This article is from the source 'guardian' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.

You can find the current article at its original source at https://www.theguardian.com/business/live/2016/sep/21/bank-of-japan-stimulus-programme-federal-reserve-business-live

The article has changed 25 times. There is an RSS feed of changes available.

Version 15 Version 16
Markets await Federal Reserve interest rate decision – business live Markets await Federal Reserve interest rate decision – business live
(35 minutes later)
4.53pm BST
16:53
Markets are betting on a no-change statement from the Federal Reserve on US interest rates but will be keen to hear the tone of the central bank’s comments, says strategist James Chen at City Index:
Not much has changed from the past several weeks in terms of the very low expectations for a rate hike. If anything, [today’s Bank of Japan] announcement of new easing measures could even further discourage a Fed move, but as it already stands, there are very few market participants that are betting on such a move to higher interest rates, at least for this particular Fed meeting. Key Fed speakers and major US economic data releases have alternately shifted the discussion from one side to another in the past few weeks. Some members advocated a rate hike this year, even citing the possibility of one occurring in September, while others, like Fed Governor Lael Brainard, cautioned against raising interest rates too quickly.
Additionally, September has thus far seen a general deterioration of US economic data in the form of substantially worse-than-expected releases regarding employment (NFP), both the manufacturing and services industries (PMI), retail sales, and housing, that were all significantly worse than expected. The one potentially brighter spot for the Fed was the Consumer Price Index (CPI) inflation reading for August, which showed that both headline and core prices increased by more than expected. Despite this more buoyant view of inflation, however, it is still unlikely to be enough to sway the Fed into action today.
Amidst all of these economic data releases and Fed member speeches, the market’s view of the implied probability of a rate hike today has continued to hover in the low-to-high teens. Of course, there could always be a surprise move, but the much more likely scenario will be a characteristically unmovable Fed.
Therefore, the market’s focus, as has consistently been the case from the beginning of the year, will be concentrated on the words emanating from the Fed statement as it relates to the indication of a possible rate hike in December and the potential pace of tightening going forward. The current market probability of a December hike remains around 60%.
The key markets to watch today, as always, will be US equity markets, gold, and the US dollar, particularly US dollar/Japanese yen due the earlier Bank of Japan announcement. A more hawkish Fed today could lead to a rebound for the dollar/yen while a more dovish statement could lead to a further drop for dollar/yen towards the key 100.00 mark and below.
Updated
at 4.55pm BST
4.14pm BST4.14pm BST
16:1416:14
Predictions of the economic gloom which would follow the Brexit vote seem to be wide of the mark, according to a new Guardian project tracking the state of play as Britain prepares to leave the European Union.Predictions of the economic gloom which would follow the Brexit vote seem to be wide of the mark, according to a new Guardian project tracking the state of play as Britain prepares to leave the European Union.
As a reminder, the UK Treasury for one forecast dire consequences in the immediate wake of the vote:As a reminder, the UK Treasury for one forecast dire consequences in the immediate wake of the vote:
@EdConwaySky The HM Treasury document is clear & specific. A vote to leave would cause...https://t.co/Mlk3W8dUbO pic.twitter.com/B3EfvYVzJW@EdConwaySky The HM Treasury document is clear & specific. A vote to leave would cause...https://t.co/Mlk3W8dUbO pic.twitter.com/B3EfvYVzJW
Unveiling the new Guardian project, Katie Allen writes:Unveiling the new Guardian project, Katie Allen writes:
Fears that Britain will slide into a post-referendum recession have been allayed after a Guardian analysis showed the latest news on the economy has confounded analysts’ gloomy expectations, with consumer spending strong, unemployment low and the housing market holding steady.Fears that Britain will slide into a post-referendum recession have been allayed after a Guardian analysis showed the latest news on the economy has confounded analysts’ gloomy expectations, with consumer spending strong, unemployment low and the housing market holding steady.
