Small businesses react to interest rates cut

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The Bank of England’s decision to cut interest rates to the record low of 0.25 percent has garnered a mixed reception from the Federation of Small Businesses (FSB).

Mike Cherry, national chair of the FSB, said: “Lower rates should lead to cheaper borrowing costs, making finance more affordable and helping to support business investment. Small firms will also welcome the boost to household spending power and consumer demand.” In addition to the rate cut, the Bank’s Monetary Policy Committee increased the quantitative easing programme, with plans to pump an additional £60bn into the economy.

Cherry added: “There is a real risk that sterling will depreciate even further, which could benefit the UK’s visitor economy and small exporters, but could also affect prices, inflation and investment.”

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