The Bank of England has held the interest rate at five per cent for the fifth month running despite increasing fears of an imminent recession.
The British Retail Consortium said that although it agrees with today’s decision, the bank should not delay cutting rates for much longer.
BRC director-general Stephen Robertson said: “With economic growth at a standstill but inflation double the bank’s target rate, no change is the right decision for now.”
“But, with the BRC shop price figures suggesting inflation may be nearing its peak and increasing fears of recession, the point at which the balance tips in favour of a rate cut is getting closer.”
Rates are expected to fall by the end of the year, but that is likely to provide little relief for retailers who continue to be hit by the ever shrinking disposable income of shoppers.
Chancellor Alistair Darling this week described the state of the economy as the “worst in 60 years”.
Source: Retail Week
