it is all about the bank of england today. the bank cut its forecast for growth and wages. mewhatto rise by greater extent than markets 2.2% in 2020.ird bloomberg british pound index rising ahead of the decision. .8%.by 1/10 that its decline was 18% since october of last year and rebounded almost 6%. flat on the year up against five of its big g10 peers this year. 7%.dollar has sunk by sterling index lower because of the bank of england cutting its growth and wage forecast. yearis the 10 year -- 10 -- 10 year yield. down to 1.17%. the day of the brexit last june. bank almost ahe year to the day cut rates to the record low. finishing up the impact, this is the chart rising. the small-cap index rose to a 17% since the brexit vote in sterling terms. in euro, little changed. sterling -- sterling's declined today's giving it a lift. governor mark carney stressed how the -- stressed how the outcome is key to the economy's prospects. >> to be clear, assuming the new transition does not mean no--holds at businesses uncertainty about the shape of the economic relationship with the eu

the bank of england as part of the discussion. ook at the bank of england and that they appear to be the next in line, the reason they are interesting at a global level is because it gives you a sense as to whether the global central banking community can get away from the zero lower bound, instead of just the fed. almost like as benchmark about how markets react if they do surprise. >> yes. ultimately, the central bank reaction function looks beyond reflation targeting. we saw that with the bank of canada. we are looking at the dollar, as well. ultimately, central banks are waking up to the fact that we have seen inflation consistently undershoot. at a time when you are seeing growing imbalances, you have the markets across europe, as well, starting to continue to remain robust. for the bank of england, we don't think they will hike today. we think they will remain on hold for another long period. the risks are that they will not be as comfortable with continued above target inflation as we saw here. tom: mike, the idea here that

as a result, short on again. >> bank of england cutting the , the inflation forecast unchanged but what stands out is an aggressive cut to wage growth in 2018 versus 3.5% and couple of months ago. if you are the bank of england and pushing for a rate hike because of the tight labor market and you think wage growth is coming, that is an aggressive cut. guy: it is and they think we are at a neutral rate when it comes to unemployment. we are not getting a wage growth . the fact they are cutting it is interesting, maybe it suggests the bank thinks there may be more slack in the economy going forward. no surprise they have downgraded the 2017 forecast where we had a .2 and a quarter one, .3, quarter to. as a result, mathematical probability the members had to come down by the conundrum is wages, when by wage pickup come through? saunders in mccafferty fit with the labor market tight, that will happen and as a result, the rates should go higher. i am only speculating, we have not seen their names. yields are lower given the reaction and sterling is softer. the diplomatic way of talking about

the bank left interest rates uchanged at 0.25%. the governor of the bank of englandth is likely to have consequences for the stance of monetary policy. that is because as the mpc has previously emphasised, the mpc has previously emphasised, the process of leaving the european union is beginning to affect potential supply in the uk. brexit related uncertainty regarding —— is causing some countries to delay decisions about entering new markets. the uk's eventual new trading arrangements will require a period of reallocation as some sectors of the economy expands and others contract. moreover, prolonged low investment will restrain growth in capital stock and increases in productivity. indeed, if the mpc‘s current forecast comes to pass, the level of investment in 2020 is expected to be 20 percentage points below the level that mpc had projected just before the referendum. as a result, the supply capacity of the economy is likely to expand that only modest rates throughout the forecast period. that means only a modest uptake in demand growth. ‘s sluggish rate will be su

the bank of england has downgraded the uk growth forecast for this year and next. correspondent simon gompertz reports. for more than eight years, the guardian of our financial system, the bank of england, has been trying to spur on the economy by keeping interest rates at record lows and providing banks with cheap money to lend out. one day, that will have to end — but this is not that day. the anxious wait in financial markets for the monthly 12pm announcement from the bank. its base interest rate, which influences how the rates we pay move, to stay down at 0.25%. two out of eight on its rate—setting committee voted for a rise, fewer than last time. low interest rates are designed to keep people confident, spending and borrowing, but we know the bank is now worried about that level of borrowing it wants to moderate it and cool it slightly, so so far they have had strong words and warnings, but they haven't raised interest rates to try and hold the household in its steps. what the bank of england is watching out for when it decides how to raise interest rates is wh

we should take the bank of england's forecast with a pinch of salt. riously bad at forecasting. then, of course, we have project fear mark two. the bank of england, the cbi and the treasury department are all ganging up again to make us frightened of brexit. even the bank's own staff are unhappy about wages. it's only when pay starts to catch up with prices that we may see interest rates rise. that's not expected until next year. one of the most seniorjudges in britain says society will have blood on its hands if a 17—year—old girl, who's tried to kill herself several times, is released from custody, without adequate supervision. the president of the family division in england and wales, sirjames munby, says it's disgraceful that it's been so difficult finding suitable provision for her when she's released in 11 days time. nhs england says it's making every effort to find appropriate care. our home editor mark easton reports on a case, which highlights a crisis in mental health provision. "a disgraceful and utterly shaming lack of proper provision for

