We’ve rounded up the key issues affecting FDs this week.
BANK HOLDS INTEREST RATES AT 0.5%
The Bank of England shocked markets with its decision to keep interest rates at 0.5% despite widespread expectations of a cut to 0.25%.
Although the Monetary Policy Committee voted 8-1 to leave rates unchanged, minutes from the meeting revealed that most members expect to see some movement next month.
A spokesperson for the Bank said: “Financial markets have reacted sharply to the United Kingdom’s vote to leave the European Union. Since the committee’s previous meeting, the sterling effective exchange rate has fallen by 6%, and short-term and longer-term interest rates have declined.
The MPC is committed to taking whatever action is needed to support growth and to return inflation to the target over an appropriate horizon. To that end, most members of the committee expect monetary policy to be loosened in August.”
NINTENDO SHARES SOAR BY 50%
Shares in Nintendo have gained more than 50% following the release of augmented reality game, Pokemon Go.
The Japanese company’s shares closed 16% higher on Thursday, which represents an increase of 56% since the release and puts Nintendo’s market value at £25.7 billion (3.6 trillion yen)
The game has become the most successful mobile-based app in history with 21 million active users in 24 hours.
GOOGLE HIT BY EU ANTI-TRUST
Google abused its dominance in the internet shopping market and restricted competition, the European Commission has alleged.
The commission has sent two statements of objection to Google, which state that the internet giant abused its dominant position by favouring its comparison shopping service in its search result pages and artificially restricting third party websites.
Commissioner MargretheVestager, said: “Google has come up with many innovative products that have made a difference to our lives. But that doesn’t give Google the right to deny other companies the chance to compete and innovate.”
Google is already facing formal anti-trust charges over claims that it abused the dominant position of its Android operating system.
CALLS TO CURB EXECUTIVE PAY
Companies and their shareholders must mitigate widespread resentment across high pay in big business, PwC has urged.
The Time to Listen report found that two-thirds of Britons believe executive pay was too high and almost three-quarters felt angry if executives were paid excessively during downtimes.
Partner at PwC, Tom Gosling, said: “We need to find a way to answer public concerns about executive pay or matters will be taken out of our hands.”