BoE left interest rates unchanged with unanimous vote. Bank of England Governor Carney reiterated that the monetary policy decisions are not automatic, while insisting once again that inflation overshoots can only be temporary and limited. Overall output in the economy is expected to be 1.0% higher over the next three years with fiscal policy contributing around half of this effect. A stronger US growth profile and supportive financial conditions will also underpin growth. Carney again warned over fragility in investment.
From the UK, on Friday, Services PMI figures were published. The Index remained above 50.0 for the sixth consecutive month in January, indicating a continued recovery in growth following a contraction last July linked to the EU referendum. That said, the Index fell for the first time since September to 54.5, and signalled the weakest expansion in three months. The rate of growth was solid overall, but slightly weaker than Markit / CIPS UK Services PMI the 20-year long-run survey average.
This week markets will be looking at:
Industrial Production (Friday 10:30)
