The Bank of England’s Monetary Policy Committee (MPC) disappointed many business groups as it put interest rates on hold yesterday.

Housing industry pundits however have been noticeably quiet about the rate hold. It was a wait-and-see scenario with the housing market cooling, but still showing growth.

CBI…
The Confederation of British Industry said the Bank of England should have cut interest rates to add momentum to the UK's sluggish economic recovery.

Ian McCafferty, CBI Chief Economic Adviser, said: "This would have been a timely moment to give the economy a helping hand.”

"There is little hard evidence that the recovery is gathering sufficient momentum. Sterling seems to have stabilised after its sharp fall last month and in the current economic climate there is no risk of significant pressure on inflation.”

"Business will now hope for a rate cut next month to drive the economy out of this sluggish spell."

TUC…
Ian Brinkley, TUC Senior Economist, said: "UK manufacturers will be disappointed. With so much economic uncertainty across the world a cut now would have given industry more confidence to invest.”

BCC…
Director General of the British Chambers of Commerce, David Frost said:

"The Bank of England has definitely missed an opportunity to offer extra support to UK business in a climate of weak demand at home and overseas. Inflation may be hovering above its target, but sales in most sectors are relatively weak.”

"The value of the pound may be falling, but considering the eurozone's economic performance, Britain's exporters may not see a rapid improvement in sales.”

EEF...
Engineering Employers Federation Chief Economist, Stephen Radley said:

"The weight of evidence since the start of the year has pointed to a slowdown in the UK and, whilst there is little the Bank can do about world markets, there remains a strong case for action to promote growth and confidence at home."

Eurozone interest rates chopped…
Fears of a new recession forced the European Central Bank (ECB) to cut rates later yesterday to the lowest level since the Second World War. The ECB chopped a half-point off borrowing costs to just 2 per cent in an vigorous attempt to kick-start the eurozone’s floundering economy.

French and Italian Prime Ministers were among a throng of politicians to approve the ECB’s decision, but some economists gave warning that the move was too little, too late.
Philip Shaw, of Investec, said: “To our minds the economy had been crying out for the further stimulus for some months.”