BoE Deputy Governor Dave Ramsden told Daily Telegraph that Brexit uncertainty has damaged UK’s “speech limit” for growth. He pointed to declining productivity and falling business investment. Also, “underlying growth has slowed through the year as Brexit uncertainty has really weighed,”
Nevertheless, Ramsden saw “less of a case for a more accommodative monetary position”, even in case of another Brexit delay. Company wage costs were “picking up quite significantly, which will drive domestic inflationary pressure”. Meanwhile, spare capacity in the economy might not have opened up. Supply potential, the speed limit of the economy, is also slowing through this period
Ramsden’s view was in contract to fellow BoE rate-setters Michael Saunders and Gertjan Vlieghe, who suggested that another delay to leaving the EU might mean lower interest rates.
