According to the minutes of the June monetary policy meeting of the Federal Reserve, the Fed did not raise its benchmark interest rate last month because policymakers were concerned about the “surprisingly weak May US employment report”.

It is worth noting that the meeting was held before the Brexit vote in the UK.

The outlook continues what has become a familiar pattern at the Fed: The central bank kicks off the year predicting stronger growth and a gradual return to higher interest rates, but then reverses its forecasts as economic data disappoints.

In the meantime, Bank of England (BOE) Governor Mark Carney stated that “there is evidence that some risks have begun to crystallise.

“The current outlook for UK financial stability is challenging.”

The BOE has eased special capital requirements for banks, thus raising banks’ capacity for lending to UK households and businesses by up to £150 billion.

Separately, Chancellor George Osborne plans to cut corporation tax to less than 15 per cent to attract business investment to the UK after the decision to exit the European Union. Mr Osborne also said the UK would: push for investment from China; ensure banks were willing to lend; invest in the north of the country to create a ‘Northern powerhouse’; and preserve the UK’s fiscal integrity.

Finally eurozone business growth held steady in June as strong growth in Germany offset a contraction in France.

Markit’s Purchasing Managers’ Index (PMI) showed that the reading for June was 53.1, up from the flash estimate of 52.8 but unchanged from May’s reading.

Chris Williamson, chief economist at Markit, said that “the survey is signalling GDP growth of just 0.3 per cent, similar to the sluggish trend recorded over the past year”.

Since the survey was mostly concluded prior to Brexit, the aftershocks of the vote to leave the EU were not reflected in the data.

In the first quarter, eurozone GDP growth increased by 0.6 per cent.

This report was compiled by Bank of Valletta plc for general information purposes only.