Bank of England

UK

Mark Carney yesterday declared the British economy is picking up but warned the recovery may prove to be another ‘false dawn'.

Sterling has risen to a seven-month high against the dollar after the UK's unemployment rate unexpectedly dipped from 7.8% to 7.7%.

Update: Benchmark ten-year gilt yields have hit a fresh two-year high of over 3% after the Bank of England opted not to release further ‘forward guidance' earlier this afternoon.

The Bank of England (BoE)has elected to hold the base rate at 0.5% and maintain the size of its quantitative easing (QE) programme at £375bn.

WEALTH MANAGERS

Positive data pointing to the increasing pace of the UK economy is putting the Bank of England (BoE) under greater pressure to rein in market expectations of an interest rate rise.

Sterling dropped and then recovered sharply minutes after new Bank of England Governor Mark Carney told the world he has no plans to raise rates any time soon, but was upbeat on UK growth.

Mark Carney has moved to defend the Bank of England's 'forward guidance' policies and said further stimulus may be necessary keep the UK economic recovery on course.

The rise in bond yields during May and June has left few parts of the bond market unscathed, and UK bonds were very much part of this move.