Investment & Finance News Roundup Friday 3rd August 2018

INVESTMENT & FINANCE NEWS ROUNDUP

ECONOMY NEWS

Bank of England raises UK interest rates to 0.75%

The Bank of England has raised the interest rate a quarter of a percentage point, from 0.5% to 0.75% – the highest level since March 2009. BoE Governor Mark Carney said there would be further “gradual” and “limited” rate rises to come, but if certain Brexit scenarios materialised the Bank would cut again if necessary. The Bank said that it did not expect interest rates to return to their long-term average of 5% “for many years” because the fundamental structure of the economy had significantly changed since the financial crash. Andrew Sentance, senior economic adviser at PwC, said: “Businesses and consumers should be able to adapt to a well-communicated and gradual series of interest rate rises, after nearly a decade of exceptionally low borrowing costs. Higher interest rates should also provide some much-needed relief to savers who have seen their investment returns eroded significantly since the financial crisis.& rdquo; Meanwhile, high street banks including Lloyds, Nationwide, RBS, Barclays and HSBC, are under fire after announcing plans to hit homeowners with interest rate hikes from today while failing to pass on higher rates to savers.

The Daily Telegraph BBC News The Times, Page: 11 Financial Times, Page: 1 Daily Mail, Page: 4 The Independent, Page: 4

High street suffers World Cup loss

Figures from BDO show that shops suffered another month of negative growth in July, with in-store sales down 1.1% due to the hot weather and the World Cup.

The Sun, Page: 49 Daily Mirror, Page: 50

PROPERTY NEWS

Government urged to rethink Rent A Room changes

The Association of Accounting Technicians has warned that government plans aimed at stopping the abuse of the current Rent A Room tax perk may overcomplicate the system and deter home owners. Rent A Room relief provides up to £7,500 tax-free income that can be received from renting out a room or rooms in an individual’s only or main residential property. The AAT says that proposals to create a shared occupancy test, with the tax break only claimable when the landlord is present at the property during the rental period, would effectively bring an end to the tax break for those renting their whole properties out or who rent out a single room whilst they are away.

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