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18th October 2023

Chambers react as inflation stays level

Inflation stayed at 6.7% in September.

Paul Butterworth, CEO at Chambers Wales South East, South West and Mid, said:

“Today’s inflation figure of 6.7% shows that inflation for consumers has remained stubborn, while prices in the production sector continue to fall.

“Although this indicator stays at a consistently high level, our latest Quarterly Economic Survey has shown that almost two thirds of businesses in Wales expect the prices of their goods and services to remain the same over the next three months.

“However, this data is just a small part of a wider picture. Our Quarterly Economic Survey also revealed that many SMEs in Wales are reporting minimal changes in their investment plans and domestic and international sales.

“Rising interest rates are also emerging as a key concern, with 54% of Welsh businesses citing it as more of a concern now than it was three months ago. Clarity on interest rates, combined with a long-term plan for growth which focuses on skills, removing trade barriers and ensuring that appropriate infrastructure is in place, will significantly help businesses.”

David Bharier, Head of Research at the British Chambers of Commerce, said: 

“Today’s figure, showing the CPI is stuck at 6.7%, shows that inflation for consumers remains stubborn. However, prices in the production sector continue to fall as the PPI rate stands at –2.6%.

“Our Quarterly Economic Survey has been showing a diminishing percentage of firms expecting their prices to rise for five quarters running, albeit this indicator remains at a high level.

But this is just part of the picture, as our research finds that most SMEs report no increases in sales, exports, or investment. The rise in interest rates has also emerged as a prime concern for almost half of businesses, with increased borrowing costs another barrier to contend with.

“Businesses need clarity on interest rates, as well as a longer-term plan for growth in the economy, focusing on infrastructure, skills, and alleviating trade barriers.

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