Closing post
Time to recap.
The pound is limping home on its worst day in over 18 months, after the Bank of England reignited expectations of more rapid cuts to interest rates.
Against the dollar, sterling is currently down over 1.5 cents at $1.3108, a drop of 1.2%. That would be its biggest one-day drop since March 2023, and takes the pound down to a three-week low.
It’s a similar position against the euro, where the pound is down 0.9% at €1.1905, again the worst fall in over 18 months.
The selloff began after the governor of the Bank of England told the Guardian it could become a “bit more aggressive” in cutting interest rates if inflation continues to cool.
Andrew Bailey said he was encouraged that cost of living pressures had not been as persistent as feared, but warned the Bank was monitoring the Middle East crisis amid fears of an oil price shock.
In a wide-ranging interview, Bailey held out the prospect of Threadneedle Street becoming a “bit more aggressive” in cutting interest rates, provided the news on inflation continued to be good.
The comments sent City analysts racing to reprice their forecasts for UK interest rates.
Hubert de Barochez, senior markets economist at Capital Economics, says:
The British pound fell sharply today, and we suspect that it will weaken more over the next year or so given our dovish view of Bank of England policy, the currency’s still-high valuation, and stretched speculative positioning.
Royal Bank of Canada now predict the Bank of England will cut rates at every meeting until next May.
Elsewere, the oil price has jumped again after president Biden indicated Israel could strike Iran’s oil facilities in retaliation for the missile attack earlier this week.
Tesco lifted its profit forecasts, after sales in the first half of the year were stronger than expected:
Bank payments can be delayed by an extra three days if lenders suspect consumers are being scammed, as part of a crackdown on booming levels of digital fraud in Britain.
Lender Revolut has blasted tech giant Meta, saying it should share the costs of reimbursing fraud victims.
The number of customer complaints that were unable to be resolved by water companies in England and Wales has risen by almost a third to the highest level in nearly a decade.
Today’s surge in the oil price was driven by the possibility that Israel’s retaliation against Iran for its recent missile barrage will include strikes on the country’s oil industry.
West Texas Intermediate soared as much as 5.5% to approach $74 a barrel after President Joe Biden, when asked if he would support Israel striking Iran’s oil facilities, responded “we’re discussing that.”
Biden also said he wasn’t expecting Israel’s retaliation to come Thursday.
Brent crude hits $77 per barrel
The oil price has hit its highest level in a month, as energy traders watch events in the Middle East closely.
Brent crude has jumped by as much as 5% today to trade as high as $77.65 per barrel today, the highest since the end of August.
Brent Crude Oil #CrudeOil spikes to $77. pic.twitter.com/sdwaDpU4cT
— Veteran Market Timer (@3Xtraders) October 3, 2024
Back on Tuesday, Brent briefly fell below $70/barrel, before surging as Iran fired missiles at Israel, fuelling fears that a regional war could begin in the Middle East.
Today, the Lebanese army said that it returned fire at Israeli forces after one of its soldiers was killed in an Israeli strike.
And an Iranian source has told Al Jazeera that Iran has sent a message to the US, via Qatar, saying that “the phase of unilateral self-restraint has ended”. It also reportedly said any Israeli attack would meet an “unconventional response” that includes targeting Israeli infrastructure.
Our Middle East crisis liveblog has all the details:
Inki Cho, financial markets strategist consultant to brokerage Exness, says:
Oil futures continued their upward trajectory on Thursday as escalating tensions in the Middle East raised concerns about potential disruptions to regional crude supplies.
Risks of a larger conflict could continue to push prices to the upside. The uncertainty around the next developments could leave markets cautious.
Any damage to energy infrastructure in the region could lead to more dramatic price spikes, further contributing to the bullish outlook after weeks of declines on demand concerns.
Revolut blasts Meta over fraud protection
In the banking world, fintech firm Revolut is calling on Meta to commit to sharing the cost of reimbursing of fraud victims.
Revolut argues that Meta’s new data sharing initiative with UK banks and financial institutions “falls woefully short of what’s required to tackle fraud globally”.
Meta has announced it will expand its data sharing scheme with more financial institutions, to help stop scammers who use social networks to defraud users.
Nathaniel Gleicher, Meta’s global head of counter-fraud, explained:
We will only beat these criminals if we work together and share relevant information related to scams. Financial institutions can share unique information with us which we can in turn use to train our systems to take action against more scams globally.
