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Bank of England Leaves Rates Unchanged Ahead of Brexit Deadline

Thursday,   07-Feb-2019   05:35 PM (IST)

The Bank of England left its key interest rate unchanged for the fourth straight meeting, as expected, with all nine members of its policy-making committee again voting not to rock the boat as the U.K. prepares to leave the EU. With just 50 days until the deadline for the U.K. to leave the EU, the economy is showing clear signs of slowing down, as uncertainty leads companies to put off investment decisions, while a steady stream of unsettling political headlines weighs on consumer confidence. The slowdown has put the Bank’s decision in August to raise its key refinancing rate to 0.75% in an unflattering light. Data on Tuesday showed that companies in Britain are cutting jobs for the first time in six years as the economy stalls. The IHS Markit/CIPS UK Services Purchasing Managers’ Index, fell to 50.1 in January from 51.2 in December, which was its lowest level since July 2016. Construction and services PMIs also fell in January, IHS/Markit said. Inflation has also retreated in line with the drop in oil prices at the end of last year. From a peak of 3.1% at the end of 2017, it stood at only 2.1% in December.