–BOE MPC voted 8-1 at April meeting for unchanged QE
–BOE MPC Miles voted for stg25bn boost to QE
–BOE MPC: Some support for view CPI fall slower vs expected
–BOE MPC: Greater chance above tgt CPI persisting into med-term
–BOE MPC: Little evidence change of bal risks to inflation
–BOE MPC: Large degree of slack in labour market
–BOE MPC: Risk recession repts, euro zone could hurt sentiment
–BOE MPC: Risk persistent weak growth could hurt supply capacity
–BOE MPC: More aggressive loosening could attenuate that risk}
–BOE MPC: Most thought sensible to wait May forecast round
–BOE Miles: QE vote ‘finely balanced’
–BOE Agents See Good News On Exports, Manufacturing, Investment

LONDON (MNI) – The Bank of England Monetary Policy Committee’s Adam
Posen switched his vote at the April meeting and voted to maintain the
asset purchase programme at stg325bn, leaving only David Miles backing a
stg25bn increase.

The minutes of the meeting released today also show that Miles
regarded his vote as “finely balanced”.

Inflation concerns appear to have become more pronounced
since the previous March meeting of the committee:

“There was a risk that inflation would fall more slowly than
assumed in the February Inflation Report projections, and the flow
of data provided some support for this view”.

The members noted that “underlying activity” was recovering and
that there could be a “greater chance that above-target inflation would
persist into the medium term”.

“For most members, there was no sufficient reason to change either
Bank Rate or the quantity of asset purchases agreed at the Committee’s
February meeting”.

For the majority it seemed sensible to let the present programme of
purchases run its course and assess the policy stance at the May
meeting when a new set of economic forecasts would be available.

The committee expressed a surprising degree of confidence on the
state of the recovery, pointing to a “wide range of surveys” pointing to
moderate growth in H1. The MPC also said it was inclined not to put too
much weight on weak construction sector data from the ONS, even though
this factor as well as the impact of the Royal Jubilee could lead to
further falls in GDP in Q1 and Q2.

MPC members also noted that underlying activity was likely to have
picked up in the second half of last year.

Intelligence from the BOE’s network of regional agents provided
support for the committee’s sanguine view on the recovery.

Consumer demand growth was reported to be “modest” while there had
been “tentative” signs of a pick-up in house market activity.

“Investment intentions pointed to a gradual rise in capital
spending over the coming year, and plans had strengthened a little
recently”.

Export growth was “robust” and manufacturing output for the
domestic market had risen modestly, the agenst said.

On the downside, however, contacts reported that credit conditions
for businesses had tightened somewhat – “primarily in terms of the cost
of finance” but said most firms still had credit access if needed.

The report also showed some reason for heightened concerns on the
inflation outlook.

The agents reported that labour costs were rising at a moderate
pace and non-labour costs continued to see steady growth. On the other
hand, manufacturing output inflation had started to decline, reflecting
slowing input cost inflation. While consumer price inflation was edging
down, it remained “elevated”.

–London newsroom: Tel: +44 207 862 7492; e-mail: dthomas@marketnews.com

[TOPICS: M$$BE$,MT$$$$]

Recent reports have had ACB selling in this pairing (got those reports when up at 1.3110 area, but busy on UK stuff)

We’re back below 1.3100 again, presently at 1.3095.

So we got middle east sovereign interest on the bid and asian sovereign interest on the offer.  Deep joy

Talk of sell stops now gathered through 1.3080.

–Dec-Feb ILO Unemployment -35,000; Rate 8.3%
–Mar Claimant Count Unemployment +3,600 m/m; Rate 4.9%
–Feb Average Weekly Earnings total pay +1.1% vs +1.3% in Jan

LONDON (MNI) – The level of unemployment fell for the first time in
nearly a year in the three months to February while earnings growth hit
its lowest level since June 2010, figures released by National
Statistics showed Wednesday.

The latest fall in unemployment contrasts with recent official data
which points to weaker economic growth in the first quarter than
economists had been expecting.

The level of ILO unemployment fell 35,000 in Dec-Feb compared with
the previous three month period, the first decline since Mar-May 2011.
The rate of ILO unemployment dropped to 8.3% from 8.4% in Sep-Nov also
the first decline since Mar-May 2011, and below the median for no
change.

