UK interest rate rise due in November but it should be August – F&C
The first UK interest rate rise is likely to arrive in November, says F&C’s Steven Bell, but cannot come soon enough.
The first UK interest rate rise is likely to arrive in November, says F&C’s Steven Bell, but cannot come soon enough.
The Bank of England could spring an interest rate rise on markets sooner than expected, according to JP Morgan’s Stephanie Flanders.
Mixed messages on the health of the United Kingdom’s economy are making deciding on a UK equities weighting a particularly tricky task right now.
The ‘slow and gradual’ UK interest rate outlined by the Bank of England will be too little, too late, according to Brooks Macdonald’s Toby Thompson.
The Bank of England’s monetary policy committee is still united in holding the base rate at 0.5%, according to minutes from the last meeting released today.
George Osborne’s announcement that the government is to sell its stake in Royal Bank of Scotland may lead to shareholder upside according to industry experts, though investors should exercise caution.
The prevailing consensus has settled around the expectation that the first UK interest rate hike is a considerable way off, but there are reasons to think this could quickly change once again.
The minutes from the last Bank of England monetary policy meeting have revealed there remains little dissent within the committee, with all members united in holding rates steady at 0.5%.
Aside from revising growth lower and putting an end to sterling’s election-led rally, The Bank of England’s May inflation report once more placed the spotlight firmly on productivity growth as the possible bad apple that could upset the whole cart.
Inflation should return to its 2% target within the next two years, the Bank of England said on Wednesday, but labour productivity remains the key uncertainty, as it downgraded its forecast for UK GDP growth from 2.9% for 2015, to 2.5%.
Markets were buoyed on Friday by the unexpectedly clear triumph of the Conservatives, but while one question hanging over investors and the country has been answered a bigger one now looms.
Policy divergence will reach a breaking point and either drag the US and UK back into quantitative easing or trigger widespread reflation, says Rathbones’ Bryn Jones.