“There has been a grim inevitability about the successive interest rate hike announcements we’ve had to sit and watch over the last year.
“We of course need to get inflation down, but this decision will have far-reaching consequences.
“As small businesses look to trade the country back to economic recovery, this will come as a cruel blow to their plans. We know that smaller firms already find it harder to access finance, so making debt more expensive will surely put a further dent in their chances, affecting their margins and rippling though their business.
“Obviously, it’s mission critical that inflation is brought down. And, while interest rates are a traditional lever to do so, this is not a traditional consumption and consumer-debt fuelled inflation spike. That’s why we need a more rounded response – from the UK Government raising the VAT threshold from £85,000 to £100,000, to the Scottish Government delivering on their regulation pledge, to energy suppliers allowing firms to ‘blend and extend’ their contracts so they can take advantage of lower wholesale prices.”
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