Bank of England

Bank of England inflation hawk Andrew Sentance believes policymakers should start gradually raising interest rates on improving economic conditions.

The Bank of England has made nearly £10bn in paper profits by buying UK government bonds as part of emergency efforts to pump money into the British economy.

The Bank of England will keep interest rates on hold until at least May 2011 as the Government's recent spending cuts weigh on the economic recovery, the British Chambers of Commerce believes.

A member of the Bank of England's Monetary Policy Committee (MPC) has called for a rise in interest rates for the first time in almost two years.

PIMCO's Mike Amey is orientating his fund towards shorter-dated bonds and cash in the view they provide better reward for the risks associated with the UK economy.

Income seekers face an even tougher environment following a Bank of England warning that UK banks will have to slash dividends for years to come.

The consumer price index (CPI) of inflation eased in May to 3.4%, down from 3.7% in April, according to the Office for National Statistics (ONS).

COMMENT

Chancellor George Osborne is set to reveal this week the Bank of England will take overall charge of regulation of the financial sector and have "oversight" across the FSA.

UK manufacturing performance took an unexpected knock in April according to official data, adding to fears Britain's economic recovery is much weaker than previously thought.