Skip to main content

UK interest rates remain balanced , though sterling hit by EU vote says BoE


Bank of England policymakers said sterling had been dealt a big hit by uncertainty in the run-up to the referendum on EU membership and that growth could slow, after voting unanimously to keep rates steady.
The central bank said the upcoming vote on June 23 could delay some spending decisions, though it said recent indicators suggested growth would keep the same momentum this quarter as it had at the end of last year.

The BoE reiterated that interest rates were more likely to rise than not over the next two years and that when they did the rise would be gradual, given likely headwinds.

After a rapid recovery in recent years, British growth slowed in the second half of last year and recent surveys show it had a rocky start to 2016, when the country will hold a referendum on its membership of the European Union.
Tail Risk Measurement Heuristics by Nassim Nicholas Taleb - One Bank Flagship Seminar
"There appears to be increased uncertainty surrounding the forthcoming referendum," policymakers said. "That uncertainty is likely to have been a significant driver of the decline in sterling. It may also delay some spending decisions and depress growth of aggregate demand in the near term."

BoE Governor Mark Carney, in a recent appearance before lawmakers, pointed to some benefits of Britain's EU membership, but said the BoE would not comment on the long-term implications of an exit.

Britain's economy has slowed, along with the rest of the world, and some policymakers worry they may struggle to fend off the latest global downturn after pumping trillions into the global financial system in recent years and given that interest rates in major economies are already so low.

The Federal Reserve on Wednesday said the United States continued to face risks from an uncertain global economy and appeared to sharply scale back its plans for interest rate rises this year. [nL2N16N1GU]

The BoE said short term interest market rates had fallen due to market worries about the world economy, and the perception that the lower bound for central banks' interest rates could be lower than previously thought.

These looser financial conditions globally could provide the UK economy with some support.

It was the second month in a row policymakers voted unanimously to keep rates at a record low 0.5 percent after Ian McCaffery, an external member of the Monetary Policy Committee, last month abandoned his rate hike vote citing a weaker outlook for wages.

The government on Wednesday sharply cut its growth forecasts for this year and next as it delivered its annual budget, after the central bank also revised down its growth estimates in the February inflation report.

The BoE expects the economy to grow 2.2 percent this year and 2.3 percent next year, more optimistic than the government's forecasts for 2.0 percent and 2.2 percent growth in 2016 and 2017 respectively.

Financial markets had fully priced out the possibility of an interest rate hike this year prior to the BoE meeting and some are even betting the first move will be a cut.

Inflation and wage growth have been sluggish for months, but have recently showed signs of a pick-up. Annual inflation edged up to a one-month high in January and wages grew by more than expected that month.

But this rise could struggle to gain momentum against the weaker economic backdrop, with the government on Wednesday also cutting its inflation forecasts for 2015 and 2016.

The BoE said the near-term outlook for inflation had changed little since the February inflation report, but added that it remained watchful for signs that low inflation might be weighing on wages.

The BoE has said it has more ammunition to help the economy if it is needed, but Governor Mark Carney has ruled out following in the footsteps of his European and Japanese counterparts with negative interest rates.

 Further Reading 
Video Bank of England Mark Carney Governor quizzed on the risks of Brexit ,Sir Jon Cunliffe
coca cola tango free fall on Osbornes sugar tax


Good News for Airbnb Londoners - online Micro Entreprenuers

AirBnb / online, Ebay Amazon Start Up, micro-entrepreneurs rent property income, internet ,homes

 #Budget2016 George Osborne ,Stamp Duty Surcharge ,Tax, Capital Gains Tax,Housebuilding

 UrPad Online new Hybrid online estate agent for Wales ,rolled out by Property Industry Experts,Caerphilly

Facebook Founder Zuckerberg settles dispute with no pay out to property developer Voskerician

new affordable housing hits record low in london data shows

Days of Chaps payment numbered ,Central banks rival Bitcoin new RSCoin super currency

 what the VLOG ? London property developers, Hackney Dalston E8 Vibe illusion

 technology law - eddies from property portals boliga.dk and now zoopla.co.uk

 Online estate agents, expecting sales bonaza, as sellers shun costly high street rivals

A Welsh developer of student accommodation ,plans March 2016 IPO + Wales tallest building

 Help to Buy: mortgage guarantee scheme, Quarterly Statistics, March 2016

 number of high street estate agents going bust up 16% , online estate agents market share up dictated by consumer not industry

