Week ahead: Focus on MPC and inflation

WITH the general election out of the way, delivering a surprise victory for the Conservatives, a raft of economic data will provide the backdrop this week.

Airline EasyJet is expected to announce a profit for the first half of the year. Picture: AP

First up is today’s interest rate decision from the Bank of England, which is expected to have kept borrowing costs on hold for another month, while Wednesday brings the central bank’s quarterly inflation report.

Other figures due for release include retail sales data and manufacturing output, along with unemployment statistics.

On the corporate front, the week brings results from budget airline EasyJet, pubs operator Mitchells & Butlers, as well as annual meetings for Lloyds Banking Group and Standard Life.

Today

• Bank of England – Members of the Bank’s monetary policy committee made their rates decision on Thursday, but held off announcing it until today to avoid any action that could have been seen as influencing the general election. The vote is expected to have been unanimous in keeping rates on hold at 0.5 per cent.

Tomorrow

• EasyJet – The no–frills carrier is tipped to have made a profit in the first half of the year, a period that is traditionally loss–making. Analysts at Numis predict a £7.5 million profit, compared with a £53m loss a year go, thanks to rising revenues and passenger numbers, which were up 3.8 per cent to six million last month.

• Retail sales – Figures from the British Retail Consortium are predicted to show muted growth in April, due to the early arrival of Easter compared with last year.

• Standard Life – Investors gather in Edinburgh for the life and pensions giant’s annual meeting. Profits rose 19 per cent to £604m last year, with chief executive David Nish’s total pay package swelling to almost £5.5m.

Wednesday

• Aegon UK – First–quarter results are due from the Dutch–owned insurer, which employs about 2,000 people in Edinburgh and has benefited from sweeping changes to the pensions landscape.

• Vertu – The car dealer, which operates under the Macklin Motors brand in Scotland, is forecast to deliver a 27 per cent jump in underlying pre–tax profits to £22.8m for the year to 28 February, on revenues 22 per cent higher at more than £2 billion. Recent industry figures showed new car sales rising in the UK, but going into reverse north of the Border.

• Bank of England – The latest quarterly inflation report is expected to support the view that interest rates are most likely to start rising early next year, although deflation remains possible in the near term. Economists also predict that a sharper–than–expected slowdown in the first quarter means the central bank will lower its GDP growth forecast for the year, which currently stands at 2.9 per cent.

Thursday

• Cairn Energy – The oil and gas explorer, which is locked in a tax dispute with Indian authorities, holds its annual meeting at Edinburgh’s Caledonian Hotel.

• Mitchells & Butlers – Pre–tax profits at the owner of the All Bar One, O’Neill’s and Toby Carvery chains are tipped to have risen 4.2 per cent to £75m in the first half.

Friday

• John Menzies – Swiss activist investor Lakestreet Capital Partners is expected to put forward its argument for breaking up the logistics firm at its shareholder meeting, to be held at the Roxburghe Hotel in Edinburgh.