The new member, American academic David Blanchflower, voted with the majority, while David Walton pushed for the second time for a 0.25 per cent rise.

The key change since its May decision has been the turmoil in the markets, which has taken the edge off the hawkish language in last month's minutes. The tone for June is much more neutral.

Over the past month assets of developing countries dropped by up to 8 per cent and in emerging markets by up to 20 per cent. The price of Brent crude eased by 6 per cent.

According to the minutes: "It was not clear whether recent asset price falls would prove to be a limited correction or the beginning of a more marked and sustained change.

"Most market commentators had suggested it was likely to be a temporary adjustment. There was a risk, however, of a more prolonged and pronounced correction of financial asset prices that might have a significant impact on growth and inflation in the United Kingdom and its major trade partners."

Economists at banking group HSBC said in a note: "These comments raise the possibility that if the MPC redid its inflation projections to incorporate recent asset price developments, inflation may no longer overshoot the target under the constant interest rate assumption."

Higher gas and electricity prices pushed May's inflation figure to 2.2 per cent, breaching the Bank's 2 per cent target.

On the downside, the committee expects the lower oil price to feed through to the forecourt, that there continues to be little evidence of a pick-up in wage inflation and rising energy prices are being absorbed by manufacturers' margins.

The MPC said there were still a number of risks to the outlook for inflation, including growth of eurozone economies.

However, M Trichet told the European Parliament in Brussels that higher interests rates in Europe were on the way if inflation threatened to rise further.

He said that keeping a cap on inflation remains a top priority in the wake of continued high oil prices.

The EU has predicted that eurozone inflation could top the European Central Bank's 2 per cent target and as the Bank of England were holding rates earlier this month, Europe raised them 0.25 per cent to 2.75 per cent.

Mr Trichet warned more increases would come if the economic outlook warrants it. Some analysts and economists have predicted that eurozone rates could hit 3 per cent by September.

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