Rolling live coverage as UK manufacturing PMI signals continued output growth despite supply chain struggles
- HSBC profit doubles as it expands bonus pool for bankers
- Meggitt set to be latest UK acquisition target in £6.3bn takeover
- FTSE 100 and European stock market indices rise
The respected National Institute of Economic and Social Research has forecast the UK economy will grow by 6.8% in 2021, an upward revision of 1.1 percentage points since May.
The economy slumped by 9.8% in 2020 as the coronavirus pandemic hit, but is bouncing back. The 6.8% growth in 2021 will be followed by a 5.3% expansion in 2022, Niesr said.
Supply-side factors and effects of reopening amid the recovery in consumption are likely to keep inflation well-above the Bank of England’s 2% target for the most part of next year. Now is the time for the monetary policy committee to prepare the ground for normalising its monetary policy stance by clearly communicating how asset purchases and the Bank rate will be adjusted in response to a changing inflation outlook.
Given the uncertainties regarding the exit from QE, the Bank should follow a carefully communicated gradual approach to avoid a significant tightening in financial conditions that might risk the ongoing recovery from the pandemic.
Wall Street has indeed gained at the opening bell – leaving the S&P 500 a whisker shy of a new record. (It will of course probably break this record the moment this is published.)
Here are the opening snaps: