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/2019/sep/19/bank-of-england-rates-brexit-retail-sales-stock-markets-business-live

The article has changed 7 times. There is an RSS feed of changes available.

Version 0 Version 1
World economy faces weakest growth since financial crisis, warns OECD - business live World economy faces weakest growth since financial crisis, warns OECD - business live
(32 minutes later)
Back in the markets, the oil price has suddenly spiked.
Brent crude is up 2.7% this morning to $65.31, from $63.60 last night. The spike followed a report that Saudi Arabia has asked Iraq for 20 million barrels of oil, to supply its refineries.
#OOTT crude up on Saudi request for 20m barrels fro Iraq pic.twitter.com/DC3l2TpGiG
That has reignited fears that last weekend’s drone attack on the Abqaiq oil refinery has caused more damage than Saudi authorities have admitted. Yesterday, oil minister Prince Abdulaziz bin Salman said production would be fully restored by the end of September....
Saudi Arabia reportedly asks Iraq for 20M barrels of crude - press - Aramco said to seek diesel, gasoline, fuel oil for domestic use . So much for ample supplies. #OOTT pic.twitter.com/8MsXpQUMOg
John McDonnell MP, Labour’s Shadow Chancellor, says Westminster politicians should heed the OECD’s warning about a no-deal Brexit.John McDonnell MP, Labour’s Shadow Chancellor, says Westminster politicians should heed the OECD’s warning about a no-deal Brexit.
“This report is a clear and stark warning of what we face if Johnson takes this country over the cliff edge of no deal Brexit. It confirms the absolute necessity of preventing this needless threat to our economy.”“This report is a clear and stark warning of what we face if Johnson takes this country over the cliff edge of no deal Brexit. It confirms the absolute necessity of preventing this needless threat to our economy.”
The OECD has long warned that Brexit would be bad for the UK economy, and today it has claimed that a disorderly No Deal could trigger a long slump.The OECD has long warned that Brexit would be bad for the UK economy, and today it has claimed that a disorderly No Deal could trigger a long slump.
My colleague Philip Inman explains:My colleague Philip Inman explains:
Today’s report estimates that losing unfettered access to EU markets after 31 October will likely plunge the UK into a recession next year. The loss of trade, investment and technical knowledge plus a further fall in the pound will prolong Britain’s low rate of growth until at least 2022.Today’s report estimates that losing unfettered access to EU markets after 31 October will likely plunge the UK into a recession next year. The loss of trade, investment and technical knowledge plus a further fall in the pound will prolong Britain’s low rate of growth until at least 2022.
Laurence Boone, the OECD’s chief economist, said an agreement to smooth Britain’s exit was important to protect businesses and the economy.Laurence Boone, the OECD’s chief economist, said an agreement to smooth Britain’s exit was important to protect businesses and the economy.
“The best thing is to avoid a no-deal Brexit and to stay closely aligned to the EU as possible,” she said.“The best thing is to avoid a no-deal Brexit and to stay closely aligned to the EU as possible,” she said.
More here:More here:
No-deal Brexit will cut 3% off UK economic growth, warns OECDNo-deal Brexit will cut 3% off UK economic growth, warns OECD
Here are some charts from the OECD’s new economic outlook report, showing how economic uncertainty and trade tensions are hurting growth and investment:Here are some charts from the OECD’s new economic outlook report, showing how economic uncertainty and trade tensions are hurting growth and investment:
The OECD has also downgraded its growth forecast for several advanced economies, including the UK.The OECD has also downgraded its growth forecast for several advanced economies, including the UK.
