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Economy Figures Set To Show ‘Positive Growth’

Economy Figures Set To Show ‘Positive Growth’

Data is due to show the economy grew by around 0.5% over April, May and June – but analysts say the recovery is still fragile.

Economists are predicting good news when the first estimate of economic growth during April, May and June is revealed next week.

Analysts expect the Office for National Statistics to say that the economy grew by around 0.5% when it reveals its preliminary estimate for Q2 GDP on Thursday.

They point to several important economic indicators which have been positive in recent months. read more

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The Governmen Plain Cigarettes And Alcohol you Turn

The Governmen Plain Cigarettes And Alcohol you Turn

Plans for plain cigarette packaging are postponed, amid reports that minimum pricing for alcohol will be scrapped

The Government is facing anger from health campaigners after plans for plain packaging for cigarettes were put on ice while it emerged minimum pricing of alcohol will be killed off altogether.

Health Secretary Jeremy Hunt said a decision on whether to go ahead with plain packaging in England would be postponed until ministers had had a chance to assess the impact of a similar scheme introduced last year in Australia.

Meanwhile, it was reported Home Secretary Theresa May will formally confirm next week – before MPs finally break for the summer – that the Government has dropped plans for minimum pricing of alcohol in England. read more

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New Bank Of England Governor Mark Carney

New Bank Of England Governor Mark Carney

  • Posted: Jul 01, 2013
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Mark Carney is hailed as “the outstanding banker of his generation” but has his work cut out after replacing Mervyn King.

Mark Carney has become one of the most powerful central bankers in the world after taking the reins at the Bank of England.

The Canadian has replaced Sir Mervyn King amid mounting expectation of a more activist stance towards monetary policy as the BoE looks to keep the UK recovery on track.

Hailed as the “outstanding central banker of his generation”, Mr Carney has moved from the Bank of Canada to take up the job in Britain. read more

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George Osborne Reaches Deal On Spending Cuts

George Osborne Reaches Deal On Spending Cuts

  • Posted: Jun 23, 2013
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(Reuters) – Chancellor George Osborne completed talks on Sunday with government departments aimed at securing spending cuts worth 11.5 billion pounds in 2015-16 to help reduce the country’s budget deficit, the Treasury said.

George Osborne on the BBC

Britain’s Chancellor of the Exchequer George Osborne appears on the BBC’s Andrew Marr Show, presented by Sophie Raworth, in this photograph provided by the BBC, in London June 23, 2013.

The finance ministry said it had reached agreement with all departments, three days before Osborne is due to publish details of their spending limits on June 26.

The talks to find spending cuts starting in 2015 – when voters go to the polls – posed a political headache for Osborne, particularly over the sensitive defence budget and a business department under pressure to do more to revive the economy. read more

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Bank of England 2013  Economy Q2

Bank of England 2013 Economy Q2

  • Posted: Jun 13, 2013
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The 2013 Q2 issue of the Bank of England Quarterly Bulletin is published today.

The onset of the financial crisis in 2008 brought an end to the ‘Great Stability’ period, making prospects for UK and global economic growth not just weaker, but more uncertain. Macroeconomic uncertainty: what is it, how can we measure it and why does it matter? focuses on how heightened uncertainty might affect the economy through a variety of channels – for example, depressing demand for goods and services as firms and households choose to delay spending decisions, or impairing the supply side of the economy by affecting investment decisions or credit provision. While uncertainty is not directly observable, this article presents a range of indicators based on data from financial markets, consumer and business surveys and media citations. Many of these indicators have remained elevated in recent years. And a simple empirical model supports the view that uncertainty has contributed significantly to the depth of the recent recession and weakness of the recovery.

