Midlands business leaders are calling on the Monetary Policy Committee to create the right environment encourage investment and sales.
Chambers of Commerce in the region agree the Bank of England is likely to leave interest rates at 0.5 per cent at the monthly meeting.
Birmingham Chamber of Commerce and Industry policy adviser Will Rogers said there was evidence of an upturn in the local economy, with Bullring shopping figures rising dramatically in recent weeks and Jaguar Land Rover posting a £22m quarterly profit – and believes it is unlikely that quantitative easing would be extended.
He added: “In the long term, the challenge in the UK is to encourage businesses to invest in order to aid the local economy and for the government to create the right environment for sales.
“Our economy is currently being aided by fiscal steroids such as quantitative easing. This puts added pressure on quarter four’s GDP results, as the business community will be anticipating an improvement on quarter three.”
Louise Bennett, chief executive of the Coventry and Warwickshire Chamber of Commerce, agreed that rates will stay at 0.5 per cent going into 2010.
Ms Bennett said rates could stay at that level into the spring of next year but believes there will be upward movement in 2010.
She said: “There are calls in some quarters for rates to go up to one per cent this week but I do not believe that is going to happen – nor should it.
“When rates do eventually rise – and it is inevitable that they will at some point in the New Year – it should be the signal that the Bank of England is confident of a recovery.
“While we have seen evidence that the recession has slowed through 2009 and that there is slightly more confidence returning to the economy, there is no evidence to suggest that a recovery has started – or indeed a sustained one.
“Therefore, we expect rates to remain the same this week while the Bank will also make a decision on whether to expand quantitative easing.”
* For instant coverage on the interest rates decision see birminghampost.net/business on Thursday