But Revolut’s head of financial crime, Woody Malouf, says Meta’s scheme isn’t good enough:
These plans are baby steps, when what the industry really needs is giant leaps forward. What our latest report on financial crime shows is that social media platforms not only continue to enable fraud, but that the issue is just as bad today as it was last year. Victims and financial institutions still ultimately bear the cost. These platforms share no responsibility in reimbursing victims, and so they have no incentive to do anything about it. A commitment to data sharing, albeit needed, simply isn’t good enough.
We are confident in the steps the UK government is taking to tackle fraud, but what is urgently needed now is for Meta and other social media companies to commit to supporting victims of fraud in the same way financial institutions do. Their silence on this issue says it all.
We are prepared to do our part to keep customers safe, and so should they. We should be the last line of defence, not the only line of defence.
Meta’s plans, and Revolut’s criticism, come as the government brings in new rules which mean fraud victims wiill receiving up to £85,000 in refunds from banks within five days of an authorised push payment scam.
Banks, though, argue that technology companies must do more.
Last month David Callington, the head of fraud at HSBC UK, told the Guardian that tech firms should be made to cover the cost of fraud perpetrated over their networks.
The costs of fraud will also now be shared equally by the banks and payment firms on both sides of the transaction, meaning there will be a fresh burden on the companies whose accounts receive the victims’ cash.
Updated
Bank of England to cut rates at every meeting until May, RBC predict
Royal Bank of Canada have revised their forecasts for UK interest rates, following BoE governor Andrew Bailey’s interview in the Guardian today.
RBC now believes there is scope for the Bank’s monetary policy committee to deliver “more and faster easing than previously”.
They now predict the Bank will cut interest rates by 25 basis points, or a quarter of one percentage point, “at successive MPC meetings between November this year and May next year.”
Previously, they had expected the Bank to cut in November but hold rates, at 4.75%, in December.
As well as two more cuts this year (November and December, following the cut in August), they also anticipate cuts at the Bank’s meetings in February, March and May.
RBC say that equates to the BoE delivering 150bps of cuts in total in this current cycle to leave Bank Rate at 3.75% - 50bp more than it had penciled in hitherto.
Updated
Italy "aiming to get more tax from most profitable companies"
Italy’s stock market is having a bad day too, as investors react to the prospect of a new windfall tax.
According to Bloomberg, Italian Finance Minister Giancarlo Giorgetti has said Italy plans to raise taxes on the companies that benefitted most from the economic turbulence of recent years in order to help bring down the country’s budget deficit.
In an interview for Bloomberg’s Future of Finance event in Milan today, Giorgetti suggested that a number of industries could face new levies.
He says:
We will be approving a budget that will require sacrifices from everyone, which means taxing extra profits.
It means taxing profits made and revenues made, and it is an effort that the whole country must undertake which means individuals, but also small, medium and large companies.
Italy’s FTSE MIB share index is down 1.35% today, the biggest fall among major European markets today.
Updated
Pound's worst day against the euro since December 2022
Back in the markets, the pound is on track for its worst day against the euro in almost two years.
The rapid repricing of the outlook for UK interest rates has pushed sterling down by over 1% against the euro.
It’s down 1.3 eurocents now, at €1.188.
This would be the biggest one-day drop, in both points and percentage terms, since 15 December 2022.
More than 300 people have been told they have had at least one conviction quashed under legislation passed to deal with the Post Office Horizon IT scandal, new figures released by the government show.
The Ministry of Justice reports that 335 letters had been sent to individuals so far (to the end of September).
The 335 letters cover a total of 1,030 convictions, suggesting many people are likely to have had more than one conviction quashed under the legislation.
All those people will be eligible for compensation under the Horizon Convictions Redress Scheme, which exonerated post office operators who had been convicted on charges including false accounting, theft and fraud.
If the individual is deceased their personal representative may be eligible to submit a claim, the MoJ says.
The MoJ said it aims to have written to the majority of affected individuals by early November 2024, and will be updating today’s data on a monthly basis.
A total of 459 individuals have had their cases assessed so far.
Back in the US, there’s been a small increased in the number of people signing on for unemployment benefit.
The number of initial claims for jobless support rose by 6,000 last week, to 225,000.
It’s a little higher than expected; Wall Street had forecast 221,000 new initial claims.
However, its a fairly low level by historic standards, suggesting US companies are still holding onto workers.
