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5% base rate disappoints RMIF

The RMIF expects the Bank of England’s decision to raise base rate to 5% to have an impact on consumer spending, says Sue Robinson, director of the National Franchised Dealers Association.

“This will cause concern to dealers,” she says. “People will take stock to meet important financial commitments such as mortgages and rising utility bills.”

Higher interest rates are especially disappointing after the small rise in new car registrations in October, she says.

The new 5% rate, a five-year high, is intended to curb inflation and to cool the housing market. But higher mortgage rates are likely to reduce demand for new cars among retail buyers.

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