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Thursday preview: BoE interest rate decision, Whitbread, SQS

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Date: Wednesday 03 Sep 2008

LONDON (ShareCast) - The Bank of England is due to announce its interest rate decision on Thursday. Anything other than a "no change" verdict would shock the market, especially in view of today's figures from the British Retail Consortium which showed the inflation rate still on an upward path.

Annual shop price inflation increased to 3.8% from 3.2% in July, with food still the main driver. Shop prices were up 0.5% in August following a 0.1% increase a month earlier.

Hotelier and coffee shop owner Whitbread is expected to announce that things are going better in its Premier Inn hotels arm than they are at the Costa Coffee chain.

In a period where consumers are cutting back on spending, Premier Inn is handily placed at the budget end of the market while Costa Coffee’s core product is a high margin item that could be one of the luxuries cash strapped officer workers choose to forgo.

Dresdner Bank expects a slow-down in growth in some areas of the business over the last few months, but anticipates another strong performance from the hotels division.

The hotel arm was beefed up in July when Whitbread swapped 44 of its Beefeater and Brewers Fayre pub restaurants for 21 of Mitchells & Butlers’ hotels.

Credit Suisse likes the expansion possibilities for budget hotels in the UK. “We believe the leading UK operators, Premier Inn and Travelodge, are best positioned to consolidate the highly fragmented independent budget hotel market and increase market shares without risking overcapacity," the bank said.

Credit Suisse has an ‘outperform’ rating on the shares and a 1,420p target price.

AIM-listed SQS, the largest independent software testing company in the world, declares interim results, with broker Evolution expecting revenues of €63.3m while earnings before interest and tax are forecast to be around €5.6m.

Recent contract wins have boosted the share price above 300p from its level of around 260p in mid-July.

Thursday September 04

INTERIMS
Datacash, Norish, Provident Financial, SQS Software Quality Systems

FINAL
McBride

INTERIM DIVIDEND PAYMENT DATE
Inchcape

QUARTERLY EX-DIVIDEND DATE
Cryptologic Ld

INTERNATIONAL ECONOMIC ANNOUNCEMENTS
ECB Interest Rate (EU) (12:45)

AGMS
Carclo, DTZ Holdings, e-Therapeutics, Endace, First Property Group, Gartmore Irish Growth Fund, Hampson Industries, Medsea Estates Group, Noble Income & Growth VCT, Queen’s Walk, SPG Media

TRADING STATEMENTS
DTZ Holdings, Whitbreads

UK ECONOMIC ANNOUNCEMENTS
Bank of England interest rate decision (12:00), European Central Bank Interest rate decision,

FINAL DIVIDEND PAYMENT DATE
SSL International

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