The Monetary Policy Committee (MPC) voted unanimously to maintain the rate, which was reduced twice back in March following the Covid outbreak, because of continued uncertainty over the economy.

It said the outlook for the UK and global economies remained ‘unusually uncertainty’. Its projections, therefore, would depend on how the pandemic and measures to protect public health – as well as how households and businesses respond to this – evolved.

It has forecast GDP will return to 2019 levels by the end of 2021 and was buoyed by the fact spending had begun returning to normal levels as had the housing market.

However, it was more cautions because of the risks of unemployment and uncertainty over business spending.

Negative interest rates

Laura Suter, personal finance analyst at AJ Bell, said the rate setters had ruled out any potential interest rate rise for the foreseeable future and they had even hinted there might be negative interest rates to come.

She said: “Worries about a second wave of Covid-19 mean the economic outlook is particularly uncertain and that negative interest rates can’t be ruled out.

“Any rate rise is miles away and savers will continue to see paltry returns on their cash.”

Alex Maddox, capital markets & digital director at Kensington Mortgages, said: “The MPC seems to be holding back some of its firepower, in case we see a downwards lurch in activity.

“The economy is beginning to reopen, which is good news, but most economists are predicting unemployment to rise by a significant amount in the fourth quarter once the furlough scheme ends.

“Until the MPC sees the true magnitude of post-furlough job cuts, they want to keep options open – which may even include negative rates.”