The UK's EU membership referendum is a "once-in-a-lifetime chance to vote for real change", Boris Johnson has argued as he declared support for an exit. The London Mayor confirmed earlier to reporters that he would be campaigning to leave the union. In a 2,000-word column for The Daily Telegraph, the Conservative MP said staying inside the union would lead to "an erosion of democracy". The prime minister has said leaving the EU would be a "leap in the dark".

 

Focus of Tuesday's session was on Inflation Report Hearings. The Bank of England could cut interest rates to zero, but will seek to avoid following Sweden, Denmark and the eurozone by setting negative rates to bolster growth and inflation. Mark Carney, the Bank’s governor, said Threadneedle Street had “no intention and no interest” in implementing negative interest rates and would adopt the full range of the Bank’s other powers to deal with a downturn in the economy.

 

He said: “If we were in a position where the economy needed additional stimulus ... we could cut interest rates towards zero. We could engage in additional asset purchases, including a variety of assets. “We could also provide a perspective where we could adjust our policy horizon – in other words we could shorten our policy horizon over which we wanted to return inflation to target.” Carney, who was responding to questions from MPs on the Treasury select committee, said the world economy had entered a period of low growth and low interest rates and was likely to be prone to financial shocks.

 

From the UK, on Wednesday, Mortgage Approvals data was published. BBA Mortgage Approvals rose to 47,500, beating forecasts on increase to 45,200. Richard Woolhouse, Chief Economist at the BBA, said: “The start of the year has seen a significant rise in mortgage borrowing. It seems that this has been driven, in part, by borrowers looking to get ahead of the increases in stamp duty for buy-to-let and second home buyers scheduled to come into effect in April.   

 

From the UK, on Thursday, GDP data was released. UK GDP in volume terms was estimated to have increased by 0.5% between Quarter 3 (July to Sept) 2015 and Quarter 4 (Oct to Dec) 2015, unrevised from the preliminary estimate of GDP published on 28 January 2016. Between 2014 and 2015, GDP in volume terms increased by 2.2%, unrevised from the previous estimate. Between Quarter 4 2014 and Quarter 4 2015, GDP in volume terms increased by 1.9%, unrevised from the previously published estimate.

 

This week markets will be looking at:

 

Net Lending to Individuals (Monday 10:30)

Manufacturing PMI (Tuesday 10:30)

Construction PMI (Wednesday 10:30)

Services PMI (Thursday 10:30)