 NHBC NEW HOME STATISTICS ANNUAL REVIEW 2015,English Housing, Papworth Disability Trust ,Joseph Rowntree & Bungalows !

why Frank Whittle and the Saville row tailor have more in common with Warren Buffet

FT first 'Rightmove maintains grip in battle of property portals @onthemarketblog

 Brick-And-Mortar Crumbling? Don't Believe It > Forbes > Leadership

 Foxtons high street estate agent facing landmark claim for £2million from group of 55 landlords

 Building a new deal for London: Final report of the London Housing Commission

 'Kleptocracy tours' 35,000 London properties currently have unknown offshore owners.

Pop-up housing could cut cost of London’s rental market & help UK housing Crisis

Chinese hunt for property bargains in Manchester amongst others say Pinnacle Alliance Property Developer

 Property pain Investigation ,service charges increasing rapidly with 30 % of firms increasing fees

 UK's largest property developers accused of 'profiting' on the back of the housing crisis

Private rental prices grew by 2.7% in England

 Rental prices increased in all the English regions over the year to January 2016, with rental prices increasing the most in London (3.9%).

 Property pain Investigation ,service charges increasing rapidly with 30 % of firms increasing fees

 Foxtons report 4% revenue increase to City, despite Prime Central London property experiencing a dead-cat bounce

 Property Partner successfully completes £15.9M ($22.4M) funding round

Nested - Start Up , property online disruptor to quick sale homes ?

 Building a new deal for London: Final report of the London Housing Commission

 high street estate agency valuations – flattery will get you nowhere by @emoovceo

Start me up: Why London needs open workspaces for creativity, innovation and growth

 Live inquiry application launch 14 th March say Land Registry Marketing Manager

LA police testing knife found on OJ Simpson property - reports

 'Kleptocracy tours' 35,000 London properties currently have unknown offshore owners

 UK's largest property developers accused of 'profiting' on the back of the housing crisis

 Pop Up Housing a solution not just for London but the UK

 estate regeneration statement GOV UK DCLG ,Lord Heseltine ,Brandon Lewis MP

 Digital Mortgage service: making improvements again & again

 Buy-to-let investors 'could face losses'

Uber's property footprint unmatched among San Fran Bay Area ,Tech StartUps
Guests staying with AirBnB for the super bowl top 15,000

 Nobroker.com Homes, one step closer to making estate agent obsolete , new round of funding

 OnTheMarket overseas properties , Britons with holiday homes in France face paying extra 10% in tax if they sell the property following a Brexit

Guests staying with AirBnB for the super bowl top 15,000

FT first 'Rightmove maintains grip in battle of property portals @onthemarketblog

Morrisons Super Markets signs deal to sell food to Amazon online customers

Amazon eyes up UK restaurant delivery market

Booking.com Launches of Passion Search ,Don’t battle your passions, unleash them

David Cameron calls EU referendum for June 23 2016 Official Statement @onthemarketblog

 zoopla.co.uk selects Birst's Cloud BI platform for data integration from all its brands and apps

Good News UK mortgage approvals hit two-year high BoE

IMF Statement: LUXEMBOURG: Concluding Statement of the 2016 Article IV Consultation Mission

 Spanish house prices 2015 see rise highest rise 2007 crash , stabilisation of housing market, idealista.com

 No Brexit for me, why I'm staying in a reformed EU and so should you

 Scotlands House prices rise and sales grow ros.gov.uk

 An analysis of recent trends in the Irish rental market 2015 in Review

 fourth quarter 2015: First-time buyers took out 87,100 loans to purchase homes. + house prices in UK

GeoPhy Exodus-from-EU-may-spark-correction-in-the-rental-market.html

 1st of March David Cameron St David's Day message "wonderful country and a great part of the United Kingdom"

Amazon eyes up UK restaurant delivery market

Bank of England's unease over market's rate view Carney & Shafik


Morrisons Super Markets signs deal to sell food to Amazon online customers

Brick-And-Mortar Crumbling? Don't Believe It > Forbes > Leadership

Chinese authorities shut down microblogging accounts belonging to a real estate mogul

 Foxtons high street estate agent facing landmark claim for £2million from group of 55 landlords

 Brexit ,purplebricks.com investor, impacts on the property market overall and on aggregate consumption in the economy will be limited

Labels:

Comments

Post a Comment