Mark Carney, governor of the Bank of England (BOE), gestures while speaking during the bank’s quarterly inflation report news conference in the City of London, U.K., on Thursday, Aug. 2, 2018.
Simon Dawson | Bloomberg | Getty Images
The Bank of England has held its main interest rate steady at 0.75% with its rate-cutting committee voting 7-2 in favor of keeping the current level.
The central bank maintained the dovish stance exhibited after its previous meeting, commenting in an accompanying statement: “If global growth fails to stabilize or Brexit uncertainties remain entrenched, monetary policy may need to reinforce the expected U.K. recovery.”
The forecast for U.K. GDP (gross domestic product) growth in the fourth quarter of 2019 was cut to +0.1% from the November forecast of +0.2%, reflecting the weakening of economic conditions shown in recent data.
On the U.S.-China trade war, the Bank of England said the “partial de-escalation of the U.S.-China trade war gives some additional support to the outlook” but highlighted that continued signs of loosening in the U.K. labor market was another potential headwind.
Sterling was trading just over 0.3% higher against the dollar at $1.3117 following the decision.
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