the bank of england has lowered its growth forecast for this year and the next. 1.9% made back in may. the bank said rising inflation has also been weighing on household spending power. the bank also voted 6—2 to keep interest rates on hold at 0.25%. they've been at that level since august of last year. next sales have had a big boost from the retailer's directory catalogue and internet business. overall second—quarter sales rose 0.7%, beating expectations. but full—price sales at next retailfell 7.a%, and the company said it remained "cautious" about its outlook. the pay of top chief executives has fallen in the past year, but there is still "a huge gap" between them and the rest of their staff — that's according to a new report from the high pay centre. the bosses of ftse100 companies now make on average £a.5 million a year, that's down 17% from £5.a million in 2015. the think tank said the fall was welcome but "limited and very late". july saw the first increase in the average price of petrol and diesel for three months following a late surge in the cost of oi

a challenging situation for the bank of england where it has an economy that might slow down. ks of to see some hearing. at the same time, you have inflation where it should be and where the bank of england wants it to be. you are in this weird situation where you want to make sure that you do not get into a situation with too much inflation but you do not want to slow the economy too much. i think it is a very normal debate to have given all of the things happening in the u.k. economy. the question is -- will they act on it or not? that is what will keep the market busy trying to figure it out. anna: yesterday, some of the response from prominent figures on the brexit side of the debate. disappointedhaps that the bank of england had reduced its forecast for growth. at the same time, perhaps taking hard from the fact that the bank of england is assuming a smooth transition to a post-brexit world. if things look anything other than smooth, those forecasts could come down further. >> that is a big assumption. i hope things will be smooth but it is a big question mark. in the worl

today is super thursday at the bank of england. ll take you to all the nuances outside the bank of england. is mervyn king and carney. these are the periods of time. look back to thousand 5, 2006, when you had this momentum move 2006, when you had this momentum move. they think august is live. "a slow-motion downturn rather than a cataclysmic drop." the pound, if you take all of that in conjunction, the pound has had a run. the dollar weakness, not so much. the sterling strength. up to present on cable. this is the bloomberg british pound. we are in this band with anxiety. what does it take to get the pound to move distinctly in one direction or the other? isxit anxiety risk dissipating. the spreads are down. what is it that makes or breaks the next move on sterling? guy, i am off to digital radio with carolyn hester. matt: i wanted to take a look at some of the winners and losers on the stoxx 600 as far as company names. if you break it down into in this point, you see hsbc as the on the stoxx 600. i believe this is one you ex-divv

the bank of england has said families are facing the worst squeeze on their incomes for more than a centuryarned of slowing economic growth and rising inflation. the bank's governor mark carney said that uncertainty over brexit was curbing pay rises and leading to delays in business investment. here's our business editor simonjack. there hasn't been much summer cheer on the beach in margate this week. the weather, overcast, and some bracing headwinds, much like the uk economy. and there was precious little sunshine shed when the bank of england governor delivered its latest forecast. he explained how the recent fall in the pound was starting to make us all poorer. households looked through brexit—related uncertainties initially. but more recently, as the consequences of sterling's fall have shown up in the shops and squeezed their real incomes, they've cut back on spending, slowing the economy. the bank cut its growth forecast for this year from 1.9% to 1.7%. it also downgraded its estimate for next year, from 1.7% to 1.6%. meanwhile, it pushed up its inflation forecast, saying it'll rise f

manus: we'll bring you the bank of england rate decision. you've got minutes of the meeting and inflation rereport that will come at u.k. mid day. anna: half an hour later, governor karney gives his news conference, including inflation reports. loomberg users can follow that at bloomberg live and here on bloomberg tv. what's next? manus: president trump signed a russian sanctions bill forced upon him by congress. with the addition of a statement he has reservations. anna: the administration may be on he verge of ramping up china. they're gearing up to investigate china for intellectual property violations. manus: what are the possible threats against chi sna >> the sust looking at having the u.s. trade representative office investigate, start a probe, into what the u.s. views could be intellectual property violations. of international trade law. by doing this, this obviously could antagonize china and there really might be retaliation in terms of, especially if the u.s. goes outside world trade organization rules, china could do the same thin

that have made mark carney and the bank of england speak up about this. bank of england will stand in the way of the currency correction. i think the bank of england actually said they were prepared to let sterling find its own level. ifl be interested to see they will take those comments but i think the history of central bankers using monetary policy and currency levels is mixed, to say the least. i think they will be more interested in the impact it's going to have on the u.k. economy which currently there is not a great deal of reflationary but you might, have expected inflation to rise by more than that. you are then wages. are pressureshere within wages. manus: stephen is the head of european asset strategy. anna: the brexit story continues on bloomberg radio. will speak to the former british ambassador to japan. manus: coming up, president macron the what are his prospects for success? ♪ anna: welcome back, it's 1:44 in the morning in new york. mixed session coming through in asia after big turnaround assession over in the u.s. markets try to put a

