The total number of Chinese visitors to the UAE stood at around 1.2 million in 2023
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The Bank of England cut interest rates from a 16-year high on Thursday after a narrow vote in favour from policymakers divided over whether inflation pressures had eased sufficiently, which initially dented the pound.
Thursday's decision was in line with the forecast in a Reuters poll of economists but financial markets had only seen just over a 60 per cent chance of a cut.
Governor Andrew Bailey — who led the 5-4 decision to lower rates by a quarter-point to 5 per cent — said the BoE's Monetary Policy Committee would move cautiously going forward.
"We need to make sure make sure inflation stays low, and be careful not to cut interest rates too quickly or by too much," he said in a statement alongside the decision.
STOCKS: The blue-chip FTSE 100 extended gains, rising 0.3 per cent on the day, while the domestically focussed FTSE 250 midcap index gained 0.5 per cent and was at its highest in over two years.
FOREX: Sterling fell to a session low of $1.2752 immediately after the decision, before reversing some of those losses to trade at $1.2766, down 0.7per cent on the day. It was also softer against the euro which was up 0.36 per cent at 84.5 pence.
BONDS: Benchmark 10-year gilt yields were last down four basis points on the day at 3.941 per cent, compared with 3.936 per cent before the decision. Two-year gilt yields, which are more sensitive to shifts in monetary policy, were down 5.7 bps at 3.754 per cent, around 15-month lows.
"Generally speaking, I would expect sterling to gradually strengthen. I think you might be able to term this a hawkish cut, as in, you have guidance from Bailey suggesting not to go too far or too fast. And then in contrast from (Chair Jerome) Powell, you have the Federal Reserve looking reasonably dovish and to me that suggests upside for sterling in the medium term," said Colin Asher, economist, Mizuho, London.
"Keeping rates too high for too long would have caused unwarranted economic weakness and therefore, an undershoot of the Bank’s inflation mandate to the downside," said Daniele Antonucci, chief investment officer, Quintet Private Bank, Luxembourg.
"Even though it makes sense to proceed at a moderate pace, beginning to soften the degree of monetary tightening looks like the most sensible approach."
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