Jobless claims rose last week and were slightly higher than expected
— CMG Venture Group (@CmgVenture) October 3, 2024
🔹 Initial Jobless Claims: 225K vs. 221K est. (219K prior)
🔸 Continuing Claims: 1.826M vs. 1.830M est. (1.827M prior) pic.twitter.com/3QUNudebdo
Deutsche Bank: Markets are repricing odds of December rate cut
Deutsche Bank have just published a research note on the market reaction to our interview with Bank of England governor Andrew Bailey.
In it, they point out that markets have been pushing up the chances of an interest rate cut in December, as well as at November’s meeting.
A cut in November now looks very likely, but could the Bank actually manage two cuts by Christmas?
Deutsche’s strategist Shreyas Gopal writes:
One simple interpretation of the Governor’s comments is that it could now take an upside surprise to inflation for the MPC not to cut rates back-to-back in November and December.
Previously the guidance suggested that the burden of proof was on inflation to surprise to the downside for such a shift away from the “gradual” pace of easing. Consistent with that interpretation, the rates market has notably increased its pricing for the December meeting. It’s the largest dovish repricing of this particular meeting in over six months, though in level terms we have simply reverted to levels seen just a couple of weeks ago.
The oil price is rising again today, as rising tensions between Israel and Iran worry the markets.
Brent crude is up almost 2% so far today at $75.30 per barrel.
Yesterday Brent touched a one-month high of $76 per barrel.
As analysts at Saxo put it:
The geopolitical risks in the Middle East will continue to underpin oil prices in the short-term.
The drop in energy prices earlier this year had helped to pull down inflation, which is why Andrew Bailey told us that the Bank of England would be watching the oil price “extremely closely to see the impact of the latest news”.
Updated
Over in the US, companies continued to cut jobs last month.
The recruitment firm Challenger, Gray & Christmas has reported that US-based employers announced 72,821 cuts in September.
Although that’s a 4% decrease on August’s layoffs, it’s a whopping 53% more than in September 2023.
Challenger Jobs Cuts down slightly from August pic.twitter.com/IFHhb9vI1K
— Mike Zaccardi, CFA, CMT 🍖 (@MikeZaccardi) October 3, 2024
And it means US companies have laid off more people so far this year, than in the first nine months of 2023.
Challenger explains:
For the year, companies have announced 609,242 job cuts, up 0.8% from 604,514 announced during the same period last year.
Though less than a percentage point separates them, this is the first time this year that year-to-date cuts are higher than those tracked during the same period in 2023.
This suggests the US labour market has lost some momentum, which may encourage the Federal Reserve to continue lowering US interest rates, as the markets already expect.
Challenger: For the year, companies have announced 609,242 job cuts, up 0.8% from 604,514 announced during the same period last year. pic.twitter.com/bhxR6QOH1M
— Mike Zaccardi, CFA, CMT 🍖 (@MikeZaccardi) October 3, 2024
Updated
The pound has been “whacked” as Andrew Bailey “shifts gears” on the outlook for UK interest rates, says Brad Bechtel, global head of foreign exchange at investment bank Jefferies.
Bechtel told clients:
The BoE’s Bailey spoke about becoming more aggressive on rate cuts if conditions warrant, in an article in the Guardian today.
The BoE had been expected to go slower than the Fed and ECB but ultimately arrive around similar levels down the road. Bailey’s comments came on the back of what he saw as continued improvement on the cost of living as inflation continues to move lower.
He didn’t commit to a faster pace, just mentioned it as a possibility but it was enough to send the GBP around 1.1% lower on the day and put it on the bottom of the leader board in overnight trade
Full story: Sterling drops after Bank of England boss hints at ‘aggressive’ rate cuts
Here’s our news story on the pound’s tumble today:
We also have evidence today that lower borrowing costs are leading to an uptick in the housing market.
Zoopla has reported that the lowest mortgage rates for 15 months is supporting a rebound in sales market activity across the UK.
They say that the number of agreed sales, and demand from buyers, are both up by more than a quarter over the last 4 weeks compared to the same period a year ago.
Households that have held off making moving decisions over the last two years are returning to the market, they reckon, following recent falls in mortgage rates.
Rate trims spur market activity, pushing prices back up in the North and West of England but the South of England remains bogged down by affordability issues and mushrooming stock (32%) from second homeowners and investors looking to hang up their bucket and spade now the profits… pic.twitter.com/LnUsO5Kz0g
— Emma Fildes (@emmafildes) October 3, 2024
Pound on track for worst day in 18 months
Today is turning into the pound’s worst day in over 18 months.
