Bank of England Governor Mark Carney has taken some flak for talking about interest rate rises in the past, but not delivering. That ended last week when the MPC’s raised Bank Rate. Now to see how the economy responds. Continue reading
It’s a familiar narrative for the UK. Strong job growth but signs of a weakening consumer on the back of paltry income growth squeezed by higher inflation. Yet markets are convinced the Bank of England is raising rates on 2 November. The latest data suggests the decision will likely be more finely balanced for policy-makers. Continue reading
The Bank of England is debating the best way to tackle the UK’s current dose of inflation. But for the central banks of the Eurozone and the US the issue is stubbornly low inflation. Continue reading
Ten years ago today heralded the start of the ‘credit crunch’. The term which was unfamiliar to most people entered dictionaries in 2008. A credit crunch refers to the sudden reduction in the availability of credit or a sudden tightening in the conditions to obtain credit. In short, the availability of credit decreased sharply and the cost of credit increased significantly. In turn, this morphed into the global financial crisis or GFC and was accompanied by a global downturn. The rest they say is history. A decade has passed and hundreds of books have been written about the credit crunch and the global financial crisis that followed.
As the world watches and waits for the outcome of the US election there are signs of modest improvements in performance across the major economies. The Bank of England marked up its 2017 growth forecast. The US continues to create jobs apace. Even the eurozone gives some cause for optimism. What could possibly go wrong? Continue reading
Over two months have passed since the UK voted to leave the EU. Since then, the media and economists have focussed on the incoming economic data to assess the impact. Continue reading
The Bank of England surprised last week by not cutting interest rates. The accompanying statement showed that most members expect to loosen monetary policy at August’s meeting. But given that expectation it left a perculiar question in its aftermath. If then, why not now? Continue reading
Initial signals of the economic fallout post-Brexit vote are weak. That’s weak in both hard to detect as well as hinting at economic fragility. It’s early days but initial signs suggest a sudden shock to business and consumer confidence as well as consumer spending. If true, the next question is, how persistent?
With five weeks to go before the EU referendum the campaigns are now in full swing and scrutinising every piece of data for signs of Brexit nervousness. Yet there’s still a lot going on that isn’t driven by our domestic political agenda and the Bank of England conceeded that the noise is making its job of interpreting the data more difficult. Continue reading
A former Bank of England Governor once said of central banking that “boring is best”. Last week though, central bankers were once again hogging the limelight. First off, the US Federal Reserve, which having raised rates must now work out whether the economy can support them. Second the Bank of Japan, which joined the negative rate club. And with all eyes on the Bank of England this week, “boring” seems a distant memory.