Pictured: Christine Braddock, president of Birmingham
Chamber of Commerce
The rise in inflation to 4.4 per cent announced on 16th August
is another huge set-back for businesses and is the main cause of
concern for firms in the West Midlands.
Birmingham Chamber of Commerce Group's latest quarterly economic
survey showed that 20 per cent of manufacturers and 24 per cent of
service businesses said that inflation was their biggest concern.
Christine Braddock, president of Birmingham Chamber of Commerce,
said inflation is damaging because it eats into profits as
consumers spend less. She said: "Gas and electricity prices
and the pending increase in train tickets are likely to push the
Consumer Price Index up to 5 per cent by the end of the year.
"However, raising interest rates from the current rate of 0.5
per cent is not the answer. The main causes of inflation are
international and therefore beyond the control of the Bank of
England or the Government. Both China and India are suffering
with high inflation.
"This is the 20th month that inflation has missed the Bank of
England's target of 2 per cent and businesses and consumers have
really been feeling the pinch.
"However we do expect Inflation to begin to fall over the next
two years before dipping below the Bank of England's
target."