My treat for Brexit day last Friday was to fly to Jersey – out of the EU but more significantly out of the UK. We will find out on Monday whether we are allowed back in without any visa – UK or Scottish.

Meantime the economy is still pottering along, at ultra-low pace and in low gear. There is no real sign of acceleration as yet, albeit markets and forecasters appear to be anticipating 2020 being a slightly better year than 2019; and 2021 marginally better again. We wait to see if such mild optimism, which only involves GDP growth rebounding to a mere 1% - 1.5% pa or so over the next two years, is justified.

For once it must have been a quite interesting (not fascinating!) meeting of the Bank of England’s Monetary Policy Committee last Thursday. There was actually a decision to be made on interest rates. Some 60% of analysts were expecting a quarter-point cut in base rate, on the grounds that inflation has been running well below the 2% target for many months, and (critically given the forward-looking nature of the target set for the MPC) is expected to stay below target until the back end of 2021.

Policy does not seem to be symmetrical. When inflation is running somewhat above target and set to stay so, then the MPC appears more likely to raise rates than it is to cut when the obverse applies. However, this is not to disagree with their decision. Given the very limited monetary policy ammunition at the Committee’s disposal, it does make sense to keep powder dry, just in case there is a further, unexpected, deceleration ahead.

The MPC has set out very clearly why it expects a gentle pick up in UK growth. This is based upon the assumption of ‘an immediate but orderly move’ to a ‘deep free trade agreement’ with the EU. The upside then results from three key factors – some global pick up; reduction in Brexit-related uncertainties; and expansion of public expenditure as per earlier Government announcements.

That is fine for a central expectation, but as ever there are downside risks. On the global front the Corona virus could develop into a real concern on a wide geographical front – or there again the risk could dissipate rapidly. The US and China have come to some sort of minimalistic agreement on trade. This looks sufficient to maintain peace and quiet on this front through to the US Presidential elections. This is unless impeachment becomes a real possibility or President Trump decides to rattle sabres with China as a sign of a continuing robust commitment to ‘America first’ in the run up to his planned re-election or some unpredicted event. To note such risks, the Bank of England in its usual cautious language noted that ‘broader trade tensions and associated uncertainties remained high.’ That no doubt includes a nod to uncertainties in the Middle East.

Who knows how the post Brexit arrangements will develop? Uncertainties will diminish if the vibrations are positive regarding trade deals with the EU and USA in particular, but neither can be seen as done deals as yet. There could still be tears before bedtime and a return to troubling unknowns. That would further stifle business investment and rock business confidence more widely.

We will have no real certainty regarding the UK Government’s tax and expenditure plans until the March 11th Budget. Here it does seem a done deal that there will be significant fiscal easing, with major increases in funding for health, education, et al and no marked tax rises. However, the extent of fiscal easing remains inherently unpredictable. Forecasting this Prime Minister’s decision making is still like reading tea leaves.

The continuation of uncertainty regarding the UK outlook is shown by currency volatility of late. After the Conservatives emphatic victory at the General Election, and the effective removal of the ‘Corbyn risk’, sterling shot up against the US dollar. More recently it has returned whence it came. There are still clouds on the economic horizon. The last Governor of the Bank of England talked about a ‘NICE’ economy – Non-Inflationary, Consistent Growth. We have the first element secure but certainly not the second for the time being.

Nevertheless the MPC expects these domestic and global factors to stimulate some growth in the demand side of our economy. That is much needed, as retail sales volume was down again through the final quarter of 2019, by a full 1%. This included the vital month of December. Consumer credit growth slowed once more, particularly spending on credit cards. If perceived uncertainties do diminish, then there may be scope for some upward movement in consumer demand. Average earnings growth slowed through last year, but remains well above the rate of retail inflation. At the same time unemployment continues to edge down.

In sum there are some positive vibes as we look forward. Maybe 2020 will be a marginally better economic year; and maybe we will end the year on a more significantly positive note. But there are plenty of maybes around. Further global shocks are possible; further enhancement of Brexit uncertainties quite feasible. It will be some time before we see genuine recovery in business investment, critical for a sustained recovery; and UK consumers remain on edge, with many keeping their hands firmly in their pockets until a real recovery in confidence is under way.

Jeremy Peat is visiting professor at the University of Strathclyde.