Commenting on the inflation data for August, published today by the Office for National Statistics (ONS), David Kern, Chief Economist at the British Chambers of Commerce (BCC), said that the figures do not alter the basic fact that signs of recovery remain fragile, and the main policy priority is to avoid a set back.
According to ONS, in August, the Consumer Prices Index (CPI) fell from 1.8% to 1.6% and the headline rate of Retail Prices Index (RPI) inflation rose to minus 1.3% from minus 1.4% in July.
Kern added that “The persistent weakness in bank lending is still a major problem, which threatens small firms in particular. Against this background, it is important for the Bank of England’s Monetary Policy Committee to increase the quantitative easing programme to £200bn, and to consider special measures, such as a negative interest on deposits held by banks at the Bank of England”.
FinSMEs
15/09/2009