The UK is seeking to join the North American Trade Pact, formerly known as NAFTA, which was renamed USMCA after Trump's revision, for an effective positioning on global trade. The UK, which has been conducting simultaneous worldwide negotiations to replace the previous free trade agreement with the European Union, has so far made numerous other trade continuity agreements alongside agreements with the EU, Japan and Australia. Before the next UK general election in 2024, a free trade agreement with the US on favorable terms may face some procedural hurdles. The UK's separate trade agreements with the US, EU, Canada and Mexico are also an option, but would complicate the structure and lengthen processes. The UK has also formally applied to join the Comprehensive and Phased Agreement for the Trans-Pacific Partnership, or CPTPP, which is a free trade agreement between 11 countries around the Pacific Rim, with officials expecting an agreement by the end of 2022. Bilateral trade negotiations with India will begin in November.
At tomorrow's meeting, the Bank of England is likely to delay escalating its hawkish rhetoric in September. In fact, the complex economic development structure that forces Central banks is also valid for the Bank of England; especially if we consider the cyclical risk balance after August; inflation has continued to advance, growth has softened and there is considerable uncertainty about the labor market outlook. Many influential factors are under evaluation. Cost factors and financial conditions that feed inflation, as well as potential risks that slow growth Covid cases, supply that can't keep up with demand, and the risk of global slowdown.
No action will be taken on interest rates (0.1% current) and asset purchases (895 billion GBP monthly, one member favored a decrease to 855 billion GBP in August alone). The minutes may contain details of the BOE's plan to moderately tighten policy in the future. Similar to the Fed, some minimum conditions for tightening are in the process, but the main challenge is rising inflation. The BOE is still likely to wait a little longer while assessing the impact of current conditions, particularly the pace of the labor market. When wage supports are withdrawn, an increase in unemployment rate may be seen and the effects of this should be evaluated. According to economic success; It may be possible to reach a position where an interest rate hike is being considered as of mid-2022.
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