Business chief’s warning over rise in interest rates

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ONE of the country’s leading business experts has used a Hampshire Chamber of Commerce dinner to call on the Bank of England to avoid raising interest rates too much too soon.

Nora Senior, president of British Chambers of Commerce, said any rise needed to be gradual and paced because the economy is not yet seeing sufficient investment growth.

Too sudden a hike by the bank’s monetary policy committee would risk choking the recovery, she said.

She said: ‘Businesses will only invest if they see that the cost of borrowing is going to remain low or has only a gradual rather than sudden rise.

‘The government hasn’t yet rebalanced the economy in favour of business investment or exports and that is having a knock-on effect on manufacturing and skills. The UK needs to invest in specialist skills.’

Commenting on her local tour, she said: ‘I am struck by the wide diversity of industries and commercial services.

‘There is a strong professional services sector here which is well placed to contribute to the very important export market in professional services in the UK generally. That activity is vital if we are to achieve an export-led recovery.

‘There is a thriving tourism sector in Hampshire as well and there is clearly also a great deal of regeneration going on.’

Ms Senior’s hosts for the visit were deputy chief executive of Hampshire Chamber Maureen Frost and president Andrew Finney.

Ms Frost said: ‘Nora Senior is a leading, campaigning voice for businesses across the UK and her insight across a range of issues was welcome and enlightening.’