Economists had predicted rates would stay at 0.5% for the 27th month in a row.
The Monetary Policy Committee (MPC) also chose to leave its quantitative easing programme at £200bn.
The weak economy has led analysts to put back the likely date for the next rate rise to November, despite inflation hitting a two-and-a-half-year high of 4.5%.
Data released since the Bank’s last MPC meeting confirmed that UK GDP grew just 0.5% in the first three months of the year after falling a similar amount at the end of 2010.
Business leaders welcomed the bank’s stance.
David Kern, chief economist at the British Chambers of Commerce (BCC), said: “While increased utility prices and high inflation puts the MPC in an uncomfortable situation, countering this with a rise in interest rates would be a mistake.
“As long as wage increases remain subdued, the MPC should hold its nerve for the time being.”
Ben Thompson, managing director of Legal & General Mortgage Club, said: “The gap between bank rate and inflation may be widening but there are precious few other indicators that provide a rationale for increasing base rate from its current rock bottom levels.
“The Bank remains in the thick of it. On the one hand needing to ensure that a sustainable economic recovery is baked in, on the other hand ensuring it does not lose its credibility as an independent rate setter that is capable of maintaining a controlled and low inflation economy. It’s a tough one that, but the recovery has to come first.”
Nick Hopkinson, director of property company PPR Estates, said: “The Bank of England is clearly not going to be able to increase interest rates this year, even though inflation is running away from it. UK plc is still very weak and any increase in borrowing costs would almost certainly tip the scales back into recession.”
He said that he expects house prices to fall 5% this year, regardless of whether base rate remains low.
Hopkinson added: “If interest rates are forced up due to the MPC needing to retain credibility on its inflation management brief, then things will get a lot worse for many struggling sellers.”
