UK

ON UK INCOME

London opened marginally weaker on Wednesday, continuing the softer trend seen towards the end of Tuesday's session, with retailers in focus in early trading.

Economics research firm IHS Global Insight has revealed its predictions for the UK economy in 2011, forecasting GDP growth of 1.8% and average CPI inflation of 3.2% over the course of the year.

London's leading index rose almost 150 points, or 2.48%, to reach 6,045 by late morning, buoyed by the commodities sector.

Revera's Glen Nimmo says next year is likely to be one of steady share price appreciation as strong cash flows passed back to shareholders are reinvested into the market.

BlackRock's Mark Lyttleton is looking to increase exposure to banks in his £1.4bn UK Dynamic fund in the view valuations are attractive again.

EUROZONE DEFAULT A CERTAINTY

The Monetary Policy Committee's (MPC) Adam Posen has warned the Bank it should not try to compensate for its past mistakes in underestimating inflation by pushing up interest rates.

Britain's financial system is vulnerable to increased EU sovereign debt woes and bubbles in emerging market assets and junk bonds, the Bank of England (BoE) says.

Ignis' chief economist Stuart Thomson believes more quantitative easing in the US and UK is inevitable in 2011.