LONDON (Reuters) -The Bank of England kept rates unchanged on Thursday in a tight decision following recent signs that inflation is slowing, which brought the pound below the highs of the day, while boosting UK government bond prices.

The pound was last up 0.2% on the day at $1.30799, from around $1.30925 prior to the decision. It weakened a touch against the euro, which was up 0.1% at 88.1 pence, from 87.98 earlier.

British government bond yields fell, with two-year gilt yields last trading at 3.78%, down 3 basis points on the day and down from 3.802% previously, while the blue-chip FTSE-100 index was down 0.2%, having pared some of the day’s losses.

COMMENTS:

SANJAY RAJA, CHIEF UK ECONOMIST, DEUTSCHE BANK, LONDON:

“We continue to think that the MPC will cut Bank Rate once more this

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