Afternoon summary
Time for a recap…. here are today’s main stories.
Former Bank of England governor Mark Carney has warned that governments will be paying higher rates of interest for their debt for the foreseeable future, and that mortgage holders should adjust to this new situation.
Carney told ITV’s Robert Peston:
If you have still a few years of low interest rates on your mortgage, if you fixed just at the right time as it turned out, recognise that there will be ann adjustment over the medium term.
It’s a question of degree but the direction is very clear.
The turbulence in the mortgage market has continued, with Nationwide lifting its fixed-term mortgage rates from tomorrow….
…and average rates across the market increasing again.
In the eurozone, the European Central Bank has lifted its key interest rates by a quarter of one percent.
The ECB warned that inflation is projected to remain too high for too long, as it lifted its forecasts for price rises over the next few years.
ECB president Christine Lagarde indicated that eurozone interest rates will be lifted in July too, saying:
“Are we done? Have we finished the journey? No. We’re not at our destination.
Do we still have ground to cover? Yes, we still have ground to cover.
And in other news:
Pound at one-year high against US dollar
Sterling has hit a 14-month high against the US dollar for the second day in a row.
The pound has gained 0.8 of a cent to $1.2745, the highest since April 2022.
The dollar has been pushed down by new economic data showing US industrial output fell by 0.2% in May, while new jobless claims were higher than expected last week.
US jobless claims steady last week after recent runup. Although new filings for unemployment benefits have jumped lately the numbers remain low and so it's still debatable if this is a sign of deteriorating labor market conditions: pic.twitter.com/9kOKGY7FpN
— James Picerno (@jpicerno) June 15, 2023
