Bank of England rate-setters held off on more help for the economy today as interest rates were kept at their record low 0.5 per cent.
The Monetary Policy Committee decided against expanding its money-printing programme beyond £375 billion, although Governor Sir Mervyn King and two allies are expected to have called again for further quantitative easing.
So far further action has been blocked by a majority on the MPC worried about a potential run on the pound as well as the potentially limited effectiveness of more QE.
Today marks the first meeting of the MPC since the Chancellor changed its mandate in the Budget, formalising its strategy of looking through high inflation and giving it the option of providing explicit guidance on policy.
The Bank expects inflation — currently 2.8 per cent — to surge above 3 per cent by the summer and remain stuck above its 2 per cent target until the end of 2015 at the earliest.