The 9-strong Bank Of England Monetary Policy Committee today voted not to let the lid up on the build up of pressure in the housing market, by keeping interest rates on hold at 4 percent.

Speculation had been mounting that rates could be on their way up, after housing market statistics this week reported record increases. However, the signals coming from the Bank are that the powers that be are keen to see surer signs that the economy as a whole is in recovery mode before they take any action on interest rates.

Despite booming property prices, things are still not going so well in the manufacturing sector, a fact that is probably keeping rates where they are. With continuing job cuts in some industries and exports still struggling, the bank is keen to give the sector the best chance possible of getting out of what is now seen as the worst slump in nearly 20 years.

The TUC this week claimed that the manufacturing recession remains the biggest domestic threat to the Government's economic growth forecasts, and warned that interest rate rises would choke off any recovery.

Meanwhile, the Confederation for British Industry today praised the Bank of England for keeping interest rates stable. The employers' organisation said that the Monetary Policy Committee had made the right decision given that inflation and pay settlements remain well under control.

Ian McCafferty, CBI Chief Economic Advisor, said: "This is the right decision with pay settlements slowing and inflation well under control. The economy remains fragile despite early signs of a pick up in manufacturing. The heat in the consumer market is beginning to cool and interest rates need to stay stable to ensure the upturn takes hold."