The governor of the Bank of England has called for Britain to rebuild its trade relationship with the EU, as the UK celebrates yesterday’s trade deal with the US.
Andrew Bailey has told the BBC that reversing the post-Brexit hit to UK-EU trade would be “beneficial”.
While Bailey was keen not to take a view on Brexit, as a public official, he also said that a closer relationship between the UK and the EU would help the economy and inflation.
Bailey said: “It would be beneficial. Having a more open economy to trade with the European Union. Because there has been a fall-off in goods trade with the EU over recent years.
“It is important we do everything we can to ensure that whatever decisions are taken on the Brexit front do not damage the long-term trade position. So I hope that we can use this to start to rebuild that relationship."
That relationship could be improved later this month, when a crucial EU-UK summit is held.
Trade between the US and China cooled sharply last month as Donald Trump’s tariff war hit demand.
The latest trade data from China shows that shipments to the US fell 21%, year on year, in April. That indicates that the tariffs imposed on China by Trump, which rose to 145% during April, hurt trade.
Shipments the other way fell, too. China’s imports from the US fell by almost 14%, after Beijing’s tit-for-tat measures raised its tariffs on US goods to 125%.
The broader picture is that China’s overall exports jumped by 8.1% in April, year on year, beating forecasts for a 1.9% rise, while imports dipped by 0.2%.
Economists have suggested that countries around the world are scrambling to take advantage of Trump’s 90-day pause to the tariffs he announced at the start of April (not including China, though). That is leading to stronger demand for China’s materials.
The agenda
• 9.40am BST: Bank of England's governor, Andrew Bailey, to give keynote address at the Reykjavik economic conference 2025 • 12.15pm BST: Bank of England's chief economist, Huw Pill, gives the national monetary policy committee agency briefing