Here’s the detailsHere’s the details
US: 2.4% growth in 2019 (down from 2.8%); 2.0% in 2020 (down from 2.3%)US: 2.4% growth in 2019 (down from 2.8%); 2.0% in 2020 (down from 2.3%)
Eurozone: growth of 1.1% in 2019 (down from 1.2%); 1.0% in 2020 (down from 1.4%)Eurozone: growth of 1.1% in 2019 (down from 1.2%); 1.0% in 2020 (down from 1.4%)
China: growth of 6.1% in 2019 (down from 6.2%); 5.7% in 2020 (down from 6%)China: growth of 6.1% in 2019 (down from 6.2%); 5.7% in 2020 (down from 6%)
Japan: growth of 1% in 2019 (up from 0.7%); 0.6% in 2020 (no change)Japan: growth of 1% in 2019 (up from 0.7%); 0.6% in 2020 (no change)
UK: growth of 1% in 2019 (down from 1.2%); 0.9% in 2020 (down from 1%)UK: growth of 1% in 2019 (down from 1.2%); 0.9% in 2020 (down from 1%)
The OECD’s chief economist, Laurence Boone, says escalating trade tensions are causing serious harm to the world economy.The OECD’s chief economist, Laurence Boone, says escalating trade tensions are causing serious harm to the world economy.
She told Reuters:She told Reuters:
“What looked like temporary trade tensions are turning into a long-lasting new state of trade relationships.”“What looked like temporary trade tensions are turning into a long-lasting new state of trade relationships.”
“The global order that regulated trade is gone and we are in a new era of less certain, more bilateral and sometimes assertive trade relations,”“The global order that regulated trade is gone and we are in a new era of less certain, more bilateral and sometimes assertive trade relations,”
Trade growth is now negative, having grown by 5% in 2017, she added.Trade growth is now negative, having grown by 5% in 2017, she added.
Hopes for an end to the trade war between Washington and Beijing were dashed in May, when negotiations collapsed. Both sides then announced fresh tariffs, but have recently delayed or watered them down, ahead of fresh talks in October.Hopes for an end to the trade war between Washington and Beijing were dashed in May, when negotiations collapsed. Both sides then announced fresh tariffs, but have recently delayed or watered them down, ahead of fresh talks in October.
Newsflash: The Organisation for Economic Co-operation and Development has warned that global growth has slowed to its weakest since the financial crisis.Newsflash: The Organisation for Economic Co-operation and Development has warned that global growth has slowed to its weakest since the financial crisis.
The OECD has slashed its global growth forecast for 2019, from 3.2% to 2.9%.The OECD has slashed its global growth forecast for 2019, from 3.2% to 2.9%.
That would be the weakest annual performance since the great recession a decade ago.That would be the weakest annual performance since the great recession a decade ago.
It has also cut its growth forecast for 2020, from 3.4% to 3%.It has also cut its growth forecast for 2020, from 3.4% to 3%.
#BREAKING OECD slashes global growth forecasts for 2019 and 2020 pic.twitter.com/XAwnEUuPht#BREAKING OECD slashes global growth forecasts for 2019 and 2020 pic.twitter.com/XAwnEUuPht
The Paris-based organisation warns that the costs of the US-China trade war are mounting, and the world risks falling into a prolonged period of weak growth unless governments act.The Paris-based organisation warns that the costs of the US-China trade war are mounting, and the world risks falling into a prolonged period of weak growth unless governments act.
More to follow....More to follow....
Tom Leman, head of retail & consumer at Pinsent Masons, argues that too many retailers are still playing ‘catch-up’ - - and Brexit worries aren’t helping.Tom Leman, head of retail & consumer at Pinsent Masons, argues that too many retailers are still playing ‘catch-up’ - - and Brexit worries aren’t helping.
Here’s his take on August’s retail sales figures.Here’s his take on August’s retail sales figures.
“Whilst monthly stats are a useful indicator of the market they do not tell the full story. The challenging global political environment makes it difficult to make too many assumptions, from these figures, about the health of the retail sector. The threat of a no-deal Brexit makes it almost impossible to predict retail sales and consumer spending in September and October.“Whilst monthly stats are a useful indicator of the market they do not tell the full story. The challenging global political environment makes it difficult to make too many assumptions, from these figures, about the health of the retail sector. The threat of a no-deal Brexit makes it almost impossible to predict retail sales and consumer spending in September and October.
Traditional retailers who have evolved their business to reap the rewards of changing consumer behaviours are ahead of the game. These retailers articulate clearly what they stand for and deliver the right products in the right way to customers. But, there are many, generally stuck in the middle, still playing catch-up who need to focus on business evolution to remain competitive.”Traditional retailers who have evolved their business to reap the rewards of changing consumer behaviours are ahead of the game. These retailers articulate clearly what they stand for and deliver the right products in the right way to customers. But, there are many, generally stuck in the middle, still playing catch-up who need to focus on business evolution to remain competitive.”
