Sterling jumps and housebuilders slump as Carney flags 'closer' rate rise

Housebuilders' shares have taken a dive in early afternoon trading after Bank of England governor Mark Carney said a hike in interest rates is "moving closer".

In a Treasury Select Committee hearing, Carney (pictured) dismissed suggestions that low inflation - figures today show UK CPI fell back to zero in June - was enough to scupper a rise. "The point at which interest rates begin to rise is moving closer, given the performance of the economy" he said. The governor added there are "caveats" to this statement but that did not prevent the pound rising by 1% against the US dollar to $1.5586. However, housebuilders, who would be negatively affected by higher mortgage rates, saw share prices drop. Taylor Wimpey, Barratt Developments and P...