The Bank of England is now odds-on to cut interest rates next week, experts said, after new figures indicated that the economy is at its weakest in five years and that the mortgage drought is set to worsen, The Telegraph reports.
The majority of economists polled by Reuters said they anticipated the Monetary Policy Committee will trim borrowing costs by a quarter percentage point to 5% next Thursday, as fresh evidence suggests the economy is facing a major slowdown.
But with the Bank's own survey showing that mortgage lenders plan a fresh squeeze on their loans in the coming months, raising rates and withdrawing products, experts warned that lower official rates would not necessarily translate to a drop in the actual cost of borrowing.
UBS, THE BELEAGUERED Swiss bank, has come under renewed pressure for a break-up and overhaul of its board as rebel shareholder Luqman Arnold began meeting Swiss shareholders and media this morning to rally support for his cause, according to The Times.
Mr Arnold, best known for his failed bid for Northern Rock earlier this year, revealed last night that his Olivant investment vehicle had accumulated a 0.7% stake in UBS worth $450m.
Mr Arnold was chairman of the group executive board at UBS in 2001 before falling out with the chairman Marcel Ospel, who this week announced plans to quit as he revealed sub-prime and structured credit losses had ballooned to an unrivalled $37bn.
THE TREASURY HAS caved in to pressure from powerful business and banking lobbies to grant a tax exemption for investment management services to non-domiciles, The Telegraph also reports.
The CBI, the British Bankers' Association and the London Investment Banking Association met Treasury officials on Wednesday to discuss concerns that the UK could lose a third of its private banking and investment management business if proposals to tax non-doms on money brought onshore to pay for financial services were not amended.
Last night the Treasury sent a letter to the BBA saying it never intended the changes to the non-dom tax regime to drive wealth management business offshore.
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