Laura Sofía Quiroga Economía Colombiana Fuente: BBC NEWS

Pinilla Fecha clase:07 de Link:

Código: 0902364 noviembre https://www.bbc.com/news/busin
ess-50333167
Fecha: 07 de noviembre

Bank split on rates as it warns Brexit deal would hit growth

The Bank of England has warned that the government's Brexit deal will drag down
growth over the next three years as extra trade barriers raise costs. It came as two
Bank policymakers called for an immediate interest rate cut to support the
economy.

Policymakers said weaker global growth and ongoing uncertainty over Brexit would
continue to weigh on the UK economy. The Bank said the new EU withdrawal
agreement struck by Prime Minister Boris Johnson had reduced the likelihood of a
no-deal Brexit.

The Monetary Policy Committee (MPC) that sets interest rates said this would end
some of the uncertainty facing businesses and households. However,
policymakers added that the transition to a new trade deal would introduce new
customs checks and regulatory barriers. The MPC said its assumption of a
Canada-style "deep free-trade agreement" between the UK and EU would "raise
administrative costs for firms" doing business with the continent.

The Bank expects annual UK growth to rise from 1.25% in 2019 and 2020 to
1.75% in 2021. While growth for 2019 is slightly faster than predicted in August,
before the Brexit deal was announced, it would be weaker in subsequent years as
the impact of extra trade barriers started to bite. Policymakers expect the UK
economy to have grown by 0.4% in the three months to September this year,
double its estimate in August amid a recovery in the UK's dominant services
sector. However, growth in the final quarter of the year is expected to fall back to
0.2%. Spending pledges by the government are expected to boost growth in the
coming years. However, policymakers said Brexit would continue to dominate the
economic outlook and could permanently reduce long-term growth. The Bank also
cited research that showed the current level of business investment is around 11%
lower because of Brexit uncertainty. Bank governor Mark Carney is due to stand
down from his role on 31 January next year. However, at the Bank's press
conference he opened the door to staying on beyond that date.He said that he had
already agreed to extend his term twice in order to ensure the financial system was
prepared for Brexit, and also to ensure a proper handover to his successor.

Mr Carney said it was understandable that a decision on the new governor had not
been made "given the priority" that the Brexit negotiations have taken. He
committed to making sure that the transition to the new governor was "smooth".