Interest rates rise warning for local businesses
CHAMBER BOSS SAYS DECISION MAY RISK RECESSION
THE Chamber of Commerce, which supports companies in Huddersfield, has warned the Bank of England’s decision to increase interest rates risks doing more harm than good to businesses in the town.
The Mid Yorkshire Chamber of Commerce – which also supports businesses in Halifax and Wakefield - will have caused alarm across West Yorkshire as people struggle with rising costs
Interest rates have risen to one per cent from 0.75 per cent, their highest level since 2009 and the fourth consecutive increase since December.
It comes as soaring energy prices have resulted in rising prices for most households and many are struggling to cope.
Chamber leader Martin Hathaway said: “The decision to raise interest rates will cause considerable alarm among households and businesses across Halifax, Huddersfield and Wakefield, given the rapidly deteriorating economic outlook and mounting cost pressures many are facing.
“The Bank of England face an unenviable trade-off between soaring inflation and a wilting economy.
“However, higher interest rates will do little to address the global headwinds and supply constraints driving this inflationary surge.
“It also raises the risk of recession by damaging confidence and intensifying the financial squeeze on businesses and consumers.
“With monetary policy continuing to tighten, it is vital the fiscal policy is now loosened to ease the crippling cost pressures faced by consumers and businesse, and to support wider economic activity.
“Urgent action is needed to limit the unprecedented surge in costs facing businesses, including financial support for those struggling with soaring energy bills.”