The Bank of England has kept its key interest rate at a record low 0.5% as worries about a lacklustre UK economic recovery outweighed any concern about above-target inflation.
The no-change decision will come as little surprise to market analysts, who are not fully pricing in a UK rate hike until mid-2012.
UK interest rates have stood at 0.5% since March 2009, when a deep recession and the threat of deflation prompted central banks around the world to slash rates to record lows.
Since then, inflation in Britain has soared to more than double the central bank's 2% target, but the BoE has been reluctant to tighten monetary policy at a time when the British government's austerity measures are already dragging down demand.
Even though inflation looks set to climb to 5% in the coming months, worries about persistently weak growth have even led some members of the Monetary Policy Committee to consider the case for additional asset purchases.
In June, two of the BoE's nine policymakers voted for a monetary tightening, one for more stimulus and the remaining six for the status quo. A breakdown of today's vote will be published in two weeks' time.