The finding comes as a leading thinktank toned down its earlier dire warnings of economic turmoil for the UK and its neighbours in the event of a leave vote. The Paris-based Organisation for Economic Cooperation and Development (OECD) said prompt action by the Bank of England to cut interest rates had cushioned the blow from June’s Brexit vote but it still believes the UK will suffer a sharp slowdown next year amid heightened uncertainty.The finding comes as a leading thinktank toned down its earlier dire warnings of economic turmoil for the UK and its neighbours in the event of a leave vote. The Paris-based Organisation for Economic Cooperation and Development (OECD) said prompt action by the Bank of England to cut interest rates had cushioned the blow from June’s Brexit vote but it still believes the UK will suffer a sharp slowdown next year amid heightened uncertainty.
Official figures on the state of the public finances, released on Wednesday, also showed little impact from the vote to leave the EU. Government borrowing was a touch higher than economists had expected in August, but was lower than a year ago in a boost to the chancellor, Philip Hammond, as he prepares to give his maiden autumn statement in November.Official figures on the state of the public finances, released on Wednesday, also showed little impact from the vote to leave the EU. Government borrowing was a touch higher than economists had expected in August, but was lower than a year ago in a boost to the chancellor, Philip Hammond, as he prepares to give his maiden autumn statement in November.
Following the historic 23 June vote to leave the EU, analysts were quick to predict the UK economy would grind to a halt or even shrink. They warned businesses and households would stop spending because of job cuts, political uncertainty and a squeeze on living standards as the weak pound stoked inflation.Following the historic 23 June vote to leave the EU, analysts were quick to predict the UK economy would grind to a halt or even shrink. They warned businesses and households would stop spending because of job cuts, political uncertainty and a squeeze on living standards as the weak pound stoked inflation.
But since the Bank stepped in with a package of measures to shore up the economy, much of the economic news has defied expectations and many analysts have toned down their post-referendum gloom.But since the Bank stepped in with a package of measures to shore up the economy, much of the economic news has defied expectations and many analysts have toned down their post-referendum gloom.
Now the picture of early resilience is bolstered in the first snapshot of post-referendum Britain in a new Guardian project that will track the economy as the Brexit talks begin and progress, and as more data on the economy becomes available.Now the picture of early resilience is bolstered in the first snapshot of post-referendum Britain in a new Guardian project that will track the economy as the Brexit talks begin and progress, and as more data on the economy becomes available.
The first report is here:The first report is here:
3.39pm BST3.39pm BST
15:3915:39
Oil prices rise after inventory figuresOil prices rise after inventory figures
US crude stocks fell unexpectedly last week as producers reduced their output, helping oil prices extend their early gains.US crude stocks fell unexpectedly last week as producers reduced their output, helping oil prices extend their early gains.
Crude inventories dropped by 6.2m barrels, according to the Energy Information Administration, compared to expectations of an increase of 3.4m barrels.Crude inventories dropped by 6.2m barrels, according to the Energy Information Administration, compared to expectations of an increase of 3.4m barrels.
Gasoline stocks fell by a larger than expected 3.2m barrels, with analysts forecasting a 567,000 decline according to Reuters.Gasoline stocks fell by a larger than expected 3.2m barrels, with analysts forecasting a 567,000 decline according to Reuters.
But stocks of distillates - which include diesel and heating oil - increased by 2.2m barrels compared to forecasts of a 250,000 rise.But stocks of distillates - which include diesel and heating oil - increased by 2.2m barrels compared to forecasts of a 250,000 rise.
Brent crude is now 1.35% higher at $46.50 a barrel while West Texas Intermediate - the US benchmark - is up 1.95% at $44.91.Brent crude is now 1.35% higher at $46.50 a barrel while West Texas Intermediate - the US benchmark - is up 1.95% at $44.91.
3.12pm BST3.12pm BST
15:1215:12
Christopher Vecchio, currency analyst at DailyFX, said:Christopher Vecchio, currency analyst at DailyFX, said:
Here we go again: What once was a much heralded and anticipated rate decision, the September FOMC meeting seems all but wrapped up at this point. The Federal Reserve will keep its main rate on hold at 0.25-0.50%, citing near-term, weak economic developments, yet insisting that enough progress has been made to warrant a rate hike at one of the upcoming meetings (hint: December, when the next SEPs are released). The key for the US Dollar today, however, is to what degree of confidence the FOMC has in the US economy, or simply, ‘how quickly does the Fed think it will be able to raise rates next?’Here we go again: What once was a much heralded and anticipated rate decision, the September FOMC meeting seems all but wrapped up at this point. The Federal Reserve will keep its main rate on hold at 0.25-0.50%, citing near-term, weak economic developments, yet insisting that enough progress has been made to warrant a rate hike at one of the upcoming meetings (hint: December, when the next SEPs are released). The key for the US Dollar today, however, is to what degree of confidence the FOMC has in the US economy, or simply, ‘how quickly does the Fed think it will be able to raise rates next?’
