Bank of England considering bigger-than-expected rate cuts, says Bailey –

Thanks for joining us. The Bank of England will announce its next decision on interest rates at noon. 

We will have live coverage of the build-up, the decision and what it means for you.

We start with a look at income tax, which a leading think tank believes could rise by 3p regardless of who wins the next election.

The National Institute of Economic and Social Research (Niesr) said the promise to stick to the fiscal rules – which says debt will be falling within five years – means that the only wait to meet the pledge is to increase taxes.

5 things to start your day 

1) Apple’s ‘destructive’ new iPad ad sparks backlash from artists and authors | Musical instruments and art supplies were squashed in Apple’s latest advert

2) Treasure hunter backed by Sir Paul Marshall loses legal battle over World War Two silver | Argentum fails to recoup costs of recovering 2,000 silver bars from 1942 shipwreck

3) P&O Ferries chief forced to ‘clarify’ evidence to MPs as he admits crew get just one day off a month | Peter Hebblethwaite said he was seeking to clarify the situation after giving evidence in person

4) HS2 tunnel held up by question marks over £1bn of funding | Bosses take drill delivery despite uncertainty over 4.5-mile route through London

5) I was debanked like Nigel Farage, says ex-Bank of England economist Haldane | City regulation had gone too far, the economist argued

What happened overnight 

Asian shares were mixed after Wall Street’s lull stretched into a second day, with Chinese benchmarks rising after China reported better than expected trade figures for April.

In Tokyo, the Nikkei 225 index was up 0.5pc at 38,392.10.

Carmaker Mitsubishi’s shares dropped 4.7pc in early trading after the company forecasted a 7pc lower net profit in the fiscal year that will end in March 2025.

Toyota Motor edged 0.1pc higher after it reported Wednesday that it doubled its net profit in the fiscal year that ended in March.

The US dollar rose to 155.59 Japanese yen from 155.52 yen, as reports in Tokyo speculated on the likelihood of further intervention by the Finance Ministry to curb the yen’s slide.

The Hang Seng in Hong Kong added 1.2pc to 18,538.57 and the Shanghai Composite index gained 0.9pc to 3,156.96.

China reported that its exports rose 1.5pc in April from a year earlier, while imports jumped 8.4pc. The renewed growth suggests a stronger recovery in demand than earlier data had suggested.

In South Korea, the Kospi lost 0.6pc, to 2,729.64. Australia’s S&P/ASX 200 shed 0.9pc to 7,735.20.

In America, the S&P 500 finished virtually unchanged yesterday at 5,187.67. The Dow Jones Industrial Average rose 0.4pc, to 39,056.39, and the Nasdaq Composite index slipped 0.2pc, to 16,302.76.

The yield on benchmark 10-year US Treasury bonds rose to 4.49pc from 4.46pc late on Tuesday.

Asian shares were subdued on Thursday as investors awaited China trade data to gauge the health of the Chinese economy.

MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.1pc, hovering not far from a 15-month high hit earlier in the week.

Chinese bluechips climbed 0.6pc and Hong Kong’s Hang Seng index gained 0.7pc thanks to a 2pc bounce in technology shares and a recovery in Chinese property developers.