The UK Central Bank voted to keep interest rates constant at 4.75%. However, for the first time in almost a year, the vote was not unanimous. All of the voting  members are confident in the state of of the British economy, but some expect a slow-down in the second half of this year, due to declining household spending and subsequent declines in retail sales. A mixed report on British manufacturing also seemed to support a negative outlook on the economy. If the economy does lose steam, the Central Bank might move to lower interest rates, which could negatively impact the Pound Sterling. BNP Paribas reports:

In the coming months, economic growth is likely to slow. Against this backdrop, we [BNP] expect the Bank of England to adopt a more accommodative stance in the second half of the year.

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