BoE Chief Economist Chief Haldane said today that business investment was “strikingly and significantly subdued” ahead of Brexit. And the economy stalled in the Q2. Though he added, “my personal view though is that I would be very cautious about considering a monetary policy loosening, barring some sharp economic downturn.”
Additionally, “with the economic road ahead potentially forking, the case for holding rates until the road becomes clearer is strong.”
On Brexit, Haldane warned “if a ‘no deal’ were to lead to a sharp fall in sterling and a sharp rise in inflation expectations, it is not clear the MPC could cut interest rates, as the market expects, if it was to meet its inflation mandate.”
