The Bank of England has held the base rate of interest at 0.5 per cent for the twenty-first month in a row.

The central bank's Monetary Policy Committee also decided against further quantitative easing, maintaining the level at £200 billion.

Edward Menashy, chief economist at Charles Stanley, said uncertainty in the Eurozone had made the Monetary Policy Committee 'reluctant' to make any changes to policy.

He said, 'The Eurozone uncertainty is set to continue forcing the International Monetary Fund to observe that Europe’s response has been piecemeal as Germany and other states resisted calls for firmer action.

'Crucially the European Central Bank does not wish to take all the risk of supporting Eurozone debtors by massive bond buying.

Menashy added, 'The European Central Bank would prefer governments to take additional measures such as increasing the rescue fund.'