Bradford's business community has reacted with dismay to the Bank of England's decision to raise interest rates.

The new five per cent rate is a five-year high as the Bank attempts to head off inflation which stands at 2.4 per cent, higher than the Government's target of two per cent.

And while the rise was widely anticipated, business leaders still greeted it with frustration.

Richard Wightman, president of the Bradford Chamber of Commerce, said: "The rise was expected but is still disappointing.

"The Bank takes decisions on behalf of the whole country but here in Bradford we have just seen a dip in sales and orders, with investment having fallen a little.

"National employment figures are also rising and we do not think the economy is overheating.

"We will be pressing for no more rises in the near future." These sentiments were backed by the Confederation of British Industry's regional director for Yorkshire, Penny Hemming.

She said: "This move comes as no surprise to businesses in the region, who recognised it would be necessary to deliver longer term economic stability. Although some commentators are already looking ahead to the next rise, our forecasts suggest that a further increase should not be needed.

"Consumer appetite for debt is falling rapidly, the economy is showing some signs of a modest slowdown and the benefits of recent falls in oil prices will help to keep inflation under control into the medium term."

Chris Glen, policy director at the Federation of Small Businesses, said he hoped the rise did not represent the start of a new trend in British economics.

"At this point we are only slightly concerned," he said.

"Overall, we are satisfied with how the Bank of England has performed since it became independent of Government as it has listened to businesses more than was previously the case.

"It will be a burden for businesses which are borrowing but some help for those which are investing for the future.

"We could become more concerned if this is followed by a further rate rise early next year, as has been mooted, as this could harm the economy and the progress of small businesses."

e-mail: mark.casci@bradford.newsquest.co.uk