Mark Carney, Governor of the Bank of England, speaks at a Bank of England Financial Stability Report news conference in London on Dec. 16, 2019.So it’s settled: Britain will leave the European Union on Jan. 31. What’s less certain is whether 11 months will be long enough to reach strike a trade deal. Already dismissed by the EU as “impossible”, the tight deadline may limit any rebound in economic growth and investment.
Bank of England Governor Mark Carney has promised a “relatively prompt response” if weakness persists. But markets don’t seem to believe him, assigning a 60% chance of a 25-basis- point interest rate cut by December. Upcoming economic data could change their mind, however: figures on fourth-quarter growth, trade, industrial output, car registrations and inflation are due in the coming week. Carney himself won’t be overseeing any policy changes -- January’s meeting is his last as BOE governor.
In decades gone by, such a dramatic development as the killing of Iran’s top military commander would have kept oil prices on the boil for weeks if not months. But with so much more of the black stuff coming from elsewhere these days, crude prices have fallen back to pre-attack levels.There are several ramifications. One worth thinking about is that there is no longer the guaranteed boost to Gulf countries’ coffers.