...In actuality, rate expectations are completely muted for today and are sitting on the fence for 2016....In actuality, rate expectations are completely muted for today and are sitting on the fence for 2016.
This is the main source of risk for markets today. Should the FOMC choose to be headstrong and tear down conventional wisdom - a small possibility with two prime dealers coming out and calling for a rate hike - global markets will be shocked. But assuming the Fed plays it safe as it usually does, a lack of a rate hike may not hurt the US Dollar significantly. By suggesting that a rate hike is still “on the table” in the near-term, and by laying out an interest rate glide path for next year calling for multiple rate hikes, then the Fed could help insulate the US dollar, plain and simple. It’s starting to feel like a September-December 2015 redux.This is the main source of risk for markets today. Should the FOMC choose to be headstrong and tear down conventional wisdom - a small possibility with two prime dealers coming out and calling for a rate hike - global markets will be shocked. But assuming the Fed plays it safe as it usually does, a lack of a rate hike may not hurt the US Dollar significantly. By suggesting that a rate hike is still “on the table” in the near-term, and by laying out an interest rate glide path for next year calling for multiple rate hikes, then the Fed could help insulate the US dollar, plain and simple. It’s starting to feel like a September-December 2015 redux.
2.53pm BST2.53pm BST
14:5314:53
So what are the chances of a US rate rise?So what are the chances of a US rate rise?
Every time the US FOMC has hiked rates in the past 20 years, the market was pricing in >70% probability pic.twitter.com/Sm3NIxhM2EEvery time the US FOMC has hiked rates in the past 20 years, the market was pricing in >70% probability pic.twitter.com/Sm3NIxhM2E
2.46pm BST2.46pm BST
14:4614:46
Wall Street opens higherWall Street opens higher
Ahead of the Federal Reserve interest rate decision, US markets are moving higher. Most investors expect the Fed to leave rates on hold, but this is by no means guaranteed.Ahead of the Federal Reserve interest rate decision, US markets are moving higher. Most investors expect the Fed to leave rates on hold, but this is by no means guaranteed.
The Dow Jones Industrial Average is currently up 76 points or 0.4% while the S&P 500 opened 0.36% higher and the Nasdaq composite was up 0.4% initially.The Dow Jones Industrial Average is currently up 76 points or 0.4% while the S&P 500 opened 0.36% higher and the Nasdaq composite was up 0.4% initially.
European markets are holding onto their gains - albeit off their best levels - with Germany’s Dax and France’s Cac both climbing 0.6%. But the FTSE 100 is up just 0.15% or 10 points. Connor Campbell, financial analyst at Spreadex, said:European markets are holding onto their gains - albeit off their best levels - with Germany’s Dax and France’s Cac both climbing 0.6%. But the FTSE 100 is up just 0.15% or 10 points. Connor Campbell, financial analyst at Spreadex, said:
The FTSE has seen its gains roughly halve as the day has gone on, the early Bank of Japan stimulus excitement gradually waning as more and more analysts voiced their scepticism about the effectiveness of the measures Kuroda and co. announced this morning. The same thing has happened in the Eurozone, the DAX and CAC now both up around half a percent having surged by as much as 1% after the bell.The FTSE has seen its gains roughly halve as the day has gone on, the early Bank of Japan stimulus excitement gradually waning as more and more analysts voiced their scepticism about the effectiveness of the measures Kuroda and co. announced this morning. The same thing has happened in the Eurozone, the DAX and CAC now both up around half a percent having surged by as much as 1% after the bell.
UpdatedUpdated
at 3.26pm BSTat 3.26pm BST
2.30pm BST2.30pm BST
14:3014:30
Summers: 10 good reasons not to raise US interest rates todaySummers: 10 good reasons not to raise US interest rates today
Larry Summers, the former US Treasury secretary, has fired an epic Tweetstorm towards the Federal Reserve, explaining why they shouldn’t hike.Larry Summers, the former US Treasury secretary, has fired an epic Tweetstorm towards the Federal Reserve, explaining why they shouldn’t hike.
