Business groups have welcomed the Bank of England's decision to keep the base rate at the historic low of 0.5 per cent for the 26th month in a row.

Despite forecasts earlier in the year the the Monetary Policy Committee would hike the rate in May, rising inflation persuaded the experts to make no change.

Graeme Leach, chief economist at the Institute of Directors, which has more than a thousand Kent members, said a rise in base rate risked a double-dip recession and would further undermine the banking system.

"Leaving interest rates unchanged is the right decision," he said. "The UK economy needs loose monetary policy and tight fiscal policy."

He added: "An easing in fiscal policy and a tightening in monetary policy could result in the worst of all worlds and an even bigger budget deficit."

Ian McCafferty, CBI chief economic adviser, said: "Given the recent mixed signals about the current strength of the economy, it is not surprising that MPC members have decided to keep interest rates on hold again.

"While the recovery continues to make progress, recent economic data show that it is very patchy across sectors, and some parts of the economy remain fragile. However, pipeline inflationary pressures have intensified, with our economic surveys showing rapid cost inflation from increased energy and commodity prices."

Jones Lang Lasalle, which manages Kent Science Park, added: "This move was widely expected in the light of recent disappointing economic news. With much of the recent rise in inflation down to temporary effects and considerable uncertainty about the recovery, it was wise for the MPC to be cautious."

However, experts believe that rates will rise sooner rather than later, with August or September tipped for the first rise in more than two years.