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The Guardian - UK
The Guardian - UK
Business
Graeme Wearden (until 1.30) and Nick Fletcher

Pound could fall to $1.15 as City accepts reality of Brexit, says BAML – as it happened

Bank of England Governor Mark Carney leaving 10 Downing Street last night.
Bank of England Governor Mark Carney leaving 10 Downing Street last night. Photograph: Leon Neal/Getty Images

Pound steady against the dollar

The pound may indeed fall to $1.15 as Bank of America Merrill Lynch has suggested, but at the moment it is holding fairly steady against the US currency.

Sterling is currently down just 0.07% at $1.2234, but this is mainly thanks to dollar weakness due to renewed uncertainty surrounding the US election, not to mention Wednesday’s interest rate decision from the Federal Reserve. Neil Wilson, market analyst at ETX Capital, said:

A poll from ABC that gave Trump a slender lead over Clinton has been the catalyst for some fairly significant risk-off moves...Given how far ahead in the polls Clinton was very recently, the fact that we’re talking about a close race again is clearly rattling investors. Suffice to say we can expect more volatility in the coming week.

Against the euro the pound is not faring so well, down 0,77% at €1.1064.

On that note, it’s time to close for the day. Thanks for all your comments, and we’ll be back tomorrow.

Here’s some gloom from pro-Brexit fund manager Crispin Odey, who has told investors the UK could face recession and the stock market could slump by 80%. Bloomberg reported:

Crispin Odey, whose main hedge fund has lost about 43 percent this year, says U.K. stocks could slump 80 percent as the economy is roiled by a recession and higher inflation following the vote to leave the European Union.

Shares will come under pressure after the FTSE 100 share index climbed 30 percent over five years even as earnings fell by 80 percent, the money manager said in a letter to investors last week seen by Bloomberg News...

“We are now destined to have a recession in the U.K. as well as inflation,” Odey wrote. “It will be difficult for the stock market to remain above all of this.”

European markets end lower

A host of badly received results - from Standard Chartered to BP to Shire and Pfizer - has helped push markets lower, not to mention renewed uncertainty over the US election.

A poll showing Donald Trump leading Hillary Clinton ahead of next week’s votes has unnerved investors while mixed US figures - good manufacturing, poor construction - just added to the downbeat mood. Chris Beauchamp, chief market analyst at IG, said:

Despite two attempts at a rally today, the FTSE 100 remains in the red... European markets have had it far worse, with the Dax losing over 1% today, with euro strength helping to take the shine off markets on the continent that have enjoyed a recent spate of outperformance compared to London...

With US markets taking a hit this afternoon as well it doesn’t take Sherlock Holmes to work out that the new polls giving Donald Trump an edge in the election are spooking investors. The parallels with Brexit are there for everyone to see, but the key battleground states are still leaning towards the Democrats. In all probability, the election will still turn out as expected, but the market’s nagging doubts are clearly getting the better of it this afternoon.

The final scores in Europe showed:

  • The FTSE 100 finished down 37.08 points or 0.53% at 6917.14
  • Germany’s Dax dropped 1.3% to 10,526.16
  • France’s Cac closed 0.86% lower at 4470.28
  • Italy’s FTSE MIB fell 1.32% to 16,898.28
  • Spain’s Ibex ended 1.12% down at 9040.7
  • In Greece, the Athens market dropped 1.47% to 582.45

On Wall Street, the Dow Jones Industrial Average is currently down 103 points or 0.59%.

Updated

Meanwhile HSBC analysts say buy gold whoever wins the US election. Bloomberg reports:

Although they deem a Donald Trump victory more supportive for the price of the metal than a win by Hillary Clinton, the bank’s Chief Precious Metals Analyst James Steel says it’ll enjoy at least a 8 percent jump whoever wins the race.

Both candidates have espoused trade policies that could stimulate demand, with gold offering a potential “protection against protectionism,” he says. Even the relatively more internationalist Democratic candidate has argued for the renegotiation of longstanding free-trade agreements. That’s positive for gold — even if “not on the scale of Mr Trump’s agenda.”

If the real-estate magnate triumphs, gold could rise to $1,500 an ounce, according to HSBC, up from around $1,289 at 10:55 a.m. in New York.

If Clinton wins, the price of the metal could improve to $1,400 an ounce by year end, Steel writes, adding that a Democratic sweep of Congress would further stoke demand for the metal owing to a possible boost in fiscal spending.

