Global stock markets rose today, after the Bank of England cut interest rates and revived a bond-buying program to cushion the blow to the economy from Britain's June 23 vote to leave the European Union.
World stocks fell for a third straight day today, depressed by growing nervousness surrounding central bank policy and the spike in world bond yields, although European bank shares rebounded after two major earnings reports.
Britain's economy is shrinking at its fastest rate since the financial crisis after last month's Brexit vote, making a Bank of England rate cut tomorrow a "foregone conclusion", a closely watched survey of businesses showed.
This morning’s data from Europe has been mixed: UK’s inflation figures were surprisingly strong, while a key German economic sentiment survey came in significantly weaker and Eurozone’s construction output shrunk more than expected.
I am pleasantly surprised to find the Bank of England Monetary Policy Committee managed to hold rates steady at the 0.50% all-time low, and not expand its purchased assets beyond the previous £350 billion. It is a triumph of sane assessment of real conditions over highly anticipatory policy making.