The Bank of England again cuts taxes, quoting Trump’s tariff tensions and slower growth

The Bank of England reduced its key interest rate on Thursday by a quarter of 4.25 percent, as the threat of US rates begins to weigh economic growth.

The fourth reduction of this Central Bank bank in nine months, which had been widely foreseen by the markets, contrasts on Wednesday with a decision of the United States Federal Reserve to freeze loan costs.

In the meantime, the update of the Bank of England arrived shortly after Donald Trump announced an agreement with Britain on Commerce, the first agreement since the President of the United States launched his world blitz of rates.

“This will be good news, including for the United Kingdom economy,” said BOE governor Andrew Bailey told a press conference after the rate’s decision.

“It will help reduce uncertainty,” he added.

Following a regular meeting in London, the BOE said that “global growth prospects have weakened as a result of … tariff ads.”

However, the BOE increased its forecast for the annual growth of the gross domestic product of the United Kingdom this year, up to a percentage of 0.75 percent.

He said that it was foreseen that British economic production would reach 1.25 percent next year, below the previous estimate of the Central Bank of 1.5 percent donated in February.

Relieve inflation

“Commerce developments in financial markets have generally reduced growth,” said BOE on Thursday.

Great Britain faces 10 percent rates of most of its goods exported to the United States, its second largest trade partner after the European Union.

Bailey said that relieve inflationary pressures, helped to reduce oil prices due to Trump’s rates, had contributed to the bank’s decision.

“In recent weeks, they have shown how unpredictable the global economy can be. That is why we have to maintain a gradual and careful approach to rates cuts,” he said.

With the latest reduction in markets, investors sought any change in the language by the BOE monetary policy committee that suggested more reductions this year.

A minute of the meeting “underlines the continuous prudent approach to reduce interest rates favored by MPC members,” said Yael Selfin, a KPMG UK chief economist.

Analysts said they hoped that the BOE will have its current pace of facilitation, which has seen a quarter -knit reduction every three months since August.

The latest announcement of the Bank of England rates occurred at 11:02 GMT, two minutes later than usual, as the United Kingdom was silent to mark the 80th anniversary of the victory on Europe.

Also on Thursday, the central banks of Norway and Sweden maintained their key interest rates without change, while the signaling of future cuts were possible in the midst of economic uncertainty.

The European Central Bank reduced loans costs in the Euro area last month.

This story originally presented to Fortune.com

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