The Bank of England has held interest rates at 5 per cent today disappointing hard-pressed retailers and customers feeling the impact of the credit crunch.

The BRC, which had argued for a rate cut, said the decision to hold rates heaps more pressure on businesses and individuals’ personal finances.

BRC Director General Stephen Robertson said: “As last week’s election results showed the strain on personal finances is one of people's key concerns. I understand the Bank has the difficult balancing act of keeping inflation under control while sustaining the economy but financial indicators overwhelmingly point to a gloomy outlook.

"There's little sign yet of the rate cuts since December having much effect. With interest rate changes often taking a year to work through, the sooner the Bank cuts again, the sooner and greater the relief for hard-pressed consumers and retailers.”