Raised interest rates disrupts supply chains

As reported by the Greater Manchester Chamber of Commerce, the Bank of England has today raised interest rates to the highest level for 14 years, impacting business and disrupting supply chains

Interest rates have been raised from one point seven five per cent to two point two five per cent – the seventh rise in a row as the Bank tries to deal with rising inflation. The decision means borrowing costs are at their highest level since the banking crisis in 2008.

Chris Fletcher, policy and campaigns director at Greater Manchester Chamber of Commerce, said: “This is worrying news from the Bank of England. The options available to the Bank for reining in inflation are limited. Putting interest rates up appears to be the preferred solution although it is not without downsides. High inflation is causing serious problems for business, but increased interest rates will also have an impact on households and businesses alike.

“Our last quarterly economic survey showed that the economic outlook was weakening as inflation, supply chain disruption and a fall in consumer spending were all having an impact on businesses.

“We would hope that the government’s recent announcement on energy support for households and businesses will help boost to confidence, but these are still challenging times for businesses.

“I would urge one note of caution – in the past figures have suggested that the UK was in recession, only for the figures to be revised at a later date. We will have a clearer picture of the economic situation in Greater Manchester when our latest quarterly economic survey results are released next week.”