That’s all for tonight. Here’s our latest news story on the Bank of England’s Brexit intervention:

Goodnight! GW

Dean Turner, Economist at UBS Wealth Management, predicts that UK interest rates could be raised before Christmas -- if the Remain campaign wins next month.

“With inflation marginally above the Bank’s target two-years forward, our long-held belief that market expectations on interest rate hikes are far too pessimistic has been confirmed. Assuming the economy recovers in the second half, we expect to see a UK interest rate rise near the end of 2016 or soon after.”

Back to the Bank of England, and Joe Rundle, head of trading at ETX Capital, has a good take on Mark Carney’s Brexit dilemma:

The central problem facing the Bank in the event of a Brexit is to balance rising inflation from a weak pound with the downward pressures from a slump in demand.

The assumption is that rates will have to rise in the event of a Brexit to stem a run on the pound, but Carney’s suggesting something rather different. His point is sensible – we may not get the runaway inflation that many are expecting if the shock of Brexit means households stop spending. Moreover, a vote to leave would hit the euro hard, which would offset a decent amount of pound weakness.

He also reckons correctly that the impact of lower rates on prices will not be felt instantly, meaning he has time on his hands to cut rates to temper the effects on aggregate demand that a Brexit shock would entail.

Effectively he could cut rates immediately after the referendum to support demand, and then look to raise them afterwards if inflation does start to overshoot.”

Here’s JP Morgan’s Stephanie Flanders:

This is from the BBC’s business journalist Adam Parsons:

We have some sad news to report. Danny Gabay, the respected City economist who founded Fathom Consulting, has passed away at the age of 47.

Fathom have issued this statement:

Danny, whose funeral took place yesterday, was diagnosed with a particularly aggressive form of brain cancer five and a half years ago. The diagnosis came just before his son Raphael’s second birthday and his wife was seven months pregnant with their daughter, Isabella. In true ‘Danny Gabay spirit’ he wasn’t going to take it lying down and fought it, tooth and nail, with dignity and incredible bravery. He defeated all the odds and had four and a half good years after his initial operation. Sadly the tumour returned last summer and appeared again in the last couple of months when he finally succumbed to it.

Erik Britton, friend and Co-Director at Fathom Consulting commented:

“His passing is a great loss not only to his family, friends and colleagues, but also to the wider economics community. Fathom Consulting is committed to continuing Danny’s great work and to commemorate his passing will be making a donation to the Marie Curie Hospice in Hampstead where he spent his last few days.”

His sister Dalia added:

“Danny was a sharp, astutely intelligent, loving and caring individual with an outrageous sense of humour. He was also a huge inspiration to many. However, his greatest achievement in life, in fact, his pride and absolute joy, were his two beautiful children that he has left behind: Raphael and Isabella. My pledge to my brother was to always be there for his children and to never, ever let them forget what a wonderful father, husband, son, brother, uncle, nephew, cousin and friend he was to all who met him.”

Danny had an impressive career, advising government ministers in his early 20s before moving to the Bank of England, and later JP Morgan, before founding Fathom.

Simon Kennedy of Bloomberg tweets:

City grandee Lord Paul Myners, who was a government minister during the 2008 financial crisis, has welcomed Mark Carney’s comments:

Myners (a Remain supporter), says:

“The Governor of the Bank of England could not be clearer: leaving the EU would lead to lower growth and a plummeting pound. It is a risk we cannot afford to take.

“The evidence is now overwhelming that staying in Europe will mean more jobs, lower prices and more financial security for British families.”

The Institute of Directors is urging businesses to listen to Mark Carney.

James Sproule, the IoD’s chief economist, says:

“The Bank of England has highlighted its concerns over the impact the referendum is having on business, and the even greater impact that it could still have on the economy. No matter what they eventually decide, every business in Britain should be giving very serious consideration to the concerns the Bank articulates.”

The editor of the FT, Lionel Barber, tweets that the BoE governor has given up being impartial:

Rain Newton-Smith, CBI Economics Director, has welcomed Mark Carney’s comments:

“The evidence that a vote to leave the EU would make a serious dent in our economy, jobs and prosperity is overwhelming and still growing.

“The continued lack of a realistic argument on how the UK economy would be better off outside the EU is revealing.

“If a different conclusion could be credibly shown, leave campaigners would have done so by now with fewer than 50 days before the vote.”

