East Midlands Chamber has said high borrowing costs can delay spending plans, following the Bank of England’s announcement to keep the interest rate at 5%.
Chief Executive Scott Knowles said: “Obviously businesses grow with investment into people, machinery, equipment and technology, and while economists widely expected the interest rate to hold at 5%, expensive borrowing continues to tie the hands of firms eager to expand through spending.
“Only two out of ten respondents in the Chamber’s Quarterly Economic Survey reported having increased their investment plans in plant, machinery, equipment and training, although seven out of ten had made no change to investment intention.
“The new government’s Autumn Statement at the end of next month must take account of the high cost of doing business and not miss the opportunity to alleviate the pressure on businesses, giving support with better rates, a reduction in regulatory red tape and enabling growth.”
Investment intentions from East Midlands Chamber’s Quarterly Economic Survey Q2, 2024:
- Six out of ten respondents reported concern over interest rates
- Seven out of ten respondents have not changed their investment plans on plant, machinery, equipment or training
- Two out ten respondents increased their investment intentions
