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Bank of England left interest rate unchanged

UNITED STATES, WASHINGTON (OBSERVATORY) — At the September meeting, the British Central Bank kept the base interest rate at 0.75%, the regulator said in a press release, Reuters reports.

In addition, the Bank of England confirmed the repurchase of assets from the market at 435 billion pounds.

Such decisions of the regulator fully coincided with the expectations of analysts interviewed by Reuters.

The Bank of England also said that increased uncertainty about the conditions for Britain to exit the European Union means that in the coming years the country’s economy can go along a number of ways.

The most suitable monetary policy option will depend on the influence of Brexit on aggregate supply and demand, as well as the exchange rate, the regulator believes.

In the case of Brexit, without an agreement with Brussels, the response from the monetary policy will not be automatic, and the direction of actions of the central bank can be any.

In addition, there is a likelihood that political events can lead to a period of further uncertainty in trade relations between the UK and the EU, and the longer this ambiguity persists, the more likely it will be that demand growth will be lower than expected, which will lead to an “oversupply” of supply… but the Bank of England admitted that its rates could be slightly increased with a softer Brexit and signs of a recovery in global economic growth.

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