No change in interest rate until 2011

A cooling global economy and an impending austerity squeeze in Britain will make the Bank of England (BoE) wait well into next year before hiking interest rates, a poll of 60 economists suggests.

For the first time this year, no economist thought the Bank would raise rates before the end of 2010, something considered a foregone conclusion in polls conducted this time last year.

Increased austerity measures and a growing chance European economies will follow the U.S. economy in slowing down are overriding concerns about above-target inflation, the poll suggests.

The full extent of the government's budget cuts will be detailed by each ministry in October. Britain's economy expanded 1.2% in Q2, its fastest pace for nine years, but analysts expect this to shrink to 0.3% to 0.5% in each quarter through to the end of next year.

Retail sales and consumer confidence figures over the last month have been buoyant, but business surveys of the private sector support expectations for a slowdown.

Inflation slowed in July to 3.1%, stubbornly above the Bank's 2% target and one reason why Monetary Policy Committee member Andrew Sentance has voted for a hike at the last three rate-setting meetings.

The poll also showed few economists expect the bank to extend its £200bn quantitative easing (QE) programme. None of those polled think the Bank will announce any change to interest rates or QE at its 9 September meeting, although six out of 41 economists thought the bond-buying programme would eventually finish at either £225bn or £250bn.