Economics / Markets

Short-term borrowing rates in China have soared to record highs as credit seizes up, prompting fears that the country's liquidity squeeze may be spinning out of control.

A sharp fall in factory output in China cast a shadow over the global economy yesterday as the eurozone remained mired in recession.

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Markets across the globe tumbled overnight after the US Federal Reserve announced it may slow down asset purchases by the end of the year.

Five major high street banks and building societies have agreed plans to plug an aggregate capital shortfall which at the beginning of the year stood at £27bn, the Prudential Regulation Authority (PRA) has announced.

The Chancellor, George Osborne, has said it would have been wise to split majority-government owned Royal Bank of Scotland (RBS) into a good and bad bank when the crisis erupted, paving the way for such action to be taken in the future.

Sir Mervyn King, the outgoing governor of the Bank of England who has spent more than two decades at Threadneedle Street, is to be made a life peer.

Bank of England (BoE) governor Mervyn King was defeated in his final bid to inject more stimulus into the UK economy, minutes from last month's minutes show.