Commenting on the publication today by the Bank of England of the Minutes of the Monetary Policy Committee (MPC) meeting held on 6 & 7 December 2006.

David Kern, Economic Adviser to the BCC, said:

"Today's MPC Minutes, and the news that the MPC voted unanimously in favour of holding Bank Rate at 5%, support our assessment that arguments for further early increases in interest rates are unjustified and should be rejected.

"The MPC minutes highlight worsening growth prospects in the United States, the slack in the UK labour market; and slower-than-average UK household consumption growth. The downside risks to inflation appear greater than the upside risks.

David Kern concludes: "To avoid causing serious long-term damage to the economy, and to underpin confidence, it is critically important for the MPC to reassure business that further early increases in interest rates will not be contemplated."