India cuts key rate in surprise bid to lift flagging economy

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He stressed this was not the Bank's central forecast for growth.

It continued to stress that interest rate rises were likely to be needed "at a gradual and limited extent" to bring inflation back to target by 2022.

Sterling initially fell a quarter of a cent against the dollar, touching a two-week low, but was up on the day after Carney mentioned the probability of an economic pick-up if a Brexit deal is done. "The amount of debt purchases by the central bank beyond February will depend on the evolving liquidity situation", Governor Shaktikanta Das said.

Mark Carney, the Bank's Governor, and the other members of the Monetary Policy Committee voted unanimously to hold interest rates steady at 0.75pc.

Neil Foster, GMB National Research and Policy Officer, said: "These serious warnings from the Bank of England chime with many of our experiences in workplaces".

European Union leaders host British Prime Minister Theresa May for talks in Brussels today as the two sides seek to save their Brexit deal.

"In fact, he is coming next month".

The US Federal Reserve's shift to a more dovish stance is giving emerging markets like India a reprieve after last year's rate hikes.

They now only expect to raise rates once over the next three years, taking the.

The meeting minutes show that the committee believes that the softer growth seen both domestically and internationally is "likely to prove only temporary", and that CPI inflation is expected to settle a "little above 2 per cent in the medium term".

Retail sales in Italy, which entered into its first recession in five years in Q4 2018, also came in negative, while the European Commission once again downgraded its growth forecasts for the Euro-area's economy. Acknowledging the huge impact of uncertainty, it ran an analysis showing that less uncertainty would lead to much stronger growth - 1.6 per cent this year and 2.2 per cent in 2020.

The party's shadow Brexit minister, Matthew Pennycook, tweeted on Thursday that if May did not accept Labour's changes "in full", the party would move to support a second referendum.

Brexit is causing the United Kingdom economy to weaken, it said, cutting its 2019 growth forecast to just 1.2%, the lowest since the financial crisis.

The main reason the BoE thinks underlying inflation pressures will build is faster wage growth after Britain's unemployment rate hit its lowest level in more than 40 years.

But the bigger picture remains weak.

Rain Newton-Smith, the chief economist at the CBI, the business lobby group, said: "It's now crunch time - a no-deal scenario must be taken off the table because the economy is seizing up from uncertainty".

Carney said that the possibility of a "no-deal" Brexit has gone up since the aftermath of the Brexit vote in 2016, when it was considered unlikely.

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