Andrew Bailey, governor of the Bank of England, has revealed that, companies are postponing investment decisions due to the continued unpredictability of the world economy. In a recent interview with CNBC during a central bank symposium in Sintra, he made the following statement:
“When I go around the country talking to businesses … what they tell me is that they are putting off investment decisions.”
This view is in line with a larger issue that Bailey outlined: corporate confidence and investment ambitions are being hampered by a weaker labor market and increasing volatility in global markets.
He underlined that the Bank is keeping a careful eye on the situation and that these factors are slowing development.
These hold-ups reinforce the Bank’s cautious approach by slowing economic development.
In light of this investment hesitancy, as well as signs of a softer labor market, Bailey suggested that interest rates are expected to decline gradually—though the pace and timing remain uncertain.
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