The decision to raise interest rates by a quarter per cent could have damaging implications for Bradford's struggling manufacturers, it was claimed today.

The EEF, which represents hundreds of Bradford manufacturing employers, warned that yesterday's move by the Monetary Policy Committee had come too soon.

And manufacturing union Amicus, which has been fighting the loss of 380 jobs at Federal Mogul in Bradford, warned the move would almost certainly mean job losses.

Amicus divisional officer Dick Croft said Federal Mogul's problems were typical of local manufacturing firms.

"A lot of companies are surviving on very high borrowing and something like this can mean the difference between survival and going under," he said. "Moves in interest rates are always stimulated by the cost of housing in the south east."

The EEF said the rise could have damaging consequences for the pound's value against the dollar, threatening an export-led recovery for local firms.

Yorkshire director Ian Hughes said: "Whilst we understand the Bank's motives, Yorkshire manufacturers will feel that the rise has come too early for them. Manufacturers will hope that this is not the beginning of a trend of increases which could choke off recovery before it is established."

Bradford Chamber of Commerce president Roland Clark said the local economy could probably swallow a quarter per cent rise after the cut in July. "There are signs of clear recovery for manufacturing, but this should not be jeopardised by a return to repeated rises in interest rates."

But Denis Kaye, deputy chairman of the Institute of Directors in Yorkshire, said the Bank of England had been left with little choice.