§ Mr. Austin MitchellTo ask the Chancellor of the Exchequer if he will estimate the impact of an immediate reduction of 2 per cent. in nominal interest rates on United Kingdom(a) output and (b) employment within (i) 12 months and (ii) 24 months. [22964]
§ Mrs. Angela KnightWe never speculate about interest rates.
Interest rates are only one of many influences on economic growth, and the impact of an interest rate reduction on the economy depends on the interaction with these other factors. The Government will continue to set interest rates at a level consistent with meeting the target for inflation of 2½ per cent. or less.