BoE Deputy Governor Says UK Investment Weak in Near Term

British business investment is likely to remain very weak in the near term after June’s Brexit referendum before later picking up, Bank of England Deputy Governor Jon Cunliffe said on Wednesday.

Cunliffe made his comments – which drew on last week’s updated economic forecasts from the central bank – as part of a longer speech looking at the reasons behind weak business investment.

A continued lack of access to finance for some firms, as well as a failure of businesses to lower their ‘hurdle’ rates for approving new investment in response to lower borrowing costs, could be to blame, Cunliffe said.

“Ultimately, the outlook for business investment, like the outlook for the economy more generally over the forecast period, depends largely on how households and businesses react to Brexit and on the process that accompanies it,” Cunliffe said.

via Reuters

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza