Recently, our Managing Director Glen Banks, was invited to a business lunch, run by the Barnsley and Rotherham Chamber of Commerce, to give a small number of business leaders the chance to discuss the economy, share areas of concern and also success, with the Yorkshire and Humber representatives of the Bank of England (BoE).
The discussions were chaired by Juliette from the Bank of England, who provided an overview of the role the Bank of England Monetary Policy Committee (MPC) play in setting Interest Rates in the UK, how their sole remit is to control the rate of inflation and maintain it around the 2% mark, and how they take forecasts from the Government to enable them to forward plan.
It is this forward planning that has led to them recently increasing the interest rate for the first time in a decade, as although inflation is above the target rate, with the effect of the original Brexit vote now starting to fall out of the comparative figures moving forward, this has led to inflation being predicted to fall in the coming months. This has also led the BoE to suggest that a further 2 rate rises are currently predicted in the next 3 years.
The BoE has no view on Brexit, other than to accept the Government’s current forecast that a ‘smooth’ Brexit transition will be the outcome, so forecasts are based on this assumption.
Local leaders outlined their feelings that business is continuing as normal at the moment, but some long-term decisions are being affected by the uncertainty caused by the Brexit vote, the availability of funds available for lending by banks is felt to be an issue, with business owners being asked to provide guarantees for whole lending amounts being sought from the banks, and the quality of employee being available at the younger end of the market being a good topic for debate, with mixed views around the table!
Glen Banks commented “It was a very good opportunity to share the views and experience from the business leaders themselves, with the representatives for our region, who report back directly to the MPC at the Bank of England. It was also interesting to see what the majority of the business leaders there are experiencing the same issues and concerns. Many thanks to the Chamber for the invite, and Holiday Inn Barnsley for the wonderful food”.