Yorkshire Shadow MPC votes on whether to raise interest rate

The Bank of England is expected to raise interest rates on Thursday for the fifth time in a row amid concerns that any delay could push the price of petrol and diesel even higher.

Despite economic figures showing rising inflation, contracting GDP and fuel and energy costs spiralling, the Yorkshire Shadow Monetary Policy Committee (MPC) found positives to share, particularly about York.

The MPC is a partnership between Clive Owen LLP and The Press, which considers the region’s economy and invites business figures to argue their case for a shift, or hold, in the rate.

The majority of members voted to increase rates this month, although some preferred to keep rates as they are for a little longer amid concern about the effects a rise would have.

Rob Whitehead, of Clive Owen, said: “I think if we are following monetary policy then we’ve got to raise interest rates to check inflation.”

Gary Smith, of Tilney, said: “If we don’t and the US raises interest rates, the pound will fall, and we will import more inflation."

Helmsley Group's Richard Peak said: “I think it is a question of whether it’s a quarter or half a point. Personally, I would probably bite the bullet, grasp the nettle and go hard quicker rather than delaying the inevitable.”

Steve Lowe, of The Press, Newsquest, said the high street, particularly in York, was busy.

"If you look at the hotel prices, they are up quite dramatically up on two years ago and are taking full advantage of people with disposable income, so people are spending."

He voted to raise interest rates, saying: “We’ve got to get inflation under control it’s as simple as that; it’s getting worryingly high.”

Dr Bob Gammie of York Business School said: “From my own sector we find that the university applications are up 50 per cent this year compared to what it was last yea; business school up 67 per cent.

"The biggest issue we have is we can’t find accommodation for students. We’ve got a huge demand for what we’re offering but we can’t find enough rooms in the York area.”

He added: “I think inflation is out of control. I think we need to send the right message as well; we need to make sure we are doing everything we possibly can to get it back under control.

"The only mechanism we really have for that at the moment is interest rates, so we need to put them up.”

Dave Broadbent, of Begbies Traynor, was concerned about possible effects of an interest rate rise.

“I completely take on board what the members are saying but I just think that it is going to have a huge impact having so much more out there that is interest-only led, and I think even half a percent interest increase is going to have a big impact.

"So, part of me is just thinking we know that inflation is going to go up, we know costs of living are going to increase.

"I am a bit more cautious which is very rare for an insolvency practitioner. But I would be more likely to say see how it goes for the next couple of months first and then, back end of the year, look at increasing at that point. I think it might be a little too soon now, however the last Bank of England discussion I was on, I know that they are talking about increasing it certainly by October.”