Bank of England policymakers face an "ever closer call" on whether to unleash further emergency measures to boost the recovery today amid mixed signs for the health of the economy.
The economy sprung back to life in the third quarter when gross domestic product (GDP) grew 1%, ending the longest double-dip recession since the 1950s. City experts predicted growth of 0.6%.
But a recent run of weak purchasing managers surveys for the services, manufacturing and construction sectors in October have given credence to expert warnings that the underlying picture is much bleaker.
As a result many economists are sitting on the fence over whether the Bank's Monetary Policy Committee (MPC) will hold its quantitative easing (QE) stock at £375 billion. Interest rates are widely expected to be held at their historic low of 0.5%.
Howard Archer, chief UK and European economist at IHS Global Insight, said: "It looks to be an ever closer call and there could very well be a tightly-split vote within the Monetary Policy Committee, but the odds look tilted marginally towards the Bank of England holding off from more quantitative easing."
A no-change decision may signal the end of QE following hints from both the governor and the deputy governor at the Bank, Sir Mervyn King and Paul Tucker, that its impact is reaching its limit.
Furthermore, minutes from the October meeting suggested the MPC was divided over the benefits of pumping more emergency cash into the economy.
The documents said some members had questioned the impact that further QE - also known as money printing - would have on the broader economy.
The Bank has also reported an encouraging start to its Funding for Lending scheme with 30 groups, including the five largest banks in the UK, signing up to the £80 billion initiative.
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Funding costs have dropped one percentage point, the Bank said, while the number of loans approved for house purchase rose by 2,103 to 50,024 in September.
Consumer prices index inflation has also eased back significantly and, at 2.2% in September, is close to the Government's 2% target.
But it is forecast to start rising again by the end of the year, which could make the bank cautious about pushing the button on more QE.