The more up to date claimant count measure posted a small rise in
March, increasing by 3,600 on the month, below the median for a 6,800
increase. The February rise of 7,200 was also revised lower to 4,500.

April saw the usual annual revisions to the claimant count with the
main point of interest a downward revision to the claimant count
unemployment rate back through 2011. The rate has been revised lower to
4.9% since September and remained at this level in March.

There was also a decent rise in employment of 53,000 on the quarter
adding to the more upbeat news in the release.

In spite of the latest fall in the ILO measure of unemployment, pay
growth remains very subdued and declined further in February. This will
not help ease the squeeze on real incomes which households have faced
over the past few years.

Total average weekly earnings growth fell to 1.1% in February from
1.3% in January, the lowest since June 2010. This was mainly due to
weaker bonus payments which were down 6.2% in the three months to
February compared with a year earlier, also the largest drop since June
2010.

Most of this was due to a 11.2% fall in bonuses in the financial
sector which traditionally pays bonuses in February and March.

Excluding bonuses, regular pay growth remained stable at 1.6% in
the three months to February compared with a year earlier.

–London bureau: 00 44 207 862 7491 e:mail: puglow@marketnews.com

[TOPICS: MABDA$,M$B$$$,MT$$$$,MABDS$]

–BOE MPC voted 8-1 at April meeting for unchanged QE
–BOE MPC Miles voted for stg25bn boost to QE
–BOE MPC: Some support for view CPI fall slower vs expected
–BOE MPC: Greater chance above tgt CPI persisting into med-term
–BOE MPC: Little evidence change of bal risks to inflation
–BOE MPC: Large degree of slack in labour market
–BOE MPC: Risk recession repts, euro zone could hurt sentiment
–BOE MPC: Risk persistent weak growth could hurt supply capacity
–BOE MPC: More aggressive loosening could attenuate that risk}
–BOE MPC: Most thought sensible to wait May forecast round
–BOE Miles: QE vote ‘finely balanced’

LONDON (MNI) – The Bank of England Monetary Policy Committee’s Adam
Posen switched his vote at the April meeting and voted to maintain the
asset purchase programme at stg325bn, leaving only David Miles backing a
stg25bn increase.

The minutes of the meeting released today also show that Miles
regarded his vote as “finely balanced”.

Inflation concerns appear to have become more pronounced
since the previous March meeting of the committee:

“There was a risk that inflation would fall more slowly than
assumed in the February Inflation Report projections, and the flow
of data provided some support for this view”.

The members noted that “underlying activity” was recovering and
that there could be a “greater chance that above-target inflation would
persist into the medium term”.

“For most members, there was no sufficient reason to change either
Bank Rate or the quantity of asset purchases agreed at the Committee’s
February meeting”.

For the majority it seemed sensible to let the present programme of
purchases run its course and assess the policy stance at the May
meeting when a new set of economic forecasts would be available.

The committee expressed a surprising degree of confidence on the
state of the recovery, pointing to a “wide range of surveys” pointing to
moderate growth in H1. The MPC also said it was inclined not to put too
much weight on weak construction sector data from the ONS, even though
this factor as well as the impact of the Royal Jubilee could lead to
further falls in GDP in Q1 and Q2.

MPC members also noted that underlying activity was likely to have
picked up in the second half of last year.

–London newsroom: Tel: +44 207 862 7492; e-mail: dthomas@marketnews.com

[TOPICS: M$$BE$,MT$$$$]

• Voted 8-1 to keep QE total at £325 bln
• Miles made “finely balanced” call for £350 bln
• Short-run path for CPI likely higher than in February forecasts, “greater chance” above-target CPI will persist in medium term (Tucker had already given the game away)
• Weak ONS construction data and Jubilee holiday mean ONS could report UK GDP falls in Q1 and Q2
• But sharp falls in construction output “perplexing”, MPC minded to focus on survey indicators
• Surveys point to moderate growth in H1 2012, likely to have picked up from H2 2011
• Risk that high inflation may persist and that MPC commitment to inflation target might be called into question
• Oil and commodity price shocks, corporate profit margins and weak productivity pose upward CPI risk
• Downside risk to CPI from potential damage to household and business confidence if ONS reports further GDP falls
• Global recovery proceeding broadly as expected, but markets’ euro zone concerns greater if anything

Quess no further QE anytime soon in the UK.

