The UK economy is now in historic territory as it prepares to leave the EU. The unknown variables it faces has heightened uncertainty, compounding the growing global economic risk that the International Monetary Fund (IMF) warned of at the start of this year.

Prior to the August interest rate cut, the Bank of England’s (BoE) monetary policy committee (MPC) last reduced its bank rate in 2009, holding it at 0.5% for seven years. These low levels were in response to the financial crisis of 2007, and with the UK economic outlook improving, investors started 2016 wondering if a rate rise would be imminent.

When David Cameron, prime minister at the time, announced in February that a referendum would be held on 23 June on the UK’s membership of the EU, this triggered heightened uncertainty in sterling markets.