BoE holds interest rate steady at 4.5%

The Bank of England (BoE) has kept its interest rate at 4.5%. The central bank is taking a cautious approach, reviewing each meeting closely. In May, they plan to assess economic risks and inflation more carefully. European Central Bank (ECB) President Christine Lagarde has also emphasized a meeting-by-meeting strategy. She noted that recent tariff hikes from the United States could impact Eurozone growth and inflation. A 25% tariff on EU goods could reduce GDP growth by 0.3% in the first year and may increase inflation by about 0.5%. If the EU responds with its own tariffs, the effects could be worse, with GDP growth dropping by 0.5% and inflation potentially rising by up to 2% over two years. The EU wants to negotiate but is prepared to counter any unjustified US tariffs. In a recent hearing, EU trade commissioner Maros Sefcovic announced that the EU will delay new tariffs against the US until mid-April to allow for more negotiations. While some countries are nervous about retaliation, the EU continues to seek a solution. The US is also considering new port fees for shipping related to China, which could raise costs for exporters and create inflationary pressures. This could disrupt global supply chains and limit US energy exports. The situation remains fluid as discussions continue about the impact of these trade policies.