The pound fell to the lowest in a month against the dollar on speculation that carry trades will continue to unwind on credit-market woes. Also, a report that’s forecast to show inflation slowed in the U.K. sent the pound near a four-month low versus the low-yielding yen.
[B][I]Barclays Has `Significant’ Loan Risk, Panmure Says[/I][/B]
A London-based analyst at Panmure Gordon & Co stated that U.K. bank Barclays holds “significant” risks from loans to hedge funds and private equity firms. The analyst Sandy Chen rates the shares a “sell” stating: “We think there is a material risk that some of Barclays Capital’s counterparties may be in trouble,” said Chen. “What was previously a strong source of growth could turn into an area of weakness.”
-Source: Bloomberg
[B][I]Police on Alert at Heathrow Climate Camp[/I][/B]
Police were on alert on Monday as climate protesters set up a tent camp in a field next to Heathrow Airport, the world’s busiest international air transport hub. The protesters plan a week of activities which they say will culminate on Sunday in 24 hours of “direct action” in a bid to force the government to halt the planned expansion of the airport, which they argue is adding to global warming.
-Source Reuters UK
[B][I]Bank of England & Intervention[/I][/B]
The economic problem of the free-rider is usually illustrated with references to street lights and garbage collection. Might it now apply to central banks? While monetary authorities in the eurozone, US, Japan and Switzerland among others have been injecting cash into the global banking system, the Bank of England has not lifted a finger. That is despite overnight rates at one point reaching 75 basis points more than the BoE?s 5.75 per cent target rate - the kind of jump that other central banks took to indicate that banks were running out of cash.
-Source: Financial Times