big mess coming up for the united kingdom, which is more about politics than it is about the bank of englandhave implications for the bank. then we have the budget. what comes out of that weaker or stronger, one of the key challenges we're seeing at the moment is does the u.k. government have the political authority, does she have the political authority to make a compromise if necessary to avoid a cliff edge. mark: even though you have divergences within the capita, happen on one side -- the talk seems to be moving toward a softer version of the heart brexit. to startl have fleshing out those positions because this issue around money, it's going to be tough both within the cabinet and the border to kingdom, you have the issue around the court of justice which if you want the transition deal and access to the single-payer market, you have to accept some jurisdiction on that, and you have thanks like the border to be dealt with as well. there's a lot of tough things to be resolved during october, including the great repeal act and how the labour party in your position respond. depending how t

let's start with the bank of england. a huge amount of information yesterday. want the cabinet to introduce a transitional arrangement for leaving the eu. the bank of england was talking about much the same thing, it is brexit and the uncertainty about brexit which is damaging the british economy at the moment. that is what the bank of england is saying. it is happening at the moment? it is saying businesses are not investing at the rate they would expect and it is a benign area. you would expecting companies to be investing more and they art and and it says it is down to uncertainty. the other end, it is looking like less moving towards any rate rises soon, the split is not as sharp as it was? we had one person in favour has just left on the new person who has joined in favour has just left on the new person who hasjoined isn't interested in increasing interest rates. compare that with the rest of the western world, the ecb is talking about easing off on bond purchases and we're expecting the fed to do something about that in september. it is already putting i

the inflation report, it is the bank of england giving its assessment of what he thinks will happen tosee this backward looking adjustment to growth and reflecting what we have seen as opposed to what we expect to see. secondly, this is a problem of their making. the weakness in sterling and the high inflation you are talking about has been encouraged by the dropping rates we saw in august last year which has turned out to be an over reaction. it is fairto turned out to be an over reaction. it is fair to say now that bankers got itself into a sticky situation and is finding it difficult to get out of the problem. the strange dilemma, it wants to rein in an relation, the bank, and only one way is doing —— one way of doing that is not rating the interest rate. they have to keep it going and get us out there spending. where is the priority? mark carney talks about the trade—offs. to what extent are interest rates assisting in the output story and how were they stimulating growth? it is difficult to argue that 25 basis points are different and it does drive some of the imbalances we have s

we should take the bank of england's forecast with a pinch of salt. otoriously bad at forecasting. then, of course, we have project fear mark two. the bank of england, the cbi and the treasury department are all ganging up again to make us frightened of brexit. even the bank's own staff are unhappy about wages. it's only when pay starts to catch up with prices that we may see interest rates rise. that's not expected until next year. simon jack, bbc news. one of the most seniorjudges in britain says society will have "blood on its hands" if a 17—year—old girl who's tried to kill herself several times is released from custody without adequate supervision. the president of the family division in england and wales, sirjames munby, says it's "disgraceful" that it's been so difficult finding suitable provision for her when she's released in 11 days‘ time. nhs england says it's making "every effort" to find appropriate care. our home editor mark easton reports on a case which highlights a crisis in mental health care. "a disgraceful and utterly shaming lack o

excerpt patients are not for a great race today although you never know for sure what the bank of englandas surprised last time around the three members dissented in favor of raising rates. people are watching that. really carefully today for the direction to see where monetary policy is headed in the u.k. months ahead. lauren: there were predictions of doom and gloom for great britain after the european union. still looking like doom and gloom? >> yeah, so initially, the initial doom and gloom people were gained right after the u.k. vote did not come to fruition. businesses and consumers held up okay. more recently, growth has been slowing and the rise in inflation has put a squeeze on consumers that's really been kind of an overhang on the u.k. economy. the bank of england has a tough balancing act between rising inflation and slowing growth that but didn't quite a conundrum. train for waking up this morning i was wondering why they were reflecting the party we had in the u.s. last night. we will see how that shakes out. thank you, regal gold. >> thanks for having me. >> entries to see

bank has left interest rates unchanged at 0.25%. our correspondent simon gompertz reports. for more than eight years, the guardian of our financial system, the bank of englands been trying to spur on the economy like keeping interest rates at record lows in providing banks with cheap money to lend out. one day, that will have to end, but this is not that day. the anxious wait in financial markets for the monthly 12 o'clock announcement from the bank. its base interest rate, which influences how the rates we may move, to stay down at 0.25%. two out of eight on its rate—setting committee voted for a rise, fewer than last time. low interest rates are decided to keep people confident, spending and borrowing, but the bank is now worried about that level of worrying, sojohnston would rate it and cool it slightly, so so far they have had strong words and warnings, but they haven't raised interest rates to try and hold the household in its steps. what the bank of england is watching out for when it decides how to raise interest rates is whether there is a shopping spree, whether borrowing is taking off, whether wages are increasing fast. so far, it's not now, not y

