Commenting on today’s interest rates decision by the Bank of England’s Monetary Policy Committee, David Kern, BCC Chief Economist, said:

“The downgrading of the OBR’s UK growth forecast in the Chancellor’s Budget highlights the challenging circumstances that the UK economy will face over the coming year, making the MPC’s decision to keep interest rates and its QE programme on hold unsurprising.

“The OBR’s downgraded UK inflation forecasts, and the fact that the bank’s own 2% inflation target is unlikely to be reached until late 2017 at the earliest, mean that a rise in interest rates is now likely to remain off the table for the foreseeable future.

“While inflation and rates remain low, the government’s priority must be on creating a stable business environment to support growth, and making it easier for SMEs, particularly exporters, to obtain finance on competitive terms.”