The Bank of England will announce next week that it will pump an extra 50 billion pounds of money into the UK economy, just as the chances of the European Central Bank starting its own money printing scheme fade, a Reuters poll showed.

Despite signs from business surveys on Wednesday that Europe's economy might be perking up, economists say both Britain and the euro zone are afflicted by profound economic weakness that will require further central bank action.

The ECB looks likely to cut interest rates in March from their record low 1.0 percent down to 0.75 percent, almost in line with its British peer that has left rates on hold at 0.5 percent for almost three years.

Chief among their concerns is the euro zone debt crisis, although expectations are riding high that Greece will avoid an unruly default so feared by financial markets by agreeing a bond-swap deal with its creditors within days.

Next to act to provide further monetary stimulus will be the Bank. Forty-nine of 56 economists thought the central bank will announce a new round of asset purchases next week worth a median 50 billion pounds, which would take the total spent since March 2009 to 325 billion pounds.

The existing programme has ended and they need to do more, tonnes more, said Michael Saunders at Citi. You can see they have softened people up with (Governor Mervyn) King's speech.

King said last week the Bank had scope to give the economy another cash boost if needed. The Bank also published a working paper on Friday concluding that the first round of quantitative easing had a notable positive effect on Britain's economic output between 2009 and 2010.

Citi's Saunders has the highest total quantitative easing (QE) spend prediction in the poll at 600 billion pounds, representing around 40 percent of British GDP.

Thirty-three of 56 economists expect the Bank to announce 50 billion pounds while another 16 expect 75 billion pounds - a much bigger total of economists expecting more QE than the 32 in total in a January poll.

The British economy contracted 0.2 percent in the final three months of 2011 and is predicted to shrink 0.1 percent in the current quarter, meeting the technical definition of recession.


Recession also looks likely to blight the euro zone in the early months of this year, likely forcing the ECB to cut rates to 0.75 percent next month.

While the ECB has refrained from the QE money printing programmes of the Bank and the U.S. Federal Reserve, it last month pumped a staggering 489 billion euros of cheap three-year loans into the banking system.

It looks set to give banks a further 325 billion euros later this month, according to a Reuters poll of money market traders on Monday, flooding banks with liquidity it hopes will be used to lower borrowing costs for hard-pressed euro zone countries.

That would put almost three-quarters of a trillion euros into Europe's banking system, reducing the need for a BoE-style money printing programme in all but the worst-case economic scenarios. Some call it QE by stealth.

The poll suggested there was just a median 20 percent chance the ECB will start making unsterilized bond purchases, down from 30 percent in January and 40 percent in December.

There is clearly a case for bond buying. But in the end this can hardly be a durable solution for the euro area and should only be a last resort, if no other means are available, said Gernot Griebling, economist at LBBW in Stuttgart.

Only 13 out of 71 economists thought the ECB will cut interest rates to 0.75 next week, although 41 thought they would do by the March meeting.

The ECB will stay put in February and wait for the impact on staff projections in March, before they cut rates again, said Christian Schulz, senior economist at Berenberg Bank.

The Bank, meanwhile, looks almost certain to keep interest rates at their record low 0.5 percent until 2013 at the earliest.

(Polling by Ashrith Doddi and Somya Gupta; Analysis by Ruby Cherian and Somya Gupta, Editing by Ron Askew)