LONDON (Reuters) - British service sector growth slowed to its weakest in more than four years in November, as worries about the credit crunch depressed new business and confidence to their lowest levels since 2003.

The figures will likely boost bets the Bank of England will cut interest rates today — but they also showed price pressures accelerating, highlighting policymakers' dilemma as they weigh slowing growth against rising inflation.

The Chartered Institute of Purchasing and Supply/NTC activity index — covering businesses from hotels to financial services — fell to 51.9 in November from 53.1 the previous month.

This was well below forecasts for a more modest easing to 52.9 and the lowest reading since May 2003. A reading above 50 denotes expansion, a sub-50 reading marks contraction.

NTC said financial services firms recorded outright declines in activity, new business and employment, suggesting that tigther lending conditions are hurting the sector.

However, it also said November's contraction was not as marked as in October and cautioned that the sectoral data was volatile.

"A combination of the financial market turmoil in late summer, the ensuing Northern Rock crisis, and increasing worries over the outlook for the UK property market, have taken their toll on confidence," said NTC economist Paul Smith.

Expectations for future business fell to its lowest level in four-and-a-half years, as did the level of new business.

But inflation pressures remained strong, with the prices charged index rising to its highest since March, while the input costs index recorded its strongest reading in more than a year.

The majority of 56 economists in a Reuters poll last week expected the Bank of England to hold interest rates at 5.75 percent today, but markets are putting a 50-50 chance on borrowing costs coming down.