Most UK economists expect at least one more interest rate increase as growth picks up in 2005, despite low inflation and signs of a weaker housing market, a Reuters news agency poll shows.
All of the 45 economists surveyed this week, expected the Bank of England's Monetary Policy Committee (MPC) to leave rates on hold at 4.75 per cent at its monthly meeting on December 9th.
Recent economic data has provided a mixed picture on the health of the economy and has ignited fresh debate about the future direction of interest rates.
Inflation has edged higher, but at 1.2 per cent remains well below the bank's 2 percent target, while weaker-than-expected growth in the third quarter and signs the housing market is cooling have fuelled expectations that rates have already peaked.
But upbeat comments from the Bank of England earlier this week, strong retail sales and manufacturing output have raised expectations that Britain's economic prospects may in fact be brighter.
The median forecast of 43 economists showed UK interest rates peaking at 5.0 per cent. Two did not give a forecast. Twenty said rates had already peaked, 15 saw rates peaking at 5.0 per cent and eight saw rates peaking at 5.25 per cent or above - roughly the same as the results shown in the last monthly poll.