FDs call on Bank to halt rate rises

Link: Personal insolvencies at all-time high

,p> The call came after a succession of interest rate rises that have seen the basic rate climb from 3.75% to 4.75% since the beginning of the year. This week’s Accountancy Age/Reed Finance Big Question survey revealed that almost half of the UK’s FDs (44%) believe Bank of England governor Mervyn King should leave interest rates alone.

One FD polled said: ‘The economy seems to be responding and needs to be left a few months. Any further increase in interest rates may lead to an overcooling of the economy and a repeat of the early nineties.’

However, 39% of the finance directors questioned believed another rise was appropriate. Tim Carr, FD at Charcol Holden Meehan, said: ‘Consumer credit rises, fuelled by public confidence off the back of potentially artificially high equity in property, need to be brought under control.’

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