He argues that the US labour market is far from overheating, and that the Fed should be comfortable with inflation running over its 2% target for some time, following the current underrun (inflation is currently 1.1%).He argues that the US labour market is far from overheating, and that the Fed should be comfortable with inflation running over its 2% target for some time, following the current underrun (inflation is currently 1.1%).
He also fears that a surprise hike tonight might unbalance the economy at a crucial moment, sending the dollar too high, and creating a mess the Fed can’t fix....He also fears that a surprise hike tonight might unbalance the economy at a crucial moment, sending the dollar too high, and creating a mess the Fed can’t fix....
There are many reasons, each of which would be reason enough alone, for the Fed not to raise rates today 1/11There are many reasons, each of which would be reason enough alone, for the Fed not to raise rates today 1/11
The Fed should not raise rate because total hours worked in US are flat to down over last 6 months 2/11The Fed should not raise rate because total hours worked in US are flat to down over last 6 months 2/11
The Fed should not raise rates because inflation expectations are falling not rising 3/11The Fed should not raise rates because inflation expectations are falling not rising 3/11
The Fed should not raise rates because in the 8 year of recovery it should be targeting inflation above 2% so inflation averages 2%. 4/11The Fed should not raise rates because in the 8 year of recovery it should be targeting inflation above 2% so inflation averages 2%. 4/11
The Fed should not raise rates because it lacks the tools to respond if a downturn comes 5/11The Fed should not raise rates because it lacks the tools to respond if a downturn comes 5/11
The Fed should not raise rates because it will come as a shock at a fragile moment 6/11The Fed should not raise rates because it will come as a shock at a fragile moment 6/11
Fed should not raise rates b/ the economy is sign. weaker & inflation expectations weaker than when it erred (judged expost) last Dec. 7/11Fed should not raise rates b/ the economy is sign. weaker & inflation expectations weaker than when it erred (judged expost) last Dec. 7/11
Fed should get off the idea credibility requires raising rates now, Dec or at any point b4 inflation expectations are accelerating. 8/11Fed should get off the idea credibility requires raising rates now, Dec or at any point b4 inflation expectations are accelerating. 8/11
There are much better ways than rate increases for dealing with any concerns about bubbles 9/11There are much better ways than rate increases for dealing with any concerns about bubbles 9/11
The Fed should take on board that with the economy so slow over the last 3 quarters rates may not be below neutral now. 10/11The Fed should take on board that with the economy so slow over the last 3 quarters rates may not be below neutral now. 10/11
Tightening now will induce artificial dollar strength, which is hardly a good thing given the magnitude of protectionist pressures 11/11Tightening now will induce artificial dollar strength, which is hardly a good thing given the magnitude of protectionist pressures 11/11
2.25pm BST2.25pm BST
14:2514:25
Federal Reserve meeting begins....Federal Reserve meeting begins....
Over in America, policymakers at the Federal Reserve have just begun today’s monetary policy meeting.Over in America, policymakers at the Federal Reserve have just begun today’s monetary policy meeting.
FED: FOMC MEETING RESUMED AT 9 A.M. ET AS SCHEDULEDFED: FOMC MEETING RESUMED AT 9 A.M. ET AS SCHEDULED
In five hours time, they’ll announce whether they’ve raised US interest rates for the first time this year.In five hours time, they’ll announce whether they’ve raised US interest rates for the first time this year.
The financial markets are widely expecting the Fed to sit elegantly on its hands tonight - but perhaps drop a big hint to expect a December rate hike.The financial markets are widely expecting the Fed to sit elegantly on its hands tonight - but perhaps drop a big hint to expect a December rate hike.
But some investors, such as hedge fund manager Dan Loeb, fear that the markets are hopelessly addicted to easy money....But some investors, such as hedge fund manager Dan Loeb, fear that the markets are hopelessly addicted to easy money....
