LAST week, we held our quarterly Bank of England briefing, kindly hosted by Bournemouth Airport.
This unique event for DCCI patrons and council members provides an interactive platform for Bank of England agents to both give their perspective on the Bank of England’s view of the economy and, valuably, get feedback direct from the business community as to how we see the economy from the coal face.
The Bank of England employs 12 agents working across the country and their job is to effectively take the pulse of businesses. We had a variety of businesses present and the picture is overall positive although we have some way to go to return to pre-recession productivity levels.
The Bank of England gave an overview that was positive across all sectors, with growth up and inflation down.
Representation from the property market, both domestic and commercial, was a positive picture although the domestic market is recovering at a greater rate than the commercial and industrial sectors (where we also face potentially limited future supply of industrial, commercial and office space).
House prices are on the rise with increased availability of mortgages.
The flipside is we have South East house prices against South West wages, so affordability of property is a real issue, particularly for first-time buyers.
This will of course also lead to an increase in rental costs, making the prospect of home ownership very difficult for many on lower wages.
Longer term we also need to think about the inevitable rise in interest rates.
The Bank of England also reported increased bank lending for businesses.
In my experience all the banks will tell you they are lending but it’s absolutely essential that businesses present a strong case when looking for finance.
Dorset Chamber of Commerce and Industry