Cross-border banking can have considerable long-run benefits, by diversifying the available sources of lending and borrowing. But such flows can also amplify risks in times of stress. Cross-border bank credit and global financial stability describes how cross-border bank lending contributed to the build-up in vulnerabilities before the recent crisis – in particular by generating mismatches on banks’ balance sheets of both currency and maturity – and exacerbated the bust once the crisis hit. The article then considers possible policy responses of central banks to prevent or mitigate such a scenario in the future, from the perspective of recipient countries as well as the global system as a whole. read more

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Bank of England 2013  Economy Q1

Bank of England 2013 Economy Q1

  • Posted: Mar 14, 2013
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The 2013 Q1 issue of the Bank of England Quarterly Bulletin is published today.

Since the onset of the financial crisis, the MPC has injected substantial stimulus into the economy through purchases of assets as part of its programme known as quantitative easing (QE). These purchases have been carried out via the Asset Purchase Facility (APF), which is owned by the Bank of England and indemnified by Her Majesty’s Treasury (HMT). In November 2012 a process for regular cash transfers between the Bank of England’s Asset Purchase Facility (APF) and Her Majesty’s Treasury (HMT) was established. The profile of cash transfers between the Asset Purchase Facility and Her Majesty’s Treasury explains how the possible size of the transfers varies depending on a number of uncertain factors, including the price at which the assets held by the APF are ultimately sold and the future path of Bank Rate. While the initial transfers are from the APF to HMT, it is likely that they will be offset by payments in the opposite direction in the future. But the ultimate net amount that will be transferred is uncertain, and a wide range of outcomes is possible. An interactive spreadsheet published alongside the article (available on the Bank’s website via the link below) allows users to examine for themselves how the transfers depend on the assumption made.

In April 2013, a new regulatory framework for the UK financial sector will come into force, which will result in the Bank of England gaining significant new responsibilities. Changes to the Bank of England gives an overview of the changes that are happening to the Bank. This includes the creation of the Prudential Regulation Authority (PRA), responsible for the microprudential regulation of individual deposit-takers, insurers and major investment firms; and the Financial Policy Committee (FPC), responsible for identifying, monitoring and taking action to remove or reduce risks to the resilience of the financial system as a whole. The Bank will also take on new responsibilities in relation to financial market infrastructures, including central counterparties. The article summarises these changes in one place, alongside the revised governance processes that are being put in place to ensure that the Bank carries out its new responsibilities effectively and is fully accountable to Parliament and the public. read more

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Bank of England 2012 Economy Q4

Bank of England 2012 Economy Q4

  • Posted: Dec 18, 2012
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 The 2012 Q4 issue of the Bank of England Quarterly Bulletin is published today.

