Business leaders in Birmingham and Solihull are aware they are in for a bumpy ride with today's announcement by the Bank of England that it expects the economy to shrink by around 5.5% at its lowest point this year before the recovery.

Birmingham Chamber of Commerce and Industry (BCI) said that although quantitative easing was implemented to boost the money supply and play an integral role in improving bank lending, a sense of anxiety still remains on this issue.

Will Rogers, policy adviser at the BCI said: "The economic recovery was always going to be a fragile and protracted one and it was expected that there would be a number of relapses along the way."

The Bank of England said that if the base rate was to follow the path currently implied by markets, inflation would be well below the government-set 2% target in two years.

Last week the Bank voted to keep interest rates on hold at 0.5%, but also decided to inject another £50billion of new money into the economy to help the country pull out of recession. 

Mr. Rogers added: "Today's setback, whilst expected, is still concerning as it emphasises the high level of uncertainty that is still paramount within the business community.

"There needs to be further questions as to how much more the aggressive quantitative easing policy stimulus can be furthered."