THE North East Shadow Monetary Policy Committee (MPC) had inflation on its mind this month – but members were not inclined to increase interest rates immediately.

Although there are positive signs in the economy, many felt that it was too soon to consider any change at this time.

The MPC is a partnership between The Northern Echo and Clive Owen LLP, 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.

Gary Ellis, partner at Clive Owen LLP, said: “Until the furlough scheme ends later in the year and we know the full impact of that it is too early to change interest rates.

“There are some inflationary pressures but not enough to warrant a rise in interest rates while there is still uncertainty in economy.”

David Coates, managing director of Newsquest North East, said: “Fears over creeping inflation have abated somewhat since we last met, and therefore I’d be inclined to leave rates unchanged.

“While the Government’s vaccination programme has made great progress, the economy has a lot of ground to make up from the impact of the pandemic and businesses need to rebuild.

“I can therefore see no justification for a change of course at this point.”

Daniel Williams, solicitor at Latimer Hinks, said: “Keep the rates the same. We need to see how things improve once lockdown restrictions have eased.”

Jonathan Willett, director at AON, said: “I believe the interest rate should remain as it is until the uncertainty of Covid 19 has passed.

“There is lots of economic positivity, but this is coupled with lots of economic uncertainty until the roadmap out of the pandemic has been met.”

Chris McDonald, chief executive of Materials Processing Institute, said: “I advocate a hold for now. As we come out of the pandemic, it is clear that we will need to start returning interest rates to a more normal level.

“Reversing the emergency cut of a year ago is the start and if the pandemic recovery continues according to plan, then I will be looking for a quarter point increase by the Summer, with perhaps another one before the end of the year.”

Chris Droogan, CEO of Cleveland Bridge, said: “With growth in both 2021 and 2022 now forecast at six per cent, there is no need for further monetary stimulus.

“Equally, there is no case for an increase yet. Although inflation is rising, it remains comfortably below the two per cent norm target and uncertainties arising from the withdrawal of government stimulus (such as Furlough costs) would call for caution in reducing the level of monetary stimulus.”

Nick Pope, managing director of Premier Tech Aqua, said: “I would vote to hold as we are still in an early stage of recovery.”

Ajay Jagota, chief executive of KIS Group, said: “I expect the interest rates to hold. We still need to see evidence of the whole economy recovering and start seeing inflation and a tapering of the QE which isn’t planned until December.

“I think it be prudent for the BOE to make a statement similar to the FED that it will hold interest rates at this rate for the remainder of this year.”

Chris White, financial director of Darlington Building Society, said: “The promising economic recovery continues to progress in the UK, with month-on-month GDP rising 0.4 per cent in February and the IMF forecasting 5.3 per cent growth for the year.

“The progress in vaccinations allowing a relaxation of lockdown restrictions has not just helped the economy and some key sectors such as hospitality but also everyone’s state of mind.

“We are nonetheless early in a recovery which is still fragile and is clearly susceptible to any changes in the roadmap out of the pandemic.

“Also, while inflation increased to 0.7 per cent it remains well below target. As such I think it is still too early to increases rates and they should remain at their record low.”

Graham Robb, senior partner at Recognition PR, said: “I am very worried about inflation but reluctantly vote for a hold at this time. However, there are serious inflationary pressures in the economy and the Bank of England must be ready to act.”