The Bank of England (BoE) has announced its decision to hold interest rates
at 5.25% for the sixth time, remaining at the highest level for 16 years.
This decision, although expected, will have significant implications for the
construction industry.
No indication was given that rates are set to be cut later in the year,
although the BoE Monetary Policy Committee (MPC) said it would ‘consider
forthcoming data release and keep under review how long the Bank Rate should be
maintained at its current level.’
Richard Beresford, CEO of the NFB commented, “The decision by the Bank of
England to maintain interest rates continues to hinder productivity and
economic recovery.
“Due to the size and nature of works, the construction industry relies on
borrowing and financing for projects, and high interest rates can hamper its
ability to secure strong pipelines of work and invest in growth.
“This announcement comes at a time when construction already faces
considerable challenges in material inflation, planning delays, and energy
costs.
“We, therefore, urge the Government to deliver greater strategic reform in
planning, procurement, and regulation to ease these difficulties and create a
favourable environment that allows our sector to drive investment, growth, and
UK productivity.”
