The Bank of England (BoE) held British interest rates steady at 4.0 per cent for the second month running yesterday, but analysts said borrowing costs are highly likely to rise next month.

The BoE made no statement after a meeting that put markets on a knife-edge over whether rates would go up to cool soaring debt levels and booming house prices.

Futures markets are pricing in borrowing costs rising by a full percentage point by the end of the year and a half-point by the end of June, even though inflation remains below the BoE's 2 per cent target. - (Reuters)