The Bank of England has kept interest rates unchanged.

Concluding its latest meeting on Thursday, the Bank's Monetary Policy Committee decided to leave the cost of borrowing at 3.5 per cent.

Business leaders welcomed the move.

"This decision is the right one for business," British Chambers of Commerce director general David Frost said.

"We are in a statistical fog at the moment - official output figures have been radically overhauled and there are mixed messages about the manufacturing sector.

"The best thing for the Bank to do is wait for more consistent signs of strong economic growth before it contemplates putting rates up.

"Inflation is still well under control and businesses need a low interest rate environment."

And unions also reacted favourably to the decision.

"This gives the economy time to get growing," TUC chief economist Ian Brinkley said.

"Higher growth next year depends on a manufacturing recovery this year which will depend on low interest rates and a competitive exchange rate.

"Manufacturing needs the Bank to resist an unnecessary hike and keep rates on hold for the rest of the year."

The most recent change in rates was a reduction of a quarter point in July.

Analysts expect interest rates will stay unchanged and the next movement will be up - but forecast it will not happen until well into next year.

However any surprise shock to the economy, such as a sudden slump in house prices, could force the committee's hand.