Press Release

Forimmediate release

Thursday4 December 2003

Bank holiday for interest rates

Today's decision bythe Bank of England's to leave interest rates unchanged was welcomed by theInstitute of Directors (IoD). However, the IoD said that companies andconsumers need to recognise further interest rate rises are likely in the NewYear.

The IoD remainsrelatively optimistic about the interest rate outlook though, forecasting thatinterest rates will peak at 4.5% by the end of 2004, compared with the 5% plusrate discounted in the City.

Graeme Leach, ChiefEconomist at the IoD, said:

The Bank of England's early Christmas present was jut what we wanted. TheBank needs to wait until the New Year to assess the impact of the previous raterise. However, if the economy looks strong in early 2004 a further half pointrise in interest rates is quite possible by the Spring.

Ends 4.12.03 No.214

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Contact Points:

Richard Taylor, PressOfficer, tel. 020 7451 3264

Mobile and out of hours. 07721 734886

David Marshall,Director of Public Affairs, tel: 020 7451 3263

mobile and outof hours: 07764 883420

Email. press@iod.com

Web. www.iod.com

Noteto editors

TheInstitute of Directors is a non-party political independent organisation witharound 55,000 members. In addition to its wide range of business services, theIoD provides an effective voice to represent the interests of its members togovernment and key opinion-formers. It also brings the experience of businessleaders to bear on the conduct of public affairs