English Rates Remain Steady
CBJ — Bank of England Governor Mark Carney has announced that country’s interest rate steady in light of the pound sterling having been dealt a big hit by uncertainty in the run-up to the referendum on EU membership and also on concerns about economic growth.
The central bank said the upcoming referendum vote on June 23 could delay some spending decisions, though it said recent indicators suggested growth would keep the same momentum this quarter as it had at the end of last year.
The BoE reiterated that interest rates were more likely to rise than not over the next two years and that when they did the rise would be gradual, given likely headwinds.
After a rapid recovery in recent years, British growth slowed in the second half of last year and recent figures show it had a tough start to 2016, when the country will hold a referendum on its membership of the European Union.
Great Britain’s economy has slowed, along with the rest of the world, and some policymakers worry they may struggle to fend off the latest global downturn after pumping trillions into the global financial system in recent years and given that interest rates in major economies are already so low.
The BoE said short term interest market rates had fallen due to market worries about the world economy, and the perception that the lower bound for central banks’ interest rates could be lower than previously thought.