the bank of england says the economy will remain "sluggish" as it cut growth forecasts to 1.7%. . one of the most seniorjudges in britain has warned that society will have blood on its hands if a 17 year old girl, who has tried to kill herself a number of times, is released from custody without adequate supervision. a surgeon who carried out needless breast operations has had his 15—yearjail sentence increased to 20 years by court of appealjudges. and robert hardy, star of all creatures great and small and the harry potter films, has died at the age of 91. his family described him as growth, elegant, twinkly and always dignified. footballing superstar neymar could become the most expensive player in the world of his deal to join become the most expensive player in the world of his deal tojoin psg from barcelona goes through. —— if the deal goes through. more about that later and never sports news with will. hello, we're building up to that much between england's women and the netherlands, in the semifinal, england beat the pretournament favourites france in the semifinal and on t

the bank of england is not the only central bank concerned about this. ook at canada, switzerland, australia, new zealand, you name it. these countries are worried about the level of household debt. the reason for this is that interest rates have been very low and property prices have been fueled higher. people have to take on more debt. there is a concern that people on the margin, those most likely not able to afford those payments, they will get burned. the banks are concerned. they are likely to announce more macro potential measures to curtail lending. if we look at some data, we see consumer borrowing at the highest levels since the 1960's. there is a concern that consumers throughout the u.k. will see real wages eroded and will not be able to borrow more to support consumption. and we already have record high debt as well. it's not a very good outlook for consumers at all in the u.k. francine: what does this mean for gilts? >> the gilts will not move far from where they are at the moment because there is a lot of uncertainty for the bank of england

the bank of england didn't raise interest rates today. again. st quarterly inflation report, which gave a somewhat brexit—sceptic view of the economy. the bank's not predicting doom and gloom, but it is predicting economic mediocrity. the bank governor didn't use the words "despite brexit, the economy is going quite well." he more or less said, because of brexit the economy is not doing so well. three reasons: in the short term, it's all about us, the consumer. we've already been hit by an effective pay cut thanks to a lower exchange rate, pushing up prices. households looked through brexit related uncertainties initially but more recently, as the consequences of sterling's fall have shown up in the shops and squeezed their real incomes, they've cut back on spending, slowing the economy. right, that's the first. in the medium term, it's about business investment. because if consumers spend less, we'd like companies to spend more. but since the referendum, they've invested much less aggressively than usual in response to an otherwise very favourab

we should take the bank of england's forecast with a pinch of salt. ve project fear mark two. the bank of england, the cbi and the treasury department are all ganging up again to make us frightened of brexit. even the bank's own staff are unhappy about wages. it's only when pay starts to catch up with prices that we may see interest rates rise. that's not expected until next year. during the eu referendum, many of scotland's whisky producers, supported the remain campaign, worried that brexit might affect exports. but now it seems some are having a change of heart, buoyed by the prospect of one—off trade deals with countries like india, where they currently face tariffs of 150%. 0ur scotland editor sarah smith has the story. the barley, the water and the weather make islay malt unique, and on this small island, whisky is very big business. almost 90% of scotland's amber liquor is exported overseas, so brexit will certainly be felt here. small distilleries, like kilchoman, don't want to lose the protected status for scotch whisky offered by eu law, and

watching the aftermath of the bank of england. ng things going on we'll talk about them after the break. they are the natural borns enemy of the way things are. yes, ideas are scary, and messy and fragile. but under the proper care, they become something beautiful. your bbut as you get older,ing. it naturally begins to change, causing a lack of sharpness, or even trouble with recall. thankfully, the breakthrough in prevagen helps your brain and actually improves memory. the secret is an ingredient originally discovered... in jellyfish. in clinical trials, prevagen has been shown to improve short-term memory. prevagen. the name to remember. >>> i'm scott wapner, top of the hour on halftime key sign for investors to stay along the rally, maybe coming from outside the u.s we're going to tell you exactly what it is plus, chief strategist tony guire is here, why investors need to wait before buying we'll tell you why >>> and breaking down today his one day amazing trade on tesla he's going to tell us about his next move as well. halftim

a word on tomorrow, the bank of england, all eyes on that, what are we expecting? easing anticipation of a rate hike from the bank of england. we believe that actually, without much sign of wage growth coming through, that actually the bank of england will stay on pause this year. the markets are slowly waking up to that, but it won't be until we get some clarity from tomorrow's meeting that the bank of england unlikely to raise rates this year in our view. we will keep a close eye on that and you will be back to talk us through the paper stories. alex, thank you. still to come: would you let someone stay in your home forfree if would you let someone stay in your home for free if they agreed it look after your pets? stay with us, you're with business live from bbc news. prices in the shops continued to fall last month, despite recent rises in inflation. food prices are going up, but they're going up less quickly. the price of non—food items continues to fall. rachel lund is head of retail insight and analytics at the british retail consortium. good morning to you. a

