>> The Bank of England has kept interest rates at a record low. Investors have been eyeing a hike. But Brexit fears in a slowing British economy have put pay to that.>> The UK economy is beginning the process of adjusting to a new and as yet uncertain economic relationship with the European Union.
Monetary policy cannot prevent the weaker real incomes likely to accompany the move to new trading arrangements with the EU, but it can influence how this hit to incomes is distributed between job losses and price rises.>> The bank voting six to two to keep rates at 0.25%. There hasn't been an increase in a decade.
Subdued wage growth appears to have swayed Mark Carney and his policy makers, and the announcement comes with sobering news for the British economy. The bank's growth forecast of 2017 revised down to 1.7%, a fall from the 1.9% made only in May. GDP predictions for next year have also been trimmed, and the bank also noted an apparent slump in consumer confidence that might impact spending in the coming months.
But while Carney and co offer their monetary response, the remedies might lie in Downing Street and Brussels. A stumbling start to divorce talks with the EU and a likely retroactive Brexit process are expected to cast out on the Brexit economy.