Bank of England governor Mark Carney: real wages will fall this year - as it happened
UK central bank warns that households will be squeezed this year as inflation rises faster than previously forecast
- Carney: Real wages will fall this year
- Carney: Inflation better than unemployment
- UK interest rates unchanged after 7-1 vote
- Bank warns that higher inflation will hit households
- Growth forecast for 2017 cut
5.51pm BST
Weak UK data and a less hawkish than expected outlook from the Bank of England left sterling weaker but the FTSE 100 virtually unchanged by the close. But with the euro edging higher, European markets slipped back, while on Wall Street the Dow Jones Industrial Average was on course for its worst daily performance for nearly a month, not helped by poor figures from Macy's. The final scores showed:
4.46pm BST
Over in Athens, Greek finance minister Euclid Tsakalotos has felt the full force of protests today with communist-aligned demonstrators occupying his office ahead of next week's vote on yet more austerity measures demanded by creditors in return for fresh bailout funds to avert default. Helena Smith reports:
Barging their way into the finance ministry on Syntagma Square, scores of communist-aligned protestors hung a massive banner from the building's faiade exhorting Greeks to "rise up" and participate in the general strike that will coincide with parliament legislating further cuts and tax increases in exchange for emergency bailout loans next week. The protest, which kicks off a week of work stoppages, strikes and street demonstrations ahead of the vote, kept Tsakalotos locked out of his sixth-floor office for most of the day.
Standing in front of the finance ministry, Yannis Hiotelis, a retired bank employee said his pension had been already been cut 60 percent. "How do they expect us to survive?" he asked of prime minister Alexis Tsipras' leftist-led government. "Austerity only leads to unhappiness, disillusionment, bitterness and ultimately friction. We are talking about outright pillage. This government has made a mockery of its own so called leftist politics."
The protest came as the International Monetary Fund appeared to roll back on speculation that it would sign up to the Greek bailout programme before a comprehensive debt deal had been found for the debt-stricken country. Greece is expected to be the focus of talks when the G7 meet over the next few days.
4.26pm BST
Joshua Mahony, market analyst at IG, said:
Today has been all about the UK, with a batch of hugely uninspiring data points giving way to a surprisingly volatile Bank of England meeting. The FTSE has suffered alongside its European and US counterparts, with a relatively stable day turning sour this afternoon. Gold producers Fresnillo and Randgold Resources are the top performers of the day, and it looks like investors are battening down the hatches for now.
The downturn in UK economic data over recent months has been there for all to see, yet this morning provided a perfect overview of how British industry is struggling of late. Negative construction output, manufacturing production and industrial production in March goes to show how tough the current business environment is for firms. However, probably the most damning number was the trade balance for goods which showed that despite the boost of a weaker pound, we are seeing consumers continue to focus on imports over domestic products.
3.29pm BST
It's turning into a disappointing day for investors, with markets under pressure and the pound underwhelmed by the Bank of England's comments and the UK data. Connor Campbell, financial analyst at Spreadex, said:
You'd think, with the Bank of England stating that interest rates may rise faster than expected, that sterling would be pretty happy. You'd be wrong.
That's because there was a lot of BoE data to digest this afternoon, and not much of it good. First of all sterling was likely disappointed that Kristin Forbes was the sole MPC member to vote for a rate hike, missing out on the potential hawkish hand rumoured from Michael Saunders. Then there was the slight downward revision to the 2017 GDP forecasts, which were trimmed from 2.0% to 1.9%. Even the pound-positive news that inflation is expected to hit 2.7% in this quarter - a decent whack higher than the 2.4% initially expected - was joined by a warning that average earnings growth will be a mere 2% this year, down from the 3% previously stated 3%, marking a huge fall in real wages and living standards.
