May 6 (Reuters) - The Bank of England said on Thursday it would slow the pace of its bond-buying as it sharply increased its forecast for Britain’s economic growth this year after its coronavirus slump. The BOE kept its bond-buying programme unchanged at 895 billion pounds ($1.24 trillion), as expected by economists polled by Reuters but said it would slow bond-buying to 3.4 billion pounds a week between May and August, down from its current pace of 4.4 billion pounds a week.. The pound and British two-year gilt yields fell after the announcement, then recouped those falls Below are comments from analysts on the meeting outcome. RICHARD MCGUIRE, HEAD OF RATES STRATEGY AT RABOBANK, LONDON “We had the initial headline that the overall purchase target was unchanged and that was greeted positively by markets given that there had been some speculation of a possible reduction in purchase volumes. And then it appears that the market responded to the headlines that the BoE would slow the pace of bond purchases. As the dust settles, there are also upbeat macro economic forecasts as well but overall it is a modest response. Net-net, gilts are softer but modestly so. Sterling also did a double take on the headlines, reversing direction when it became clear that the pace of purchases would slow. So that was modestly positive for the pound.” MORGANE DELLEDONE, DIRECTOR OF RESEARCH, GLOBAL X “The upward revision of UK GDP growth this year to 7.25% is sending a positive sentiment with regards to the reopening of the economy and the pandemic finally being under control in the UK. However, the summer holidays could test this forecast as the pandemic is far from over in other parts of the world. Given the continued uncertainty about the spreads of new variants and the low inflation figures, the BoE is likely to take cautious baby steps when it comes to increasing interest rates next year.” STUART COLE, HEAD MACRO STRATEGIST, EQUITI CAPITAL “The BoE emphasising its cautious approach to the path back to monetary normalisation, making reference to the need for “clear evidence” of a rebound in activity before tightening and also seeing inflation still rising only modestly and temporarily above target, despite the sizeable upgrade in its growth forecast from 5% to 7.5%. Overall, not much of a change in stance, but possibly slightly more hawkish at the margin, given the better growth forecast and higher over-shoot for CPI.” JON HUDSON, FUND MANAGER, PREMIER MITON UK GROWTH FUND “The MPC is now expecting a faster economic recovery than previously expected, led by households spending their forced savings accumulated over lockdowns. High demand and rising commodity prices will cause inflation to rise in the near term but medium term expectations remain unchanged, allowing the MPC to keep financial conditions loose. This inevitably increases the risk that the economy may overheat further down the line but for the time being it bodes well for domestically focused UK businesses.” JOHN GOLDIE, FX DEALER AT ARGENTEX, LONDON “Sterling dipped sharply on the release, as asset purchases and base rate were kept on hold, but the revisions to the Committee’s outlooks were sufficient to motivate sterling buyers to push it higher again.” (Reporting by London markets team;) Our Standards: The Thomson Reuters Trust Principles.