INSTANT VIEW - Bank holds rates at 0.5 pct, QE unchanged

LONDON (Reuters) - The Bank of England left interest rates at a record low 0.5 percent for a fourth month running on Thursday but surprised markets by announcing no expansion of its quantitative easing scheme.

Following are reactions from business groups and economists to the decision.

ROSS WALKER, UK ECONOMIST, ROYAL BANK OF SCOTLAND

"Most of us thought they would go down the path of least resistance and do the final 25 billion, then make a bigger decision in the context of August's Inflation Report.

"They haven't closed the door on further purchases ... but they have reached this decision today ahead of the Inflation Report sends a v clear signal that that is probably it."

"It may be that they request further authorisation to keep in reserve -- but if that was happening it may be targeted at credit assets."

"Big gilt purchases are almost certainly behind us."

"August will be an important decision but the fact that they didn't feel the need to go beyond 125 billion at this stage is important. August will probably show a higher inflation profile, which acts against further QE."

IAN MCCAFFERTY, CBI CHIEF ECONOMIC ADVISER