British inflation will be on course to hit the central bank's target in two years if interest rates remain at 4.75%, the Bank of England said today.
The BoE's quarterly Inflation Report said the overall outlook had changed little in the last three months.
Analysts saw the tone as suggesting that there would be no further rise in British interest rates.
The BoE left interest rates on hold at 4.75% for the third month in a row last week as five hikes in the last year appeared to have slowed the economy down.
But BoE Governor Mervyn King was careful to point out that there were significant uncertainties and that future developments would as ever depend on the economic data.
'These risks mean we cannot be confident of where the future path of output, inflation, and hence interest rates will lie. When we say that, we mean it,' King said at a news conference.
The bank said UK growth would pick up to around an annual rate of 3% in two years. It noted that house price inflation had declined a little more sharply than anticipated in August. 'The outlook for house prices is extremely uncertain,' the report said.