The Funding for Lending Scheme (FLS) was launched over the summer by the Bank of England and HM Treasury. It is designed to incentivise banks and building societies to boost their lending to UK households and businesses. Specifically, banks and building societies are offered funding with both the amount and its price depending on the amount they lend. An article in this edition describes in detail the thinking behind the scheme, including describing the mechanics of how the scheme will work. The Article notes that by reducing funding costs, the FLS should lead to more and cheaper credit flowing into the real economy than otherwise. Early signs have been encouraging: market funding costs for UK banks have fallen sharply and many loan rates have fallen. But given the usual lags from credit being offered to loans being made, the FLS is unlikely to materially affect lending volumes until 2013. The UK economy has received a significant amount of monetary stimulus since the onset of the financial crisis. Bank Rate has been reduced to its lowest level in its 300-year history and the MPC has purchased £375 billion worth of assets since the launch of its asset purchases programme (or QE) in early 2009. But despite this significant amount of stimulus, broad money growth has been persistently weak since 2008, without any precedence in the past half century. So it is important to investigate what impact QE has had on broad money. The article – What can money data tell us about the impact of QE? – analyses the impact of QE by using a money accounting framework, focusing on the period during which the second round of asset purchases took place. It shows that the monetary impact of QE2 looks very similar to that of QE1, with around 60% of asset purchases having fed through into broad money. But whereas in QE1 most of the 40% ‘leakage’ could be explained by bank balance sheet repair, during QE2 the largest ‘leakage’ came from sales of government debt by banks. So whereas the first two rounds of QE seem to have had a similar proportionate impact on money, there is some evidence that the transmission mechanism of QE may have varied over time. The financial crisis has powerfully demonstrated the need for a new approach to financial regulation. Major reforms are therefore under way, aiming to establish a UK regulatory framework which is more focused on the issues that matter and better equipped to deliver financial stability. These reforms will come into effect in April 2013. The Financial Services Authority will cease to exist in its current form, and its responsibilities will be transferred to two new bodies – the Prudential Regulation Authority (PRA), a part of the Bank of England, focusing on prudential issues; and the Financial Conduct Authority, a separate body, focusing on business and market conduct. Additionally, a Financial Policy Committee will be established within the Bank, focusing on the stability of the financial system as a whole. The article in this edition focuses on the Prudential Regulation Authority. It sets out the PRA’s role in the new regulatory framework, describing the PRA’s statutory objectives of promoting the safety and soundness of firms and contributing to policyholder protection. The PRA will advance these objectives by setting out expectations that firms should meet. The article goes on to describe how the PRA will supervise firms against these expectations. Importantly, it will do this using a judgement-based approach, and one that is both forward-looking and focused on the key risks posed to the stability of the UK financial system. This edition also includes analysis from the 2012 NMG Consulting Survey which looks at influences on household spending and saving; an article on The role of designated market makers in the new trading landscape; and the regular Markets and Operations article reviewing developments in financial markets and the Bank’s official operations in the period between the previous Bulletin and 26 November 2012. More economic news from Bank of England 

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Bank Of England Says UK Economy Set To Shrink

Bank Of England Says UK Economy Set To Shrink

  • Posted: Nov 14, 2012
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Britain’s weak economy may shrink in the last three months of the year and growth will remain sluggish into 2013, the governor of the Bank of England warned Wednesday.

The central bank in the UK warning came after the country’s gross domestic product on annual basis unexpectedly grew by 1 percent in the third quarter, ending a nine-month recession.

“Welcome as that is, it is not a reliable guide to the future,” Governor Mervyn King said at a news conference while introducing the Bank’s quarterly Inflation Report.

“Output growth is likely to fall back sharply in Q4 as the boost from the Olympics in the summer is reversed – indeed output may shrink a little this quarter.,” King said. read more

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Sir Mervyn King  UK GDP May Contract Again In Q4

Sir Mervyn King UK GDP May Contract Again In Q4

  • Posted: Nov 14, 2012
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Bank of England governor Mervyn King has said the UK economy may contract once again in the fourth quarter of 2012 despite moving out of recession in Q3.

Speaking after the publication of the Bank’s quarterly inflation report, Mervyn King  said it is “difficult to discern” the true path of GDP and said the UK recovery may start later than previously forecast.

He also pointed to the strength of sterling as a negative factor for the economy, saying a strong pound is undermining competitiveness and may result in a slower recovery.

The governor said the Q3 GDP rise, estimated to be 1% according to the Office for National Statistics, was fuelled by one-off factors, meaning “headline growth is consequently likely to fall back sharply in Q4”. read more

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Olympics Helps Great Britain To Get Out Of Recession

Olympics Helps Great Britain To Get Out Of Recession

  • Posted: Oct 25, 2012
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There was a better than expected growth in the Uk economy after 2012 Olympics.

Analysts today confirmed that the Olympics has grown the UK economy and strong ticket sales helped the UK exit the longest double-dip recession since the Second World War

This is the first estimate of how the economy performed in the third quarter of 2012, the Office for National Statistics (ONS) confirmed a return to growth of 1% over the three months following a 0.4% contraction in GDP in the previous period. That was higher than analysts had expected and the strongest quarter of GDP growth for five years.

In addition to 2012 Olympics sales there was another big national event, the Queen’s Diamond Jubilee that stimulate Uk’s economy. read more

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