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Rate held but rises forecast

The Bank of England monetary policy committee&#39s decision to leave the base rate unchanged at 4 per cent caught out a good number of economists last week but most expect to see a rise next month.

Market commentators such as Charcol senior technical adviser Ray Boulger believe the base rate will rise by 0.25 per cent in May to coincide with the publication of the MPC&#39s quarterly inflation report.

Royal Bank of Scotland chief UK economist Geoffrey Dicks predicts that rates will rise by 0.25 per cent in May, August and November, peaking at 4.75 per cent.

Boulger says an ease in consumer spending, an increase in national productivity and the strength of sterling have all counterbalanced rising house prices and higher lending.

He says: “The MPC probably feel they are between a rock and a hard place, with the housing market showing renewed strength and consumer spending still buoyant but other sectors, particularly manufacturing, struggling to make much headway. Furthermore, sterling remains strong against the dollar and is improving steadily against the euro.”


Chelsea the next target for Money Portal

Discount broker Chelsea Financial Services is likely to be among the next acquisition targets for fast-growing fund distributor The Money Portal once it secures a further tranche of funding. TMP, which last year acquired Willis Owen, HCF, the Isa and With-Profits Bond Shops and Bates Investment Services, has a wish-list of nine firms. The list […]

Billy the kidder

Filing expenses is always a stressful experience and never more so than for ABI press officer Emma Quantrill who suffered from the surreptitious prurience of her cabbie. Getting out of a cab from the House of Commons to the ABI&#39s City HQ, Emma shoved her receipt into her purse, where it remained until she filled […]

Questions on strength and trust

The Abacus consultancy director David Ferguson questioned the stated cost of smoothing, which Pru chief executive Mark Wood admitted is around a 0.75 per cent annual management charge. Ferguson queried where the fund&#39s capital for new investment and offers such as extra allocations came from. He said, with returns under pressure, costs such as this […]

Lord Abbett carves niche

LORD ABBETT CF LORD ABBETT UK GROWTH & INCOME FUND Type: Oeic Aim: Growth and income by investing in larger UK companies Minimum investment: Lump sum £1,000, monthly £50 Investment split: 23.57% financials, 11.92% energy 11.63% consumer staples, 11.57% healthcare, 11.56% telecommunication services, 10.09% consumer discretionary, 8.98% utilities, 4.2% materials, 1.85% information technology, 4.63% cash […]

The Investment Clock: Keep calm and Macron!

Trevor Greetham, Head of Multi Asset In a marked contrast to the surge in risk sentiment that followed President Trump’s election in November, markets greeted Emmanuel Macron’s victory in the French presidential election with satisfaction and relief, rather than euphoria. After rallying strongly on opinion polls that accurately predicted the outcome, the euro held onto […]


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