Economist Rupert Seggins has crunched today’s retail sales figures...and also pointed out that the monthly data should be treated cautiously.Economist Rupert Seggins has crunched today’s retail sales figures...and also pointed out that the monthly data should be treated cautiously.
UK retail sales growth of 0.6%q/q in the 3 months to August, consistent with a c. 0.03% retail sector contribution to GDP growth. Rise driven mainly by non-store sales & sales by specialised shops (e.g. chemists, computer shops, games shops etc.). pic.twitter.com/dkCwDg4B1zUK retail sales growth of 0.6%q/q in the 3 months to August, consistent with a c. 0.03% retail sector contribution to GDP growth. Rise driven mainly by non-store sales & sales by specialised shops (e.g. chemists, computer shops, games shops etc.). pic.twitter.com/dkCwDg4B1z
The UK's favourite piece of statistical noise - monthly change in retail sales. pic.twitter.com/O29YPM1cVgThe UK's favourite piece of statistical noise - monthly change in retail sales. pic.twitter.com/O29YPM1cVg
Just in: UK retail sales fell in August, suggesting that consumers are becoming more cautious.Just in: UK retail sales fell in August, suggesting that consumers are becoming more cautious.
The Office for National Statistics reports that retail spending dropped by 0.2% last month. That’s weaker than expected, with economists forecasting sales would be flat.The Office for National Statistics reports that retail spending dropped by 0.2% last month. That’s weaker than expected, with economists forecasting sales would be flat.
The ONS blames “non-store retailing” for this fall -- suggesting that people spent less money online last month. It says:The ONS blames “non-store retailing” for this fall -- suggesting that people spent less money online last month. It says:
Internet sales fell on the month by 0.8% when compared with July 2019.Internet sales fell on the month by 0.8% when compared with July 2019.
Other stores reported the largest fall of 5.8% but non-store retailing was the largest contributor to the monthly fall because of its large weight of 50.7%.Other stores reported the largest fall of 5.8% but non-store retailing was the largest contributor to the monthly fall because of its large weight of 50.7%.
July’s figures have been revised higher, though, so it’s not all bad.July’s figures have been revised higher, though, so it’s not all bad.
UK retail sales for July revised up so a 0.2% decline in August not that bad. #gbpUK retail sales for July revised up so a 0.2% decline in August not that bad. #gbp
Over the last three months, retail sales grew by 0.6%, which the ONS calls “moderate growth”.Over the last three months, retail sales grew by 0.6%, which the ONS calls “moderate growth”.
And on an annual basis, the amount of items bought was 2.7% higher than a year ago .And on an annual basis, the amount of items bought was 2.7% higher than a year ago .
The ONS says:The ONS says:
This is a slowdown compared to the stronger growth experienced earlier in the year which peaked at 6.7% in March 2019.This is a slowdown compared to the stronger growth experienced earlier in the year which peaked at 6.7% in March 2019.
Commenting on today’s Retail Sales figures for the 3-months to August, Head of Retail Sales @StatsRhian said https://t.co/OGL94RYxEO pic.twitter.com/vXvDNT91b7Commenting on today’s Retail Sales figures for the 3-months to August, Head of Retail Sales @StatsRhian said https://t.co/OGL94RYxEO pic.twitter.com/vXvDNT91b7
High street retailer Next has been burned by the unusually hot autumn weather.High street retailer Next has been burned by the unusually hot autumn weather.
The company warned this morning that the “warm start to September” has adversely affected trading this month. This sent its shares sliding 5% at one stage, to the bottom of the FTSE 100 leaderboard.The company warned this morning that the “warm start to September” has adversely affected trading this month. This sent its shares sliding 5% at one stage, to the bottom of the FTSE 100 leaderboard.
CEO Simon Wolfson argues that the weather, rather than Brexit, is the problem:CEO Simon Wolfson argues that the weather, rather than Brexit, is the problem:
It is very hard to determine whether the uncertainty over Brexit is having any effect on consumer spending and we can find no evidence that it is affecting spending on small ticket price items.It is very hard to determine whether the uncertainty over Brexit is having any effect on consumer spending and we can find no evidence that it is affecting spending on small ticket price items.
