The Governor of the Bank of England, Andrew Bailey, has cautioned against the risks of 'fragmenting' the global economy, following Donald Trump's election victory and his pledges to impose steep trade tariffs.
Speaking to the Treasury Select Committee of MPs on Tuesday, Mr Bailey stressed the importance of maintaining an 'active dialogue' with the incoming US administration. He stated: 'I would be very clear, fragmenting the world economy is not a good thing.'
However, the governor refrained from speculating on the specific impact of potential tariffs on UK policy, saying: 'I don't think we can make that judgment today because we literally do not know what their intentions are.'
Mr Trump has repeatedly proposed a 20% tax on all imports, a move economists warn could hinder UK economic growth. Mr Bailey noted that US policymaking does not have the 'same tightness' to pre-election commitments as the UK, adding that it is 'important that we wait to see what the administration actually does.'
He concluded that policymakers should 'be in an active dialogue with the Trump administration on those policies as they affect the UK.'
