The Bank of England has held interest rates at 3.75% for a fifth consecutive meeting, offering greater certainty for businesses and households, including the UK’s franchised automotive retail sector. While inflation fell to 2.6% in June, it is expected to increase later this year as volatility in global energy markets continues to affect prices.
Sue Robinson, Chief Executive of National Franchised Dealers Association (NFDA), said:
‘Holding interest rates gives businesses some much-needed certainty, but the Government now needs to focus on keeping inflation under control while creating the conditions for the economy to grow. For the automotive sector, that means giving consumers the confidence to make big purchasing decisions and allowing retailers to plan for the future.’
Although borrowing costs have eased from their recent peak, they remain higher than they were 12 months ago, meaning affordability continues to be a key consideration for motorists looking to purchase a new vehicle. A steady interest rate environment also gives franchised retailers greater confidence to invest in their businesses.
NFDA will continue to monitor economic conditions and work with Government to help shape policies that encourage consumer demand and provide the certainty franchised retailers need to invest for the future.