Better than Reuter’s median forecast of +7,000.

Claimant count rate down to 4.9%, better than median forecast of 5.0%

Ilo unemployment rate for 3 months to February 8.3%, better than median forecast of 8.4%

Cable spikes higher, presently at 1.5971.

–Adds Forecasts, Comments On Swedish, Global Economies And On Rate Path

PARIS (MNI) – Sweden’s central bank, the Riksbank, on Wednesday
left its repo rate unchanged at 1.5%, pausing after having cut rates by
25 basis points at its previous two meetings.

Despite some “positive signs” in activity following a sharp
slowdown of Sweden’s economic growth last year, “inflation is low and
expected to remain so over the coming year,” the Riksbank said in its
monetary policy statement.

“Monetary policy needs to remain expansionary to support the
recovery,” it said. “The Executive Board of the Riksbank has therefore
decided to hold the repo rate unchanged at 1.50%.”

The bank also left its projected repo rate path unchanged. After
its last monetary policy meeting in February, it had said the rate would
stay at 1.5% “until sometime in 2013.” Today it refined that assessment
slightly, saying the rate would stay at its current “low level for just
over a year.”

Later, when inflationary pressures increase, “the repo rate will
need to be gradually raised. This repo-rate path will contribute to
stabilising inflation around 2% and resource utilisation in the
economy around a normal level,” the central bank said.

The decision to keep rates unchanged was not unanimous. The two
customary dissidents on the Riksbank’s board, deputy governors Karolina
Ekholm and Lars Svensson, both advocated for a 50 basis point rate cut
to 1.0% and argued that the repo rate path should be lowered.

The Riksbank noted that despite improvement in the U.S. economy and
a “relatively good pace” of growth globally, “the situation on the
financial markets in Europe is fragile, and much work remains to be done
before sustainable solutions to the problems in the debt-ridden euro
countries have been implemented.” It added that, “economic growth in the
euro area is therefore expected to be weak during the coming period.”

After contracting in the fourth quarter of last year, largely due
to “very weak” exports, there are now signs that both Swedish exports
and domestic demand are increasing again, the bank said. It noted an
improvement in household and business confidence, too.

“However, growth in the Swedish economy will be relatively slow
this year,” before gaining speed in 2013, the Riksbank projected. And
the soft economy will lead to a slight rise in unemployment.

The bank downgraded its domestic growth forecasts for both this
year and next. It put 2012 GDP growth at 0.4%, down from 0.7% in its
February
forecast. For 2013, the Riksbank projected a growth rate of 1.9%, down
from the previous projection of 2.1%.

It also cut its consumer price inflation forecast for this year to
1.2%, from the previous figure of 1.4%. It left the 2013 CPI projection
unchanged at 1.9%.

Recent economic sentiment indicators have shown a marked
improvement since the Riksbank cited weakening economic activity in
Sweden as justification for its 25 basis point cut in February. The
KI/NIER Economic Tendency survey, for example, rose sharply from 93.5 to
101.8 between January and March, pointing to above-trend growth.

Weak export data, cited as a major concern of the central bank’s
executive board at its last meeting, have also shown signs of
stabilizing, and retail sales have registered a surprise increase.

At 1.5% in March, inflation remained in line with the bank’s
projections and below its target rate of 2.0%.

–Paris newsroom, +331-42-71-55-40; paris@marketnews.com

[TOPICS: M$$EC$,M$X$$$,MGX$$$,M$$CR$,MT$$$$]

Hardly surprising.

EUR/CHF up 5 pips from when I got in, presently at 1.2020.

This is way of adding liquidity to money markets, keeping swiss rates low.

Here you go

There’s hawkish for you. Comment has given cable a lift, presently back up at 1.5925.