Iain Duncan Smith, the pro-Brexit former Work and Pensions secretary, has dismissed the Bank of England’s concerns:

Final question.

Q: Vote Leave’s official position is that Britain would leave the single market; is that a worry?

Carney says there would be implications for the level of financial service activity in the UK if we had a ‘WTO relationship’ with the EU.

[I think that’s because of the ‘passporting’ arrangements that currently allow banks to base in London and then offer financial services across the EU]

Carney also admits that the Bank can’t be sure how the underlying economy is performing, because of the uncertainty created by the Brexit vote.

Q: Should the Bank of England really be changing its schedule to only hold eight meetings a year, not 12, given the threats to the economy?

Carney says it’s not a problem. We could meet anytime, if needed, he says, indeed the MPC could hold a meeting right now!

Q: Will the Bank be announcing further measures to protect the economy around the referendum vote?

Never say never, Carney replies. But we learned with Scotland that it’s best to release liquidity facilities well in advance, so people don’t think we’re signalling potential threats.

The bank’s PRA (Prudential Regulatory Authority) is also working with financial firms to ensure they are taking precautions.

Q: How long would it take for the uncertainty over the EU referendum to fade?

Deputy governor Ben Broadbent says that the Bank has done some work on this.

It believes that the uncertainty should fade relatively quickly, as we know exactly when the vote takes place.

But it still believes the effects could still be felt early into next year, even if Remain win.

Carney pledges there will be no shortage of liquidity for banks if Britain votes to leave the EU.

Q: Isn’t this more Project Fear? Why has the Bank not considered the benefits from Brexit, such as a cheaper pound helping exports and less regulation?

Carney reiterates that the Bank is just following its mandate by explaining its concerns about the EU referendum.

Q: Are you saying that the Bank would be powerless to stop Britain falling into recession?

Monetary policy has a lag, so if there is a sharp drop in activity from any event it takes time for stimulus to feed through and cushion that demand, Carney replies.

(That sounds like a yes).

He also points out that it’s not automatically clear whether the Bank would raise or lower interest rates in the event of a Brexit vote.

Q: Did the MPC discuss the impact that a Leave vote would have on the international markets and the global economy?

There is a risk of a spillover to the international markets from the uncertainty around the EU referendum, Carney responds.

He then says that almost everyone he meets wants to talk about Brexit:

This issue is the number 1 issue that is raised with me and my colleagues every time we meet another central banker, finance ministers, the head of a major corporation, and most small business owners.

Q: Is George Osborne right to say that the Bank is warning that Brexit would be a ‘lose-lose’ for Britain?

Carney declines to comment on the chancellor’s tweet (see earlier), saying Osborne answers for himself.

The Bank is just trying to outline its views on the economy, and explain how it might react.

Q: Can you give more detail about how the pound would fall after a Brexit vote, and would it bounce back?

Deputy governor Ben Broadbent says the Bank hasn’t made any numerical forecasts about Brexit, including for the exchange rate.

But the prospect of Britain leaving the EU has had a ‘dampening effect’ on sterling already.

There’s a wide range of factors, Broadbent says, making it very hard to make forecasts.

If there were changes to tariffs, that could have a long-term impact on the pound.

While if the risk-premium on UK assets rose, sterling could ‘overshoot’ in the short term.

Q: Your comments on Brexit go much further than during the Scottish independence compaign - why, and why today?

Carney defends his comments - the EU referendum is the biggest domestic risk to the UK, so the MPC has a duty to talk about how it would respond.

We have to communicate those risks - it would be a political decision if our views were suppressed.

During the Scottish referendum campaign, the Bank was mainly concerned with the impact of banks moving their headquarters from Scotland to London.

And we’re talking about it today because the quarterly inflation report is being published.

A technical recession means two quarters of negative growth, so Carney appears to be suggesting that the UK could contract through the second half of this year if the Leave campaign wins June’s referendum.

Carney concludes his statement by saying that the people of Britain will make a significant decision on June 23, and they will consider a much wider range of issues than just monetary policy.

Whatever the public decides, the MPC will address the consequences for growth and inflation.

But there are limits to what monetary policy can do. The Bank cannot offset the full impact of a Brexit vote.

The EU referendum is the ‘elephant in the room’, says Mark Carney.

He warns that it is making it hard for the Bank to read the current economic data .