It's only dropped back to a 4 day low, but biggest sell off we have seen in the US for a while. S&P500 back to the trend: pic.twitter.com/TWSlvkL524
3.06pm BST
Back to the Bank of England once more, and here's the view of one ex-member of its monetary policy committee:
big issue for mpc is why no members who seem to understand data & will challenge the forecast = back to tyranny of the (wrong) consensus?
3.03pm BST
With stock markets under pressure after their recent runs - the Dow Jones Industrial Average is down 135 points or 0.6% at the moment - there are signs of life in the precious metals market.
Gold is currently up $5 an ounce at $1223 while silver is up from $16.14 to $16.26, as investors dip their toes back into perceived safer areas.
2.45pm BST
Back with the Bank of England, and this chart shows how UK and US interest rates are now diverging:
The Bank of England holds fire on interest rates but what about its growth projections? https://t.co/N40H5iaUqk pic.twitter.com/iATvtL2ewH
2.38pm BST
US markets have opened on the back foot as consumer shares were undermined by disappointing results from department store group Macy's.
The Dow Jones Industrial Average is down while the S&P 500 opened 0.25% lower and the Nasdaq Composite down 0.3%.
2.29pm BST
Over in the US, and new claims for jobless benefits unexpectedly fell last week, another indication of the growing strength of the labour market.
Weekly jobless claims fell by 2,000 to 236,000 compared to expectations of a rise to 245,000. Claims have been below 300,000 - a level seen as a sign of a healthy jobs market - for 114 weeks in a row, the best run since 1970.
2.11pm BST
And the slide in sterling continues in the wake of the Bank of England's meeting, with the expectation that it will not raise interest rates before the end of 2019, notwithstanding the more hawkish tone of some of its comments.
So the pound has hit a one week low against the dollar of $1.2851, down around 0.7%. Against the euro it has fallen 0.5% to a1.1838.
2.07pm BST
And here's some City reaction to the Bank of England's meeting:
1.54pm BST
Mark Carney's warning that real wages will shrink this year is an alarm bell for UK politicians, says the TUC.
TUC General Secretary Frances O'Grady says workers have already suffered enough since the financial crisis; a second wage squeeze is simply not fair.
"British workers have already suffered the longest pay squeeze since Victorian times. It will worry them that the Bank of England says there is more pain to come this year.
"All the political parties must explain in their manifestos how they will give Britain a pay rise. They should start with scrapping the unfair pay restrictions on public servants, which will leave midwives over 3,000 a year worse off in real terms by 2020. And they must commit to boosting the National Minimum Wage to 10 as soon as possible."
1.49pm BST
There's lots of coverage of the Bank of England's quarterly inflation report.
Chris Giles of the Financial Times is struck by Carney's comments on Brexit:
UK interest rates will be able to rise towards more normal levels during the next three years if Theresa May negotiates a "smooth" Brexit, the Bank of England said on Thursday as it published forecasts suggesting that the recent economic slowdown will be temporary.
But in a stark warning to the UK prime minister less than one month before the general election, the central bank made it clear that its sanguine forecasts depended on Mrs May coming back from Brussels with a Brexit deal that ensures companies will not have to make sharp adjustments as the UK leaves the EU.
Stronger business investment and the ongoing global recovery will ensure economic growth this year remains robust, even as households face the biggest real income squeeze in years, according to the Bank of England.
Bank policymakers trimmed their forecast for UK growth this year to 1.9pc due to slower household spending growth.
Mark Carney warned that U.K. households will face a difficult year, underpinning the Bank of England's decision to keep interest rates on hold. The pound fell.
While the BOE governor said policy makers have assumed the U.K.'s departure from the European Union will unfold smoothly, he noted the uncertainties surrounding that process and said real wage growth will remain weak for now.
1.33pm BST
Q: Are your forecasts at risk if stock markets fall back from their current high levels and volatility rises?
The world hasn't become dramatically less uncertain and we can certainly see some potential triggers for increased volatility at some point.
