The call for more stimulus by Bank of England Governor Mervyn King was overruled by a majority of policymakers for a third month, over fears that further easing might exacerbate inflation expectations and prompt renewed weakness in the pound.

Nonetheless, policymakers became more open to extension of asset purchases in the face of significant degree of slack in the economy and weak wage growth.

At the meeting held on April 3 and 4, the nine-member Monetary Policy Committee unanimously decided to maintain the record low 0.50 percent interest rate.

As seen in February and March, King along with Paul Fisher and David Miles sought an increase in asset purchases by GBP 25 billion to a total GBP 400 billion, while six other members voted to retain the asset purchase programme at GBP 375 billion.

This was the first meeting after the government broadened the central bank's capacity to expand stimulus even when inflation stays above the 2 target. "In responding to this trade-off, the Committee was setting policy in broadly the same way that it had done since its formation," the minutes said.

"Monetary policy was already highly stimulatory and the benefit of past actions would continue to be felt," minutes said. Inflation is likely to rise further later this year, while medium-term inflation expectations had drifted upwards in recent months. Price growth was 2.8 percent in March.

In addition, the extent to which supply capacity would respond to greater demand would depend on how quickly capital and labor could be redeployed from declining to growing businesses, the minutes said.

More quantitative easing in May is still possible, especially if the first quarter GDP figure is worse than expected, said Vicky Redwood, chief UK economist at Capital Economics. Further, she said it may be that an action will not come until Mark Carney takes over as chief in July.

The central bank is looking for other ways of helping the economy, particularly in trying to get more working capital through to smaller companies, said IHS Global Insight's Chief UK economist Howard Archer.

The minutes showed that policymakers saw merit in possible extensions to the Funding for Lending Scheme that would boost lending further.

The Agents' summary of business conditions showed that the availability of credit improved for larger and some medium-sized corporates in recent months, but not for most small firms. Demand for bank lending had remained weak.

Data from the Office for National Statistics today showed that earnings of British employees increased at the weakest pace since 2009. Including bonus, earnings advanced 0.8 percent year-on-year during the quarter ended February.

The number of persons seeking jobless allowance, or the claimant count, dropped unexpectedly by 7,000 to around 1.53 million in March, the ONS said.

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