the bank of england has the challenges we all have. that, you will see its peak around the end of this year, is normally you find when sterling fell and it fell about a year ago it takes about a year or that to come through and higher prices that we pay for foreign goods and that is what we are seeing. for now, thank you. i know we will talk through some of the paper stories later. for now, thank you. still to come... i know we are going to talk about charging points for electric cars. some of you have been in touch, julie says a lack of charging points, the cars are silent to pedestrians, automatic cars, not manual but would like to try for environmental reasons. keep your comments coming in using the bbc business live hash tag. we'll speak to the man behind the uk's largest network of charging points for electric vehicles. but are there enough to power our demand? you're with business live from bbc news. commuters are braced for rises in railfares... within the hour, we'll find out how much prices will go up, linked to the latest rat

anna: this is the bank of england's consumer credit data and there is the u.k. nce, the big banking credit and this shows there has been a boom. also a lot of that has been away and the high street banks with these alternative lenders. in terms of the overall picture, knows surprise with such low interest rates but something the bank of england is increasingly worried about, are you? geoff: the banking sector is in is oneshape, and so that and the overall sizes are small. household watch incomes, whether they continue to stagnate on a real basis. that is something that inflation will manage. interest rate expectations, do you really want to hit households on the mortgages side when this is starting. manus: the possibility of a rate hike has dropped aggressively, 56% at the end of june. they might a moving that way to 40%. have you shifted you're thinking and what does that do to sterling? geoff: u.k. expectations were higher than the u.s. it is all about the household sector. if inflation gives a buffer or cushion for real income growth maybe we will reassess. he

unemployment >> listening to governor mark carney's press conference yesterday, it sounds like bank of england has become decidedly more pessimistic, even since may in the wake of the general election you have forecast the same sort of downturn since then >> yes the bank of england yesterday reduced effectively the forecast for economic growth in the uk from the previous estimates slightly lower than previously our current forecast for real gdp growth is slightly lore than that we are expecting the real gdp growth for 2017 to be around 1.5%, and for the year after around 1%. so certainly a deceleration of economic growth. >> how concerned are you about the fact that the uk consumer at this point seems to some extent overleveraged? i've been hearing a lot of comments about that, especially when it comes to mortgage debt but also consumer debt as a whole when it comes to auto debt or student loans, that's also a problem in the u.s at what point would the banks suffer from that >> you're right. the level of indebtedness of the uk household sector is quite high the income to debt ratio which is a

of course hammond's over in argentina talking to banking people that's another bad example industrial unrest at the heart of one of the icons of british politics and british finance and indeed the bank of england good term to the gold obviously we're not telling anyone else and you know we should also say of course the independent where this story was from the new investor the saudis so maybe we'll have interesting news from. the independent let's go do that great friend of the bankers himself in the daily mail the mail online the high court the blocks private prosecution bit by former iraqi army chief against tony blair over the iraq war yes folks we're talking about whether tony blair will ever end up in court as a result of calling that war and it looks like he won't is going to get out of jail free card here some specifics here the justice and senior judge mr justice who's the dismissed application of that it's not about whether he did it or not they just say no point in in part pressing this case because it's not going to go anywhere tens of millions of injured or dreading it's only millions. displace them ok i wasn't listening all that i was listening jerry corbin of course was always ag

the guardian financial pages carry a warning from the bank of england saying that the task of regulatingity of london after brexit will put a strain on its ability to police the financial sector. and, finally, on front of the telegraph there's been a rush of tributes being made to the american country music legend glen campbell, who's died at the age of 81. the singer dolly parton called him one of the greatest voices of all time. he had his biggest hit with rhinestone cowboy in 1975. with me is paul charles, who is ceo of the pc agency. nice to see you. let's talk about trump, because obviously it's dominating the headlines — fire and fury like the world has never seen — it usually the kind of language that is the preserve of north korea. powell worrying is it that we are seeing it now being bandied about from both sides? -- so how worrying. it is extraordinary from president trump, who is on holidays, a little more relaxed than the confines of washington. undoubtedly he is again responding to what he feels is a major threat from us intelligence and merging overthe major threat from us

the deputy governor of the bank of england is warning that a cliff edge brexit basically, a very quickf uk finance and business interest from the eu would end up with the most dire financial consequences for the uk. the bank of england has done an audit and says that companies are making contingency plans and they are seeing that if you do have this very sudden removal from the eu, it will present all kinds of difficulties. we hear this a lot. i hear this from people i speak to in banking. this isa people i speak to in banking. this is a real warning which is being taken is a real warning which is being ta ken seriously. people is a real warning which is being taken seriously. people there some are asked spending their days at work trying to —— people face some are spending their days at work trying to work on contingency plans. they would say they need time, we needed transition, you can't take british interests out so quickly. for those who do not study the minutiae of these things, this is about no deal is better than a bad deal. saying goodbye and slamming the door. and lots of bus