1.26pm BST
Q: Your forecasts are build on a smooth Brexit, including a transition forecast. Isn't that rather optimistic, given Mrs May is heading for a hard Brexit - and that infamous dinner at Number 10 Downing Street?
The UK's stated objective is a bold, comprehensive trade agreement with the EU, and an appropriate transition period.
1.24pm BST
Q: Theresa May wants to reduce immigration below 100,000 per year, which may tighten the labour market and dampen growth. Do you take that into account?
Carney does his best to avoid saying anything controversial, explaining that the Bank bases its forecasts on migration projections from the Office for National Statistics, rather than on political promises.
1.19pm BST
Q: Is it better to leave monetary policy looser for longer, rather than risking tightening too soon?
The current stance of monetary policy is 'appropriate', Carney replies carefully, dampening the idea that policy is too loose.
1.16pm BST
Q: You said hopefully wages will catch up next year; will that be enough for people who are struggling right now?
The key to making ends meet is having a job, Carney replies. So the Bank needs to set monetary policy so that as many people are in work as possible.
If the trade-off is people in work, but inflation is a little higher, then it's better to have people in work.
1.13pm BST
Asked about the global economic picture, Mark Carney says that China is one key medium-term risk.
Both the rate of growth in China, and the economic adjustments as it transitions to a consumer-driven economy, must be watched closely.
1.10pm BST
Q: How can you be confident about employment staying strong, and wages rising, given the possibility that artificial intelligence will reshape the labour market and take jobs?
It is possible that automation, machine learning, will have a major impact on the jobs market in the future, Carney agrees.
1.08pm BST
Q: How worried are you about the fall in Britain's savings ratio to a record low?
Mark Carney says it takes a "very special and to some extent sad individual" to really understand the intricacies of the savings ratio (which measures the ratio of personal savings to disposable income in an economy).
1.03pm BST
Q: Inflation is above forecast, the economy is growing at trend growth, unemployment is falling...so how can you justify excessive stimulus at these levels? And are you not raising interest rates because households can't stomach it?
Where to begin, sighs Carney, before taking a stab at it...
12.59pm BST
Asked about trade, Carney says that trade growth has been 'relatively modest' given the scale of the fall in sterling and the pick-up in global trade
(maybe he's thinking of this morning's worrying jump in the UK trade deficit....)
12.57pm BST
Interesting. Carney: Bank has detected "evidence some businesses are hesitating to raise wages at a time of uncertainty abt market access"
12.54pm BST
Despite some hawkish comments in the Bank of England's statement, ING economist James Smith says he still does not expect a rate hike before Brexit talks concude in 2019. He says:
Today's major tail risk was that MPC member Saunders could join Kristin Forbes in voting for an immediate 25bp rate hike. In the event, the committee voted 7-1 (note the MPC is a voter down at present) to keep rates unchanged.
Unsurprisingly, there were no earth shattering changes to growth or inflation forecasts, with the possible exception of the 2017 CPI forecast (which was raised from 2.4% to 2.7%). After all, the General Election period is not an ideal time to make major alterations.
12.53pm BST
Q: How can you be certain that real wages will turn positive again in a couple of year's time?
Mark Carney points to the 'tightness' in the labour market. Britain is still creating jobs, and at some stage that should feed through to higher wages.
12.53pm BST
A quick explanation: Real wages means people's actual pay, minus the inflation rate.
So, for example, if pay is rising by 2%, and inflation is rising by 2.1%, real incomes are slightly negative.
12.48pm BST
Q: Is the squeeze in real incomes all down to Brexit?
No, says Carney. Part of the story is that wage growth has been weak for some time.
12.47pm BST
Q: You say your forecasts are build on a 'smooth' Brexit - what impact would a turbulent Brexit have?
Carney says the Bank hasn't done an alternative forecast; a smooth Brexit includes an agreement on future trade links and a smooth transition out of the EU.