On gold, Jasper Lawler at CMC Markets said:

Weakness in the US dollar and rising uncertainty from Presidential nominee Donald Trump rising in the polls saw gold breakout to a three-week high. The gold price has continued to climb after CFTC [Commodity Futures Trading Commission] data showed the first rise in net long positions in four weeks. Gold appears to be being accumulated as a hedge against equity market declines before the US election.

In times of uncertainty, gold and silver are seen as havens for investors and so it is proving at the moment, ahead of the Federal Reserve’s latest interest rate decision and, crucially, the US presidential election.

Gold has climbed from $1276 an ounce to $1288, while silver is up from $17.87 to $18.37.

The ISM said the October PMI indicated growth for the 89th consecutive month in the overall US economy, and indicated growth in the manufacturing sector for the second consecutive month. The ISM’s Holcomb said:

The past relationship between the PMI and the overall economy indicates that the average PMI for January through October (51 percent) corresponds to a 2.5 percent increase in real gross domestic product (GDP) on an annualised basis. In addition, if the PMI for October (51.9 percent) is annualised, it corresponds to a 2.8 percent increase in real GDP annually.

Back with the ISM manufacturing report, and here are some of the comments from the respondents to the survey:

  • “Domestic business steady. Export business trending higher.” (Chemical Products)
  • “Very favorable outlook in the market.” (Computer & Electronic Products)
  • “We are looking at a considerable slowdown for October and November. Production is down 20 percent.” (Primary Metals)
  • “Business is much better.” (Fabricated Metal Products)
  • “Strong economy driving steady sales.” (Food, Beverage & Tobacco Products)
  • “Due to the hurricane and other storms, our business is up significantly.” (Machinery)
  • “Ongoing strength seen in 2016 — it’s a good year.” (Miscellaneous Manufacturing)
  • “Customers continue to press price reductions.” (Transportation Equipment)
  • “Our business remains strong.” (Plastics & Rubber Products)
  • “Hard to predict oil price dynamics, but there seems to be a consensus that the market is stabilizing, at least above USD 50 bbl this month.” (Petroleum & Coal Products)

Bradley J. Holcomb, chair of the Institute for Supply Management, said: “Comments from the panel are largely positive citing a favorable economy and steady sales, with some exceptions.”

Updated

But there are some poor US construction figures.

The Commerce Department said construction spending fell 0.4% in September, compared to expectations of a 0.5% rise. The figure for August was revised slightly higher, from a 0.7% drop to a 0.5% fall.

And the other manufacturing survey does indeed also show signs of improvement.

The ISM manufacturing activity index climbed from 51.5 in September to 51.9 last month, better than the 51.7 expected.

And on jobs, the picture is more optimistic. The manufacturing employment index jumped from 49.7 in September to 52.9, well ahead of the forecast level of 50. This is the highest level since June 2015.

The two manufacturing surveys strike a positive note as the US Federal Reserve begins its latest two day meeting. However it appears unlikely the Fed will announce an interest rate rise tomorrow, just ahead of the election, even if a December hike could well be on the cards.

Despite the good US manufacturing performance, firms are reluctant to take on staff, says IHS Markit, partly due to caution ahead of the election. IHS Markit chief business economist Chris Williamson said:

October saw manufacturing enjoy its best performance for a year. Factories benefitted from rising domestic and export sales, driving output higher to mark an encouragingly strong start to the fourth quarter.

The survey also picked up signs of manufacturers and their customers rebuilding their inventories, often filling warehouses in anticipation of stronger demand in coming months.

US manufacturing PMI
US manufacturing PMI Photograph: IHS Markit

However, a widespread reticence to take on extra staff highlights lingering caution with respect to investing in capacity, at least until after the presidential election.

Hiring is also being subdued partly by worries about escalating costs, with the October survey recording the largely monthly rise in factory prices for five years.

While output growth is accelerating, so too are inflationary pressures, which will further fuel speculation that the Fed will hike interest rates again in December.

US manufacturing improves - Markit

And here is the first manufacturing survey, and it’s fairly positive.

The final IHS Markit manufacturing PMI figure for October has come in at 53.4, marginally higher than the initial estimate of 53.2 and up on September’s final reading of 51.5. This is the highest level since October 2015.

In short order, we get the ISM manufacturing reading, which is also expected to show an improvement.