Certainly, the first few weeks of the Autumn season have been disappointing. However, we believe that the warm start to September has done much more to hinder sales than the political temperature.”Certainly, the first few weeks of the Autumn season have been disappointing. However, we believe that the warm start to September has done much more to hinder sales than the political temperature.”
Next also says its prices will go down rather than up in event of a no-deal Brexit (although that is not its preferred outcome).Next also says its prices will go down rather than up in event of a no-deal Brexit (although that is not its preferred outcome).
The Government’s new temporary tariff regime announced in March will reduce Next’s import duty costs by around £25m. “All things being equal we would pass this saving onto consumers and the proposed tariffs would reduce our cost of goods by around 2%.”The Government’s new temporary tariff regime announced in March will reduce Next’s import duty costs by around £25m. “All things being equal we would pass this saving onto consumers and the proposed tariffs would reduce our cost of goods by around 2%.”
Next has also acquired Authorised Economic Operator status (Morrisons has this too and likened it to speedy boarding at the ports). As a precaution it has moved shipments away from the Dover Calais route to alternative ports or airports.Next has also acquired Authorised Economic Operator status (Morrisons has this too and likened it to speedy boarding at the ports). As a precaution it has moved shipments away from the Dover Calais route to alternative ports or airports.
Wolfson, whose father chaired the company in the 1990s, revealed that Next is managing to drive its rents down, although only when they come up for renewal. He also quipped:Wolfson, whose father chaired the company in the 1990s, revealed that Next is managing to drive its rents down, although only when they come up for renewal. He also quipped:
“I remember my dad quipping that a business only discovers its fixed costs when sales decline!”“I remember my dad quipping that a business only discovers its fixed costs when sales decline!”
Total sales at Next are up 3.8% over the last six month, with a 12.6% jump in online trading making up for a 5.5% slump at its retail stores.Total sales at Next are up 3.8% over the last six month, with a 12.6% jump in online trading making up for a 5.5% slump at its retail stores.
Newsflash: Norway’s central bank has defied the prevailing mood, by raising interest rates.Newsflash: Norway’s central bank has defied the prevailing mood, by raising interest rates.
The Norges Bank’s Executive Board has decided to raise the policy rate by 0.25 percentage point to 1.50%.The Norges Bank’s Executive Board has decided to raise the policy rate by 0.25 percentage point to 1.50%.
Unlike rival central banks, it has concluded that the outlook requires slightly higher interest rates, saying:Unlike rival central banks, it has concluded that the outlook requires slightly higher interest rates, saying:
Underlying inflation is close to the inflation target. Growth in the Norwegian economy remains solid, and capacity utilisation is somewhat above a normal level. This suggests in isolation a higher policy rate. A higher policy rate may also mitigate the risk of a renewed acceleration in debt growth and house price inflationUnderlying inflation is close to the inflation target. Growth in the Norwegian economy remains solid, and capacity utilisation is somewhat above a normal level. This suggests in isolation a higher policy rate. A higher policy rate may also mitigate the risk of a renewed acceleration in debt growth and house price inflation
BREAKING! #Norway continues to be a central bank ‘outlier’ as Norges Bank raises rates again. pic.twitter.com/1mYGxRBuIaBREAKING! #Norway continues to be a central bank ‘outlier’ as Norges Bank raises rates again. pic.twitter.com/1mYGxRBuIa
Switzerland’s central bank has left interest rates on hold, at their record low of -0.75%.Switzerland’s central bank has left interest rates on hold, at their record low of -0.75%.
These negative rates are in an attempt to prevent the Swiss franc strengthening too much.These negative rates are in an attempt to prevent the Swiss franc strengthening too much.
The SNB declined to match the European Central Bank, which eased monetary policy again last week. Instead, it has pledged to remain active in the currency markets, if needed.The SNB declined to match the European Central Bank, which eased monetary policy again last week. Instead, it has pledged to remain active in the currency markets, if needed.