There is a risk that we could be over, or under-estimating the underlying momentum in the economy in the event that Britain remains in the EU says Carney.

A vote for Brexit would have a “material” impact on the economy, he says.

Mark Carney begins the press conference with some history - reminding us that the UK recovery began three years ago, making Britain the fastest growing G7 country.

But growth has slowed at the start of this year, and appears to be decelerating further

This reflects the EU referendum, Carney declares, which has “pushed up uncertainty measures to levels not seen since the eurozone crisis.”

He cites the Bank’s conclusion that Brexit fears are responsible for half of the fall in pound since November.

The Bank of England is giving a press conference on the inflation report right now.

It’s being streamed online here.

Here’s Katie Allen’s news story on the Bank of England’s warning:

This chart, from the inflation report, shows how the pound has slumped by 9% in the last six months - partly due to the EU vote.

The report is online here.

The prime minister is also tweeting:

Chancellor George Osborne has swiftly responded to the Bank’s concerns about Brexit, arguing it bolsters the Remain campaign.

Just 10 minutes to go until the Bank of England announces its interest rate decision, and publishes the quarterly inflation report.

Economist Mark Astley, who used to work at the BoE, reckons dovish MPC members are unlikely to actually vote to cut rates.

Mark Carney won’t be able to avoid talking about the EU referendum at his 12.30pm press conference, predicts Peter Rosenstreich, head of market strategy at Swissquote Bank.

Concerning the press conference, questions will be geared towards the BoE view on “Brexit”. Carney will be undoubtedly prepared for this and will tread cautiously over every neutral, unbiased response.

This minefield should generate pound volatility but nothing lasting, barring Carney going rogue. The focus of the inflation report will be the extent of the BoE adjustment of forecasts and contingency plans after the “Brexit” vote. We expect that any mention of the event will be limited due to the Bank’s effort to appear neutral. Yet, it will be difficult for BoE‘s Carney to stay balanced as his prior views suggest that “Brexit” poses a massive economic risk to the UK.

Rosenstreich also predicts that the MPC will vote 9-0 to leave interest rates unchanged.

Mark Carney will probably also be quizzed about the UK housing market today.

A new report shows that the average London house price has virtually doubled since 2009, to an eye-watering £600,000. House prices in the capital are rising by 11%, outpacing the rest of the UK.

And astonishingly, an old garage in Hammersmith was just auctioned for £466,000 - possibly to someone planning to build the house of their dreams.

Two years ago, Carney said rising house prices were the biggest risk to the recovery, and he recently hinted that the Bank could rein in buy-to-let lending.

However, there are also signs that the market is cooling. LSL, which owns Your Move and Reeds Rains estate agents, says it handled 20,000 fewer sales in April, as demand dropped in the weeks after the introduction of higher stamp duty for buyers of second homes and investment properties.

Every City economist polled in the run-up to today’s meeting expects the Bank of England to leave interest rates on hold.

Borrowing costs have been pegged at 0.5% since March 2009, so the ‘rate hike’ button is looking pretty dusty:

The Brexit question will dominate the agenda at the Bank of England today, predict Bloomberg.

They write:

The pre-vote nerves are manifesting themselves in the pound.

A gauge of hedging for sterling losses versus the dollar climbed to the highest since 2003. While sterling has recovered from the seven-year low against greenback that it reached in February, it’s still the worst-performing Group-of-10 currency in 2016.

This chart shows that many investors have been buying protection against the pound tumbling against the US dollar:

Governor Mark Carney will endure a tricky press conference today, predicts Sam Hill of RBC Capital Markets.

And that’s because the looming Brexit vote will have a massive impact on interest rates.

Hill explains:

Essentially, neither Governor Carney, nor the MPC collectively, are likely to want to be drawn into issuing a significantly new or decisive message about the future path of monetary policy at this stage, if they believe the optimal path for rates (and asset purchases) is dependent on which way the vote goes

Hill also predicts that the BoE will raise its inflation forecasts.

That’s because the oil price has recently recovered, the pound has weakened, and the markets expect interest rates to be lower for even longer (as this chart shows):

City economists are adamant that the Bank of England will leave interest rates unchanged today:

But there is chatter that at least one policymaker will vote for a cut.

The most likely doves are chief economist Andy Haldane, and former hedge fund economist Gertjan Vlieghe.