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The central bank’s base interest rate currently sits at the lowly figure of 0.75%, but recent comments suggest others are considering cutting rates, a move they last made in the wake of the Brexit referendum. Implied market chances of a cut later this year are now 70%.

Two Monetary Policy Committee (MPC) members, Michael Saunders and Jonathan Haskel, voted for a rate cut at the December meeting. Silvana Tenreyro said she may support a rate cut in the next few months. She was joined by another MPC member, Gertjan Vlieghe, at the weekend: “Personally I think it’s been a close call, therefore it doesn’t take much data to swing it one way or the other” he told the FT, adding that he needs to “see an imminent and significant improvement in the UK data to justify waiting a little bit longer”.

There are certainly reasons to be hopeful for the economy. We entered December hurtling towards a Brexit deadline without any clear idea of what future relations with our largest trading partner would be – or which government would be negotiating them. This uncertainty paralysed businesses, and most likely consumers too. A fair chunk of that uncertainty has now gone, and anecdotal evidence points to returning confidence, including buoying the housing market.

The only problem is that (despite the electorate’s best efforts) the British economy is deeply tied to Europe’s, where demand has been weak as a consequence of the global manufacturing and trade slump of 2019. Thriving business and consumer demand on the continent remains the most important factor for British industry.

MPC members are well aware of this, and so they may want to cut rates for added insurance. Even if domestic confidence jumps back to life, money supply growth is anaemic, inflation is low and the effective sterling exchange rate against the euro is 5% above where it was halfway through 2019 – when industrial confidence was already sliding.

The latter point is particularly important, given that a low sterling value has been the main factor supporting British exporters since the referendum result in 2016. With sterling now higher, British goods will become more expensive just as regulatory changes from Brexit start to kick in. This will lower the demand for British exports at a time when economic recovery is still fragile.

The MPC decided on no changes on 29th January, but we suspect that rates could change with one eye on the currency value, so don’t be surprised if we see a rate cut of 0.25% this year!