Chamber urges government to cut costs as inflation stays stable

Midland business leaders today urged the new Government to reduce “unrelenting” cost pressures to drive economic growth as inflation holds steady at the Bank of England target rate.

Emily Stubbs (pictured), head of policy at the Greater Birmingham Chambers of Commerce, called on Keir Starmer’s newly elected Government to reduce costs, as the rate of services inflation remained at 5.7 per cent over the year.

She said: “Many were expecting a continued decline in inflation this month, but the headline figure remains solidly at the Bank of England’s target two per cent rate.

“Meanwhile, services inflation remains stubbornly high. The Monetary Policy Committee will be carefully weighing this – together with tomorrow’s employment data – in their decision as to whether to cut the base interest rate at the start of August.

“Our latest Quarterly Business Report, launching tomorrow, highlights the unrelenting cost pressures Greater Birmingham businesses are currently under.

“Reducing these cost pressures and enabling business investment must be fiscal priorities for the new Government to drive economic growth.”

Today’s latest official figures show that inflation was unchanged from May, partly driven by an increase in hotel prices.

It means that the cost of living is still rising but at a rate with which the Bank is comfortable after nearly three years of above-target inflation which has squeezed household finances. But in areas such as services, ranging from restaurants to hairdressers, price increases remain persistent.

Emily added: “The King’s Speech, taking place today, will set out the Government’s legislative agenda for the coming months. The Chamber Policy team will publish a comprehensive overview of what the announcements made mean for local businesses.”

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