BRC in rate cut call

The British Retail Consortium (BRC) has called for a cut in interest rates this week following disappointing December sales figures.

Statistics revealed that like-for-like sales in the festive period were up by only 0.3 per cent on a year earlier, the weakest December figures for three years.

BRC director general Kevin Hawkins called for a 0.5 per cent interest rate cut to stop the situation worsening

Such a move could have a significant effects on mortgage rates and the housing market, with knock-on effects for the building industry if buyer demand is reignited.

KPMG, which compiles the statistics, warned the figures could signal a hard year ahead for the sector unless action is taken.

Head of retail Helen Dickinson said: "This sets the scene for the new year ahead and like-for-like sales look set to move into negative territory as they did in 2005."

Falling sales figures may increase fears of a wider economic downturn, a possible prospect which the Bank of England monetary policy committee said was behind their decision to cut rates last month.


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