• Inflation may remain above 3% in Q2
• May remain above 3% into 2H
• Wage growth may be inconsistent with 2% target
• Expect weak output data for 1Q, 2Q
• Surveys suggest growth in underlying activity
• UK rebalancing has some way to go
• Firms need more sources of funding
• Inflation may be more stubborn than forecast

Dow Jones reporting.

Good old Denmark

PARIS (MNI) – Sweden’s central bank, the Riksbank, on Wednesday
left its repo rate unchanged at 1.5%, pausing after having cut rates by
25 basis points at its previous two meetings.

Despite some “positive signs” in activity following a sharp
slowdown of Sweden’s economic growth last year, “inflation is low and
expected to remain so over the coming year,” the Riksbank said in its
monetary policy statement.

“Monetary policy needs to remain expansionary to support the
recovery,” it said. “The Executive Board of the Riksbank has therefore
decided to hold the repo rate unchanged at 1.50%.”

The bank also left its projected repo rate path unchanged. After
its last monetary policy meeting in February, it had said the rate would
stay at 1.5% “until sometime in 2013.”

The decision to keep rates unchanged was not unanimous. The two
customary dissidents on the Riksbank’s board, deputy governors Karolina
Ekholm and Lars Svensson, both advocated for a 50 basis point rate cut
to 1.0% and argued that the repo rate path should be lowered.

Recent economic sentiment indicators have shown a marked
improvement since the Riksbank cited weakening economic activity in
Sweden as justification for its 25 basis point cut in February. The
KI/NIER Economic Tendency survey, for example, rose sharply from 93.5 to
101.8 between January and March, pointing to above-trend growth.

Weak export data, cited as a major concern of the central bank’s
executive board at its last meeting, have also shown signs of
stabilizing, and retail sales have registered a surprise increase.

At 1.5% in March, inflation remained in line with the bank’s
projections and below its target rate of 2.0%.

MORE

–Paris newsroom, +331-42-71-55-40; paris@marketnews.com

[TOPICS: M$$EC$,M$X$$$,MGX$$$,M$$CR$,MT$$$$]

Yer right.

Comments from the soon to be ex-French president and IMF’s head honcho helped pressure EUR/USD to session low 1.3087.

However we’re back up at 1.3098 as Middle Eastern buying emerges. Deep joy…….

UPDATE:  Glad to see some of you noted my deliberate mistake.  Put there to see if any of you were still awake

Christine (we’re on first name terms), in an interview with Frankfurter Allgemeine Zeitung, has opined that the ECB has room to aid growth in the eurozone where a low inflation environment persists.

The IMF head honcho said “We see good reasons for a monetary easing in those industrial states in which inflation is under control, there is scope.”

Guess they’ll be much gnashing of teeth at the Bundesbank

• Euro exchange rate must be discussed with ECB (good luck with that one pumpkin)

EUR/USD has slumped 4 pips since I arrived two and a half hours ago, presently at 1.3111.

I’m feeling a little bit sick…….

Germany re-opens 2 year benchmark 0.25% March 2014 schatz issue

Target amount  5 bln euros

Results due soon after 09:30 GMT

What will we see first, 1.0500 or 1.0300.

We sit presently at 1.0390.

Reasoning for choice as usual would be cool, but not obligatory.

C’mon Hassan and Dr John, let’s be having ya

• Won’t accept austerity as rule for countries

Dow Jones headlines.  Await details.

–Mixed Data, News Flow Seen Doing Little To Alter MPC Chemistry
–Hurdle To Further QE At Pivotal May Meeting Could Be High

LONDON (MNI) – With past months’ data flow having failed to provide
much reassurance on the recovery, minutes of the Bank of England’s
Monetary Policy Committee’s April 4-5 meeting look likely to show Adam
Posen and David Miles dissenting again in favour of a further stg25bn
boost to QE.

Analysts are universally looking for a repeat of the 7-2 vote split
in favour of unchanged stg325bn of asset purchases seen at the March
meeting.

Data flow since March hasn’t provided any justification for a
change in the world view of committee members. Survey data, including
PMI’s, the BCC’s Q1 survey of the SME sector as well as other sundry,
private sector surveys (the REC-KPMG jobs report and even the BRC’s
March retail sales report) have pointed to a moderate bounce off last
autumn’s nadir. But official data (Jan-Feb retail sales, February
industrial production/construction sector output) continue to underline
economic sluggishness.

