Chamber calls for clear strategy after interest rates freeze

16 December 2016

Business leaders in Birmingham have called on the Government to provide a clear policy programme for businesses following the Bank of England’s decision to leave interest rates at a record low of 0.25 per cent.

The last change was a rate cut in August, in the wake of the UK’s vote to leave the European Union.

The Bank warned that household budgets could be squeezed because of slower wage growth and higher inflation.

It still expects inflation to rise above the two per cent target, but not as quickly and by not as much as predicted last month. 

Greater Birmingham Chambers of Commerce chief executive Paul Faulkner (pictured) said: “As expected, the Monetary Policy Committee took the decision not to alter interest rates.

“This is not surprising, given the economic and political instability which has marked 2016 and is expected to continue into the New Year, particularly as a result of the uncertainty around Brexit negotiations and American foreign policy.

“In light of this ambiguity, now is the time for Government to provide a clear policy programme to ensure businesses have the tools required to expand and flourish.

“The Chancellor’s announcement of a National Productivity Fund, with its emphasis on developing infrastructure and improving digital connectivity, is a step in the right direction.

“However, the Government needs to go further to encourage business investment and reduce the burden of input taxes on firms across the country.”

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