European stock markets have opened higher, as trader digest last night’s cut in US interest rates....and Fed chair Jerome Powell’s comments afterwards.European stock markets have opened higher, as trader digest last night’s cut in US interest rates....and Fed chair Jerome Powell’s comments afterwards.
The main indices are all higher, led by Italy and France.The main indices are all higher, led by Italy and France.
Powell’s message to the markets was broadly this: The US economy is in good shape, but problems overseas and the trade war aren’t helping. We’ll be guided by the data, but it’s best to be proactive. The Fed doesn’t see a recession looming, but we’d take action if we did.Powell’s message to the markets was broadly this: The US economy is in good shape, but problems overseas and the trade war aren’t helping. We’ll be guided by the data, but it’s best to be proactive. The Fed doesn’t see a recession looming, but we’d take action if we did.
Alex Kuptsikevich, FxPro financial analyst, says Powell’s optimism may have reassured investors.Alex Kuptsikevich, FxPro financial analyst, says Powell’s optimism may have reassured investors.
The Federal Reserve cut the key rate by a quarter of a percentage point to 1.75%-2.00%. In the press conference, Powell noted the “favourable” economic forecast, explaining that this easing step was to “provide insurance against ongoing risks”. Strictly speaking, these comments turned out to be a little hawkish than the market expected, pointing to a possible pause in policy easing.The Federal Reserve cut the key rate by a quarter of a percentage point to 1.75%-2.00%. In the press conference, Powell noted the “favourable” economic forecast, explaining that this easing step was to “provide insurance against ongoing risks”. Strictly speaking, these comments turned out to be a little hawkish than the market expected, pointing to a possible pause in policy easing.
Overall, Powell was very optimistic about the state of the economy, noting healthy growth rates of employment and consumer activity, despite the lower capital expenditures of companies.Overall, Powell was very optimistic about the state of the economy, noting healthy growth rates of employment and consumer activity, despite the lower capital expenditures of companies.
Powell’s speech proved to be very convincing, as the economy has recently provided very positive economic data.Powell’s speech proved to be very convincing, as the economy has recently provided very positive economic data.
A few hours before the rate decision, we saw the highest number of construction permits in 12 years. The day before, the Fed had published robust industrial production data, indicating a likely upward reversal in business activity not only in the consumer but also in the manufacturing sector.A few hours before the rate decision, we saw the highest number of construction permits in 12 years. The day before, the Fed had published robust industrial production data, indicating a likely upward reversal in business activity not only in the consumer but also in the manufacturing sector.
The Financial Times has spotted that City investors are positioning themselves to profit from a no-deal Brexit (or at least limit their losses!).The Financial Times has spotted that City investors are positioning themselves to profit from a no-deal Brexit (or at least limit their losses!).
The FT’s Philip Stafford explains:The FT’s Philip Stafford explains:
Investors have taken out a record number of options contracts to bet on or hedge against moves in UK interest rates, amid rising concerns that Britain may depart the EU at the end of October without an agreement on its future relationship with the bloc. Open interest — a measure of traders’ live positions in futures and options on UK rates over the next three months — surged to 18.4m contracts on Tuesday at ICE Futures Europe, the main derivatives exchange in London.Investors have taken out a record number of options contracts to bet on or hedge against moves in UK interest rates, amid rising concerns that Britain may depart the EU at the end of October without an agreement on its future relationship with the bloc. Open interest — a measure of traders’ live positions in futures and options on UK rates over the next three months — surged to 18.4m contracts on Tuesday at ICE Futures Europe, the main derivatives exchange in London.
The options, if exercised, would allow investors to profit from unexpected rate cuts or protect themselves from the damage stemming from rapid rate rises.The options, if exercised, would allow investors to profit from unexpected rate cuts or protect themselves from the damage stemming from rapid rate rises.
Investors take out record number of options to trade ‘no-deal’ Brexit https://t.co/xiSPvRWnlmInvestors take out record number of options to trade ‘no-deal’ Brexit https://t.co/xiSPvRWnlm
Britain’s competition watchdog has waded into a takeover between two UK shoe retailers.Britain’s competition watchdog has waded into a takeover between two UK shoe retailers.
