UPDATE 2-Bank of England, on Carney debut, steers markets on future rates
* BoE says markets are pricing in too fast a rise in UK rates
* Carney, at first MPC meeting, takes initial steps on guidance
* Bond yields and pound slide, share prices rally on news
LONDON, July 4 (Reuters) - The Bank of England warned investors on Thursday they were being too quick to price in a rise in interest rates, as new Governor Mark Carney began to deploy a strategy of giving guidance on what monetary policy has in store.
Four days after the Canadian took over the BoE, he persuaded its top policymakers to issue a statement which said a recent rise in bond yields had gone too far, given the still weak state of Britain's economic recovery.
It came after the BoE left its key rate unchanged at 0.5 percent, which traditionally has meant no statement.
The nine-member Monetary Policy Committee also signalled it could start giving more explicit guidance on interest rates as soon as next month.
An hour-and-a-half later, European Central Bank President Mario Draghi also broke with tradition to give forward guidance, but said it was a "coincidence".
Thursday's surprise announcement by the BoE immediately weakened sterling and pushed up the price of shares and British government bonds.
"Carney appears to be doing a good job of convincing his colleagues of the need for clear guidance to the markets and the public in order to keep market rate expectations in check and cement the recovery," said Rob Wood, chief UK economist at Berenberg in London.
Carney and his fellow policymakers said the "significant upward movement" in yields would weigh on the central bank's expectations for growth and inflation which, for now, remained unchanged.
"In the Committee's view, the implied rise in the expected future path of Bank Rate was not warranted by the recent developments in the domestic economy," the statement said.
As widely predicted, the bank voted against reviving its bond-buying programme and kept interest rates unchanged from 0.5 percent, where they have remained since 2009.
A recent run of better-than-expected data had help push up borrowing costs in financial markets on hopes that the British economy is finally on the mend after two years of stagnation, and five years after the financial crisis struck.
Yields on gilts, like those on other government bonds, had also risen sharply after Ben Bernanke, chairman of the U.S. Federal Reserve, spelled out in June a possible timetable for the U.S. central bank to reduce and then end its bond-buying.
The pound fell to a one-month low against the dollar and British government bond yields fell sharply after the BoE moved to push back expectations of when it might eventually raise rates.
Markets are now pricing in the first interest rate rise by the BoE in the second half of 2015, rather than in the first half as thought before Thursday's announcement, said Moyeen Islam, a fixed-income strategist at Barclays.
Carney has been tasked with speeding up Britain's sluggish economic recovery. Finance minister George Osborne asked him to report back next month on whether the BoE should give more detailed guidance on the future path of interest rates.
The monetary policy committee said this debate "would have an important bearing" on its Aug. 1 policy discussions.
In 2009, the Bank of Canada under Carney as its governor said it would keep interest rates low for more than a year in an attempt to give more confidence to businesses and households as the financial crisis hammered the global economy.
Some economists said the statement might also herald a restart of bond-buying by the central bank under Carney.
"I think it's a cert there'll be guidance in August, and then the question is whether there will be asset purchases as well," said David Tinsley, an economist at BNP Paribas.