Stagnating economic growth, record house price falls and the motor industry recording its worst sales figures for more than 40 years were not enough to persuade the Monetary Policy Committee to cut rates from the current level of five per cent.The decision dealt a blow to home owners, coming as Britain's biggest mortgage lender Halifax said house prices had fallen at a new record rate during the year to the end of August, losing 12.7 per cent of their value.But with inflation currently running at 4.4 per cent, more than double the committee's two per cent target, and expected to hit five per cent in the coming months, interest rates are not likely to be cut until November at the earliest.The controversy surrounding Chancellor Alistair Darling's gloomy comments on the British economy's prospects has also helped send the pound plunging against the dollar and the euro, adding to inflationary pressures.The European Central Bank kept rates on hold yesterday and scaled back growth forecasts for the eurozone next year, while in the US gloomy jobs figures heightened the economic concerns and hit stock markets on both sides of the Atlantic.It was also revealed yesterday that the British motor industry endured its weakest August for new car sales since 1966.Sales of new cars slumped to 63,225 last month according to figures from the Society of Motor Manufacturers and Traders.The sales were down 18.6 per cent year-on-year, bringing the total year-to-date decline in new car registrations to 3.8 per cent.The poor sales figures for August, which accounts for a quarter of the total decline seen so far this year, has raised concerns that the consumer spending downturn is deepening.The decision not to cut interest rates has been criticised by trade unions. The TUC's head of economics and social affairs, Adam Lent, said: "This is a depressing decision. With the slowdown now biting and recession on the cards, inflation is not the main threat to the economy."A cut today would have offered hope to all those who fear for their jobs and homes, and helped cut through the economic pessimism that is now doing as much damage as the credit crunch and energy prices."

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