What the Bank of England has to weigh up next week

By Sumeet Desai

LONDON (Reuters) - The Bank of England is expected to leave interest rates on hold for the fourth month running next week as it continues to tread a fine line between a sharply slowing economy and rising inflation.

All 76 analysts polled by Reuters this week predicted the Bank's Monetary Policy Committee would leave borrowing costs pegged at 5 percent at the end of its two-day meeting on Thursday.

Policymakers were split three ways last month after what was term a "difficult decision" for all of them.

David Blanchflower thought a rate cut was needed to prevent the economy slipping into recession and Tim Besley wanted to hike rates to show the Bank was serious about fighting inflation. The remaining seven chose to leave rates on hold.

The bias appeared to be raising rates but the MPC will have new forecasts for next week's meeting which could show inflation undershooting the 2 percent target in two years' time.

Here are some of the main factors the Bank will be looking at.

INFLATION

CPI inflation hit 3.8 percent in June, nearly double the central banks' 2 percent target. It is expected to go higher still, perhaps exceeding 5 percent in the coming months because of the huge increases in household bills announced by utility providers.