Update: at 12.20pm, sterling is down around 1.2% so far today against the US dollar at around $1.31, a drop of over 1.5 cents.
That would be its biggest one-day drop against the dollar since 7 March 2023.
The pound has been dropping steadily through the day, after the governor of the Bank of England told the Guardian it could become a “bit more aggressive” in cutting interest rates if inflation continues to cool.
Updated
Today’s comments from Andrew Bailey have “challenged investors’ expectations” that the BoE, faced with persistent price pressures in the key services sector, would cut rates far more slowly than the Federal Reserve and the European Central Bank.
So says the Financial Times, adding;
Given that inflation in the UK has been higher than in the US and Europe, the market has been pricing a shallower cycle,” said Athanasios Vamvakidis, global head of G10 FX strategy at Bank of America.
But these comments suggest that the BoE could go faster.
Updated
The pound has now fallen by around 2% against the US dollar so far this week.
Around half of that is today’s fall. The other half largely came on Tuesday, when Iran’s missile attack on Israel led investors to rush into safe-haven assets such as the dollar.
This chart from brokerage XM shows major asset price changes this morning – with the pound’s slide against the US dollar at the bottom:
Charalampos Pissouros, senior investment analyst at XM, says
Today, it was the pound’s turn to tumble as BoE Governor Bailey said in an interview with the Guardian that they could turn “a bit more activist” on interest rate cuts if data continues to suggest progress in inflation.
The market is now nearly fully convinced that a quarter point cut will be delivered in November, assigning a 65% probability for another one in December.
Updated
Geopolitical risks may have prompted the Bank of England’s governor to hint at faster interest rate cuts, suggests Professor Costas Milas of the University of Liverpool.
Prof Milas tells us:
Andrew Bailey, and rightly so, notes that the Bank’s MPC might cut more aggressively if the news on inflation continue to be good. But this is a given. So, why his comments now? It is not a coincidence that Bailey’s comments coincide with geopolitical risk, fuelled by tensions between Israel and Iran, being on the rise.
As my colleague Mike Ellington and I have noted in an LSE Business Review blog, rising geopolitical risk impacts negatively, and strongly, on four-quarter UK output growth within two to three quarters.
My argument is that Bailey had (also) this negative output scenario in mind when talking about further interest rate cuts.
Pound drops to three-week low
The pound continues to slide against the US dollar – it’s now down a cent and a half, at $1.3115, which is a three-week low.
Michael Brown, senior research strategist at brokerage Pepperstone, reckons the markets may be overdoing it…
The actual remarks from BoE Gov Bailey are *way* more caveated than the way markets appear to have interpreted them...cable off over 1% on this seems rather over-done... pic.twitter.com/lrv7zAS19C
— Michael Brown (@MrMBrown) October 3, 2024
Data just released by the Bank of England shows that UK businesses have trimmed their inflation expectations.
The Bank’s latest ‘decision makers panel’ survey shows that expectations for CPI inflation a year ahead have dropped by 0.1 percentage point to 2.6%.
Firms also expect inflation to be 2.6% in three years time, which is also a drop of 0.1 percentage points compared with last month’s report.
These expectations are important, as they influence how fast companies will expect to raise their own prices.
Firms are still expecting to make inflation-beating pay rises, too.
The Bank explains:
Expected year-ahead wage growth remained unchanged at 4.1% on a three-month moving-average basis in September. Annual wage growth was 5.7% in the three months to September, 0.1 percentage points lower than in the three months to August.
Firms therefore expect their wage growth to decline by 1.6 percentage points over the next 12 months based on three-month averages.
The DMP report also shows a small drop in business uncertainty (despite other surveys showing that confidence has been hit by worries about this month’s budget).
It say:
Uncertainty fell in the three months to September with 48% of firms reporting that the overall level of uncertainty facing their businesses was high or very high, one percentage point lower than in the three months to August
Here’s a chart showing how the pound swooned as the Guardian published our interview with Andrew Bailey online:
Updated
UK homebuilders rise after BoE governor hints at faster rate cuts
Andew Bailey’s hint that the Bank of England could be “more aggressive” in cutting interest rates is also moving the London stock market.
Shares in housebuilders are rallying, as traders calculate that lower borrowing costs could lift demand for homes.
