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UK inflation expected to inch up – business live

Discussion in 'Market News' started by Lily, Mar 22, 2016.

  1. Lily

    Lily Forum Member

    Aug 29, 2015
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    All the day’s economic and financial news, including the latest UK inflation report and a parliamentary hearing on the UK budget

    8.02am GMT

    Michael Hewson of CMC Markets also predicts that today’s inflation data could raise the chances of UK borrowing costs rising soon.

    He writes:

    Unlike the Federal Reserve, the Bank of England has been much more dovish in recent months in respect to its own rate message. This is despite UK economic data being much better than US data, with average earnings in particular rising on a par with those in the US.

    Furthermore, CPI Inflation has also been rising steadily since November’s -0.1%, with another rise expected to 0.4%, from January’s 0.3%. The rebound in oil prices as well as recent sterling weakness has knocked the scenario of rate rises sometime in 2017.

    7.53am GMT

    This morning’s UK inflation report could reignite talk of a UK interest rate rise in the not-too-distant future.

    David Song, currency analyst at DailyFX, believes the consumer prices index could put could show signs of stronger price growth, perhaps to 0.4% from 0.3% in January.

    Another uptick in the U.K. Consumer Price Index accompanied by stickiness in the core-rate of inflation may boost the appeal of the sterling as it puts increased pressure on the Bank of England to normalize monetary policy sooner rather than later.

    The BoE looks poised to retain its current policy ahead of the U.K. Referendum in June as the Monetary Policy Committee remains unanimous in keeping the benchmark interest rate at the record-low, but increased price pressures may encourage Governor Mark Carney to adopt a more hawkish tone over the coming months as the central bank sees a risk of overshooting the 2% inflation-target over the policy horizon.”

    7.35am GMT

    Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.

    It’s quiet, too quiet, as they say in the old Westerns. But the edgy calm that has broken out in the markets recently could be shaken by a splurge of economic data this morning.

    Today’s highlights include German ZEW & IFO, manuf & services PMI from FR, GE & EU, UK CPI, US Richmond Fed Manuf Index & API Inventories

    Our European opening calls:$FTSE 6188 up 4
    $DAX 9945 down 3
    $CAC 4431 up 3$IBEX 9020 down 1$MIB 18715 up 18

    Related: Disability benefits U-turn leaves Cameron with £4.4bn to find

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