12.46pm BST
At Bank of England: Real wages will fall this year. Consumers will feel the squeeze. But things will get better next year as inflation slows
I like how Carney explains his points both in technical terms ('real wages declining') and layman's terms ('wages not keeping up').
12.44pm BST
12.42pm BST
Onto questions...
Q: Can you explain in layman's language what you are seeing with real wages?
This is going to be a more challenging time for households.
12.39pm BST
While Brexit will play an important role, other factors will also play a part affecting inflation, Carney continues.
Monetary policy can respond in either direction to changes in the economic outlook (ie, the Bank could either cut or raise interest rates as needed), says the governor.
12.37pm BST
Good news for workers: The Bank of England thinks that the factors pushing down real wages will not persist for long.
Carney explains that wages are expected to rise as the output narrows towards the end of its forecast horizon.
12.35pm BST
Mark Carney on GDP growth and household spending. #InflationReport #SuperThursday pic.twitter.com/G3dzAGUXzx
12.34pm BST
12.34pm BST
Mark Carney begins by saying that the path the UK economy takes depends on how households, businesses and the financial markets respond to the negotiations around Britain's exit from the EU.
And there are signs that Brexit is having an effect.
12.31pm BST
Bank of England governor Mark Carney is holding a press conference at the Bank of England now, accompanied by deputy governor Ben Broadbent.
You can watch it here:
12.26pm BST
Sterling has fallen against the US dollar since the minutes were released, losing half a cent to $1.288.
That's slightly surprising, to be honest, given the Bank's warning that rates are likely to rise faster than the City currently expects.
The BoE said the UK may need tighter monetary policy than the yield curve currently implies and re-iterated that it has limited tolerance for above-target CPI inflation. But the markets were left disappointed by the fact no other MPC member joined Kristin Forbes in voting for a rate rise.
12.24pm BST
Here's some instant reaction to the Bank's announcement, from Resolution Group's Duncan Weldon:
Shorter BOE: bigger than expected real income squeeze this year but not much change in forecasts. *If* Brexit is smooth then rates go up.
Bank of England to Britain: It's not our fault you guys decided to make yourselves poorer pic.twitter.com/UgAExT3n1a
12.19pm BST
The Bank minutes include a warning that its forecasts are based on Britain achieving a 'smooth' Brexit.
It says:
In the final year of the forecast, however, the output gap closes and inflation rises slightly further above the target. This is conditioned on the assumptions that the adjustment to the United Kingdom's new relationship with the European Union is smooth, and that Bank Rate follows the market-implied path for interest rates.
BoE doesn't change its forecasts much. Warns T May that sanguine outlook depends on her negotiating a "smooth" Brexit
12.15pm BST
The Bank of England has also warned that it might have to raise interest rates faster than the market thinks.
The minutes of today's meeting conclude that:
In judging the appropriate policy stance, the Committee will be monitoring closely the incoming evidence regarding these and other factors. Monetary policy can respond in either direction to changes to the economic outlook as they unfold to ensure a sustainable return of inflation to the 2% target.
On the whole, the Committee judges that, if the economy follows a path broadly consistent with the May central projection, then monetary policy could need to be tightened by a somewhat greater extent over the forecast period than the very gently rising path implied by the market yield curve underlying the May projections.
12.10pm BST
My colleague Katie Allen has emerged from the lock-in at the Bank of England, and reports....
The Bank of England has warned households that living standards will fall this year as the Brexit vote works its way through to higher prices and meagre pay deals.
Presenting a sober assessment of the economic outlook just weeks before the general election on 8 June, the Bank left interest rates on hold at their record low of 0.25% but hinted that they may need to rise sooner than investors were anticipating if inflation continued to overshoot its target.
More gloom on UK living standards outlook: Bank of England average earnings growth f'cast cut to 2% fr 3% made in Feb
12.09pm BST
The Bank of England has slightly cut its growth forecast for this year, from 2% to 1.9%.
On the upside, it now expects growth of 1.7% in 2018, up from 1.6% three months ago.
