Bank of England

Government austerity measures and high levels of consumer debt pose "strong headwinds" for the UK's economic recovery, the IMF has warned.

Sterling jumped across the board after the Bank of England's latest report said inflation is likely to remain above target for longer, fuelling expectations the MPC will act sooner to tackle price rises.

Bank of England governor Mervyn King has warned the extended holiday to celebrate the Royal Wedding last month will hurt GDP growth.

British businesses are seeing costs rise far more slowly than the headline inflation rate, signalling that price increases are set to return to the Bank of England's target, according to leading economic analysts.

Speculation the Bank of England will lower its economic growth forecasts has caused the pound to slump in afternoon trading.

The Bank of England has again held rates at 0.5% amid signs the economic recovery is failing to gather momentum.

A number of economists predict the Monetary Policy Committee will raise interest rates in August this year, to curb rising inflation.

The Monetary Policy Committee (MPC) was again divided six-three against a rate rise earlier this month, minutes from the April meeting reveal.

This week: Douglas Roberts, senior international economist at Standard Life Investments

The Japanese government has raised the severity of the crisis at the Fukushima Dai-Ichi nuclear plant to 7, a rating only previously applied following the 1986 Chernobyl disaster.