Fed policy isn't a "punch bowl" it's a crack cocaine pipe," according to Dan Loeb #ReutersLiveFed policy isn't a "punch bowl" it's a crack cocaine pipe," according to Dan Loeb #ReutersLive
2.02pm BST2.02pm BST
14:0214:02
Some City cynicism about the BoJ’s bold pledge to get inflation above target:Some City cynicism about the BoJ’s bold pledge to get inflation above target:
Macro Man announced his intention to grow from 5'10" to 6'2" pic.twitter.com/1ySunmLv56Macro Man announced his intention to grow from 5'10" to 6'2" pic.twitter.com/1ySunmLv56
1.57pm BST1.57pm BST
13:5713:57
Royal London Asset Management have kindly sent over their full reaction to the Bank of Japan (as flagged earlier).Royal London Asset Management have kindly sent over their full reaction to the Bank of Japan (as flagged earlier).
Trevor Greetham, their head of multi asset investing, says:Trevor Greetham, their head of multi asset investing, says:
“This is helicopter money in all but name and it is supportive of our overweight stance in Japanese equities.“This is helicopter money in all but name and it is supportive of our overweight stance in Japanese equities.
“Japan has been suffering from excessive debt and deflationary pressure for longer than any other developed market, so we should watch new policy developments in Tokyo with interest.“Japan has been suffering from excessive debt and deflationary pressure for longer than any other developed market, so we should watch new policy developments in Tokyo with interest.
“Today’s announcement makes it clear that the authorities are going down the route of explicit financial repression, boosting nominal growth while keeping interest rates near zero at all maturities. The idea is to transfer wealth from savers to borrowers, the government included, to reduce debt burdens and wipe the slate clean.“Today’s announcement makes it clear that the authorities are going down the route of explicit financial repression, boosting nominal growth while keeping interest rates near zero at all maturities. The idea is to transfer wealth from savers to borrowers, the government included, to reduce debt burdens and wipe the slate clean.
“Monetary policy didn’t ease today, as the muted market reaction shows, but the economy isn’t weak enough to merit it. If growth turns downwards, the new framework allows Japan to make short rates more negative, increase the monetary base and expand government spending without needing to worry about the markets.”“Monetary policy didn’t ease today, as the muted market reaction shows, but the economy isn’t weak enough to merit it. If growth turns downwards, the new framework allows Japan to make short rates more negative, increase the monetary base and expand government spending without needing to worry about the markets.”
The markets are still digesting today’s announcement, which sent the Tokyo stock market up by 2%.The markets are still digesting today’s announcement, which sent the Tokyo stock market up by 2%.
The yen, though, has reversed its initial selloff and is now at a four-week high against the US dollar. That’s not what the BoJ wants to see....The yen, though, has reversed its initial selloff and is now at a four-week high against the US dollar. That’s not what the BoJ wants to see....
Bank of Japan not getting much buck for its bang. Yen rises to highest in a month vs dollar, looks like it could soon break 100. pic.twitter.com/LiHxpcOUtrBank of Japan not getting much buck for its bang. Yen rises to highest in a month vs dollar, looks like it could soon break 100. pic.twitter.com/LiHxpcOUtr
1.10pm BST1.10pm BST
13:1013:10
Lord Livermore (a former top strategist for Gordon Brown and Tony Blair) cautions against complacency over the EU referendum effect.Lord Livermore (a former top strategist for Gordon Brown and Tony Blair) cautions against complacency over the EU referendum effect.
BBC News - Brexit has had 'no major effect' on economy so far https://t.co/biYZxiSWzOBBC News - Brexit has had 'no major effect' on economy so far https://t.co/biYZxiSWzO
That's probably because Brexit hasn't happened yet. https://t.co/KnQQAtXNsMThat's probably because Brexit hasn't happened yet. https://t.co/KnQQAtXNsM
12.41pm BST12.41pm BST
12:4112:41
Bank of Japan's stimulus drive divides expertsBank of Japan's stimulus drive divides experts
City experts have now had a few hours to digest the Bank of Japan’s new stimulus plan. And opinion is still split.City experts have now had a few hours to digest the Bank of Japan’s new stimulus plan. And opinion is still split.
Duncan Weldon of Resolution Group reckons that the BoJ is paving the way for the Japanese government to boost its spending, turning monetary stimulus into fiscal muscle.Duncan Weldon of Resolution Group reckons that the BoJ is paving the way for the Japanese government to boost its spending, turning monetary stimulus into fiscal muscle.
