The MPC members have many factors to take into account
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The Bank of England is expected to keep interest rates on hold at 5.75% when it unveils the latest decision of its rate-setting committee.
Despite signs of some slowdown in the housing market and weaker consumer confidence, most analysts predict rates will remain unchanged.
They point to the Bank's need to keep inflation contained at a time of record oil prices and higher food costs.
UK rates have been on hold since July when they rose to 5.75% from 5.5%.
The Bank will announce its latest rate decision at 1200 GMT.
Weaker data
The Bank's rate-setting Monetary Policy Committee (MPC) has much to discuss at the two-day meeting.
On Monday, official figures showed that manufacturing output contracted by 0.6% in September, while figures from purchasing managers indicated that growth in the service sector slowed to a 53-month low in October.
On Tuesday, the British Retail Consortium said retail sales rose by just 1% year-on-year in October, their weakest growth since November 2006.
Worries over the health of the financial sector have also continued, with further bad news emerging from global giants such as Citigroup and Merrill Lynch.
But while this would appear to favour a rate cut, the Bank also needs to keep an eye on inflation with global oil prices at record highs and increasing food prices.
The most recent inflation data showed the Consumer Prices Index remaining unchanged in September at 1.8%, below the government's 2% target.
"The series of weaker data and survey evidence over the past few days has significantly shortened the odds that the Bank of England could decide on Thursday that a pre-emptive interest rate cut is justified to reduce the risk of a sharp UK economic slowdown," said Global Insight chief economist Howard Archer.
But he added: "We still favour the Bank to leave interest rates unchanged, but there is likely to be a very lively debate within the MPC and the vote could well be very close."
Most analysts predict the Bank will cut rates to 5.25% in two stages by mid-2008 in line with signs that UK economic growth will cool slightly next year.
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There is likely to be a very lively debate within the MPC and the vote could well be very close
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