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Bank of England in London on February 12, 2024.
Henry Nichols | AFP | Gets the image
The Bank of England is expected to hold interest rates when it meets on Thursday, as the UK is facing economic winds both at home and abroad.
The Central Bank is likely to support its benchmark by 4.5% at March meeting, given the unpredictability of President Donald Trump’s trade tariffs and the Young World Trade War, and how these factors can affect inflation in the UK in the UK
Boe also convened Since the UK economy shows signs of delay, with monthly. The meeting on Thursday comes a few days before the UK government’s taxation came into force, which appeared to be unpopular with enterprises that say their tax burden could allocate growth, investment and jobs.
For its part, the Bank of England was already warned at its last meeting in February that it would be a close step because it lowered the UK growth forecast for 2025 and predicted temporary growth In the course of inflation, up to 3.7% – above the target of the bank of 2% – which BOE said that it would be caused by higher energy prices.
As for the tariffs on Trump, the Bank Governor Andrew Bailey warned earlier in March that potential trade duties were another threat to the country’s economy and growth, tells British legislators that “the risks for the economy of the UK and the truly world economy, are essential,” and that the UK citizens in their pockets “will have less money” as a result of tariffs.
Disagree on the Committee
In February, most of the seven members of the nine strong monetary policy committee voted in favor of the reduction, two MPC members, including the well-known Khock Catherine Mann, voting for more finishes.
Economists say the division of voting on Thursday will be closely watching.
“The Bank of England has visible signs of differences on the rate of reducing the rate necessary this year. But when wages and inflation growth remains sticky, we expect the bank to keep rates this Thursday, ahead of the next rate in May,” James Smith, a developed economist.
Andrew Bailey, Governor of England, during a press conference of the financial stability report at the Central Bank headquarters in London on November 29, 2024.
Bloomberg | Bloomberg | Gets the image
“The drama is not often synonymous with the Bank of England. But the February meeting was nothing else bomb. The committee soon.
“With all the excitement, the answer does not seem. However, he admitted that the inflation pressure puts the Central Bank in the” uncomfortable position “.
Budget changes?
On March 26, Boe meets a few days before the “spring statement of the UK” when British Chancellor Rachel Reivz presents an update on her British economy plans.
Finance Minister is pressured to reduce public expenses, increase taxes further or bend independently imposed government financial rules amid higher borrowing costs, and UK debt profit in recent months. The Treasury substantiated the idea to reduce the cost of paying well -being, but this idea remains controversial among the legislators in the left government.
“Spring statement” Riva will be announced together with economic forecasts in budgetary responsibility, independent economic and fiscal forecaste, which evaluates the likely influence Taxation Plans and Government Costs which were announced last fall.
This budget included 40 billion pounds ($ 51.9 billion), which increases taxation – the load mainly drops to enterprises – to connect a black hole in state finance and allow investing in public services.
Rachel Reiche, the UK Finance Minister, speaking at Squawk Box CNBC outside the World Economic Forum in Devos, Switzerland, January 22, 2025.
Jerry Miller | Cnbc
OBR is expected to reduce its UK economic forecasts, exerting further pressure on the Reiva to make changes to its political plans.
“It should not have been like this. The UK Chancellor Rachel Rivz planned to submit the official double forecast of the government on March 26, without making any changes to politics. However, the growth rate on the market, high borrowings in the financial year 2024-25 years and a possible decrease in budgetary responsibility for the growth of products,” “,,,” Andrus, as well as an economist who entered the Bank “budget responsibility”. Analysis on Monday.
“Without reducing costs and taxes, OBR predicts that the government lacks its financial rule of financing daily cost with tax revenues up to 2029-30 years. To avoid six months of speculation on how the rivus will make a deficit in the next budget in the fall, and the conclaw must act now,” he added.