Housebuilder Persimmon is the top riser on the FTSE 100 share index, up 3.1%, followed by rival Vistry (+2.3%) and Barratt (+2.2%).
A UK interest rate cut in November now looks almost certain, the City believes.
According to the latest money market pricing, a cut in Bank Rate next month to 4.75% is now a 96.5% chance, leaving only a 3.5% likelihood that the BoE leaves rates on hold at 5% again.
Before Andrew Bailey’s Guardian interview moved the markets, a November cut was around an 88% chance, the markets indicated.
Andrew Bailey’s comments are significant, because a couple of weeks ago he sounded rather more cautious about future interest rate cuts.
On 19 September, when the Bank left rates on hold at 5%, Bailey said “It’s vital that inflation stays low, so we need to be careful not to cut too fast or by too much.”
A week ago, he told the Kent Messenger that he thought the path for interest rates would be “downwards, gradually”.
So, today’s talk about being a bit more “activist” and “aggressive” do feel like a change in stance, which is why the pound dropped this morning.
Breaking News: Sudden fall in #Pound Sterling after Bank of England Governor Andrew Bailey said in an interview with the Guardian newspaper that the central bank could become "a bit more activist" on rate cuts if there was further good news on inflation.
— Mohammed_Saif10 (@fx_saif10) October 3, 2024
GBPUSD DOWN 0.67%
GBPJPY…
$GBP under pressure as markets sense the Bank of England is pivoting. Governor Andrew Bailey says Bank can be more "activist" on cutting interest rates. Just two weeks ago he said caution was still warranted. This is what's changed: https://t.co/iLM42cyQ3W pic.twitter.com/BtTQNvCU7b
— Pound Sterling Live (@thepoundlive) October 3, 2024
Today’s fall means the pound has now lost all its gains against the dollar over the last two weeks, since the US Federal Reserve slashed its lending rate by half of a percent.
The Fed’s ‘jumbo’ rate cut weakened the dollar against the pound (and other currencies).
Back in the currency markets, the pound is continuing to drop against the US dollar.
Sterling has now lost a full cent, to $1.3161, as investors digest Andrew Bailey’s suggestion that the Bank could become a “bit more aggressive” in cutting interest rates provided the news on inflation continued to be good.
Inflation was last clocked at 2.2%, in August, only slightly above the Bank’s target of 2%.
Our interview with Andrew Bailey is also moving the government bond market, it seems.
This just flashed up on Reuters:
UK GILT FUTURES OPEN UP ABOUT 20 TICKS AFTER BOE’S BAILEY TALKS OF CHANCE OF MORE AGGRESSIVE RATE CUTS
Gilts are UK government bonds. And prices are rising in early trading, which pushes down the yield (or interest rate) on the debt.
Ths yield on 10-year gilts (a benchmark for govenment borrowing), has fallen by 30 basis points to 4.011%, down from 4.041% last night.
That means the price of the bond has gone up, and indicates that investors are pricing in deeper cuts to UK interest rates in coming months than before.
The pound is also losing ground against the euro, as well as the dollar.
Sterling has dropped by 0.66%, or three-quarters of a eurocent, to €1.1933 against the euro this morning, down from €1.2012 last night.
Bloomberg’s Markets Today liveblog has spotted that Andrew Bailey’s comments are “rippling through bets on Bank of England rate cuts”.
Investors are now more confident that the Bank will cut borrowing costs in coming months.
Bloomberg’s Sam Unsted explains:
Having wavered slightly so far this week, a 25 basis point cut in November is now being fully priced again. And bets are being added further down the horizon too, with 125 basis points now priced by June next year.
The pound slides to its lowest in two weeks versus the dollar following dovish comments by Bank of England Governor Andrew Bailey https://t.co/Wl4GwPVT6d
— Bloomberg UK (@BloombergUK) October 3, 2024
Analyst: Andrew Bailey sinks the pound
Sterling has been rattled by the dovish comments from the Bank of England governor Andrew Bailey in today’s interview with the Guardian, says Kathleen Brooks, research director at XTB.
Brooks points out that the dollar has also been benefitting from ‘safe haven flows’, as nervous investors try to protect their money due to the Middle East crisis.
She says it’s been a ‘bruising week’ for the pound, which may have further to fall against the dollar.
In a note headlined “Andrew Bailey sinks the pound”, Brooks explains:
The pound was already selling off before Bailey’s comments, and GBP/USD is down more than 1% so far this week, it is down from $1.34 at the start of this week to below $1.31 this morning.
