Businesses were hit by a double whammy yesterday as the Bank of England refused to cut interest rates and the pound responded by hitting a three-year high against the dollar and rose against the euro.
The final meeting of the monetary policy committee chaired by Sir Edward George, who retires as Governor this month, left rates on hold at 3.75 per cent. The decision had been widely expected but was immediately condemned as a "lost opportunity" by business groups and trade unions.
"UK manufacturers will be disappointed," said Ian Brinkley, a senior economist at the TUC. "With so much economic uncertainty across the world a cut now would have given industry more confidence to invest."
David Frost, director general of the British Chambers of Commerce, added: "The Bank of England has definitely missed an opportunity to offer extra support to UK business in a climate of weak demand at home and overseas."