gilles moec: the bank of england last week kind of gave up.way from the latest, gave up on the rate hike. it was always kind of surprise that you had up to three members of the mpc in favor of such a big move. there was maybe volatility when the rail side was doing well. -- real side was doing well. was going to soften and we have increasing signs it is happening. finally, we have a sense from the bank of england that they absolutely believe it inflation chart is not going to feel, going to take any effects. the biggest take away from the inflation report is at the bank of england took down is wage forecast. act at the same time, and very frothy labor market and tons of job creation but not generating increases. you would needed to see increases to turn into something more sinister. if you are the bank of england, you expect inflation to peak this year and a slowly, slowly edge back below the target by the middle of next year. francine: you are talking about this chart we are looking at, this is also something i will put on social media for ra

the bank of england has said families are facing the worst squeeze on their incomes for more than a century economic growth and rising inflation. the bank's governor, mark carney, said that uncertainty over brexit was curbing pay rises and leading to delays in business investment. here is our business editor, simonjack. there hasn't been much some cheer on the beach in margate this week. the weather, overcast, and some bracing headwinds, much like the uk economy. and there was precious little sunshine when the bank of england governor delivered its latest forecast. he explained how the recent fall in the pound was starting to make us all poorer. households look through brexit related uncertainties initially. more recently, as the consequences of sterling's four have shown up in the shops and squeezed their real incomes, they have cut back on spending, slowing the economy. the bank cut its growth forecast for this year from bank cut its growth forecast for this yearfrom1.9% bank cut its growth forecast for this year from 1.9% to 1.7%. it also downgraded its estimate for next year, from 1.7%

nejra: the bank of england cut its forecast for economic growth and wages at it kept its benchmark rate low. britain's economy has moved into a phase of study but sluggish growth. it was announced that eight cities from frankfurt to dublin have applied to host the european union's banking authority. 19 are looking to be the home of the drugs regulator. the news kicked off a campaign to win agencies being forced out of london by brexit. thanks mate as much as $50 million in capital in the aftermath of a hard brexit. according to oliver wyman, some smaller firms may abandon their operations on the continent altogether. deutsche bank is envisioning shifting all months -- almost half to the continent in the coming years. according to people briefed on the matter, most of the positions will move to frankfurt and berlin. global news 24 hours a day powered by more than 2700 journalists and analysts in more than 120 countries. i'm nejra cehic. this is bloomberg. factor: the most important is the outcome of brexit negotiations. that is according to mark carney. the bank left rates unchanged yest

moment we got off foreign guests and we tried to persuade them to invest a look at the gold in the bank of england building and put some more in there as well presumably because that's off when the post cracks and buy more nearly when you're up against goldman sachs carney the bank of england governor who i think is releasing an inflation report tomorrow obviously they were going to go on strike why is it these workers didn't go on strike before i don't think they've got political timing on this i think they're frustrated they don't think that. the weather service in mount holly new jersey has issued a severe thunderstorm warning for north central ocean county in new jersey southeastern one of county in central new jersey until three thirty pm at two forty six pm a severe thunderstorm was located over jackson for twelve miles northwest of times river moving northeast at ten miles per hour answered sixty miles per hour wind gusts and because size hail source radar indicated impact expects damage to trees and power lines locations impacted include toms river jackson howell she's in malls blakers far

i think mark carney, the bag of england governor, was right to warn of the potential consequences —— bankd. of course at the moment brexit hasn't happened and we are some way from that split, expected in march, 2019. i think we're beginning to see that working its way through the economy. even the questions you're posing our kind of loaded, aren't they? you talk about the cliff edge facing businesses when we leave, it's going to be in your view a cliff edge we're going to be dropping off. it's a cause for concern. you say the risks of the eu not agreeing a divorce agreement with britain views on the... this is nicky morgan who wa nted on the... this is nicky morgan who wanted to remain in the eu revelling in being the awkward squad, to quote your words. i think you are able, as a politician, i'm a former lawyer as well, to take on the role as a chair ofa well, to take on the role as a chair of a select committee. you are there to hold government accountable to parliament. parliament is going to be hugely important in this process, we're asking the questions our constituents want us to ask