It has found decent support at $1.3170, however, this has been a bruising week for the pound, and $1.35 seems like a mountain to climb from here. Part of the pound’s sell off is due to external factors. As geopolitical risks in the Middle East have risen, the US dollar has caught a bid. The currencies that were most extended vs. the US dollar have sold off rapidly, as investors have sought the safety of the dollar.
Hence, the pound and the yen were in the sellers’ sights, as the markets scrambled to buy dollars. The pound is still the best performing currency in the G10 FX space so far this year, thus, if tensions escalate further, then we could see another leg lower for GBP/USD [the pound against the dollar].
Tesco lifts profit forecast
Supermarket chain Tesco has announced it now expected to make profit of £2.9bn for the year, up from £2.8bn previously predicted.
Tesco says it will make £100m more than expected after it grabbed share from rivals by cutting prices, put more staff on the shop floor and used AI to target ranges to local tastes.
The UK’s biggest supermarket said it had made £260m of cost savings in the six months to 24 August and had also benefited from restructuring its bank and shoppers trading up to higher priced products as the cost of living crisis has eased.
The retailer said 20 million more people had bought its Finest premium own-label range.
The dollar is also strengthening against other currencies this morning.
Reuters reports:
The dollar scaled a more than six-week high versus the yen on Thursday as robustness in the U.S. jobs market reinforced bets the Federal Reserve will not rush to cut interest rates.
Sterling tumbled to a two-week trough after Bank of England Governor Andrew Bailey said in an interview with the Guardian newspaper that the central bank could become “a bit more activist” on rate cuts if there was further good news on inflation.
The euro slid to a three-week trough after normally hawkish European Central Bank policymaker Isabel Schnabel took a dovish tone on inflation, cementing bets for a rate cut this month.
The yen has come under selling pressure since Japan’s new prime minister said on Wednesday, following a meeting with the central bank governor, that the country is not ready for additional rate hikes.
⚠️ Exclusive: Bailey held out the prospect of the Bank becoming a “bit more aggressive” in cutting interest rates provided the news on inflation continued to be good.$GBP offered on this news pic.twitter.com/tMbnTTzBHg
— PiQ (@PiQSuite) October 3, 2024
Introduction: Bailey says Bank could become 'a bit more activist' on interest rates
Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.
The pound has dropped to a two-week low this morning, after the Bank of England governor told the Guardian that the central bank could become a “bit more aggressive” in cutting interest rates provided the news on inflation continued to be good.
Andrew Bailey told us that he has been encouraged by the fact that cost of living pressures had not been as persistent as the Bank thought they might be.
In an interview with my colleague Larry Elliott, Bailey says that if the news on inflation continued to be good there was a chance of the Bank becoming more “a bit more activist” in its approach to cutting interest rates, now at 5%.
This has knocked the pound, which is down 0.8 of a cent to $1.3185, its lowest level since 19 September (just before the Fed’s rate cut).
The Bank had recently sounded more cautious about rate cuts than its counterparts in the US and the eurozone. It has only made one quarter-point cut this year, in August, while the Federal Reserve has cut US rates by half a point, and the European Central Bank has made two quarter-point cuts since June.
The Bank is next scheduled to set interest rates in early November; the money markets suggest there’s an 88% chance of a cut, to 4.75%.
Bailey made the comments in a wide-ranging inteview, in which he explained he was watching developments in the Middle East “extremely closely”.
Bailey told us:
“Geopolitical concerns are very serious,.
It’s tragic what’s going on. There are obviously stresses and the real issue then is how they might interact with some still quite stretched markets in places.”
Bailey said that in the year since the Hamas attack on Israel there had not been a big rise in oil prices of the sort seen in the past.
He explained:
“From the point of view of monetary policy, it’s a big help we haven’t had to deal with a big increase in the oil price. But obviously we’ve had that experience in the past, and in the 1970s, the oil price was a big part of the story.
“Obviously, we keep watching it. We watch it extremely closely to see the impact of the latest news. But … my sense from all the conversations I have with counterparts in the region, is that there is, for the moment, a strong commitment to keep the market stable.
Here’s the full interview:
The agenda
9am BST: Eurozone services PMI index for September
9,30am BST: UK services PMI index for September
10am BST: Eurozone producer prices index for August
12.30pm BST: Challenger survey of US job cuts for September
1.30pm BST: US weekly jobless claims report
Updated
