The Bank of England released a bombshell today. They signal led there is room for at least one interest rate cut in 2008. They currently believe this may be necessary to encourage growth without leading to increased inflationary pressures. This is a very different picture the bank is painting to that of just a few months ago, when they said inflation will be a big issue until 2009 and more rate hikes would be necessary to slow things down. The pound dropped sharply against the dollar and the euro on the news.
Other news from the UK was benefit claims were down 9900 to 824,000, this is the lowest level for two and a half years.
