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BoE set to stay on hold as Brexit looms

Thursday, August 03, 2017 - 01:07

The Bank of England looks set to keep interest rates at a record low once again on Thursday with investors looking for signs that, faced with Brexit, it is getting nearer to raising rates for the first time in a decade. Jacob Greaves reports.

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The Bank of England is set to keep interest rates at a record low Thursday. Investors have been scouring for any signs of a hike. But Brexit fears and a slowing British economy are likely to stave off an increase. When Governor Mark Carney and his fellow rate-setters last met in June they only narrowly decided to keep levels the same. That surprising nail biter pushed up sterling and British government bond yields. The bank rate currently sits at 0.25 percent. It hasn't seen an increase in a decade. With unemployment at a four-decade low and inflation above the Bank's target pressure has been mounting for an about-turn. But a stumbling start to divorce talks with the EU have left a Brexit cloud hanging over growth prospects, with the bank expected to cut its forecast for 2017. Couple that with a surprise dip in inflation and weak wage growth. And it all adds up to a difficult balancing act for the governor.

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BoE set to stay on hold as Brexit looms

Thursday, August 03, 2017 - 01:07