Two members of the Bank of England's monetary policy committee (MPC) voted once again to lower UK interest rates at its most recent meeting.

Minutes of the meeting, released on Wednesday, showed that Christopher Allsop and Stephen Nickell voted for a quarter-point cut in rates, for the fourth time in a row.

There is a risk of a further move down in interest rates Steven Pearson Halifax Bank

Read about the decision to keep rates on hold

After the meeting on 9 January, the MPC left interest rates unchanged at 4% for the 14th consecutive month.

In the minutes, the committee appeared to be cautiously optimistic about prospects for the UK economy.

"Output growth had recently been around trend, and there was no sign in the monetary or labour data that the economy was about to weaken abruptly, despite the gloomy tone of some commentators," the statement said.

Global cooling

However, there was some concern about the state of the global economy, particularly Germany, which is struggling with sluggish economic growth.

Stephen Nickell voted for a cut in rates

"Some committee members remained concerned that weak confidence in Germany might begin to spill over to other countries in the euro area," the minutes said.

Several economists believe this increases the chance of further cuts to UK interest rates.

Steven Pearson, chief currency strategist at Halifax Bank of Scotland, said: "The fact that two members wanted a rate cut and that there is a bit of focus on a slightly weaker global economy means there is a risk of a further move down in interest rates."

MPC members were also worried that international tensions, such as the stand-off with North Korea and possible military action against Iraq, would impact on consumer confidence.

Housing slowdown on its way?

In the UK, members agreed that there were "some signs of the long-expected slowdown" in the housing market.

The MPC is forecasting that the increase in house prices will slow to zero over the next two years, but has admitted there is still much uncertainty.

House price inflation, which has been running at around 25%, looked marginally stronger in the fourth quarter than had been expected, the minutes said.

We are still not out of the woods yet and the economic situation is still uncertain George Buckley Deutsche Bank

The MPC expected general inflation to be higher in the short term than projected, but said there would be little impact on policy.

The Bank of England prefers to set policy to meet its goal about two years out because it usually takes that long for changes to filter through into the economy.

Figures out on Tuesday showed underlying inflation, which excludes mortgage repayments, dropped slightly last month to 2.7%. This is above the MPC's asymmetrical target of 2.5%.

"We are still not out of the woods yet and the economic situation is still uncertain," said George Buckley, economist at Deutsche Bank.

"Those considerations mean that the MPC will still be looking toward the possibility of cutting rates," he added.