The target for total corporate bond and government bond purchases was also maintained at £20bn and £875bn, respectively.

Rates have remained unchanged since March 2020 when they were reduced to help minimise the economic shock of the Coronavirus pandemic.

The Bank said it expects the UK economy to recover faster than it had previously predicted. It said output in June was expected to be just 2.5% below its pre-pandemic level.

The Monetary Policy Committee said the economic implications of delaying the final relaxation on social distancing rules in the UK to 19 July is likely to be “relatively small”.

Hinesh Patel, portfolio manager at Quilter Investors, said rate hikes may not be seen until 2023: “Core inflation is likely to peak this summer, so it may even be 2023 until we see rate hikes given the Bank will want to catch-up to pre-Covid conditions. Quantitative easing, meanwhile, will need to gradually be reduced as the fiscal burden eases.”

The Bank has come under pressure from some industry commentators to rise rates due to an uptick in consumer price inflation.

The Monetary Policy Committee said in its statement that the direct impact of rises in commodity price on CPI inflation will be transitory and that, after a temporary burst of economic growth and higher prices, growth and inflation will fall back.

Annabelle Williams, personal finance specialist at Nutmeg, said it comes as no surprise that the Bank chose to continue to leave its base rate unchanged but warned the rise in consumer price inflation could be more than a blip created by the easing of lockdown rules.

Investment platform AJ Bell said inflation may be alive and well, or flat on its back, but it is too early to tell, especially as the data points on which monetary policy is being formulated are subject to considerable change.

Laith Khalaf, financial analyst at AJ Bell, said: “Inflation is already above target and the UK economy is racing along, but the Bank of England isn’t taking its foot off the accelerator just yet. That’s because the inflation numbers are comparing activity now with this time last year, when the shock and scale of the pandemic was just sinking into the UK economy. We will only really be able to get an idea whether inflation is a flash in the pan or not at the back end of this year, at which point talk of transitory factors will be starting to wear thin.”