Midland business leaders have welcomed the Bank of England’s decision to hold interest rates again at 0.5 per cent, boosting export opportunities for manufacturers.
Michael Ward, president of Birmingham Chamber of Commerce said the West Midlands was one of the only regions not in recession in quarter one.
“Manufacturers are leading that growth with fantastic products that the region has to sell to the world. Low interest rates enable manufacturers to be more competitive.
“Companies are also finding opportunities to capitalise on the poor quality of Chinese goods and can produce smaller quantities, which helps customers avoid storage problems. However while our economic prospects are increasing, we must not get complacent.
“Ongoing problems in Europe will persist for some considerable time and demands for more quantitative easing have started to rise due to the worsening crisis in the Eurozone. But there are plenty of opportunities elsewhere in the world.
“High-growth markets include the BRICs (Brazil, Russia, India and China), whose dynamic economies will provide a wealth of prospects for UK firms in the coming decades.
“In addition to the BRICS, there are other fast-growing markets with great potential, such as Colombia, Indonesia, Vietnam, Turkey and South Africa.”
The interest rate hold was also welcomed by Black Country Chamber of Commerce, whose president Paul Bennett said: “It was widely predicted interest rates and the Quantitative Easing (QE) programme would remain unchanged at the MPC’s June meeting.
“The British Chambers of Commerce (BCC) has recently published its new Quarterly Economic Forecast, downgrading its prediction for UK GDP growth in 2012 to 0.1 per cent (from 0.6 per cent).
“BCC predict that given the fall in GDP in Q1 2012, and the continued difficulties in the eurozone, GDP growth for 2012 will be minimal, followed by stronger growth of 1.9 per cent in 2013 (revised up from 1.8 per cent) and 2.3 per cent in 2014.
“It is imperative that rates remain low to help improve business confidence; this coupled with a boost in the flow of credit available to businesses should help rebalance the economy.”
Mark Smith, regional chairman at PwC in the Midlands, said: “There is much talk about whether the base rate should fall further from its historic low of 0.5 per cent and whether further quantitative easing may be required.”