Economics

Inflation rose at the fastest rate for almost six years in April. The Consumer Prices Index rose to 3 per cent, from 2.5 per cent in March, far above the Bank of England’s 2 per cent target.

Mortgage lending The number of loans for house purchase in the three months to April fell to their lowest level since 1975 at 142,300, down from 225,700 in the previous quarter, figures from the Council of Mortgage Lenders show.

House price growth continued to slow in March. The Department of Communities and Local Government said that the annual rate of house price inflation fell to 5.2 per cent, from 6.3 per cent in February.

US retail sales fell by 0.2 per cent in April, after a 0.2 per cent rise in March. Excluding cars, “core” sales rose by 0.5 per cent in April, after a 0.4 per cent increase in March.

US Federal Reserve Ben Bernanke, Chairman of the US Federal Reserve, said that the financial market conditions are “far from normal”.

Chinese retail sales rose by 22 per cent in April, from 21.5 per cent in March and well ahead of market expectations of a 21.2 per cent increase.

Banking & finance

Crédit Agricole, the French bank, confirmed it is planning to raise €5.9 billion (£4.7 billion) through a rights issue after taking a €1.2 billion sub-prime hit from its investment banking operations in the first quarter.

JPMorgan Asset Management, the fund manager, said in a report that the middle classes were sleepwalking into a debt crisis and the Government was failing to act.

Deutsche Bank analysts said the earthquake in China could unravel the Government’s efforts to rein in bank lending and cool inflation. Regional banks in the affected areas are expected to be granted immunity from the new curbs imposed on lending.

ABN Amro, the Dutch group whose investment bank was acquired by Royal Bank of Scotland last year, has lost a number of specialist staff in emerging markets to Barclays, its rival.

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