Interest rates have been kept at 5% for the fifth month in succession.

The Bank of England’s Monetary Policy Committee has decided not to ease the cost of borrowing by cutting interest rates – an indication that it’s main concern is rising inflation.

‘This is not encouraging,’ said Keith Steventon, head of research at Atisreal. ‘It won’t help bank margins and therefore the speed at which they can rebuild capital and get help to householders and property investors.

'The recession that the OECD (Orgqanisation for Economic Co-operation and Development) claims is already with us is simply unavoidable now.’

In recent months the Monetary policy Committee has been split three ways over how interest rates should move with Professor David Blanchflower falling for cuts to ease the economy, and Professor Tim Besley calling for a rates increase to contain inflation.

The other seven members of the committee have voted to keep interest rates at 5%.