- Carney renews pledge to keep interest rates low
- European industrial output rises less than forecast
- US to release monthly budget statement
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European stocks were mixed as Bank of England (BoE) Governor Mark Carney renewed his pledge to keep interest rates at a record low.
Carney used the Bank's quarterly inflation report as an opportunity to change his forward guidance on interest rates.
The BoE had vowed to hold the benchmark rate at a record low of 0.5% at least until the unemployment rate fell to 7%.
However, a faster-than-expect fall in the jobless rate, now at 7.1%, prompted the central bank to rethink its guidance.
Carney said today he expects unemployment will reach the threshold soon but the Bank will need to consider a list of factors before raising interest rates gradually. The focus on the guidance is now squarely focused on the need to absorb all the spare capacity in the economy.
The range of indicators for raising the interest rate depend mainly on: the unemployment rate; the degree of participation in the labour market; the average number of hours worked and the extent of involuntary part-time working; surveys of spare capacity in companies; labour productivity and wages.
"Needless to say, this 'second phase' of guidance lacks the simplicity of the previous one," said Capital Economics. "And there is a clear concern that, in putting more focus on the general degree of spare capacity, it simply replaces the unemployment rate with an even more unpredictable, and much less observable, economic concept."
European industrial output
European industrial production rose less than expected in December, signalling the bloc's struggle to keep a firm grip on the recovery.
Output climbed 0.5% year-on-year, compared to a 2.8% increase in November and the consensus forecast of a 1.8% gain.
On a month-on-month basis production dropped 0.7% in December from a rise of 1.6% the month before, surprising analysts who had expected a 0.3% fall.
In China, the General Administration of Customs revealed exports increased 10.6% percent in January from a year earlier. Economists had predicted a 0.1% advance. Imports were up 10%, exceeding the 4% jump that had been forecast.
In the US later, the monthly budget statement for January will be released a day after the House of Representatives passed an increase in the government's borrowing limit.
WM Morrison rose after Bloomberg said that its founding family is considering taking the supermarket group private. The Morrison family, who are thought to hold around 9-10% of the UK grocer, are said to have spoken to a number of private-equity firms to gauge their interest.
Heineken edged higher after saying it expects sales to increase in 2014.
ING Groep and Societe Generale SA rose strongly after reporting fourth-quarter profit that beat analysts' estimates.
Aluminium producer Norsk Hydro rallied after reporting fourth-quarter sales ahead of market expectations.
Telecity Group declined after posting 2013 earnings that fell short of consensus.
Telenor dropped as the telecommunications operator reported fourth-quarter earnings that trailed analysts' predictions.
The euro fell 0.35% to $1.3590.
Brent crude futures rose $0.175 to $108.870 per barrel, according to data from the ICE.