Birmingham Businesses say farewell to an MPC member (and call for an interest rate cut in coming months)
The decision by Stephen Nickell to leave the Monetary Policy Committee (MPC) could have a stronger impact on Birmingham businesses and the region's economy than expected, says Birmingham Forward.
Ronnie Bowker, board member of Birmingham Forward and senior partner at accountants Ernst & Young, said: "We have consistently called on the MPC to cut interest rates in order to kick start the economy and push us further away from recession.
"Mr Nickell was the only MPC member to vote to cut interest rates for the last two months and losing his support may mean we are now less likely to have an interest rate cut, particularly as we are near to Budget day.
"On the other hand, the fact that Gordon Brown is looking to the US for a new committee member could be a positive move for our economy. While the UK economy is certainly different from that of the US or the rest of Europe, a fresh pair of eyes on the UK situation could add clarity to the committee's thinking.
"On the whole, the economy is still giving out mixed signals, with house prices appearing to be on the rise while the manufacturing and retail sectors are still finding conditions tough.
"These factors are magnified in the Midlands, where the collapse of LDV Vans and Eliza Tinsley and the threat to jobs at Jaguar are compounding the downward pressure on the economy.
"The MPC needs to take action in the coming months if it is to ease some of the negative pressures that are building and avert a full scale recession."
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