12.03pm BST
Here's the official announcement:
MPC holds #BankRate at 0.25%, maintains government bond purchases at 435bn and corporate bond purchases at up to 10bn. pic.twitter.com/vPlTLdPDnD
12.01pm BST
Breaking! The Bank of England has voted to leave UK interest rates unchanged, at their current record low of 0.25%.
It's a seven-one split; only Kristin Forbes voted for a hike in borrowing costs.
11.55am BST
ING have thrown their hat into the ring, predicting that the BoE was split 7-1 on whether to leave interest rates on hold.
Watch for this from the Bank of England - will there be another MPC member voting for a rate hike? Unlikely, but you never know.#BOE #FX pic.twitter.com/TqbtCnrqRn
11.29am BST
In 30 minutes time, we learn what decisions the Bank of England took this month, plus we see the new forecasts in the Inflation Report.
Although interest rates aren't expected to change, there's some chatter in the City that Kristin Forbes might not be the only person to vote for a hike.
Today's meeting has the potential for a bigger vote split but for the Bank to sound more cautious overall.
There is some chatter on the street that Michael Saunders has joined hawk Kristin Forbes in voting for a 25 basis point rate hike at the meeting. He's previously made the case for raising rates to normalise policy in light of rising inflation and growth remaining resilient. Forbes voted for a hike at the last meeting and inflation has since risen from 1.8% to hold at 2.3% for two months.
I'll be surprised if the hawks get too much of a grip on the BOE today; it should all be rather dull tbh
11.13am BST
Here's Angela Monaghan on this morning's downbeat economic data:
Related: Brexit slowdown fears as industrial output falls and trade deficit grows
10.57am BST
The pound has fallen back towards $1.29, following the news that Britain's trade deficit widened in March as industrial production dropped by 0.5%.
10.54am BST
Martin Beck, senior economic advisor to the EY ITEM Club, says that today's industrial production and trade figures are "uniformly weak".
Here's his take:
The industrial sector saw the third consecutive monthly drop, with the effect of the unseasonably warm weather on utilities output the biggest driver of the fall. But manufacturing also contributed, shrinking by 0.3%. Along with earlier revisions, this has cut the ONS' estimate of growth in industrial production in Q1 from 0.3% to 0.1%. But this was not enough to affect its estimate that overall GDP rose by 0.3% in the quarter.
"Construction output also fell in March for the third month in a row. But there was no change to the preliminary estimate that output rose by 0.2% in the first quarter of the year.
10.38am BST
Economist Sam Tombs of Pantheon also flags up that the depreciation in the pound isn't helping Britain's trade gap to narrow:
The trade deficit, ex erratics, hit a 9yr high in March. Import vols still up more than exports. This must be the worst depreciation ever pic.twitter.com/yZ37lF0rDc
10.25am BST
Total UK imports in March jumped by 2.9bn due to an increase in the amount of goods entering the country, many from the European Union.
The ONS explains:
At the commodity level, the main contributors to this increase were chemicals from the EU (0.6 billion), oil from non-EU countries (0.5 billion), cars from the EU (0.4 billion) and mechanical machinery (0.2 billion) from non-EU countries.
The UK is so keen to leave the EU that we're importing as much of it as possible, as fast as possible.... https://t.co/p6ozYVj18O
So, we don't HAVE to import all that stuff from the EU. But, er, we do. pic.twitter.com/zQwjy2e2vc
10.24am BST
This chart, which strips out erratic elements, show how Britain's trade in goods worsened in March:
UK trade deficit in goods less oil and erratics still widening, no depreciation boost. pic.twitter.com/BZR3eaUQK9
10.07am BST
Today's "ropey" trade and industrial production data confirm that Britain's economy is slowing, says IHS's Howard Archer.
He adds:
The poor data dilute any hopes that markedly slower GDP growth of 0.3% quarter-on-quarter in the first quarter could be revised up.
