Clive Owen LLP

The Yorkshire Shadow MPC members were convinced that holding interest rates are they are is the right thing to do this month, with only one dissenting vote for a small rise.

Members were fairly downbeat in their thoughts and more than one predicted a ‘difficult’ winter. The impact of fixed rate mortgage deals ending also played a role in the less positive outlook.

The MPC is a partnership between Clive Owen LLP and the York Press, which considers the state of the region’s economy and gives experts from a variety of sectors the opportunity to argue their case for a shift, or hold, in the rate.

Phillipa Symington, partner at Clive Owen LLP in York, said: “The latest trend that we have started to see is in stock levels. People are starting to rationalise and that’s a sign they are starting to cut costs.

“People are concerned, they’ve spent their savings now and I think that people have relied more and more on their savings and they’ve diminished or are not there anymore.”

Steve Lowe, of Newsquest, said: “What we’re finding from an advertising perspective, we’ve got customers moving from awareness and branding to direct lead generation because they can’t afford to waste any marketing spend. There’s a lot more digital spend.”

Gary Smith, chartered financial planner at Evelyn Partners said: “The last quarter has been tough – inflation has been stickier than expected. We do expect that interest rates will increase once more in the UK. We are definitely seeing the bite of mortgage interest rates – the Bank of England estimates that as fixed rates come to an end the average monthly increase will be £500 which will suck a lot of wealth out of the economy.”

Dave Broadbent, partner at insolvency practitioners Begbies Traynor said: “We’ve continued to see a rise in insolvencies for small businesses. The repayments on Covid borrowings are starting to bite together with a decrease in turnover at the same time. Small businesses are struggling at the moment and unfortunately I think all we can see is an increasing cost base, increasing overheads going forward for the next six months – it’s not going to be a brilliant winter unfortunately.”

Paul Robbins, managing director of manufacturer Bartoline said: “We’ve seen a slight recovery but the expected decrease in the price of raw materials hasn’t really materialised in the business yet. The price of oil has gone about $90 again and this has put an additional strain on purchases and the economy. It’s going to be a bumpy second half of the year.”

Richard Peak, managing director of Helmsley Group, said: “There I uncertainty in the markets. Interest rate rises are undoubtedly affecting whether house buyers are moving forward with purchases, they just don’t want to be saddled with the additional debt. York is very fortunate in that it’s a little bit of a bubble in terms of its property market and we’re seeing sales at the lower end of the market but at the higher end people aren’t looking to scale up and take in more debt.”

Christopher White, chief financial officer at the Ecology Building Society, said: “A few colleagues on the MPC have said that we’re starting to see the impact of rates going up. People coming off fixed rate mortgages are seeing their rates increase and their spending in the wider economy reducing is an example of that.”

Louise Scott of Castle Recruitment said: “We’ve seen quite a challenging Quarter 3 across the board. Employers are being a little bit more cautious seeing how things pan out. Despite the redundancies that we’re seeing there’s still a candidate shortage – getting the right skill set to match with the vacancies.”

Gill Gitsham, of manufacturer GSM Group said: “We have seen a really sharp decline in our order rate. Manufacturing, if you strip out automotive would definitely be showing a recession. The availability of skilled staff is more plentiful and the rates of pay which people are expecting have come down as people are fearing for their livelihood a little bit more.”

Dr Bob Gammie of York Business School, who was the lone voice voting for a 0.25% increase said: “As the price of oil increases – there’s some talk of $100 a barrel – if that comes to fruition things are going to be tricky around inflation. In our business here we’re not strictly governed by things like interest rates, the biggest issue as our number of students and international students rises is places to stay in York.”