THE Engineering Employers' Federation in the region has welcomed the decision to cut interest rates once more.

It believes the 4 per cent rate agreed by the Bank of England's Monetary Policy Committee responds to the needs of the real economy.

The EEF's third quarter business trends survey showed that conditions in the manufacturing sector had become more severe than in the last recession before the terrorist attack on the United States.

Andrew Semple of the EEF in the North-west said: "The move will be welcomed by manufacturers in the region.

"The MPC has responded to clear evidence that the global slowdown is an issue not just for manufacturing but for the economy as a whole.

"The Bank must continue to respond rapidly to further evidence of economic weakness and not be distracted by the inflation hawks."

But Andrew Ratcliff, Chief Executive of Bolton and Bury Chamber, said: "A quarter per cent cut represents more of a gentle nudge to the economy than the bold push that business was seeking.

"A more significant interest rate cut would have sent a clearer signal that the Bank is prepared to stop any economic slide gathering strength.

"Under normal circumstances we would welcome a quarter point cut.

"But these are not normal circumstances and with inflation well under control, the Bank has the scope to act more decisively in cutting interest rates."