Indeed, the actual industrial production data was weaker than estimated in the preliminary first quarter GDP estimate while the trade deficit unexpectedly widened
10.04am BST
City experts are in agreement; this morning's UK economic data was rather poor....
Weak UK data:
Construction, manufacturing, industrial output all below forecast. Trade deficit 13.44B, 3rd widest on record (nominal terms)
The summary of today's UK manufacturing, production and trade data for March is that they were weak and disappointing #GBP #GDP
Disappointing trade figures. Monthly deficit up 2.3bn to 4.9bn in March, quarterly deficit up 5.7bn to 10.5bn: https://t.co/YWRDvZLl5r
9.59am BST
More bad news: Britain's trade gap widened last month, dashing hopes that the weaker pound is spurring an exporting boom.
The total trade deficit, covering goods and services, widened by 2.3bn between February and March 2017 to 4.9bn.
Total imports increased by 2.9 billion between February and March 2017, with an increase in imports of goods from both EU and non-EU countries.
Some companies may hedge against currency movements in the short- to medium-term. In addition, evidence suggests that a high proportion of UK imports are traded in foreign currency, while some UK exports are traded in sterling, so there will not necessarily be a straightforward pass through from the changes in the value of sterling to the value of trade.
Between February and March 2017, the volume of goods exported increased by 3.2% and is now 8.5% higher than in March 2016. Import volumes have increased by 8.5% in the month to March 2017, the largest monthly growth since December 2014. The growth in export volumes in the latter part of 2016 may be a consequence of the fall in the value of sterling, making UK exports more competitive. However, volumes of imports have also increased in the same period and therefore we are not yet seeing a notable narrowing of the trade deficit attributable to the sterling depreciation.
9.45am BST
Newsflash: Britain's industrial sector has suffered a sharp fall in output, fuelling concerns that the economy is slowing.
Industrial production shrank by 0.5% in March, reports the Office for National Statistics.
Basic metals and metal products provided the largest downward pressure on manufacturing in March 2017, while warmer-than-average temperatures led to a decrease in energy supply.
9.37am BST
Over in Brussels, the European Commission is releasing its latest growth forecasts -- including a brighter picture for the UK.
The EC now expects Britain's economy to expand by 1.8% this year, up from 1.5%. GDP is then forecast to slow to 1.3%, up from 1.2%.
#Unemployment in the euro area is set to fall to 9.4% this year and 8.9% in 2018, the lowest level since 2008. #ECforecast
Growth map 2017: Poland 3.5%; Spain 2.8%; Netherlands 2.1%; UK 1.8%; Germany 1.6%; France 1.4%; Italy 0.9% #ECforecast @EU_Commission pic.twitter.com/CMgc11ki2H
The fiscal outlook is improving on the back of growth & low interest rates: the euro area deficit should fall to 1.4% in 2017. #ECforecast
9.24am BST
The City has three questions for the Bank of England today.
Has it hiked its inflation forecasts, has it cut its growth forecasts, and does it give fresh hints on when interest rates might rise?
The Brexit vote's biggest impact has been on the sharp drop in sterling, which has pushed U.K. inflation to three year highs of 2.3%. This overshoot above the BOE target of 2% is expected to push higher still over the rest of the course of the year. In the February report, the central bank forecast consumer prices to peak at 2.7% in 2018, but since then oil prices have dropped substantially and sterling has recovered.
A weak pound is of course beneficial for exports and inflation, but as wage growth has slowed down rising inflation will likely undermine consumer expenditure; one of the major drivers of the economy. Interestingly, there was market talk today that Carney may be tempted to talk up the inflation impact.
The UK economy started the year on the backfoot with GDP slowing worse than expected to its weakest pace in 12 months. The most recent figure of +0.3% is more than half the +0.7% pace advance at the end of last year. It is also most notably below the +0.6% forecast from the BOE in the first quarter.
