Bank Rate held at 0.5pc for 35th month
The Bank also decided against an increase in its policy of Quantitative Easing. In October the Bank said it would inject another £75bn into the economy through QE.
The MPC expects the announced programme to take another one more month to complete.
Inflation remains well above the BoE’s target of 2% at 4.8%.
Minutes of the MPC’s meeting are expected to be released on the 25th January.
Ben Thompson, managing director, Legal & General mortgage club, said: “The Christmas period and start to the New Year kicked off with all manner of negative predictions and forecasts however there have been some glimmers of hope as well.
“These glimmers are just that, and there is a very long way to go before any fiscal tightening is required.
“However these pieces of good news, amongst other key factors will have allowed the Bank another month to fully consider all indicators in more detail before unleashing a further round of QE, which is widely expected to happen either in February or later in the year.
“For now it’s a pause, and that at least means there is no major or obvious panic, all eyes for now remain firmly fixed on the eurozone.”
Barry Naisbitt, chief economist at Santander, said: “It is the first meeting of a new year and with the members of the MPC having voted to extend the quantitative easing programme by £75 billion in October and that programme still running, the general expectation was that the MPC would again make no policy changes.
“With the end of the quantitative easing programme and the February Inflation Report coming up, the MPC is likely to want to see how the economy is developing before making any further changes.
“The very slow pace of growth over the past year and the recent weakening in activity indicators, in the UK and in other economies, will be of concern to the MPC but seemed unlikely to call for immediate action.
“On the positive side, inflation has fallen in the past two months and these falls, together with the expectation of further reductions as we go through 2012, should ease the squeeze on households’ real earnings.”
Simon Gammon, head of Knight Frank Finance, said: “The continued turbulence in the eurozone is weighing heavily on economic sentiment, both there and here in the UK.
“Greece is still facing large challenges, and there are now worries emerging about the credit ratings of some other eurozone countries, even France.
“There is also the feeling of “wait and see” in the mortgage market, certainly among the high street lenders. Whereas usually the beginning of a new financial year would see a raft of keenly priced mortgage deals on the market, that has failed to materialise this month.
“Instead, rates have remained the same, with many high street banks struggling to price their deals more competitively. In the background, Libor rates are also ticking up, despite the base rate remaining unchanged.
“The lack of activity on the high street is making the deals offered by overseas banks, especially private banks, look even more attractive. There are some great rates available, but borrowers need to be cautious about how they apply for their loan.
“The application process can be more onerous, but more than worth it if there is a good rate at the end of it.”