The Bank of England’s Monetary Policy Committee (MPC) has decided to retain the United Kingdom’s interest rate at 0.5%. The rate, the lowest in the Bank of England’s history, has now been unchanged for over two years despite speculation that higher rates may help combat inflation.
Euro-zone interest rates have been raised to 1.25% from the record low of 1% by the European Central Bank (ECB). Interest rates had been held at 1% for just under two years following the financial crisis and global recession.
Global commerce will grow 6.5% this year after expanding a record 14.5% in 2010 as economies from China to Brazil recover from the worst recession in six decades, the World Trade Organization said on Thursday.
If recent evidence is anything to go by, Brazil’s latest effort to stem the rise in the Real is unlikely to have a lasting impact on the markets, according to Capital Economics.
Brazil unveiled Wednesday the latest effort to stem a flood of foreign capital that is driving the local currency sky-high and undermining the competitiveness of the country’s exports. Finance Minister Guido Mantega blamed the currency woes on the Federal Reserve policy that keeps US interest rates near zero.
Uruguay this year plans to swap part of its foreign-currency bonds for debt denominated in Pesos, said Economy Minister Fernando Lorenzo. Uruguay will also sell Peso securities and use the proceeds to pay off bonds denominated in other currencies, Lorenzo said without providing further details.
Portugal's caretaker government said on Wednesday it had decided to seek financing from the European Union in an abrupt turnaround after resisting a bailout for months despite sharply deteriorating financial conditions.
White House officials said the United States and Colombia have reached a deal on a free trade agreement. President Barack Obama and Colombian President Juan Manuel Santos are to meet Thursday to discuss the deal.
Members of the US Federal Reserve are in sharp disagreement about how to address rising prices. The bank might need to tighten the reins on the economy before the end of the year to stave off inflation, said some members of the central bank's policy-setting body.
The increase in the Mexican IMEF manufacturing index last month suggests that the industrial sector has continued to benefit from stronger demand in the US, points out Capital Economics.