My colleague Julia Kollewe explains:My colleague Julia Kollewe explains:
The Competition and Markets Authority fears that JD Sports’ £90m deal to buy its smaller rival Footasylum could be bad for shoppers, and will carry out an in-depth investigation unless JD can address its concerns.The Competition and Markets Authority fears that JD Sports’ £90m deal to buy its smaller rival Footasylum could be bad for shoppers, and will carry out an in-depth investigation unless JD can address its concerns.
The CMA said its initial investigation found the deal could result in a “substantial lessening of competition” by removing one of JD Sports’ closest competitors.The CMA said its initial investigation found the deal could result in a “substantial lessening of competition” by removing one of JD Sports’ closest competitors.
The CMA is concerned that this could result in a worse deal for customers through higher prices, less choice in stores or worsening customer service. “JD Sports must now address the concerns identified or face a further, more in-depth, investigation,” it said.The CMA is concerned that this could result in a worse deal for customers through higher prices, less choice in stores or worsening customer service. “JD Sports must now address the concerns identified or face a further, more in-depth, investigation,” it said.
Colin Raftery, senior director at the CMA, said: “JD Sports is already by far the largest player in the growing sports fashion sector, so any deal that results in it buying up one of its closest competitors could clearly give cause for concern.Colin Raftery, senior director at the CMA, said: “JD Sports is already by far the largest player in the growing sports fashion sector, so any deal that results in it buying up one of its closest competitors could clearly give cause for concern.
“Our investigation has shown us that JD Sports and Footasylum have been competing strongly across the UK, with a sports fashion offering that few other retailers are able to match. That’s why we’re concerned this deal could lead to higher prices, less choice and a worse shopping experience for customers.”“Our investigation has shown us that JD Sports and Footasylum have been competing strongly across the UK, with a sports fashion offering that few other retailers are able to match. That’s why we’re concerned this deal could lead to higher prices, less choice and a worse shopping experience for customers.”
JD, though, insists that the merger makes sense.JD, though, insists that the merger makes sense.
Competition watchdog CMA says JD Sports’ takeover of smaller rival Footasylum could be bad for shoppers; threatens in-depth investigation if JD doesn't address its concernsCompetition watchdog CMA says JD Sports’ takeover of smaller rival Footasylum could be bad for shoppers; threatens in-depth investigation if JD doesn't address its concerns
Marc Ostwald of ADM Investor Services is confident that the Bank of England won’t do anything too dramatic today:Marc Ostwald of ADM Investor Services is confident that the Bank of England won’t do anything too dramatic today:
The Bank of England can safely be assumed to stand pat, being hostage as it is to very elevated Brexit uncertainty, though it will be interesting to see if the minutes suggest any tweaks to its forecasts, even though these tend to be generally reactive....The Bank of England can safely be assumed to stand pat, being hostage as it is to very elevated Brexit uncertainty, though it will be interesting to see if the minutes suggest any tweaks to its forecasts, even though these tend to be generally reactive....
The lower than expected CPI, in no small part due to Clothing, imparts a modest upside risk for today’s Retail Sales, which have defied gloomy signals from most retail sector surveys in recent months.The lower than expected CPI, in no small part due to Clothing, imparts a modest upside risk for today’s Retail Sales, which have defied gloomy signals from most retail sector surveys in recent months.
Several other central banks are also setting monetary policy today, including the national banks of Switzerland, Norway, Indonesia, Taiwan and South Africa.Several other central banks are also setting monetary policy today, including the national banks of Switzerland, Norway, Indonesia, Taiwan and South Africa.
Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.
Like Supreme Court justices, central bankers have been the ‘adults in the room’ during these times of economic upheaval.Like Supreme Court justices, central bankers have been the ‘adults in the room’ during these times of economic upheaval.
So, after an intriguing Federal Reserve meeting last night, its the Bank of England’s turn in the spotlight today, with the Bank of Japan having already acted overnight - leaving rates on hold.So, after an intriguing Federal Reserve meeting last night, its the Bank of England’s turn in the spotlight today, with the Bank of Japan having already acted overnight - leaving rates on hold.
