The Monetary Policy Committee voted 9-0 in favour of keeping interest rates on hold at 0.75% yesterday. It also left its quantitative easing programme unchanged at £435 billion. This was as expected and so any major sterling movements were always going to be unlikely. Indeed, the government published a raft of Brexit papers which highlighted the potential ramifications of exiting the EU without a deal.
The government still remains convinced that the Chequers plan is the best route forward – and the EU looks increasingly open to doing everything they can to agree a deal. However, it is fair to say that opinion is divided in the UK. It remains to be seen whether a deal can be thrashed out before the deadline. Still, the pound managed to make some gains following some surprising inflation data from the US.
Today there are no economic data releases from the UK, but we are certain to hear more about Brexit and the potential impacts of exiting the EU without a deal. More than anything, British businesses want to know what is happening and they will be hoping that they are told sooner rather than later.