of policy makers and central bankers? to see to what extent the european central bank or the bank of japan or bank of england is willing tomalizing their policies. there, had qe forever and at some point they have to normalize policy. any u.s., you have economy further ahead in the cycle, so it will stay low there. what you're going to see is what other central banks are going to do. tracy: i know you cycles a pretty short nowadays, but i remember two years ago, we had mario draghi stealing the show at jackson hole. he gave a speech that ended up eating the forerunner to the on buying program announced by the ecb later. do you expect a repeat of that performance from him? hans: it is hard to say. the bond buying program will be down down. the european economy is doing quite well. it is growing better, faster than the u.s. economy. base tohas a bigger tighten policy than the fed does. we might see an announcement or hint of that direction, the move toward policy normalization taking up speed. tracy: very briefly, we did have some news from the bank of england last week as well, cutting their broke -- there growth forecast

phenomenon, but it is a sterling phenomenon, not a domestic inflation phenomena and that gives the bank of englandn check. do you agree? >> no, when you look at the bank of england, the risk is they hike rates. when you look at inflation, it is likely to stay at elevated levels of 2.7%. against a target of 2%. when you look at underlying rates of economic activity, they are ok. there is a risk in the u.k. of gdp growth, and it's stronger, not weaker. anna: so, is the bank of england about to make a policy mistake, if itd oet does that? >> no, because ultimately what they are doing is reversing that post-brexit cut they made. manus: but is that all you see them doing? this is just off emergency. >> absolutely. and when you look at the u.k., doesn't need emergency levels of interest rates? clearly not. anna: do you expect them to do more than just that, reverse the emergency come they 25 basis points? >> that is the first step and then you see how the economy copes with that. and then it does shift here. in the future you would expect more in the way of rate hikes, but this is underpriced. anna: we

were consumer credit cooling slightly in july amidst concern amongst bank of england officials that thearket may be entering a bubble of secure lending. it grew 1.2 billion on the month. banks have been warned recently that they may be getting into a spiral of complacency in consumer lending. ofresponding to the buildup credit by ordering lenders to hold extra capital and strengthening rules on mortgage lending. untila will be in japan friday. i thought we would look at the trade balance. trade deficit a in the u.k. four in the u.k. for a number of years since at least 1988. it has been increasing in the last year or two. the problem for the premier is as she tries to hash out a provisional trade deal with japan, their focus is on the eu. it is tricky times for theresa may. abigail, how are we looking in the u.s.? abigail: the boards are up this morning. early yesterday, we saw some pretty steady declines following north korean tension, but a decent rally by the end of the day. the dow looks slightly negative right now. s&p 500 and nasdaq are on pace for their best day since last week.

the bank of england has warned about soaring levels of debt.ys at the border. the hire firm hss has issued a profit warning — and that‘s sent its shares down 20% this morning with the price now down 80% since the firm listed on the stock market in 2015. the company has warned that sales will be "materially lower" than expected following a tough start to the year. consumer debt is of growing concern for the bank of england, and unsecured borrowing is up 10% on last year. now a new report suggests that people struggling with long term credit card debt are more likely to have their limit raised than those who aren‘t. the research by citizens‘ advice found that 18% of struggling credit card users had their limit raised in the past year without requesting it, compared to 12% of all credit card holders. earlier i spoke to matthew upton is from citizens‘ advice who produced the research. total credit card debt now actually stands at about £67 billion and is growing quickly. we have all had the experience, many of us, of having the letter through the d

today is about the bank of england keeping rates unchanged. i will not beat dan hansen's stuff up.the it was 5-3 last time. a new member has come on board. this is the bloomberg pound index. biggest drop today, 8-10 of 1% -- 8/10 of 1%. a record low by the way for the bloomberg pound index since october last year. it has rebounded 6%. a little change. the euro is the best performer against sterling up 55%. 5%.dollar i-- by up by 17%.krone a big move today given the boe cut its forecast for growth and wage growth today. another busy day for banks. definedrre mus expectations. the bank could not keep up earnings growth, posting a surprise second-quarter earnings surged today. a for the improvement in capital. -- a further improvement in capital. billion euro capital increase. growth in fee and commissions. unicredisecond-quarter profit beating estimates off of subscriber growth in the u.s. deutsche is increasingly relying on the u.s. for sales growth.the numbers overshadowed by the looming decision whether to combine the unit with a rival to gain further scales. shares of deutsche te

has to do, for every £100 of loa ns bank has to do, for every £100 of loans it has outstanding, it has got to put some in a deposit itself with centre back, the bank of englandth the bank of england has gone up in relation to how much you are allowed to lend. so the good news is ten years on, banks are safer than they were back then, so are safer than they were back then, so the crisis is unlikely to come from the same place it did last time, because there have been changes. this next question, the financial crisis is a result of the live now, pay later culture, but when it is time to pay up, they seem to just borrow more? when it is time to pay up, they seem to just borrow more ?|j when it is time to pay up, they seem to just borrow more? i don't know if you mean consumers borrow more to pay back their debts. you mean consumers borrow more to pay back their debtslj you mean consumers borrow more to pay back their debts. i think it means everybody. that is almost a political question about the nature of debt and credit. it is true people got into a situation where they bought too much. people say now, the interest rates on offer at the banks are encouraging

