Fast forward 24 hours, and they’re as carefree as lambs frolicking in a summer meadow: Lisbon’s PS120 index was up 3.5% this morning, while the FTSE rose about 1%.
Is the surge temporary, or have markets really calmed down? Portuguese prime minister Passos Coelho was due to meet his coalition partners today to talk them into reaching a deal on austerity measures (thus preventing an election), so it really depends on the outcome of that.
And markets have also been buoyed by a temporary ban on naked short selling introduced this morning by the Portuguese market regulator – as well as a temporary ban on short selling on a number of Portuguese companies brought in by the UK’s Financial Conduct Authority. Every little helps…
Meanwhile, the new Bank of England governor Mark Carney’s first Monetary Policy Committee meeting has gone as expected.
Carney and his MPC colleagues debated such pressing issues as who deserves to be on a banknote more – Jane Austen or Emeline Pankhurst (one bird at a time – let’s not give them the wrong idea) – and what to do about quantitative easing.
With the US Federal Reserve having announced it will ease back on its own version of quantitative easing, there was a (very small) chance the UK could follow suit. But Carney et al reacted as expected, holding QE at £375bn and leaving interest rates unchanged at 0.5%.
If you’re keeping count, that’s the 51st month in a row the interest rate has stuck at 0.5%. MT suggests the MPC considers renaming it the ‘boring rate’.