Shropshire Chamber of Commerce says it understands the Bank of England’s decision to raise interest rates today for a 12th consecutive occasion - to tackle the ‘stubbornly high’ rate of inflation.
Ruth Ross, Shropshire Chamber’s chief executive, said: “The spiralling rate of inflation is devastating for many of our small businesses which are struggling to absorb the ongoing price rises.
“But at the same time, we must recognise that a continued rise in the base rate can have serious negative effects too - particularly for companies which may be looking to borrow money to manage their cashflow problems.
“We cannot escape the fact that the combination of high interest rates and high inflation is the worst of both worlds for some small firms.”
The Chamber’s latest quarterly economic survey found that rising interest rates are of particular concern to the hospitality sector, which employs thousands of staff across Shropshire.
Ruth said: “We support the views expressed today by the British Chambers of Commerce, which is calling on the Government to consider further action to break this vicious cycle by boosting economic growth through investment in infrastructure, skills training, and global trade.”