The new chairman of the Federal Reserve Janet Yellen continued where Ben Bernake left off. On Wednesday evening the it was announced that the Federal Reserve would taper their monthly asset purchases by $10bn in April, as they had in recent months, easing the US economy from the stimulus as growth begins to gain pace. As expected interest rates were left unchanged at the record low of 0.25%, but hinted that rates could rise in 2015, which would be about 6 months after it is has finished its…

The release on Wednesday morning from the Office for National Statistics (ONS) showed that the number of people in employment has continued to increase. The 3-month unemployment rate for November 2013-January 2014 was 7.2%, just above the Bank of England Forward Guidance 7% threshold announced in August 2013. The full ONS Labour Market Statistics release for March 2014…

The Bank of England Monetary Policy Committee minutes from the meeting held on the 5th and 6th of March show that the members voted unanimously to leave interest rates and asset purchases unchanged. Current base rate: 0.50% Asset purchases (QE): £375bn The report highlights the appreciation of Sterling due to safehaven flows due to the escalation of tensions in Ukraine/Russia. The MPC mentioned that Sterling could continue to strengthen if UK growth remains favourabl…

The central bank of the UK, has announced two new deputy governors, Ben Broadbent and the first female Nemat Shafik, who was previously with the International Monetary Fund. There is a third deputy governor role that is yet to be announced. Spencer Dale and Paul Fisher will lose their votes on the Monetary Policy Committee; however it is unlikely the change will have an effect as to when interest rates will be raised. The full press release from the Bank of England can be found h…

The UK housing market is regularly covered in the UK press, but there is a significant regional disparity. There has been considerable concern from analysts and the media that the sustained growth in UK house prices, primarily in London, are creating a property bubble. The governments flagship Help-top-buy scheme, providing loan guarantees requiring only a 5% deposit have been criticised for being reckless, and potentially fuelling a UK subprime. However the latest release from the RIC…

The National Institute of Economic and Social Research released their estimates that output grew by 0.8% in the 3 months ending in February. This is a slight improvement on the estimate for January which believed growth to be at +0.7% for the prevailing 3 months, though this undershoots the pre-recession peak. Interest Rates The NIESR anticipates that the Bank of England will leave rates unchanged at the record low of 0.5% until the Q2 2015. There is concern from some market comm…

It’s the first Friday of the month, which means that it at 13:30 (London) the pivotal US employment report will be released. The Non-Farm Payrolls report is compiled by the United States Department of Labor for jobs in manufacturing, goods, services and construction, but doesn’t include non-profit, private household or farm works (due to the seasonal swings). The unusually disruptive weather has caused havoc across North America, which has been the go-to reason for analysts…

As the 5 year anniversary of the Bank of England cutting interest rates to 0.5%, the bank has announced to leave the base rate and asset purchases unchanged. The current level of asset purchases (QE) remains at £375bn. The 5 year anniversary is a significant length of time for interest rates to be held at the record low of 0.50%. The ultra-loose monetary policy has been highlighted as a risk to the economy by some analysts. Mark Carney’s policy of Forward Guidance headline…

On Monday as tensions seemed to escalate, with rumours of deadlines for a Ukrainian surrender of warships in the Crimean region. Investors sought safe havens for assets, the precious metal was bid, reaching multi-month highs trading up to $1350/oz, in the currency markets Swiss Franc and the Japanese Yen strengthened, with the Russian Ruble and Ukrainian Hryvnia reaching all-time lows. The Russian central bank intervened in the markets due to the weakening Ruble, and hiked interest rat…

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The Ukrainian people in Kiev have recently overthrown the countries elected leader of their ties with Europe. The country is circled from the North and East by Russia, with links to Europe in the West of the country. Historically there are strong Soviet ties, primarily in the East of the country and the Southern region of Crimea. The bloody clashes in Kiev have left the country in limbo with Pro Russian and Pro European elements pushing for different allegiance. The situation escalated…

On Wednesday morning the Office for National Statistics released the UK quarterly GDP growth release that remains unchanged at 0.7%. The release highlighted a positive that the construction industry output increased by 0.2% in the final quarter of 2013, compared to a previous estimate of a 0.3% decrease. The 2013 full year growth estimate is 1.8%, which though significantly below the pre-crisis levels this is a positive economy and something to build upon. The UK economy has begun to s…

The Bank of England Minutes released on Wednesday, showed that the MPC voted unanimously to keep interest rates at the record low rate of 0.50% and asset purchases unchanged. The BoE base rate has now been at 0.50% since March 2009. In the minutes it said that despite the sharp fall in unemployment, the committee believed that the economy is able to “absorb spare capacity further before raising rates”. The change in focus from the 7% unemployment threshold to reducing the o…

The inflation rate for the UK fell to below the Bank of England’s target of 2% for the first time since November 2009. Inflation has overshot the 2% target since then, which had been a concern for analysts, who believed the central bank would need to raise interest rates to combat the rise. Mark Carney has now released “Forward Guidance 2.0,” which is focused on the output gap, which last year the BoE said was “unobservable” and “difficult to explain&rdquo…