The Bank cut rates immediately after the terror attacks
With the global economy faltering, and consumer confidence hit in the aftermath of the terrorist attacks in the United States, central banks around the world have cut rates sharply.
The Bank of England, however, has somewhat stood on the sidelines, cutting rates after the attacks by only a quarter point to 4.75% , and one day later than all the world's other big central banks.
On Tuesday, the US Federal Reserve reduced its key lending rate by half-a-percentage point to 2.5%.
Considering that US inflation currently runs at 2.7%, the Fed is effectively lending money for free.
And since the 11 September attack, US rates have come down a full percentage point.
A show of independence?
In the City, some analysts say the MPC might be tempted to show its independence from moves in the United States and decide to keep rates unchanged for now.
Tom Hougaard, analyst at City bookmakers Financial Spreads, said the MPC had been "quite obstinate, they don't want to be seen to be playing second fiddle to the Fed".
However, with interest rates falling both in Europe and America, the Bank may find it hard to resist pressure for further cuts.
Two speed economy
The MPC's deliberations are being complicated by the split picture presented by the UK economy.
Manufacturing is in recession, while the service sector is still relatively strong.
A report from the Engineering Employers Federation said the engineering sector was suffering worse conditions than during the early 1990s, with additional job losses in the manufacturing sector this year of 150,000 with a further 164,000 forecast to be lost in 2002.
And the slowdown in the housing market, reported by the Halifax house price survey in September, may encourage the MPC to cut rates.
The fears of a housing boom, along with a wage price spiral which increased inflation, has been the main reason the Bank has been holding off.
Nevertheless, with the quarter point cut on 18 September, UK rates are now at their lowest level since 1964.
As a matter of fact, before the US attacks some MPC members were actually considering a rise UK interest rates.
In the end they decided to keep them on hold.
The MPC will announce its decision on Thursday at 1200 London time.