The UK economy will barely grow this year and may have taken a bigger hit from the euro zone debt crisis than thought, but the Bank of England gave little indication that it would rush to pour further stimulus into the economy.
UK-ECONOMY - Team GB's winning streak continues at the London Olympics - but the country's golden success is not reflected in its economy.
The Bank of England predicts growth will come to a virtual standstill in 2012, as the effects of the euro zone crisis continue to batter the outlook.
In his quarterly Inflation Report, Bank governor Mervyn King said that growth in two years time is likely to be around 2 percent a year, down sharply from a forecast of 2.67 percent.
BANK OF ENGLAND GOVERNOR, MERVYN KING, SAYING:
"The recovery and rebalancing of our economy will be a long slow process. So it is to our Olympic team that we should look for inspiration. They have shown us the importance of total commitment when trying to achieve a goal that may lie some years ahead."
Britain's economy entered its second recession in four years at the end of 2011.
And last month data showed output had slumped 0.7 percent in the second quarter of 2012, partly due to wet weather and an extra public holiday.
The Bank of England promised to buy a further 50 billion pounds of government bonds over the summer to help.
It now says the economy may pick up in the short term but only modestly.
Sarah Hewin from Standard Chartered says that's partly due to a fall in inflation - which was 2.4 percent in June.
SENIOR ECONOMIST AT STANDARD CHARTERED, SARAH HEWIN, SAYING:
"I think that the good news from the Bank of England's point of view is that inflation is moving in the right direction. What we will be looking for is the assessment of where inflation will be in two years time. Is it going to be below target, in which case they will be signalling that they need to do more quantitative easing."
The UK government is part-way through a five-year austerity program.
But it's finding the cuts increasingly difficult to defend as growth in Britain and the euro zone falters.
It's a similar story across the Channel where government forecasts of 0.3 percent growth also look optimistic.
France is now expected to slip into recession in the third quarter, with a 0.1 percent contraction in the second.
There may still be scope to increase the number of Olympic medals but there's little sign of growth elsewhere.
Ciara Sutton, Reuters.