The latest survey data on the other hand has showed some positive momentum carrying through to Q2 with resilient consumer confidence figures. Whether negative real wage growth coming in the next few months hits spending growth more aggressively will be key for GDP prospects and Carney's handling of this will be fascinating. Indeed, we called this his 'hire-wire' balancing act at the February meeting.
After one (departing) policymaker [Kristin Forbes] voted for a rate rise in March,Carney is expected to keep a measured tone as there is no reason at this stage to start a more hawkish rhetoric, especially after the modest Q1 growth figures.
In addition the June general election may have an extra bearing on the Committee's reasoning. February saw Carney talk about the 'twists and turns' of the Brexit journey and it is most likely that monetary policy will be kept steady until any negotiation deal clarity is evident. For us, the impact on sterling will be key. Cable spiked higher earlier today to $1.2988 on the market chatter of possible hawkish bias by Carney. This seven month high comes after a series of bull flag breakouts seen since the 300 point plus move after the election announcement.
9.05am BST
There's little early drama in the European stock markets, yet.
Markets are pretty flat as traders await the Bank of England's decisions.
8.52am BST
Here's the seven men and one woman who set UK interest rates this month.
8.46am BST
The pound is bobbing around the $1.294 mark this morning, having failed to bash its way over $1.30 yesterday (a level not seen since September)
It may take something special from the Bank of England to drive sterling to a new seven-month high, says FXTM chief market strategist Hussein Sayed:
Pound sterling has been flirting with the 1.3 level for most of the past week, but failing to break above this key level indicates that a strong catalyst is needed to convince traders to go long from here.
Whether we see a break above or a pullback hinges upon the Bank of England's decision and the quarterly Inflation Report issued today.
8.38am BST
Although Gavin Patterson has lost that 4m bonus, he's still got a job....
....Unlike 4,000 BT workers worldwide, who are being axed under new plans to reshape its Global Services division.
BT is cutting 4,000 jobs in a drive to recover from an accounting scandal and a profit warning https://t.co/FgX1DQIvt0 pic.twitter.com/wgu3xvAmlJ
8.29am BST
BT's chief executive is counting the cost of the company's Italian accounting scandal this morning. A 4m cost, to be precise.
Gavin Patterson lost his bonus following the discovery of accounting problems at its division that cost BT 145m, and wiped billions off its market value.
Related: BT chief's pay package slashed by 4m over Italian accounting scandal
I believe that as a CEO you need to set an example
I signalled to the board back in January, when we announced the problems in Italy, that it would be inappropriate to take a bonus if one was due. And that's what you can see today.
BT chief executive Gavin Patterson says he won't take his bonus this year https://t.co/otlPc1JS85 pic.twitter.com/z4U4gXGtPp
8.20am BST
Today's Bank of England meeting is overshadowed by signs of a slowdown in the housing market.
The Royal Institution of Chartered Surveyors has warned that momentum is ebbing, with sales slipping and housing stock in short supply.
Related: 'Stagnant' buyer demand puts the brakes on UK housing market
8.05am BST
Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.
"With economic surprises having been negative in recent weeks, the Bank looks to be in wait-and-see mode at the moment."
Since the February Inflation Report growth has disappointed expectations a little and inflation has exceeded the Bank's forecast a little. This makes the trade-off faced by the MPC trickier but we expect that the core neutral stance will hold this time.
That means the MPC is likely to continue to tolerate a forecast for above-target inflation by exercising the flexibility in its remit to have due regard for the risk that a quicker return of inflation to target could trigger undesirable volatility in output and employment.
Bank of England Super Thursday
Rate decision 12pm, unchanged decision expected by all economists surveyed.#gbpusd pic.twitter.com/elY7NdoMFE
#ftse100 could wobble on open as these companies are set to go ex dividend today - but should recover as day goes on. #markets #FTSE @IGcom pic.twitter.com/H8CyQ9haG9
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