the whole bank of england reaction function is predicated on brexit. 't think the bank of england are going to be able to hike rates until there's more clarity. adam was talking about transitional agreements. last week, carney made that extremely explicit. until brexit uncertainty is resolved, we are not going to get the bank of england hiking rates. the bank of england assumes that the household savings rate is going to remain unchanged over the next three years. basically there's going to be no buildup in precautionary household savings. that is a pretty big assumption to make. i think it is very difficult for them to move. francine: i've had about 40 fx strategists over the last two weeks coming on and only one of them said it is time to hike. why did carney go to the pains to sound more hawkish? oliver: there are some legitimate reasons to want to hike rates. the unemployment rate is where they think equilibrium is. inflation is overshooting the target. that is something that has only happened three or four times in the last decade. on the other han

that is in line with the information we have from the bank of england's agents reports. 0ver we have gents reports. over the last ten yea rs or agents reports. over the last ten years or so we have seen agents reports. over the last ten years or so we have seen implement grow from 29 million to 32 million, huge increase in employment. 0utput in the economy has not grown as rapidly. that means productivity growth has been sluggish and that is not enabling firms toward paying creases, also essential pay increases, two employees. there is also a significant availability of labour. normally would we would suggest that when unemployment is falling it is more difficult to find workers. that means there is pressure for employers to put up what they pay. yellow macro ten yea rs what they pay. yellow macro ten years ago we had 30% of all workers we re years ago we had 30% of all workers were self—employed. —— years ago we had 30% of all workers were self-employed. -- ten years ago. 27% are now part—time. many of those want to work longer hours than they currently have. there is an increased av

we have the bank of england decision coming up got a surprise last month.t do you anticipate we'll hear what are the markets expecting and hoping to hear today >> i think today we won't see any change in the base rate. the vote will probably still be six for no change and two for a rate rise. the data over the last month or so has been a bit weaker than in the previous month i think with that on balance, inflation a bit higher in the uk, it's temporary looking forward to next year wage growth has not picked up. on balance there's no need for the mpc to be raising rates. >> james, the debate has been picking up over the last true mon few months who has the better attractively market, the u.s. or europe tell the us how you see things from your side of the aisle. >> i'm a uk investor, i'm a uk equity investor, i will be talking my own story i look at the uk market, it loolook looks cheap to me. 4 % yield on the uk, dividend yield. when you look at cash yielding effectively zero, bond yields around 1, getting a 4 % income off uk looks attractive to me. don't fo

the bank of england will take your old banknotes but not your coins. it is very heavy.he bank itself, the bank of england, you can't actually, because that is the person who has the signature on it. they won't take your coins. or your kroner. thank you very much, trevor. that is it from us today. the team will be back tomorrow, full coverage of all of this throughout the day and on the business live pages. thank you forjoining us on world business report. we will see you again tomorrow. many of us had some pretty heavy rain overnight. a rumble of thunder as well. the good news is that it's all pretty much clearing away sofa today many of us enjoying a dry day with some sunshine and just a few showers developing into the afternoon. that early morning rain clears away from eastern areas. a bit of a slow start the south—east with a bit of cloud. elsewhere, though, good spells of sunshine, and evenin though, good spells of sunshine, and even in the south—east that cloud will break up to give sunny spells as well. one or two showers as we mentioned this afternoon, particular

through this zero percent interest rates the free money they get from the fed or the central bank of england the bank of england so that has been no reduction in the overall cost actually in terms of how much the government spends you can see that in their own get government deficit numbers like government spending is gone up on welfare by trillions and trillions of dollars on the recipients of the government sponsored welfare of in the bankers so i'm going to. say and even shocking more shocking what is so or shocking changes to life expectancy in the u.k. could cut three hundred ten billion pounds from british private sector pension obligations as i said or fifteen percent of the total liability that's pretty shocking you know to see that p.w. c. is on the estimated this and may although at other actuaries have called that figure relatively extreme but peter you see is is more plugged in than most actuaries and terms of being able to see what's in the pipeline of their other corporate clients in terms of what a certain future is for most of these people who are in the private sector you kn

through this zero percent interest rates the free money they get from the fed or the central bank of england the bank of england so you know that there has been no reduction in the overall cost actually in terms of how much the government spends you can see that in their own get government deficit numbers like government spending is gone up on welfare by trillions and trillions of dollars on the recipients of the government sponsored welfare of in the bankers so i'm going to say and even shocking more shocking what i've said or shocking changes to life expectancy in the u.k. could cut three hundred ten billion pounds from british private sector pension obligations as i said for fifteen percent of the total liability that's pretty shocking to see that p.w. see is on the estimated this and may although at other actuaries have called that figure relatively extreme but peter you see is is more plugged in than most actuaries and terms of being able to see what's in the pipeline of their other corporate clients in terms of what a certain future is for most of these people who are in the private se