Homeowners were set for another boost after experts forecast interest rates would remain on hold for a ninth month in succession.

Stock market turmoil and signs of a slowdown in consumer spending are likely to persuade members of the Bank of England's Monetary Policy Committee (MPC) to keep rates at a 38-year low of four per cent.

The MPC begins its two-day rate setting meeting tomorrow and may even mull over the possibility of a surprise cut in the cost of borrowing.

However, most economists believe the nine-member committee will continue its wait-and-see approach before taking decisive action.

Members appeared ready earlier this summer to raise the base rate from its post-September 11 level as signs of a pick-up in the economy grew.

But the fall in the FTSE 100 Index to its lowest level for six years has knocked economic confidence and led some experts to believe that interest rates may not increase until next year.

Philip Shaw, chief economist at Investec Bank, said: "There is much uncertainty over the course of equities and their effect on the real economy.

"We think UK rates will remain at four per cent until early next year."

The bank's hold decision is also likely to be driven by reports that some of the heat has started to come out of the spending boom.

With inflation at an underlying rate of 1.5 per cent, the bank will not be under pressure to raise the cost of borrowing.

An influential report suggests the MPC needs to consider a reduction in rates. The BDO Stoy Hayward survey showed upheaval in financial markets has sent its usiness optimism index down for a second successive quarter.