Bank of England

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Sterling reverses gains after surprise drop in UK inflation

Posted on May 17, 2016 at 10:35 am GMT

Inflation in the UK posted a surprise drop in April as a big decline in air fares dragged the consumer price index lower. Annual CPI rose by 0.3% in the 12 months to April, falling short of expectations that it would stay unchanged at 0.5%. The month-on-month rate also missed estimates, as CPI in April increased by 0.1% from March, instead of 0.3% as forecast. Core CPI, which excludes energy, food and alcoholic beverages, was unchanged on the month, missing [..]

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European Session – Oil rises for third day to $47, sterling and Norwegian crown rally after rate announcements

Posted on May 12, 2016 at 2:20 pm GMT

The main focus today was on the Bank of England policy meeting and quarterly inflation report. The Bank left policy unchanged as widely expected. The main interest rate stayed at 0.5% while the asset purchase program was kept at 375 billion pounds. In its updated quarterly inflation report, the BoE lowered its economic projections for the next three years. Sterling was volatile after the news announcements but firmed up to rise above the key $1.45 level to as high as [..]

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Bank of England keeps rates on hold but steps up warnings of Brexit risk

Posted on May 12, 2016 at 1:54 pm GMT

The Bank of England unanimously voted to keep interest rates unchanged at 0.5% and its asset purchases at £375 billion as expected at its May policy meeting today. With the upcoming referendum of the UK’s membership of the European Union just over a month away, there were no expectations of any change in the BoE’s bank rate, which has remained at a record low of 0.5% since March 2009. In its statement, the Bank said that economic growth could slow [..]

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UK industrial output grows less than expected in March; sterling slides

Posted on May 11, 2016 at 10:52 am GMT

Industrial production in the United Kingdom made a tepid recovery in March following a sharp contraction the previous month. Total production rose by 0.3% month-on-month in March, cancelling out all of the previous month’s drop. However, the figure was below expectations of a more robust bounce back of 0.5%. On an annual basis, output was down 0.2% from the same month in 2015. Manufacturing growth was also positive, but only barely. Manufacturing production expanded by just 0.1% in March from [..]

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European Session – Sterling steady at $1.41 after BoE holds rates, dollar tests 109 yen after CPI data

Posted on April 14, 2016 at 2:35 pm GMT

The Bank of England announced its latest policy decision today and unanimously maintained its policy with a 9-0 voting outcome .There were no changes to the benchmark interest rate as was widely expected and it was left at a record low of 0.5% while the asset purchase programme was kept at 375 billion pounds. The minutes from the BoE policy meeting showed that the central bank was likely to remain in a wait and see mode until the outcome of [..]

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UK inflation at 15-month high; sterling pushes above 1.43 dollars

Posted on April 12, 2016 at 10:54 am GMT

British consumer prices rose at the fastest pace since December 2014 in March as higher air fares and clothing prices drove up the headline inflation rate. Annual CPI accelerated to 0.5% in March from 0.3% in February, beating expectations of a smaller rise to 0.4%. On a month-on-month basis, CPI was up by 0.4%, above estimates of a 0.3% increase. Core inflation, which excludes food, energy, alcohol and tobacco prices, also picked up pace, rising by 1.5% year-on-year. The figure [..]

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Week Ahead – Big week for Chinese data with GDP in focus

Posted on April 8, 2016 at 12:36 pm GMT

Looking ahead to the coming week, data out of China dominates the economic calendar with key indicators such as GDP and trade. US and UK inflation will also be watched closely but policy meetings by the Bank of England and the Bank of Canada are unlikely to be market movers. All eyes on China GDP Chinese inflation data will start the week on Monday. Annual CPI is forecast to head higher for a fourth straight month to increase to 2.5% [..]

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European Session – Dollar limits losses after US jobless claims data; sterling hits 1-month high of $1.45

Posted on March 17, 2016 at 3:32 pm GMT

The US dollar was broadly weaker during today’s European session, extending losses from the Asian session following a big tumble in reaction to a dovish and unexpectedly cautious Fed on Wednesday. Markets reacted negatively as the Fed announced that it scaled back its rate hike forecasts. This led to a dollar sell-off and by today’s European session, the US currency fell to a 16-month low below the key 111 yen level. It touched 110.65 yen, the lowest since October 2014. [..]

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Week Ahead – After ECB, attention turns to Fed; SNB, BoE and BoJ also in focus

Posted on March 11, 2016 at 1:31 pm GMT

It will be another busy week for central banks over the next seven days as the US Federal Reserve, Bank of Japan and Bank of England hold their policy meetings. The Swiss National Bank will be meeting too next week, while major data out of Japan, the US and the UK will also be eyed. It should be a quiet start to the week with Japanese machinery orders to be the main data on Monday. Machinery orders in January are [..]

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Mid-European session – Euro dips below 1.10 dollars after weak German Ifo

Posted on February 23, 2016 at 11:43 am GMT

Yesterday’s risk rally faded today and European stocks followed Asia to open lower on Tuesday. Oil prices were around 2% lower, while gold was up 1%. The US dollar was mixed as it fell against the yen but was firmer against the euro. The greenback dipped below 112 yen several times before rising just above it in mid-European session as risk-off sentiment boosted the yen. The euro continued its descent against the Japanese currency and was last at 123.30 yen [..]

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