Updated

Wall Street edges higher

Ahead of two US manufacturing surveys due shortly, the US market is slightly ahead at the open, but with continuing nervousness about the forthcoming election - with one new poll showing Donald Trump ahead of Hillary Clinton - investors remain cautious.

The Dow Jones Industrial Average is currently up around 12 points while the S&P 500 and Nasdaq Composite both opened around 0.2% higher. As a reminder, all three indices recorded their worst monthly performances since January in October.

Sterling to fall to $1.15 early next year, says BAML

Alert! Bank of America Merrill Lynch has predicted that the pound could plunge to just $1.15 by the first quarter of 2017.

In a new research note, analysts at the bank warn that sterling hasn’t fully adjusted to the reality of Brexit, and have slashed their forecasts for the pound.

They also predict the pound will weaken to just 94p against the euro, closer to parity.

BAML believe some investors are hoping that court cases brought by Remain campaigners will stop Theresa May triggering article 50 without a parliamentary vote.

BAML say:

Whilst the outcome is still unknown, client feedback suggests to us there is hope that the verdict may derail the governments’ intentions. The decision on the review is pending and is expected soon, but this will not be the end of the matter. In our view, an appeal to the Supreme Court is a possibility by whoever loses the hearing and if the verdict is appealed, this could be held before the end of the year.

A defining feature of our conversations with clients since the Referendum is the belief that Brexit may never happen. For this reason, we think some investors retain the hope that somehow the courts will able to prevent the triggering of A50.

But.... BAML believe that article 50 WILL be triggered, with or without MPs voting.

The result of the Referendum has been accepted by most politicians’ and with seven out of ten Labour constituencies having voted to leave the EU we find it hard to imagine that Labour MP’s would go against that mandate.

And that would send the pound down to new 31-year lows early next year, before recovering through the year.

We think Q1 could mark the low in the pound. A combination of US dollar weakness, Brexit fatigue and data stabilisation should see pound recover into end-2017.

This graph shows how the pound has fallen faster than in many previous sterling crises (and boy, have there been a few over the years), but not as sharply or as far as after Black Wednesday in 1992 (yet anyway)

.
A brief history of pound selloffs Photograph: BAML

BAML also dub sterling the ‘British peso’, saying it has been trading like an emerging market currency such as the South African rand (ZAR) or the Turkish lira (TRY)

.

Updated

Back in the markets, two pharmaceuticals firms have both disappointed investors with their latest financial results.

Shares in Pfizer, the viagra-maker, have slipped by 2.2% in pre-market trading after it missed its profit and sales targets in the last quarter.

Reuters explains:

Pfizer’s new breast cancer treatment, Ibrance, generated sales of $550 million, missing the consensus forecast of $576 million compiled by Evercore ISI.

The company’s Lyrica pain drug brought in sales of $1.05 billion, missing expectation of $1.28 billion, but its Prevnar vaccine generated $1.54 billion, above the forecast of $1.48 billion.

Separately, Shire, the London-listed drugs group, has plunged by 5.5% to the bottom of the FTSE 100 leaderboard after posting smaller revenues than the City expected.

The company insists, though, that it’s ‘highly confident’ about Shire’s future growth prospects. The new dry eye disease drug, called Xiidra, has made a very strong start, it adds.

JP Morgan: The case for Mark Carney's defence

Wall Street bank JP Morgan has got Mark Carney’s back.

Analysts Malcolm Barr and Allan Monks argue there are five ‘lines of defence’ against the argument that the Carney, and the rest of the monetary policy committee, violated the Banks independence by being so gloomy about Brexit.

  1. The judgements were limited to short run impacts, not the long run.
  2. They were shared by the whole of the MPC.
  3. They related directly to areas where the BoE had to make policy decisions.
  4. Supporting analysis for the views expressed was provided.
  5. And those views were in line with the consensus among most private and international institutions.

That doesn’t get away from the fact that Britain’s economy expanded by a solid 0.5% in the three months after the refererendum.

But still....

In our view, the fact that the economy has held up better than expected thus far reflects a forecasting error that many have made, rather than being clear evidence of any abuse of office.

Updated

The opposition Labour party have tweeted their support for Mark Carney today:

Last night Rebecca Long-Bailey MP, Labour’s Shadow Chief Secretary to the Treasury, criticised the attacks on the BoE governor from some conservative MPs:

“That a committed public servant like Mr Carney has been the subject of briefings, on and off the record, questioning his fitness for the role - when he himself has no opportunity to respond - is an indictment of the toxic atmosphere now brewing inside the Conservative Party.”


