Closing post
Time to recap…
Bank of England policymakers have told MPs that they will take a ‘gradual approach’ to cutting interest rates, as they assess the inflationary impact of last month’s budget.
BoE governor Andrew Bailey told MPs:
“A gradual approach to removing monetary policy restraint will help us to observe how this plays out, along with other risks to the inflation outlook.”
MPC member Alan Taylor suggested the Bank could cut rates more rapidly than the market expect, if inflation remains lower than expected, while colleague Catherine Mann argued that rates should have remained on hold this month until there was proof that inflation was beaten.
Bailey offered support to UK retailers who fear that increases in national insurance contributions will cost jobs and push up costs.
Bailey also warned against “fragmenting” the world economy, given the threat that Donald Trump imposes steep trade tariffs on other countries.
Global stock markets have dropped, after Ukraine fired US-made long-range missiles into Russia for the first time since the Biden administration lifted restrictions on their use, drawing a warning from Moscow that it would respond “accordingly”.
Here’s the rest of today’s news stories:
Over on Wall Street, stocks have opened lower as investors react to rising geopolitical tensions.
The Dow Jones industrial average of 30 large US companies has dipped by 0.8%, down 355 points at 43,033, while the broader S&P 500 index is 0.4% lower.
Wall Street’s ‘fear index’, the Chicago Board Options Exchange’s CBOE Volatility Index, has jumped almost 10%.
Traders have noted that Ukraine has fired US-made long-range missiles into Russia for the first time, drawing a warning from Moscow that it would respond “accordingly”.
The missile attack came shortly after Vladimir Putin signed a revised nuclear doctrine which lowers the threshold for using nuclear weapons.
