BCC: Manufacturing figures suggest keeping interest rates low

  • Manufacturing output in June 2014: up 0.3% on the month, up 1.9% on the year
  • Total industrial production in June 2014: up 0.3% on the month, up 1.2% on the year
  • David Kern urges the MPC not to ‘jump the gun’ on interest rates ahead of its decision tomorrow

Commenting on the manufacturing and production figures for June 2014, David Kern, Chief Economist at the British Chambers of Commerce (BCC) said:

“The slight increase in manufacturing and total production was much smaller than analysts expected, and suggests that the UK economy still has challenges to overcome.

“Despite encouraging progress seen by the manufacturing sector over the past year, its total output is still more than seven percent below its pre-recession level in 2008 – in contrast to services that are now more than two percent higher. Manufacturing exporters are also trying to cope with a strong pound at a time when demand in the eurozone – our biggest trading partner – remains weak.

“There are a number of uncertainties still facing the economy, and we would urge the MPC not to jump the gun on interest rates. Our view remains that the risks to the economy of raising rates too early are much greater than the risks of waiting just that little bit longer.”

Written on 6th August 2014Lillie Geistdorfer. Published in BCC, Economy, Manufacturing, News