Despite today’s expected hold in interest rates, the Bank of England must stand ready to cut rates next year if the economy begins to slow, according to EEF, the manufacturers organisation.
EEF’s fourth quarter business trends survey published earlier this week showed a sharp fall in confidence in response to a range of increasing costs and the strengthening dollar.
EEF Chief Economist, Steve Radley, said:
“Whilst the Bank can afford to stay its hand into next year, strong headwinds are now being generated by an increasingly turbulent world economy. With manufacturers already being buffeted by increased costs and a weak dollar, if the outlook worsens they will look to the Bank for swift action to keep them off the rocks.”