He explains:He explains:
The BOJ is effectively pledging to hold ten year borrowing costs at around zero (the yield curve target) and to do this for quite some time (the inflation overshoot pledge). That is a strong signal that the government should follow through with fiscal stimulus — stimulus that effectively comes with no borrowing costs.The BOJ is effectively pledging to hold ten year borrowing costs at around zero (the yield curve target) and to do this for quite some time (the inflation overshoot pledge). That is a strong signal that the government should follow through with fiscal stimulus — stimulus that effectively comes with no borrowing costs.
It’s not quite a monetary financing but it’s a step closer.It’s not quite a monetary financing but it’s a step closer.
A pledge to overshoot a target you’ve consistently failed to hit isn’t especially credible. The macro impact of that pledge through expectations is unlikely to be large. But a pledge to finance government spending at zero per cent for the coming years could be a much bigger deal — even if it is only making explciit what has been implicit in Japan for quite some time.A pledge to overshoot a target you’ve consistently failed to hit isn’t especially credible. The macro impact of that pledge through expectations is unlikely to be large. But a pledge to finance government spending at zero per cent for the coming years could be a much bigger deal — even if it is only making explciit what has been implicit in Japan for quite some time.
Here’s the full piece:Here’s the full piece:
Rebooting Abenomics: Quick BOJ Thoughts - https://t.co/eieBG39JSw (which Medium tells me is a 3 minute read).Rebooting Abenomics: Quick BOJ Thoughts - https://t.co/eieBG39JSw (which Medium tells me is a 3 minute read).
Nick Gartside of JP Morgan Asset Management says the BoJ have been pretty creative, defying those who thought central banks were out of ammunition.Nick Gartside of JP Morgan Asset Management says the BoJ have been pretty creative, defying those who thought central banks were out of ammunition.
By adopting the ‘yield curve control concept’, which is designed to steepen the Japanese yield curve by targeting a 10 year JGB yield of 0%, the Bank of Japan showed that central bankers still have a few tricks up their sleeves.By adopting the ‘yield curve control concept’, which is designed to steepen the Japanese yield curve by targeting a 10 year JGB yield of 0%, the Bank of Japan showed that central bankers still have a few tricks up their sleeves.
“This is a creative and imaginative policy and markets have reacted favourably. The policy, which also commits to expanding the monetary base until inflation reaches 2% on a sustainable basis, is a form of long range forward guidance.“This is a creative and imaginative policy and markets have reacted favourably. The policy, which also commits to expanding the monetary base until inflation reaches 2% on a sustainable basis, is a form of long range forward guidance.
Royal London Asset Management reckon the BoJ will be flooding Japan with money for some time -- which should pump share prices higher.Royal London Asset Management reckon the BoJ will be flooding Japan with money for some time -- which should pump share prices higher.
Royal London Asset Management: “This is helicopter money in all but name and is supportive of our overweight stance in Japanese equities"Royal London Asset Management: “This is helicopter money in all but name and is supportive of our overweight stance in Japanese equities"
Bur Robin Bew of the Economist Intelligence Unit fears the BoJ may be firing blanks.Bur Robin Bew of the Economist Intelligence Unit fears the BoJ may be firing blanks.
Good #BoJ trying to do more, but sceptical that it will have much impact. Bond buying little changed, and 2%+ inflation promise hollow?Good #BoJ trying to do more, but sceptical that it will have much impact. Bond buying little changed, and 2%+ inflation promise hollow?
12.09pm BST12.09pm BST
12:0912:09
Here’s our news story about today’s UK public finances....Here’s our news story about today’s UK public finances....
11.58am BST11.58am BST
11:5811:58
Every cloud has a darker cloud behind it....Every cloud has a darker cloud behind it....
Actually, for the time being the @OECD sounds much more concerned about collapsing world trade growth than Brexit pic.twitter.com/EmXrhawlIzActually, for the time being the @OECD sounds much more concerned about collapsing world trade growth than Brexit pic.twitter.com/EmXrhawlIz
11.53am BST11.53am BST
11:5311:53
In a busy morning for Brexity data, the Bank of England’s regional agents have reported that UK firms have cut back on investment intentions, and hiring plans, since the Referendum.In a busy morning for Brexity data, the Bank of England’s regional agents have reported that UK firms have cut back on investment intentions, and hiring plans, since the Referendum.
