If the Monetary Policy Committee (MPC) wanted to cut interest rates from 0.75% to 0.50% on Thursday 19th December, the continued weakness of both activity and underlying price pressures means it wouldn’t find it hard to justify doing so. However, we think there are enough reasons for the Committee to sit tight in December. Unless the tone of the economic news improves, though, rates could be cut early next year despite a Brexit deal.
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