Federal Reserve cuts interest rates, and earns another blast from Trump - as it happenedFederal Reserve cuts interest rates, and earns another blast from Trump - as it happened
The BoE is widely expected to leave interest rates unchanged, while it awaits some clarity on Brexit. Yesterday’s drop in inflation, to a three-year low of 1.7%, is no reason to cut borrowing costs, while a rate hike would hurt an already-nervous economy.The BoE is widely expected to leave interest rates unchanged, while it awaits some clarity on Brexit. Yesterday’s drop in inflation, to a three-year low of 1.7%, is no reason to cut borrowing costs, while a rate hike would hurt an already-nervous economy.
The minutes of today’s meeting, also released at noon, will show the BoE’s concerns about Brexit preparedness and the state of the UK. A gloomy outlook could move the pound.The minutes of today’s meeting, also released at noon, will show the BoE’s concerns about Brexit preparedness and the state of the UK. A gloomy outlook could move the pound.
Ipek Ozkardeskaya, senior market analyst at London Capital Group, says:Ipek Ozkardeskaya, senior market analyst at London Capital Group, says:
The Bank of England (BoE) is expected to maintain its monetary policy unchanged at today’s meeting, as Governor Mark Carney will continue assuming an orderly Brexit while keeping an eye on the looming downside risks.The Bank of England (BoE) is expected to maintain its monetary policy unchanged at today’s meeting, as Governor Mark Carney will continue assuming an orderly Brexit while keeping an eye on the looming downside risks.
With the worst Brexit scenarios fully priced in, the pound traders could find interesting dip-buying opportunities below the 1.25 level against the US dollar. A negative outcome regarding Johnson’s parliament suspension could send the pound rallying past $1.25.With the worst Brexit scenarios fully priced in, the pound traders could find interesting dip-buying opportunities below the 1.25 level against the US dollar. A negative outcome regarding Johnson’s parliament suspension could send the pound rallying past $1.25.
Before the BoE’s big moment we get new UK retail sales figures. Due at 9.30am, they are expected to show a slowdown in spending.And while Mark Carney does have a tough job, at least he needn’t worry about being labelled gutless by the prime minister.Before the BoE’s big moment we get new UK retail sales figures. Due at 9.30am, they are expected to show a slowdown in spending.And while Mark Carney does have a tough job, at least he needn’t worry about being labelled gutless by the prime minister.
Last night, Fed chair Jerome Powell earned another blast from Donald Trump after announcing a small cut in interest rate — too small for the president. In response, Powell hinted that the US Economic would be in a better state without the president’s trade wars.Last night, Fed chair Jerome Powell earned another blast from Donald Trump after announcing a small cut in interest rate — too small for the president. In response, Powell hinted that the US Economic would be in a better state without the president’s trade wars.
Jay Powell and the Federal Reserve Fail Again. No “guts,” no sense, no vision! A terrible communicator!Jay Powell and the Federal Reserve Fail Again. No “guts,” no sense, no vision! A terrible communicator!
The Fed’s decision wasn’t unanimous - while 7 governors voted in favour, two opposed any cut while one wanted a deeper move. The FOMC was also remarkably split over the future path of interest rates. Some think they’re done cutting for the year, others expect more easing, and a third group think rates are going up again soon.The Fed’s decision wasn’t unanimous - while 7 governors voted in favour, two opposed any cut while one wanted a deeper move. The FOMC was also remarkably split over the future path of interest rates. Some think they’re done cutting for the year, others expect more easing, and a third group think rates are going up again soon.
The markets initially concluded that the Fed was disappointingly hawkish (sending shares down and the dollar up), but this move later reversed as Powell spoke about being prepared to act aggressively if needed.The markets initially concluded that the Fed was disappointingly hawkish (sending shares down and the dollar up), but this move later reversed as Powell spoke about being prepared to act aggressively if needed.
So, lots for investors to ponder today, with the weekly US jobless reportSo, lots for investors to ponder today, with the weekly US jobless report
The agendaThe agenda
9.30am BST: UK retail sales for August9.30am BST: UK retail sales for August
12pm BST: Bank of England interest rate decision12pm BST: Bank of England interest rate decision
1.30pm BST: US weekly jobless report1.30pm BST: US weekly jobless report
3pm BST: US home sales report for August3pm BST: US home sales report for August