But there are signs of a pick-up in August.But there are signs of a pick-up in August.
Here’s the key points:Here’s the key points:
More here:More here:
Economist Rupert Seggins has helpfully charted today’s data:Economist Rupert Seggins has helpfully charted today’s data:
BoE agents scores for investment intentions are a rough signal & they've weakened, but they're not indicating an investment collapse in Q3. pic.twitter.com/8J4IRMAhOxBoE agents scores for investment intentions are a rough signal & they've weakened, but they're not indicating an investment collapse in Q3. pic.twitter.com/8J4IRMAhOx
UpdatedUpdated
at 11.53am BSTat 11.53am BST
11.38am BST11.38am BST
11:3811:38
Housing market slows, but avoids Brexit shockHousing market slows, but avoids Brexit shock
Julia KolleweJulia Kollewe
Property transaction figures from HMRC out today show that there hasn’t been the market crash that many feared following the Brexit vote in June. Residential property transactions were broadly flat between July and August, albeit down 6.1% from a year ago.Property transaction figures from HMRC out today show that there hasn’t been the market crash that many feared following the Brexit vote in June. Residential property transactions were broadly flat between July and August, albeit down 6.1% from a year ago.
The provisional figures show that 97,660 homes were bought in August, only slightly lower than the 97,710 that changed hands in July. (These are seasonally adjusted figures.)The provisional figures show that 97,660 homes were bought in August, only slightly lower than the 97,710 that changed hands in July. (These are seasonally adjusted figures.)
Commercial deals picked up again, after a drop in the immediate aftermath of the Brexit vote to 10,010 in July from 10,630 in June. Non-residential transactions totalled 10,620 in August, up 6.1% from July and 8% higher than a year ago.Commercial deals picked up again, after a drop in the immediate aftermath of the Brexit vote to 10,010 in July from 10,630 in June. Non-residential transactions totalled 10,620 in August, up 6.1% from July and 8% higher than a year ago.
David Brown, chief executive of London estate agents Marsh & Parsons, said of the residential figures:David Brown, chief executive of London estate agents Marsh & Parsons, said of the residential figures:
“The total numbers for Q1 and Q2 of 2016 were astronomically high compared to the corresponding period last year. Consequently the market is still levelling after the frenzy we saw as people clambered to meet the April Stamp Duty deadline. This, along with the Bank of England’s plans to curb Buy-to-let mortgages, caused such an enormous spike in activity, that even if we had not had the referendum vote, we would have expected to spend a good few months seeing the market recover to some level of normality.“The total numbers for Q1 and Q2 of 2016 were astronomically high compared to the corresponding period last year. Consequently the market is still levelling after the frenzy we saw as people clambered to meet the April Stamp Duty deadline. This, along with the Bank of England’s plans to curb Buy-to-let mortgages, caused such an enormous spike in activity, that even if we had not had the referendum vote, we would have expected to spend a good few months seeing the market recover to some level of normality.
“At Marsh & Parsons we are certainly seeing good levels of activity, and it is particularly pleasing to see a number of enquiries resurfacing from people who had put their property searches on hold a couple of months ago. We are feeling optimistic about the remainder of the year.”“At Marsh & Parsons we are certainly seeing good levels of activity, and it is particularly pleasing to see a number of enquiries resurfacing from people who had put their property searches on hold a couple of months ago. We are feeling optimistic about the remainder of the year.”
11.22am BST11.22am BST
11:2211:22
The Financial Times also reckons Britain is going to miss its borrowing target this year:The Financial Times also reckons Britain is going to miss its borrowing target this year:
The UK government seems to be overshooting its borrowing forecasts again, regular as clockwork https://t.co/g65iN32hJN pic.twitter.com/XhmPlwBowgThe UK government seems to be overshooting its borrowing forecasts again, regular as clockwork https://t.co/g65iN32hJN pic.twitter.com/XhmPlwBowg
The old targets may be academic, though, if Philip Hammond does tear up George Osborne’s fiscal targets in two months time....The old targets may be academic, though, if Philip Hammond does tear up George Osborne’s fiscal targets in two months time....