The British Independent Retailers Association has expressed its concerns regarding the Bank of England’s decision to raise interest rates amid reports of declining footfall in July.
The Bank of England last week decided to raise the interest rate from 5% to 5.25%, its 14th consecutive rise, amid reports of a drop in footfall in 14 years in July, attributed to the UK experiencing one of the wettest months on record. Overall footfall was down by 0.3%.
Andrew Goodacre, ceo of BIRA, commented: “The weather in July has certainly had an impact on footfall, making it a challenging month for independent retailers. However, the issue of rising interest rates cannot be ignored and shouldn’t be masked.
“Today has been a double blow for the high street. Footfall in July was really disappointing. It is easy to assume it was the weather, and the rain has not helped, but we also have to see the decline in consumer confidence and consumer expenditure.
“The interest rate announcement is not a surprise, and it will not be a surprise if it reduces spending even more. Inflation is falling, and that is due to a reduction in energy costs, not interest rate rises. The Bank of England is using a blunt instrument based on a recent history of poor forecasting.”