IP data – which should have been available to the MPC at the April
4-5 meeting – would have made for particularly dismal reading.
Preliminary Q1 GDP data due out Apr 25 looks set to make the weather
ahead of the MPC’s pivotal May meeting. Chances are that this will show
anaemic growth at best.

NIESR estimates pointed to GDP rising by just 0.1% in the first
quarter of this year. That would follow a fall in growth of 0.3% in Q4
2011 and expectations that a series of bank holidays associated with
June’s Royal Jubilee could take a big bite of GDP.

It is also some way below the 0.5% q/q growth rate predicted by the
BOE in February.

So very little here it would seem to make either Posen or Miles
retreat from the view they set out in the March minutes:

“Two members continued to think that a larger monetary stimulus was
warranted to reduce the risk that persistently weak growth would damage
the future supply capacity of the economy. In their view, policy should
be loosened further to stimulate demand quickly…”

That said, data have probably been mixed enough to keep other MPC
members from joining the two in backing additional purchases. Even
those doves who may be inclined to back a bit more gilt buying will no
doubt be inclined to wait for the results of the May forecasting
round, which will be available at next month’s meeting and the first Q1
GDP release before making their minds up.

Despite all the not-so-good news flow, the hurdle to further asset
purchases could still be high, although hardly insurmountable come May.

Minutes for the February meeting of the committee at which stg50bn
of further QE was agreed, lifting it to a total of stg325bn, showed that
some members took the view that there was a good case for doing nothing.

“The Committee recognised that there were substantial risks to
inflation in the medium term in both directions, and that it would be
some time before the uncertainties around these risks were resolved.
There was a range of views among Committee members over the evolution of
these risks. For some members, the probability of inflation exceeding
the target was slightly higher than shown in the projection to be
published in the February Inflation Report, and a case could be made for
maintaining the stance of policy at this meeting. For others, the case
for further easing was more clear-cut”.

Since that meeting ended in unanimous support for doing more QE,
it’s a reasonable enough assumption that a number of members regarded
the decision as an ‘insurance policy’ against yet-to-materialise
downside risks to activity, implying they face a higher bar to support
yet more in May.

BOE Deputy Governor Charles Bean as well as Chief Economist Spencer
Dale indicated that their own inflation forecasts lay to the upside of
the BOE inflation forecasts, seeming to put them in this camp. The
hawkish Martin Weale has also more explicitly ruled out further QE in
public comments, although admittedly before the official data turned
sour – again.

Ben Broadbent’s commentaries have tended to strike a more
sanguine note on developments since the turn of the year. The seeming
success of the European Central Bank’s 3-year LTROs in stabilising
the markets has clearly impressed him, although their benign effect in
lowering peripheral bond yields is starting to look a bit erstwhile.

BOE Deputy Governor Paul Tucker gets a chance to vent his views in
a speech in Liverpool on Wednesday morning, although it is not clear if
his speech will be focused on monetary policy or financial stability.
Tucker became worried at the start of 2011 that the BOE was losing
credibility in the international financial markets over its commitment
to the inflation target. Signs that inflation may not fall back to
target by end 2012 may rekindle his angst.

Other more dovish members, such as the governor himself as well as
BOE Executive Director Markets Paul Fisher could more easily be won over
to the case for doing more QE by May. And even if domestic data fail to
provide a strong enough case for doing more QE, event risk on the euro
zone horizon abounds – French presidential elections, Greek elections,
Spain back in the markets’ firing line etc…

Any of the latter could shift market sentiment about the outlook
for the euro zone and at the same time dissolve MPC qualms about the
risks of doing more QE.

Analysts expect the committee to have split 7-2 in supporting
unchanged stg325bn QE, with Miles and Posen backing a stg25bn boost.

–London newsroom: 4420 7862 7492; email: dthomas@marketnews.com

[TOPICS: M$$BE$]

Whatever……

Haven’t had a Chinese RRR rumour for at least……………………a coupla days

Yipeeeeeeeeeeeeeee