Duncan Weldon of Resolution Group is also concerned that UK manufacturers are suffering such a sharp spike in import costs:

Updated

We don’t want Mark Carney’s ego to expand too quickly, so here’s a rather critical assessment of the governor, from Ben Habib, CEO of First Property Group, a fund manager.

The pressure on Mr. Carney to go was portrayed as coming from Tory Brexiters and his decision to stay another year has been described as providing stability during the Brexit process. Both assertions are wrong.

“Mr. Carney should have resigned early because he is simply not competent. Perhaps the best of example of this was his assessment of the UK economy in August when he launched another wave of pernicious QE. He justified this decision in significant part because of his prediction that the economy would grow by only 0.1% in the third quarter. In fact it grew at five times this rate.

His remaining as Governor of the BoE during the Brexit process is going to materially add to the challenges faced by Mrs. May.”

Carlo Alberto de Casa, chief analyst at spread-betting firm ActivTrades, also sees Carneys’ decision as positive:

‘The City has welcomed news that Mark Carney will stay one more year at the helm of the Bank of England. When he eventually leaves the post in summer 2019, the Brexit process should largely be over. Significantly, we have seen the FTSE 100 go up, whilst the pound is also performing well.

This appears to reflect a certain amount of relief and reassurance in the City that Carney will be at the controls for a while longer.’

Virgin Money CEO welcomes Carney decision

Jayne-Anne Gadhia, CEO of Virgin Money.

Jayne-Anne Gadhia, chief executive of Virgin Money, has told us that she’s pleased Mark Carney chose to stay at the Bank of England until June 2019.

Gadhia says Carney showed leadership immediately after the EU referendum, and was right to express his view on Brexit.

Thank goodness for that would be my comment.

When I think back to 24 June when an awful lot of people wondered who was leading the country I was pretty relieved when Mark Carney stepped up and was sensible. We need stability going forward.

How difficult to have a job where we are all able to comment [on Carney’s performance].

When you take on a big role like that you have to be a public figure and expect to have public comment. I don’t criticise people for making the comments they have made. I do think now he is here we should let him get on with his job. Hopefully that will add to the stability of the country.”

(via my colleague Sean Farrell)

Capital Economics have taken one look at Markit’s survey, and produced this excellent chart showing how UK inflation is heading a lot higher....

Updated

Markit’s October manufacturing PMI should deter the Bank of England’s monetary policy committee from cutting interest rates again, at its meeting on Thursday.

As well as showing that companies are faring quite well, the data also shows how the slump in sterling has painful effects as well as benefits.

Ms Lee Hopley, Chief Economist at EEF, the manufacturers’ organisation, explains:

“The weaker pound is supporting improving demand from export customers, but price rises from higher import costs are becoming more significant and will be felt in consumer’s pockets sooner rather than later.

If any MPC members were on the fence about interest rate moves this month, this latest survey would argue against any further cuts right now.

Dave Atkinson, head of manufacturing at Lloyds Bank Commercial Banking, is encouraged by today’s UK factory report.

“Manufacturing activity remains at its highest level since January, and the fact that firms have maintained a positive outlook amid an uncertain landscape and a devalued pound is something to be applauded.

Markit also produced this chart, showing just how sharply import costs have jumped since the Brexit vote:

.

That is likely to feed through to prices in the shops.

David Noble, CEO at the Chartered Institute of Procurement & Supply, says:

“The impact of the pound’s performance against the euro and dollar was particularly felt on imports as manufacturers experienced one of the fastest rises in average costs for raw materials in the 25-year survey history. Especially highlighted were costs for flour, dairy products, steel and zinc. These price hikes resulted in manufacturers passing on higher prices to their customers as charges rose for the sixth consecutive month and to the steepest degree since June 2011.

UK manufacturing 'returning to growth' as weak pound drives exports.

Newsflash: Britain’s manufacturing sector is probably returning to growth this quarter, as the weak pound helps factories to win export orders -- but also makes raw materials pricier.

The monthly healthcheck from data firm Markit shows that UK factories grew their output last month, with new orders rising and staffing levels picking up too.

This pushed Markit’s manufacturing PMI to 54.3, down slightly from 55.5 in September, but well above the long-run average of 51.5 (anything over 50 = growth).

