BOE Poised to Unveil Gloomier Forecasts Amid Brexit Uncertainty

(Bloomberg) --

The Bank of England is expected to announce a gloomy set of forecasts next week as Brexit uncertainty and a global slowdown dent prospects.

The majority of economists surveyed by Bloomberg see the BOE cutting predictions for growth in 2020 and 2021 when it unveils its revamped Monetary Policy Report on Nov. 7. Meanwhile, the outlook for inflation is expected to be cut for those two years, and the forecast for unemployment raised.

The new forecasts come amid prolonged Brexit uncertainty, with the U.K.’s exit date now pushed back until Jan. 31 and an election on Dec. 12 further complicating the picture. In such situations the convention is for policy makers to compile forecasts based on the incumbent government’s policy, namely leaving the European Union with Boris Johnson’s Brexit deal at the end of January.

Despite the weaker outlook, and comments from some officials that entrenched Brexit uncertainty may spur the need for rate cuts, economists also expect policy makers to vote unanimously to hold rates at 0.75% on Thursday. Of the 19 analysts surveyed, only Capital Economics see a single vote for a reduction.

To contact the reporters on this story: David Goodman in London at dgoodman28@bloomberg.net;Harumi Ichikura in London at hichikura@bloomberg.net

To contact the editors responsible for this story: Paul Gordon at pgordon6@bloomberg.net, Brian Swint, Andrew Atkinson

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