18 August 2008
The British Chambers of Commerce (BCC) is calling for cuts in interest rates to prevent the British economy from entering into a serious recession. It claims that recession could hit the UK in the next six to nine months unless moves are made to cut the rate of borrowing to ease the pressure on businesses and those with secured loans. But it warns that if the Bank of England does not cut base rates in the next three to six months then the prospects for growth will be much worse. David Kern, the BCC's Economic Adviser, said: "The longer the monetary policy committee waits before cutting rates, the bigger the danger that the economic situation could deteriorate." The BCC is advocating a cut to 4.75% in the fourth quarter of this year, followed by a further cut to 4.5% in the first quarter of next year. This month, the Bank of England's monetary policy committee held the base rate at 5% - the fourth month in a row it was left unchanged.
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