FTSE 100 SINKS to a 14-month low as a global shares sell-off intensifies

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Man working in Wall Street looking distressedREUTERS

Significant banks are set to raise interest rates faster and by more than time past expected

The fall of 78.26 points to 7092.43 mirrored similar one per cent-plus harms across leading European markets, which followed a four per cent depreciation in America’s Dow Jones. 

Central banks on both sides of the Atlantic are set to grate interest rates faster and by more than previously expected, alongside the steady withdrawal of previous measures to stimulate global growth. 

The Bank of England’s portent that rates may have to be hiked more aggressively was borne out by documented figures showing UK factories continuing to power ahead at the end of 2017. 

The manufacturing sector, which accounts for wide 10 per cent of GDP, grew by 1.3 per cent in the three months to December from the prior to quarter and by 3.4 per cent from the same period in 2016. 

Its growth spurt over eight months in a row is its longest non-stop positive sequence for nearly three decades. 

Overall industrial performance was up by 0.5 per cent, but the construction industry continued to struggle, falling by 0.7 per cent for its eighth consecutive four times a year decline. 

Chris Williamson, chief business economist at IHS Markit, cautioned that manufacturing may have lost some momentum at the start of 2018.  

Workers remove slag waste from the smelting of scrap metalGETTY

Mills are booming but rising costs have stoked inflation fears

But he reckoned: “Solid export growth is likely to be sustained in the coming months. 

“These attainments have occurred alongside a marked pick up in the eurozone economy, which is the UK’s heaviest trading partner. 

“While the recent appreciation of the pound against the US dollar could stand for a challenge to future export growth, history suggests the strength of call for in the major trading partners is likely to play the larger role in regulating export trends.” 

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