Summary Its main lending rate has stood at 0.50 percent for more than four years.
LONDON (AFP) - The Bank of England is Thursday expected to vote to maintain both its record-low interest rate and level of cash stimulus as investors wait to see whether Britain s economy has re-entered a period of recession.
The BoE s nine-member Monetary Policy Committee (MPC) -- which includes outgoing governor Mervyn King -- will vote on monetary policy at the conclusion of a regular two-day meeting held at the start of each month.
Its main lending rate has stood at 0.50 percent for more than four years, while the central bank has pumped out 375 billion ($567 billion, 442 billion euros) under its quantitative easing (QE) stimulus programme since March 2009.
King, who shortly steps down to be replaced by Canadian central bank chief Mark Carney in July, has in recent months unsuccessfully called for an additional 25 billion of stimulus along with two other MPC members.
Investec bank analyst Philip Shaw said it is not impossible that the MPC sanctions more QE at this week s meeting, "but the issue is more a lack of clarity over economic prospects than outright concerns over the downside."
Ahead of the meeting, the British Chambers of Commerce (BCC) said it believed Britain s economy had avoided a third downturn since the 2008 global financial crisis.
However, economic data published Tuesday appeared to indicate that the country had suffered a triple-dip recession in the first quarter, which has just ended.
According to BCC chief economist David Kern, "UK output has continued to grow in the early months of 2013" as evidenced by the business group s own first-quarter economic survey. "Fears of another recession are calmed by our results," he added.
The BCC survey of more than 7,000 businesses came though as data showed that new export orders fell for a 15th month running in March, denting hopes of a boost from a weakened pound.
The manufacturing sector rose to an indexed level of 48.3 points in March from February s 47.9, but remains below the key 50 level which separates expansion from contraction, according to figures from joint data firm Markit and the Chartered Institute of Purchasing & Supply s monthly Purchasing Managers Index.
"March PMI data indicate that the UK manufacturing sector contracted again during the opening quarter of 2013, to remain a drag on the broader economy," said Rob Dobson, senior economist at Markit.
"The ongoing weakness of manufacturing and the hard to estimate impact of bad weather on first quarter growth suggest that this is still touch-and-go and that any expansion will be disappointing nonetheless," he added.
Recent official data revealed that British gross domestic product (GDP) shrank 0.3 percent in the fourth quarter of 2012 compared with the previous three months. Another contraction in the first quarter of 2013 would place Britain in its third recession since the 2008 global financial crisis. Data for this period is due in late April.
For now, Tuesday s PMI data could "put pressure on the MPC to ease monetary policy on Thursday," said HSBC economist John Zhu.
"However, the minutes of the March MPC meeting showed growing unease over imported inflation and warned of the dangers of rising inflation expectations" -- which could see Thursday s vote result in no policy changes.
Zhu added: "On balance, we still think the MPC will not change policy this week, although the vote is likely to remain divided."
The economy has meanwhile been hit hard by ongoing state austerity measures from the coalition government that took power in 2010. And Britain will stick firmly to its barrage of cuts, finance minister George Osborne last month insisted in a budget that also slashed the government s economic growth forecasts.
Chancellor of the Exchequer Osborne meanwhile on Tuesday launched a spirited defence of his controversial welfare reforms, accusing critics of spouting "ill-informed rubbish."
In a keynote speech, the disputed chancellor said it was time to "make work pay" and denounced the current system as fundamentally "broken."
