Mark Carney’s first rate set went with a real bang. Many economists were split on whether he would do a deep cut of .50% or a more conservative cut of .25%. The previous governor almost always preferred to do slower measured cuts of only .25%.
Yesterday Mr. Carney set his own fingerprints on the job by lower the bank rate by .50%. It was likely the right thing to do as the US economy has performed worse then expected, and the outlook does not look good. Coupled with this is the rapid increase in the Euro has made that economy a tiny bit sluggish. These are two major customers for our goods and services and they are having a tough time.
Count on continued rate cuts for the balance of this year.
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