9 minutes ago | July 30th, 2014 23:05:14 GMT

Bank of England Broadbent: Comments on UK economy, GBP and interest rates


BOE deputy governor Ben Broadbent speaks in Bloomberg interview – comments crossing the wires:

  • First rate increase shouldn’t be ‘massive shock’
  • Says household debt hardens case for moving gradually
  • Raising rates would be sign economy is recovering
  • Sees case for raising rates earlier for gradual path
  • Guidance isn’t ‘hard and fast,’ depends on data
  • Rates likely to be lower than in past expansions
  • Says rate increases likely to be limited, gradual
  • Says weaker wages suggest BOE underestimated slack
  • Slack being eaten up faster than BOE forecast says some increase in wages is likely
  • Possible growth in past year closer to 4% than 3%
  • Sees growth slowdown toward end of year, early 2015
  • 3Q growth forecast may be revised up marginally
  • Says ‘the edge is coming off’ UK housing market
  • Debt level not argument for doing nothing on rates
  • Exchange rate result of imbalances, not the cause
  • Risk of leaving move too late is faster inflation
  • Says pound would weaken if global growth accelerated
  • Says a concern growth in rest of the world is so weak
  • Says ‘quite possible’ sterling is overvalued


Broadbent spoke yesterday as well: Broadbent Says Global Growth Creating Drag on U.K. Recovery


50 minutes ago | July 30th, 2014 22:24:19 GMT

Meanwhile – mediator on Argentina: Argentina didn’t reach agreement with holdouts


Mediator (Dan Pollack) on Argentina:

  • Argentina didn’t reach agreement with holdouts
  • Argentina will imminently be in default
  • Remains available to parties to find solution
  • Says the full consequences of default are not predictable, but they are certainly not positive


This while Argentine Economy Minister Axel Kicillof press conference is happening (and being updated and added to, here)



1 hour ago | July 30th, 2014 21:52:16 GMT

Argentina’s Kicillof: Speaking now


Argentine Economy Minister Axel Kicillof press conference. Earlier: Argentina downgraded – cut to Selective Default by S&P

Live feed here (in Spanish)


  • Giving an update on talks with holdout creditors
  • Reiterated Argentina’s position to holdout creditors
  • Says Judge Griesa thinks holdout creditors should grant stay
  • Says hedge funds not willing to give delay on ruling
  • Says Argentina can’t comply with court ruling
  • Says debt taks should include all holdouts, not just hedge funds
  • Says Argentina presented an offer, same terms as previous debt swaps
  • Holdouts didn’t accept offer (i.e hedge funds rejected Argentina’s offer)
  • Argentina asked holdouts for a delay on court ruling, says a stay would create conditions for debt negotiation
  • Total claims from holdouts $15bn-$20bn
  • Holdouts suggested providing a guarantee
  • Kicillof says guarantee doesn’t make sense for Argentina
  • Says Argentina cannot sign any accord under extortion
  • Judge doesn’t understand complexities of the case
  • Judge seems to favour holdouts
  • No one knows how to define this Argentine default
  • Says Argentina is not in default, Argentina to keep paying its debt
  • Says blocked debt payment the responsibility of judge
  • Argentina will continue to pay restructured bondholders
  • Says ratings agencies aren’t credible
  • Argentina will take all measures needed to face unfair situation
  • Argentina will not do anything illegal


(ps. – the other important late US development: Banco Espirito Santo capital falls below minimum requirement on 4.25B euro loss)


I’m updating all these comments … but the FX rates don’t care. Not much happening. (Although oil is drifting lower)


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