Moore on UK Growth

ON UK GROWTH

The UK equity market has responded very well to the guidance included in the Bank of England's statement issued after its regular monthly meeting.

It notes that “the implied rise in the expected future path of bank rate was not warranted by the recent developments in the domestic economy”. Following its meeting, the European Central Bank (ECB) also provided, for the first time, forward guidance on interest rates, with a similar positive impact on equity prices. Indeed, the strength of the subsequent rise in the market is indicative of the extent to which equity investors have been unsettled by the increases in both long-term interest rates and rate expectations experienced in recent weeks. In addition to this, recent economic...