The survey shows that the slump in the pound since June is helping the manufacturing sector. Bosses reported a rise in new exports, and new orders from the USA, the EU and China.

But the weaker currency is also driving up the cost of imports, like oil, energy, metals and pork products.

Markit’s PMI

Rob Dobson, senior economist at IHS Markit, says:

“The UK manufacturing sector remained on a firm footing in October and should return to growth in the fourth quarter. Despite slowing from September’s highs, growth of output and new orders continued to defy expectations, rising at marked rates and supporting the fastest job creation in a year.

“The main topic of the latest PMI survey was, however, the impact of the sterling depreciation on manufacturers. On the positive side, the boost to competitiveness drove new export order inflows higher, providing a key support to output volumes. The down-side of the weaker currency is becoming increasingly evident, however, with increased import prices leading to one of the steepest rises in purchasing costs in the near 25-year survey history. Around 90% of companies offering a reason for increased costs made some reference to the sterling exchange rate.

Stairs at Standard Chartered's headquarters in Hong Kong.

Eek. Shares in Standard Chartered have just slumped by 5%, after it posting its latest financial results.

The Asia-focused bank posted a pre-tax profit of $458m up from a $139m loss a year earlier, but shy of forecasts of $500m profits. Income dipped to $3.47bn, from $3.68bn.

CEO Bill Winters doesn’t sound best pleased, saying:

“We now have a stronger balance sheet...but income and profit levels are not yet acceptable.”

Standard Chartered also revealed that it is being investigated by Hong Kong regulators, over an IPO (stock market flotation) it handled in 2009.

Updated

The FT’s Janan Ganesh has handed out a pasting to Mark Carney’s critics in Westminster this morning:

The pound is living up to its reputation for volatility, and dropping back from earlier highs.

Not every investor is toasting Mark Carney this morning, though.

Savvas Savouri, chief economist of asset manager Toscafund, has been criticising the governor on Radio 5’s Wake Up To Money this morning, and on Sky News last night.

City veteran David Buik is also relieved that Mark Carney has decided not to leave in 2018:

Most observers will be delighted that he did not wait until after the Inflation Report and MPC meeting this coming Thursday, to announce his decision. Many hoped he would stay the full trip until 2021.

And in his classic colourful prose, Buik argues that Carney was rather too gloomy about the consequences of EU exit.

The reassurance he needed consisted, I think, of some TLC and an official ringing endorsement from Chancellor Philip Hammond to follow up positive comments made by senior government ministers. In terms of Mr Carney’s duty of care post the Referendum, he was right to point out that the UK’s economy might not be as robust immediately prior to the BREXIT and post its withdrawal.

However I think he ladled on the ‘Sodom & Gomorrah’ syndrome far too thickly, which gave the impression that he was massively pro-REMAIN and possibly an acolyte of George Osborne, who, after all appointed him.

The pound hit its highest level since 20 October this morning, nudging $1.228.

That’s up a cent this week, but still sharply lower than a month ago - when traders started worrying about a hard Brexit.

The pound vs the US dollar since August
The pound vs the US dollar since August Photograph: Thomson Reuters

FTSE 100 pushes towards 7,000 points

Shares are rising in London this morning, in another sign that Mark Carney’s 12-month extension has reassured the markets.

The FTSE 100 has gained 31 points, or 0.44%, to 6985 points.

Royal Dutch Shell is leading the way, up 3.7%, after posting an 8% jump in quarterly profits this morning.

Mining firms are also gaining ground, after overnight data showed China’s factories growing faster than expected. That should bolster demand for iron ore, coal, copper and nickel.

The pound continues to climb, and is now trading at $1.227 - up almost one cent this week.

Mann: Theresa May has mishandled the Carney question

John Mann the MP for Bassetlaw in Nottinghamshire.

Labour MP John Mann argues that Theresa May, and chancellor Philip Hammond, have botched the whole issue of Mark Carney’s tenure at the BoE.

Writing for Politics Home, Mann says the pair have been “dragged kicking and screaming by the markets” to extend the contract of a governor who deserved more respect for his actions after the Brexit vote.

Mann says:

The day after the referendum saw the Prime Minister resign after previously promising he wouldn’t and the Chancellor disappear as the Treasury went silent at a time when the markets went into a panic. Into this breach stepped Mark Carney, speaking publicly from the Bank of England, who calmly stated the steps the bank had already taken to reassure the market and would be taking to ensure that the UK’s economic system remained functional.

