Summary of news:



• The FTSE-100 will open flat this morning amid investor caution ahead of HSBC's results today and the Bank of

England's interest rate decision Thursday.

• IG Index reckons the FTSE 100 is seen opening 0.4 points lower at 5,974-5,980 after closing 45.4 points stronger at

5,974.9 on Friday.

• During Wall Street's final session last week, US stocks rallied strongly after a sharp slowdown in second-quarter

gross domestic product growth increased expectations the Federal Reserve's run of interest rate hikes will come to an

end.

• The Commerce Department said GDP growth slowed to a 2.5 pct annual rate from 5.6 pct in the first quarter, below

the expected 3 pct flagged in by most analysts.

• The Telegraph: Roger Bootle considers the balance of the monetary policy debate. He thinks the Monetary Policy

Committee (MPC) can afford to hold off raising the policy rate for the time being, because wage inflation remains

subdued and core inflation is low.

• The Observer: Under the headline “Bosses beg: Leave rates on hold", the Observer quotes a number of business

representatives who are worried about the possible outcome of Thursday’s meeting.

• FT: Hometrack, the property website, says that house prices rose 0.6% in July, leaving prices 3.2% higher than in

the same month a year earlier.

UK DATA:

08:30 Net mortgage lending, £ bn (June) Prev: 9.3 . Forecast. 9.4

08:30 Mortgage approvals, k (June)1 Prev. 17 Forecast 116

08:30 Net consumer credit, £ bn (June) Prev. 1.2 Forecast 0.7

• In the UK, the key event will be the MPC's interest rate decision on Thursday, recent MPC minutes and other

comments by Committee members show no urgency to tighten policy, so a move next week could be unlikely. By

November, though, the committee could be ready to raise the policy rate.

• By contrast, the Bank of England rate decision on Thursday is much more finely balanced.

• GBPEUR: 1.4610

EUROPEAN DATA:

• The ECB is expected to raise rates (Thursday) by 25 basis points, to 3%, while they may use the phrase “monitor

closely" and deliver a strong message that future increases are strictly dependent on the data and whether the ECB's

baseline scenario continues to evolve.

• Thursday should be a done deal – not a single forecaster surveyed by Bloomberg or Reuters expects anything other

than this.

• EURUSD: 1.2746

US DATA:

12:10 FRB of St Louis President Poole speaks on "Chinese growth - a source of US export opportunities"

15:45 FRB of San Francisco President Yellen speaks on "A monetary policymaker's view of the US economy"

15:00 US Chicago PMI (Jul) Prev.56.5

• We expect July non-farm payrolls (Friday) to post a 160k gain (consensus: 143k),and the unemployment

rate to hold steady at 4.6% (in line with market expectations).

• Although the US Fed does not decide on rates until next week – and last week’s softer-than-expected Q2

GDP data have seen August rate hike expectations reined in – the ISM surveys later this week and several

keynote speeches could still be influential. US Treasury Secretary Paulson’s speech on Tuesday which

provides an opportunity for him to set out the administrations dollar policy.

• GBPUSD: 1.8630