Economics / Markets

Markets have remained down this afternoon as the negative reaction to European bank stress tests continue to drag on the FTSE 100.

Worries over the eurozone debt crisis have prompted the Ernst & Young Item Club to cut its forecast for GDP growth this year from 1.8% to 1.4%.

The Federal Reserve chairman Ben Bernanke has ramped up pressure on Congress to agree on its debt ceiling level, in light of rating agencies S&P's and Moody's threats to cut the US' AAA debt rating.

The Bank of England made £9.8bn last year on its £200bn "money printing" programme of quantitative easing to prop up the battered UK economy.

Euro inflation held steady at an annual rate of 2.7% in June, according to figures out today.

Ratings agency Moody's has said it may cut the US AAA debt rating, citing the "rising possibility" the US will default on its debt obligations.

Public finances are likely to come under pressure into the next Parliament and beyond as Britain struggles to deal with the cost of social care for its an ageing population, the Office for Budget Responsibility (OBR) has said.

The Treasury has denied the new regulatory structure set to replace the Financial Services Authority (FSA) will clash with European regulation.

Ratings agency Moody's has cut the Republic of Ireland's debt rating to junk status.

UK consumer price inflation fell from 4.5% in May to 4.2% in June despite food prices remaining high.