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No rate hikes for the Bank of England and a political asylum offering

On Thursday, European markets closed in the red after the Bank of England decided to leave interest rates unchanged

calamatta_cuschieri
Calamatta Cuschieri
16 June 2017, 11:58am
The Bank of England decided to leave interest rates unchanged. The weaker pound has put the brakes on consumer spending by making imports dearer
The Bank of England decided to leave interest rates unchanged. The weaker pound has put the brakes on consumer spending by making imports dearer
On Thursday, European markets closed in the red after the Bank of England decided to leave interest rates unchanged. The rate-setters cited a substantial slowdown in economic growth in the first quarter and partly attributed the setback to the weaker household spending. The weaker pound has put the brakes on consumer spending by making imports dearer, but on the other side the currency is helping exports and encouraging businesses to invest. The monetary policy Committee stressed that real income growth may weaken during the process of the departure of Britain from the European Union.

This comes after; the US Federal Reserve raised interest rates to a range of 1% to 1.25% and noted another rate hike may occur before the end of the year. With Soft U.S economic data and oil prices under pressure on oversupply worries in the world’s largest economy increase concerns about a slowing U.S. economy.

The FTSE 100 slid 0.74%. Fresnillo led the losses as it plunged 7.26%. Other miners also posted significant losses as Anglo American and Randgold Resources dropped over 4%. The DAX shed 0.89%. The worst performers were Deutsche Telekom and ThyssenKrupp as they dipped 2.38% and 2.33%, respectively. The CAC 40 declined 0.50%. ArcelorMittal lost 2.85%.

The pound edged up 0.04% against the dollar to sell for 1.2758, while the euro fell 0.59% compared to the US currency to go for 1.1151. The gains in the pound come following the hawkish dissent at the Bank of England.

Political Asylum

Russia's President Vladimir Putin said on Thursday Moscow is "ready" to offer former FBI Director James Comey political asylum if necessary. The Russian President compared Comey to the former CIA employee Edward Snowden who was given asylum in Russia after leaking classified information. Putin also noted that it was also “strange” that the ex-FBI chief recorded his conversations with President Donald Trump and leaked to the media later.

"If he continues to be persecuted in this connection, we will be ready to provide political asylum to him, he should know about that," Putin assured Comey.

On the other hand, Trump’s lawyer Marc Kasowitz strongly criticised Comey for leaking memos containing “classified” material and he intends to file a complaint against the Former FBI director.

Spotify

The music streamer Spotify reported a widening loss for 2016. The music company increased revenues by around 50 percent EUR 2.9billion in 2016 as more customers are paying for access to some 30million songs. However, the Company still pays the majority of the revenues back to record labels for use of their songs. In fact, Spotify net loss more than doubled as royalty and distribution fees rose 49 percent to EUR 2.48 billion in 2016.

 

Disclaimer:

This article was issued by Rodrick Duca, Trader at Calamatta Cuschieri. For more information visit, www.cc.com.mt. The information, view and opinions provided in this article is being provided solely for educational and informational purposes and should not be construed as investment advice, advice concerning particular investments or investment decisions, or tax or legal advice. Calamatta Cuschieri Investment Services Ltd has not verified and consequently neither warrants the accuracy nor the veracity of any information, views or opinions appearing on this website.

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