inflation

The Bank of England will weigh the weakness of Britain’s wage growth against the strength of its economic recovery when it delivers fresh forecasts in its quarterly inflation report on Wednesday morning, containing signals about when a rise in interest rates is likely.

<To be delivered in tandem with the latest UK employment data, the BoE’s estimates of the amount of slack in the economy will be one of the most closely watched metrics. At the last quarterly inflation report in May, the BoE estimated the amount of spare capacity was between 1 – 1.5 per cent, judging there was room for this to narrow further before rates tightened.

By Sarah O’Connor and Claer Barrett

 

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Alan Beattie

The euro has fallen to a 16-month low below $1.27 – run, run for your lives! Or recognise that it’s still around the trade-weighted average for the past decade and only slightly weaker in real terms than when it launched, that a weaker currency is just what a stricken economy needs and that there isn’t much sign that the fall is disorderly and hence generally hitting confidence in eurozone assets. (The eurozone authorities are doing that.) Read more