Bank of England Chief Urges UK to Rebuild EU Trade Ties After US Deal
Andrew Bailey, Governor of the Bank of England, has called on the UK to do “everything we can” to rebuild trade with the European Union, stressing that stronger EU-UK economic ties would be “beneficial” for long-term economic health.
Speaking to the BBC, Bailey did not express a political stance on Brexit, but made clear that restoring lost trade with the EU would help boost UK exports and curb inflation.
“There has been a fall-off in goods trade with the EU over recent years. It would be beneficial to have a more open economy to trade with our largest partner,” he said.
Post-Brexit Reset in the Works
Bailey’s comments come as the UK government enters fresh talks with the EU to reset its post-Brexit trade and security relationship, ahead of a summit later this month. One key focus is the possibility of a veterinary agreement that would reduce red tape on food, fish, and farm exports by aligning regulatory standards.
US Trade Deal Sets the Stage
His remarks follow the signing of a new UK-US trade agreement, which reduces tariffs on British cars, steel, and aluminium, though most goods will still face a 10% import duty.
Bailey suggested that the relatively limited scope of the US deal opens space for deeper engagement with the EU, adding that the UK should leverage these deals to help rebuild global trade systems.
“It shows trade deals can still be done—and matter. We should use this to reset our position globally and with the EU,” Bailey noted.
Trade Recovery Seen as Inflation Strategy
Bailey indicated that improving trade with the EU would have a positive impact on the UK’s inflation trajectory, by reducing import costs and increasing competition. The EU remains the UK’s largest trading partner, making closer ties a logical economic priority.
While political sensitivities around Brexit remain, Bailey emphasized the importance of focusing on the economic outcomes over ideological debates.
