UK Economics Correspondent, London
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Apr 2, 2014

ECB set to hold course in face of deflation fears

FRANKFURT, April 3 (Reuters) – The European Central Bank
looks set to keep interest rates steady and offer no new aid to
the euro zone’s fragile recovery on Thursday despite a fall in
inflation to its lowest in more than four years.

Policymakers have been willing in recent weeks to publicly
broach cutting deposit rates below zero – effectively charging
banks to hold cash with the ECB – or embarking on bond purchases
as the United States, Japan and Britain have.

Mar 27, 2014

Bank of England readies tools to rein in risky mortgage lending

LONDON (Reuters) – The Bank of England urged banks on Thursday to consider the risk of future spikes in interest rates when they approve mortgages, and prepared tools to rein back potentially dangerous lending.

British house prices have risen by around 10 percent over the past year, and the central bank said mortgages were higher as a share of home-buyers’ income than at any point since 2005, although other indicators remained weaker than average.

Mar 26, 2014

UK says to sign yuan clearing deal with China next week

LONDON, March 26 (Reuters) – Britain and China will sign an
agreement next week to set up the first clearing service for
renminbi trading outside Asia, putting London in a prime
position to offer yuan trade business in Europe.

China has been a key focus of finance minister George
Osborne’s efforts to boost exports of financial services from
Britain, which was the first Group of Seven country to agree a
renminbi swap line with the People’s Bank of China last year.

Mar 25, 2014

UK inflation hits new four-year low, wages still lag

LONDON (Reuters) – British inflation fell to its lowest in more than four years in February, easing pressure on Britons’ living standards ahead of next year’s election and dipping further below the Bank of England’s 2 percent target.

Prices have been rising faster than pay almost continually since the start of the financial crisis in early 2008, and the fall in living standards despite recent strong economic growth is a major line of attack by the opposition Labour Party.

Mar 21, 2014

Bank of England’s trust in banks “badly mistaken”, says former official

LONDON, March 21 (Reuters) – The Bank of England needs to
abandon a culture of cosy chats and too much trust in banks
following the latest financial scandal to hit London, former
policymaker Adam Posen said on Friday.

BoE Governor Mark Carney unveiled a major shake-up of its
management on Tuesday, in part to tackle complaints from
lawmakers that the central bank had been too slow to spot signs
of financial misconduct in the past.

Mar 20, 2014

year debt suffers biggest fall since November on Fed and pension hit

LONDON (Reuters) – British 30-year government bonds suffered their sharpest fall since November on Thursday as the prospect of higher U.S. interest rates compounded damage from pension changes announced in Britain’s annual budget on Wednesday.

The yield on 30-year gilts jumped by 6 basis points to finish at 3.55 percent, the biggest jump since November 21 when gilts were hammered by strong industrial orders and a more hawkish U.S. policy outlook.

Mar 19, 2014

Osborne, eye on election, offers tax help in budget

LONDON (Reuters) – Chancellor George Osborne on Wednesday promised tax relief for households, a cap on welfare, help for savers and manufacturers, and lower costs for bingo and beer as the government prepares for next year’s elections.

In an annual budget statement, Osborne announced upgrades to official forecasts for country’s economic growth but said he would stick to his belt-tightening plans.

Mar 19, 2014

Britain’s Osborne, eye on election, offers tax help in budget

LONDON (Reuters) – British finance minister George Osborne on Wednesday promised tax relief for households, a cap on welfare, help for savers and manufacturers, and lower costs for bingo and beer as the government prepares for next year’s elections.

In an annual budget statement, Osborne announced upgrades to official forecasts for country’s economic growth but said he would stick to his belt-tightening plans.

Mar 19, 2014

Shake-up at Bank of England with three new top policy appointments

LONDON (Reuters) – Britain shook up the Bank of England on Tuesday, breaking the all-male grip at the top as it appointed two new deputy governors and a chief economist who has been highly critical of the banking industry.

The biggest single change in senior staff since the BoE gained independence in 1997 is accompanied by changes lower down which Bank of England Governor Mark Carney said were essential to wean the bank from its previous almost-exclusive focus on targeting inflation.

Mar 18, 2014

Carney revamps Bank of England, says will avoid past ‘flaws’

LONDON (Reuters) – Bank of England Governor Mark Carney announced an overhaul of the central bank on Tuesday, saying the almost exclusive focus by central banks on inflation in the past was “fatally flawed”.

Carney also said that scandals in the Libor interest rate and more recently foreign exchange markets showed the need for changes to make markets fairer and more efficient.

    • About David

      "David keeps a close watch on the UK economy, the Bank of England and the British government debt market. Previously he worked in Frankfurt, covering the European Central Bank and euro zone economy, and in Brussels where he reported on everything from EU summits to Belgian supermarkets."
      Languages:
      English, French, German
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