Brexit is still proving to be the big obstacle preventing another rate hike in the U.K.
Bank of England (BOE) policymakers are meeting Thursday but, despite positive economic data, the central bank is unlikely to announce any rate action, analysts have told CNBC.
"If it wasn't for Brexit uncertainty the Bank of England would probably be thinking about putting interest rates up this week," Mike Bell, global market strategist at J.P. Morgan Asset Management, told CNBC via email, adding that interest rates look "unnecessarily low."
In September, the nine BOE rate-setters voted unanimously to hold rates at 0.75 percent. At the time, the BOE highlighted greater market concerns surrounding Brexit.
Since then, there were hopes that a Brexit breakthrough would be achieved in mid-October, ahead of an EU summit. But, those hopes were crushed after a meeting between the two chief Brexit negotiators, where divergences over the Irish border blocked any substantial progress in talks.
As a result, the negotiating teams are still working to find an agreement between the U.K. and the EU on how the former will leave the Union in March. The big deadline is mid-December, when European leaders are due to gather once again. The idea is to have a deal before that time, so that it can then be ratified in the different European parliaments. But at this stage, it is unclear if both sides will strike an agreement before that date.
"The Bank of England is likely to stay on hold at the upcoming meeting and in the near future as Brexit negotiations approach a crucial stage and uncertainty is high," Silvia Dall'Angelo, senior economist at Hermes Investment, told CNBC via email.
"However, the monetary policy committee will likely maintain a mild tightening bias, reiterating that a gradual and limited hiking cycle is appropriate under most Brexit scenarios," she added.