Bank of England rate-setters are expected to hold fire on further aid for a fragile UK economy this week a year after launching efforts to boost the money supply.

The Monetary Policy Committee (MPC) is likely to mark quantitative easing’s first birthday by keeping the scale of the programme unchanged at £200 billion and holding interest rates at their 0.5 per cent all-time low.

Figures last week showed the UK emerging from recession at a faster pace than first thought - although the sluggish 0.3 per cent growth registered in the last three months of 2009 offers scant cause for celebration.

It comes after a year of massive stimulus - both from the MPC and from the Government - through measures such as temporary VAT cuts, car scrappage schemes and spending brought forward to beat recession. The dire public finances mean there will be little scope for further giveaways.

But tightening of monetary policy seems far off as several MPC members - including Governor Mervyn King - have highlighted the fragile nature of the recovery and said the Bank could yet decide to increase QE.

Louise Bennett, chief executive of the Coventry and Warwickshire Chamber of Commerce, said the low rate level had prevented an even deeper recession.

And she believes maintaining that will be one of the factors in achieving a sustained recovery.

Ms Bennett said: “Just two years ago, interest rates were at 5.25 per cent and the onset of recession and then the 18-month slump saw rates tumble to this record low and remain there.

“We called for rates to fall more quickly two years ago but since then we have backed the Bank’s policy of trying to keep interest rates as low as possible.

“Having rates at 0.5 per cent has almost certainly prevented a much worse economic situation and, when you consider that the recession we have just been through has been one of the most difficult many businesses can remember, it says a great deal.

“We have seen one or two ‘green shoots’ of late but if you talk to most companies, they are very, very cautious about the future.

“While rates have been low, many of our members still say that they have not had the access to finance that they need to grow and develop their businesses.”

Investec chief economist Philip Shaw said: “Whereas we had thought that there might have been a turnaround in the monetary policy debate by now - towards considering when policy should be tightened - the short-term choice facing the committee is still between keeping policy on hold and stepping up asset purchases.”

The potential for more QE has weighed on the pound, which has fallen to a nine-month low of 1.52 against the dollar and below 1.12 euros - hitting holidaymakers in the pocket.

The Bank lowered its growth forecasts in the February inflation report, when the Governor said the economy was still “bumping along the bottom”.

Factors such as last month’s VAT hike as well as January’s snow storms could also add to “double-dip” fears when growth figures for the first three months of 2010 are released just before a likely general election.

House prices also fell for the first time in 10 months during February as the market was hit by the weather and the end of the stamp duty holiday.

The MPC is unlikely to make any rash policy moves to tackle a short-term inflation spike, with the Consumer Prices Index (CPI) currently well above target at 3.5 per cent thanks to the VAT rise and higher petrol bills.

The Bank expects CPI to drop well below its 2 per cent target over the longer term, as the huge slack created by what is now the deepest recession since official records began as well as the longest drives down prices.