The Bank of England's Monetary Policy Committee (MPC) is widely expected to mark time after last month's interest rate rise when it announces its decision at midday today.
Economists say although the cost of money is almost certainly headed higher in the coming months, the MPC has hinted that it only plans to raise it gradually for fear of derailing the housing market and consumer spending with too sharp a monetary tightening.
A poll last Friday found 42 of 45 economists predicting the bank would hold the key repo rate at 3.75 per cent today, having raised it a month ago from a 48-year low of 3.5 per cent. The rise was the first in almost four years.
The Bank of England has not moved rates in December for five years.
"We think the Bank of England will keep its powder dry. If the economy looks strong in the New Year, a half point rise by March is then quite possible," said Mr Graeme Leach, chief economist at the Institute of Directors.
British economic releases this week have painted a mixed picture, with robust service and manufacturing sector purchasing managers' surveys offset by fresh evidence that house price growth is slowing and that retail sales got off to a slow start in the runup to Christmas.