The Bank of England has kept the cost of borrowing at 5.75%.

But unusually, the Monetary Policy Committee (MPC) also released a statement which normally accompanies a change in rates. The statement made clear that the MPC had considered the effects that the interest rates could have on the rate of inflation. Inflation currently stands at 1.9%, which is below the target of 2%. Rates have not risen since July, but that was the fifth rise in 12 months.

Michael Coogan, the Council of Mortgage Lenders’ (CML) director general, said: “Credit conditions have tightened since the rate went up in July, and a further increase would have added to the liquidity problems we are already seeing in some sections of the market. At the same time, there is now much clearer evidence that the cumulative effect of five rate rises since last August is slowing activity in the housing market. The bank is right to wait and see, and if market conditions produce a further tightening of credit, it will strengthen the case that the next decision should be that rates go down, not up.”