Bank of England lowers growth forecast

Markus Kuger, senior economist at Dun & Bradstreet, comments:

“News that the Bank of England has lowered its growth forecast for 2017 and voted to maintain interest rates at 0.25% reiterates the economic uncertainty that the UK is facing, as the landscape continues to be uncertain with Brexit on the horizon. The BoE’s perspective is not dissimilar to our analysis, and Dun & Bradstreet are maintaining a ‘deteriorating’ risk outlook for the UK until there is more clarity on how Brexit will impact businesses operating in the UK market.

“During these uncertain times, our recommendation to businesses is to carefully monitor economic indicators and how Brexit negotiations develop over the coming months. Furthermore, we are maintaining our baseline scenario of a gradually slowing economy over the next two years. Leaving the EU will undoubtedly pose challenges, especially for companies whose supply chains involve sourcing from or selling to the continent. Although the weak pound is currently providing support for some sectors, such as manufacturing and tourism, it is far from certain that this stimulus will be enough to counterbalance the adverse Brexit effects over the medium to long term.”