It should never have to come to the point where his re-appointment became a such a test of strength for the Prime Minister and Chancellor.

Mann also hits out at former Conservative ministers William Hague and Michael Gove for attacking Carney.

During 2016 the Bank of England will have to have found two new deputy Governors to replace Andrew Bailey who was appointed to run the FCA by George Osborne, and Dr Minouche Shafik who is leaving her role as head of markets and banking. Their calls for a new Governor to be appointed at a time when the Government is about to start its negotiations with the EU was staggeringly short sighted and suggests a fundamental misunderstanding of the challenges facing the British economy.

Investors are relieved that Mark Carney won’t quit the UK in 2018, as had initially been his plan.

Kathleen Brooks, research director at City Index, says yesterday’s decision to serve an extra year is is “a welcome sign of stability in exceptionally uncertain times”.

She writes:

The markets are breathing a collective sigh of relief that Carney has extended his term, after all, if he extended it once, could he do so again? The pound has enjoyed a major turnaround, and is the best performing currency in the G10 at the start of this week. It is higher by a decent 0.5% against both the USD and the euro, and has also done well against the yen

However, the City would be even happier if the governor had agreed to stay until 2012.

An extra year is good, however the uncertainty caused by Brexit makes it very difficult to anticipate the health of the UK economy in three years’ time. Thus, even after today’s announcement, Carney may still leave the Bank of England at a delicate time for the UK economy, as the government tries to navigate a smooth exit from the EU.

Mark Carney: What the papers say

Mark Carney’s 2019 departure makes the front page of several newspapers today.

The Telegraph point out that the governor has decided to quit shortly after Britain’s exit from the EU has been concluded, following a “deterioration of relations” with Downing Street in recent weeks.

The Times also point out that recent criticism from Conservative politicians may have encouraged Carney not to serve three extra years.

They write:

Mark Carney surprised the government last night by turning down the chance to stay in his post until 2021 after receiving lukewarm backing from Downing Street. The governor of the Bank of England said that he would leave in June 2019 — the earliest opportunity to depart after Brexit.

The Financial Times points out that the governor’s family will return to Canada in the summer of 2018, as originally planned. These personal circumstances (Carney is blessed with four daughters) are the reason he originally only signed up for five years.

Carney also graces the front page of the Guardian:

The pound got an immediate lift last night when the Bank of England announced that governor Carney would serve an extra year.

And it’s still trading around $1.224 this morning.

The agenda: UK manufacturing report coming up...

Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.

We get a new healthcheck on Britain’s economy today, when data firm Markit publishes its latest Purchasing Manager’s Index (PMI) covering the manufacturing sector, at 9.30am GMT.

Economists are expecting to see that factory output grew at a steady rate in October, with the PMI (which measures activity) dipping to around 55.0 from 55.4 in September.

This is the first ‘soft’ economic data for the fourth quarter of 2016, so it will be scrutinised closely for signs that the Brexit vote is causing a slowdown.

RBC Capital Markets say:

UK PMIs enjoyed something of a rollercoaster ride in the three months after the Brexit referendum before returning to close to their long-run average at the end of Q3.

For today’s manufacturing print, we look for a slight weakening to 55.0 from 55.4, though that is coming off the highest reading for the manufacturing reading since June 2014.

We’ll also be watching the Bank of England, after Mark Carney decided to serve one extra year as governor, until 2019.

Our financial editor Nils Pratley says the Canadian central banker got one over the prime minister.

He writes:

You want me to stay for an extra three years? I’ll do one more and then I’m off. Mark Carney’s decision to leave the Bank of England in 2019 looks to be a straightforward snub to Theresa May.

Earlier on Monday, the prime minister’s spokeswoman described the governor as “absolutely” the best person for the job, which is the sort of thing you say if you think he’ll do the full eight-year term.

But he’s doing six. Yes, it’s one more year than was signalled back at his appointment, but it is not the full deal. Those angry Tory Brexiters who have been making mischief at Carney’s expense for the past month will count this result as a victory for them.

And on the corporate front, oil giants BP and Shell are both reporting results this morning, along with Virgin Money, MoneySupermarket.com, and Standard Chartered bank. Pharmaceuticals firm Pfizer are reporting later too.

Updated

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