Despite some commentators predicting a further pre-emptive rise in interest rates, the Bank of England will have surprised few people yesterday, by deciding to keep rates on hold at four percent.

Despite the fact that retail sales have surged over the last month, and in spite of a once-again-buoyant housing market, the Bank refrained from what would have been a third increase in a very short period of time, after a couple of years of relative inactivity.

Last month, all nine members of the Bank's monetary policy committee (MPC) voted to raise interest rates by a quarter point to keep inflation on target and curb house price growth and consumer spending. How many of them voted to keep rates on hold this time round will not be seen until the minutes are released on the 17th March, but many expect it won’t be long until the next increase comes along.

Graeme Leach, chief economist at the Institute of Directors, said: "The Bank of England is keeping its powder dry for another month. Following today's decision to leave rates unchanged, the only question is when, not if interest rates will rise. Consumers and business should be aware that further interest rate rises are just around the corner."

David Frost, Director General of the British Chambers of Commerce, agreed with the wait and see approach: "This is the best decision for business. After last month's quarter point increase we should wait and see if consumer debt and house prices stabilise before raising rates any further. We urge the Bank to take a cautious approach in the coming months and maintain a favourable monetary policy for the business sector as long as it feasibly can."