The Bank of England’s monetary policy committee agreed on Thursday to hold interest rates steady for the first time since last September and maintained its commitment to buy up to £150bn in gilts and corporate bonds.

The decision to keep interest rates at 0.5 per cent was widely expected, after rates had been cut by a total of 4.5 percentage points in the six meetings of the MPC since September.

The move comes amid fears that further rate cuts would hit banks’ spreads and profitability, which could affect their ability to lend, and that they might not be passed on.

The committee also agreed to continue with the programme of quantitative easing – creating central bank reserves mainly to buy up gilts – that it began after the last meeting.

The Bank of England

The Bank of England


Michael Coogan of the UK Council of Mortgage Lenders gave an interesting interview on BBC Radio 4’s Today programme this morning about the welcome signs of life in the UK mortgage market.

Essentially HSBC has cut mortgage rates; and there now seems to be a willingness from an increasing number of lenders to increase their loan to values. Announcements have been made by Northern Rock, Lloyds, RBS and HSBC. HSBC has made £1bn available for first time buyers.

Listen to the interview here:


The pound’s slide against the euro has begun to trigger concerns on the continent that the UK is seeking to gain a competitive advantage over its European Union partners.

Sterling has fallen by more than 25 per cent on a trade-weighted basis since the autumn of 2007, raising the question as to whether Britain is letting its currency fall to help its exporters at a time when the eurozone is falling more deeply into recession.

Brian Lenihan, the Irish finance minister, in January directly accused the UK of running a policy of “competitive devaluation”, putting other countries under “immense pressure”.

As the pound has stabilised a little in recent months, the Bank of England now sees the benefits of a lower currency, not in rising exports but in a rapid fall in imports contributing positively to economic growth.


Brian Lenihan the finance minister delivered the toughest budget in the history of the state. The main points include:

– €3 billion in tax rises and spending cuts
– Doubling the income and health levies
– Cutting child benefit

Typically a person earning €100,000 per annum will pay an extra €333 per month into the governments coffers.

In other news Moody’s increased its expectation of losses on Irish bank loan portfolios due to continued deterioration in real estate prices, the likelihood of more corporate defaults and the erosion in residential loan performance.

Straightened times indeeed.

The New York Times has run a sensationalist piece on the sudden economic implosion in Ireland. This comes on the back of the Sean Dunne expose back in Janaury and ahead of todays emergency budget announcement.

Similarily BBC Radio 4’s venerable Today programme ran a feature this morning on the perceived pitiful economic situation in Ireland.

Added to this was the recent Sunday Times magazine feature on Ireland’s beleagured economy.

There seems to be a sense of schadenfreude to the current international coverage. Just how accurate is all this doom-filled commentary? Does the irish media have a riposte?

Sensationalist Schadenfreude?

Sensationalist Schadenfreude?

Links:, &

– House prices increased by 0.9% in March
– House purchase activity reaches highest level since May 2008
– Welcome signals of market improvement but too early to talk of house price recovery

House prices rose in March for the first time since October 2007, according to the Nationwide.

The building society said that property prices increased by 0.9% compared with the previous month.

That reduced the annual rate of house price falls from 17.6% in February to 15.7% in March, with the average UK home costing £150,946.

Nationwide described the change as a “surprise bounce” and warned against concluding the market had turned.

Source: Nationwide Building Society

Work is well underway on this huge development being built by London-Irish developer Eamon Lyons. It is located on Old Street on the edge of London’s financial district – The City. It is due for completion in 2010. The development comprises of two 14 and 16-storey towers.

Eamon Lyons has over 20 years experience in the East End. Originally from the west of Ireland, Lyons cut his teeth with Sean Mulryan’s Ballymore Homes in the late 1980s and early 1990s but eventually established his own company, Tudorvale Homes, which has been building houses and apartments for over a decade.

Artists impression of the finished development

Artists impression of the finished development

Tesco plans to redevelop and expand its store in Hackney Central and make changes to the surrounding area.

A planning application and conservation area consent have been submitted for the Tesco site in Morning Lane, which would see construction of three, nine and 13 storey buildings, providing 11,125 sq metres of retail space for a new store in the three storey building. There will be space for eight other new shops, offices, restaurants and bars.

Further proposals include building 134 new homes, 414 car parking spaces, 252 cycle spaces and new and improved pedestrian routes to and within the Tesco site including the landscaping and pavement widening in Morning Lane.

RYANAIR CHIEF executive Michael O’Leary yesterday said the airline would continue to pare back its services from Dublin airport in a move to up the ante against the Irish Government’s proposed introduction a €10 air travel tax.

Passengers traveling through Dublin Airport over the weekend have reported it being incredibly quiet – “it’s usually pandemonium in there”. Officially there was a 12% decline in the Passenger throughput at Dublin Airport for the month of February, over the same period last year, according to the Dublin Airport Authority (DAA).

Meanwhile the DAA is investing €2bn in new facilities over the next decade and planning permision has been granted for a new runway. Hmmmmm…?

White Elephant?

White Elephant?