ANALYSIS: Bank of England running out of time to create Brexit cushion
Bank of England policy makers have a benchmark interest rate of just 0.5% — leaving limited room to cut should they need to
London — Mark Carney’s window to raise interest rates before Brexit is closing. As Britain draws nearer to its divorce from the EU at the end of March with little certainty as to the economic repercussions, Bank of England policy makers with a benchmark interest rate of just 0.5% could be left with limited room to cut should they need to act. There’s not much time to reload the arsenal. After voting 7-2 to leave interest rates unchanged on Thursday, policy makers are left with just seven meetings — and only three inflation reports — before the UK’s official departure date in which they could push rates higher. Policy makers also acknowledge that interest rates are still low enough to stoke growth and that the economy risks overheating. Despite Carney’s assurances that "an ongoing, modest tightening" is still on the cards, the monetary policy committee’s decision to wait for momentum to reassert itself, after weak first-quarter data, now leaves economists asking whether the bank will...
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