The Bank of England is expected to hold back from issuing another dose of emergency medicine to help the ailing British economy, but economists expect it to "leave the door wide open" for action next month.
Most experts in the City believe the Bank's Monetary Policy Committee (MPC) will on Thursday keep its quantitative easing (QE) programme at £275 billion and interest rates on hold at their record low of 0.5%.
The no-change decision is forecast to come despite a call from the British Chambers of Commerce to increase its support with a £50 billion top-up to QE, following October's shock increase.
Howard Archer, chief UK and European economist at IHS Global Insight, expects the Bank to boost QE by a further £50 billion in February and a further £50 billion in May as a result of "the worrying and uncertain outlook".
Recent economic data have shown a higher-than-expected lift in economic growth in December, which may have surprised the MPC.
Growth in the powerhouse services sector, which makes up 75% of the UK economy, is likely to have saved the wider economy from contraction in the final quarter, while surveys reported growth in manufacturing and construction. However, the crisis in the eurozone continues to rumble on.
David Kern, chief economist at the British Chambers of Commerce (BCC), said: "With the Government's tough deficit-cutting measures squeezing domestic demand, and problems in the eurozone creating difficulties for our exporters, UK monetary policy must remain as expansionary as possible."
He added: "We believe that an immediate announcement would boost confidence and ease concerns over the situation in the eurozone."
The minutes from the MPC's last meeting in December suggested a further cash injection to boost the economy was highly probable but not until at least February, as the committee completes the current round of QE announced in October.
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Holding interest rates at 0.5% will be welcomed by borrowers, but the extended period of lower lending costs spells more misery for pensioners and savers, who will continue to suffer low returns on their money at a time when inflation is eroding the value of their deposits.
