BoE to Raise Rates to Boost UK Economy

Britain’s Brexit-bound economy remains stuck in a low gear but is probably not weak enough to dissuade the Bank of England from raising interest rates next month, economic data showed.

Separately on Tuesday, Britain’s budget forecasters gave a gloomier medium-term outlook for the economy, potentially leaving finance minister Philip Hammond with less room to offset any big hit from Britain’s departure from the European Union.

The somewhat downbeat picture for the world’s fifth-biggest economy from a raft of data – including a record goods trade deficit – contrasted with the situation in some of Britain’s closest trading partners in the European Union.

German exports outpaced imports in August, adding to signs it performed strongly in the third quarter, and Italian industrial output was much stronger than expected.

But there were some signs of encouragement for Britain.

The country’s factories had their strongest two months of 2017 in July and August, and the construction sector grew for the first time in three months.

In year-on-year terms, factory output was 2.8 percent higher, its fastest growth in six months.

Revisions to past data showed Britain’s economy had been a bit less weak earlier this year than previously thought.

via Kitco

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