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22 Mar 2024

East Midlands Chamber reacts to static interest rates

The Bank of England has kept interest rates at 5.25% but a rate cut looks to be on the horizon, says East Midlands Chamber.

Despite inflation falling more than analysts expected this week the Bank’s Monetary Policy Committee voted to maintain interest rates at the current level but did suggest a rate cut could be “on the way” in future decisions. 

Responding to the news East Midlands Chamber Director of Policy and Insight Chris Hobson said:

We may not have had a drop yet in interest rates, but the feeling is very much that it’s not far off. Inflation fell by more than was anticipated earlier this week, providing a strong sign of improving health in the economy.

“When we listen to what businesses are telling us, there’s lots of reasons to feel confident that things are going the right way here in the East Midlands.  Research published this week in our Quarterly Economic Survey revealed a sense of optimism across the region with businesses planning for improvements in turnover and profitability over the next 12 months.

“However, it’s not all plain sailing. Higher borrowing costs restrict investment and add to the pressures businesses face, so it’s vital that the Bank doesn’t dither in reducing rates and easing that burden.  Our Manifesto for Growth 2024 – presented to Westminster last week – clearly outlines the key asks we need for growth in the East Midlands, with focus on the four I’s of Infrastructure, International Trade, Innovation and Investment at the centre of the reforms we need.”