Last month’s landslide Conservative election win teamed with this week’s Brexit sign-off from the Queen has seen traders expect the Bank of England to hold interest rates steady, the Daily Telegraph reports. Markit’s purchasing managers’ index (PMI) showed private sector activity surged this month for the first time in almost half a year, with the index rising to 52.4 in January. The sum is the highest it has been for more than a year.
IHS Markit said: “January data… highlighted a decisive change of direction for the private sector economy art the start of 2020.”
The previous month was recorded at 49.3 and any number above 50 signals large growth.
The numbers are the strongest indicator yet that the British economy is back to booming again.
It comes after a month of news that will no doubt delight Brexiteers far and wide, with Boris Johnson’s deal getting Royal Assent yesterday having finally been passed through Parliament.
The EU is now working on the assumption the so-called Brexit transition period after Brexit will terminate at the end in 11 months.
A senior official said Boris Johnson’s repeated efforts to rule out an extension to the transition period and Brexit itself has forced the EU into surrender.
The bureaucrat, who did not want to be named, said: “We can assume at this point that the transition period will end on December 31, 2020.”
The source did however reiterate that if there were ever to be an extension the UK would have to keep paying the membership fee to the EU, which is around £1.2billion monthly.
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They said an agreement to extend the transition period “presupposes an agreement on continued financial participation and contribution from the UK to the EU”.
Brussels has previously indicated it was unlikely to agree a trade deal before the December deadline and would likely extend the transition period.
Ireland’s Simon Coveney said it is “probably going to take longer than a year”, while Ursula von der Leyen said it may not be feasible” to do a deal by the end of 2020.
The bloc today signed the Brexit withdrawal treaty confirming the United Kingdom’s departure.
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The Prime Minister’s spokesman said: “It has been a long three years but we have got Brexit over the line and the PM wants to move the whole country forward as one to a brighter future.”
Once Mr Johnson has added his signature to the withdrawal agreement, it will be transported back to Brussels where it will be stored in the bloc’s official archive.
The UK is now set for a smooth exit from the bloc on January 31, some nine months after the original departure date.
Britain will from February 1 enter into the so-called Brexit transition period, under which the country will continue to follow the EU’s rulebook until December. This can be extended up until 2022 but Mr Johnson has warned that he is not willing to keep the country in limbo and will instead seek a trade deal with the bloc by the end of the year.
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