The size of the Bank’s bond-buying economic stimulus programme was also kept unchanged at £375bn.
The decision was widely expected, despite continued signs of strength in the UK economy.
Last month, the Bank of England reiterated it was in no rush to raise rates, with governor Mark Carney saying they may remain low “for some time”.
However, Mr Carney added the economy had “edged closer” to the point where interest rates would need to rise.
Commenting on the bank’s announcement, David Kern, chief economist at the British Chambers of Commerce said: “The decision to keep interest rates and quantitative easing on hold was the right one”.
And he added: “With annual CPI inflation below target, the MPC can afford to wait before tightening their policy. The strong rise in sterling over the past year, making UK exports more expensive, is an important reason for not raising interest rates prematurely”.
Latest official figures show that the UK economy grew by 0.8% in the first three months of 2014.
Recent business surveys have also indicated that the economy is continuing to enjoy strong growth, and the unemployment rate has fallen to a five-year low of 6.8%.
Despite Mr Carney’s recent comments, minutes from last month’s meeting of the Bank’s Monetary Policy Committee (MPC) suggested some members were softening their stance on raising interest rates.
While all nine MPC members voted to keep rates unchanged, the minutes said the views of some members on raising rates were becoming “more balanced”.
Most analysts do not expect UK rates to rise until the first half of next year.