Bank of England policymakers were split at their October meeting over the need to boost the economy further and unemployment dropped in August, BoE minutes and data showed on Wednesday, casting doubt over future action by the central bank.

The nine members of the Bank's Monetary Policy Committee voted unanimously to maintain the quantitative easing asset purchases at a total of 375 billion pounds and to keep interest rates at their record low of 0.5 percent.

But these purchases will be complete by the time of the Monetary Policy Committee's meeting next month, and October's minutes show the nine policymakers continue to disagree on whether more will be needed.

"There were some differences of view between members about the outlook and the likelihood that further easing in policy would be required," the minutes said.

A separate release from the Office for National Statistics showed that the number of Britons claiming unemployment benefit fell unexpectedly in September, possibly helped by jobs created for the London Olympics and Paralympics.

Employment rose to 29.59 million in August, showing the highest number of Britons working since records began in 1971.

Sterling rose to a session high against the dollar and gilts futures extended losses as investors reassessed the chances of more quantitative easing asset purchases in November.

"I think they'll (the Bank of England) sit on their hands in November. I think they are putting more emphasis on the Funding For Lending scheme and letting that do its thing," said Scotiabank economist Alan Clarke.

The BoE's Funding for Lending Scheme, which offers banks cheap credit if they lend more, was showing some "encouraging" signs of helping the mortgage market, but could take longer to benefit businesses, the minutes said.

JOBS

Britain's economy has not fully recovered the output lost during the 2008-2009 slump and fell back in recession at the end of last year. However, jobless numbers have fallen as the economy kept creating jobs.

Unemployment fell to 7.9 percent in August, below even the most optimistic economists' forecast, the ONS data showed.

BoE chief economist Spencer Dale and external MPC member Ben Broadbent both opposed the last expansion of asset purchases in July and last week another external member, Martin Weale, also expressed scepticism about further purchases.

October's minutes also omitted a key phrase from the previous month's minutes which said that policymakers "felt that additional stimulus was more likely than not to be needed".

Most economists polled by Reuters earlier this month expected the central bank to extend its government bond purchases once the current 50 billion pound round is completed and policymakers have new growth and inflation forecasts in November.

Some policymakers also voiced doubts about the effectiveness of more asset purchases.

Last week BoE Governor Mervyn King said that monetary policy would ultimately reach the limit of what it could do to help growth - though he did not say this point was near - and this month's minutes showed differences within the MPC.

Though Britain probably exited recession and posted some growth in the third quarter, weak business surveys have stoked fears of a relapse as the government's austerity drive and the euro zone debt crisis continue to weigh on the economy.

The MPC said that the outlook for growth and inflation over the medium term had not changed much, although an expected pick-up in growth was taking longer than expected to materialise.

Inflation - which fell back to a near 3-year low of 2.2 percent in September - may rise in the short term, due to higher energy, utility and food prices, but was likely to stay close to its 2 percent target, the MPC said.

(Additional reporting by Peter Griffiths, Alessandra Prentice, Peter Schwartzstein and Li-mei Hoang; writing by Sven Egenter; editing by Patrick Graham)