Category Archives: Economics

UK workers must accept lower pay deals to help beat inflation, says Bank ratesetter

Posted on by

Deputy governor Sarah Breeden also says firms must rein in profits as there is ‘some way to go’ to meet 2% inflation target

Victory in the war on inflation will require British workers to accept lower pay deals and companies to rein in their profits, a senior Bank of England policymaker has said.

Sarah Breeden, one of the central bank’s four deputy governors, said there was still “some way to go” before inflation would fall back to the 2% target set by the government for the Bank to achieve on a sustainable basis.

Continue reading...

Lloyds and Santander accused of providing accounts for Iranian front companies

Posted on by

Both banks deny helping Tehran-controlled oil firm PCC to move money in breach of sanctions

Two of the UK’s largest lenders, Santander UK and Lloyds Banking Group, allegedly held bank accounts for front companies that helped Iranian entities evade US sanctions, according to reports.

The news has rattled investors, who sold off shares in the two banks on Monday morning, amid fears that the lenders could face penalties if they are found to have in any way assisted Iran’s state-controlled Petrochemical Commercial Company (PCC).

Continue reading...

Labour’s mixed messages on £28bn green pledge put it in worst of all worlds

Posted on by

Tories watch on delighted as Starmer repeats figure while the shadow Treasury team distance themselves

For weeks, Labour officials have been locked in meetings as they try to figure out how to present Westminster’s worst kept-secret: Keir Starmer’s slow U-turn away from his pledge to spend £28bn a year on the green economy.

Publicly, senior party figures insist that nothing has changed since last summer, when the shadow chancellor, Rachel Reeves, said the party would spend £28bn only if the party’s strict fiscal rules allowed.

Continue reading...

Jeremy Hunt suggests tax cuts in budget won’t match last year’s £20bn giveaway – UK politics live

Posted on by

The chancellor said he wanted to manage people’s expectations ahead of the spring budget

The UK needs a government guided by clear purpose, Reeves says.

Labour has set out five missions. But they are all tied to the economic mission – to raise growth.

These are the symptoms of economic decline.

Continue reading...

Eurozone narrowly avoids recession as German economy shrinks

Posted on by

Single currency zone’s stagnating GDP figure will add to pressure for ECB interest rate cut

The 20-nation eurozone has narrowly avoided recession after the region’s economy flatlined at the end of 2023, official figures show.

Zero growth in the single currency zone in the final quarter of last year followed a 0.1% economic contraction in the third quarter meaning that recession – defined as two consecutive quarters of contraction – was just averted. Economists polled by Reuters had expected the eurozone’s economy to shrink by 0.1% in the fourth quarter.

Continue reading...

UK ditches post-Brexit Canada trade talks; Vodafone and Three UK merger under investigation – as it happened

Posted on by

Live, rolling coverage of business, economics and financial markets as Canada says UK was unwilling to give access to agricultural products

Shares in US chipmaker Intel have slumped in pre-market trading after it revealed a weaker forecast of earnings.

Chipmakers have been flying in recent years as shortages followed by the huge hype over artificial intelligence – which is hungry for processing power – prompted investors to pile into the sector.

Although Intel beat estimates, investors’ disappointment in Intel’s datacentre GPU story’s growth can be primarily attributed to the slower-than-expected product delivery and ramp-up.

Continue reading...

‘It’s going to be tough’: the impact of war on Israeli lives and businesses

Posted on by

Despite signs of revival, the true costs of conflict are impossible to calculate because no one can say how long it will last

Cafe Merkaz is busy. A handful of patrons sit at its half dozen tables on Jerusalem’s Hanevi’im Street on a sunny lunchtime, while inside the coffee grinders grind and a pile of sandwiches on the counter shrinks hour by hour.

“A month or so ago, things looked pretty desperate. But we had twice as many people through the door this morning by 10am as we had in entire days back then. Now I think the year is just going to be tough, but we’ll hang on,” said Yaakov Saly, the 27-year-old owner.

Continue reading...

Australia news live: Townsville residents advised to shelter in place ahead of Cyclone Kirrily reaching Queensland coast

Posted on by

The latest advice from the Bureau of Meteorology is that Tropical Cyclone Kirrily will begin crossing the coast from 10pm tonight. Follow the day’s news live

As we flagged just earlier, wind gusts associated with Tropical Cyclone Kirrily have already begun around the Whitsundays, with gusts over 100km/h.

In a Facebook group for Whitsundays locals, a new resident has asked an innocent question:

Hey there I’m kind of new to town from Melbourne. Does anyone know how to tie my tree down so that it doesn’t blow away?

“I would use fairy lights.”

“If you hop around clockwise on your left leg 3 times and then do a Kangaroo hop to the right, the drop bears will take care of it by having the tree extend it’s roots deeper.”

“If you’re really from Melbourne you would know how to tie down a tree with the windy crap weather down there. Ride a kangaroo to bunnings [and] get some ratchets.”

“From the state of the supermarket shelves I’m guessing everyone is using toilet paper to tie their trees down.”

“Take the leaves off and store inside. The rest will be fine.”

Continue reading...

Escaping poverty has become much harder in past two decades, report says

Posted on by

Six million of the poorest people would need more than double their incomes to move out of hardship, says Joseph Rowntree Foundation

Escaping poverty has become significantly harder over the past two decades, with progress to eradicate hardship in Britain having stalled under the Conservatives since 2010, a major report has warned.

The Joseph Rowntree Foundation (JRF) said levels of hardship had deepened for millions of people across the country since the mid-1990s, having been compounded by years of “political failure” to tackle poverty.

Continue reading...

Wall Street notches fresh records as S&P 500 and Dow Jones close at all-time high

Posted on by

Record highs come amid hopes a cooldown in inflation will allow Federal Reserve to cut interest rates several times this year

Wall Street scaled fresh records on Monday, as the S&P 500 and the Dow Jones industrial average each closed at an all-time high.

The S&P gained 0.2% to 4,850.43. The Dow cleared 38,000 for the first time, rising 0.4% to 38,001.81.

Associated Press contributed reporting

Continue reading...

More than 47,000 UK businesses on ‘brink of collapse’, warn insolvency experts

Posted on by

25% jump in firms facing ‘critical’ financial distress, with property and construction sectors featuring heavily, says Begbies Traynor

More than 47,000 UK companies are on the brink of collapse after a 25% jump in the number of businesses facing “critical” financial distress in the final three months of 2023, according to a report.

It marks the second consecutive quarter-on-quarter period when critical financial distress has risen by a 25%, the latest “Red Flag” report by insolvency specialists Begbies Traynor found.

Construction (7,849)

Support services (7,096)

Real estate & property services (6,228)

Professional services (4,347)

General retailers (3,133)

Telecoms & IT (2,830)

Health & education (2,719)

Media (1,828)

Financial services (1,373)

Food & drug retailers (1,343)

Continue reading...

New Brexit checks ‘pose existential threat’ to UK fruit and flower growers

Posted on by

Exclusive: NFU warns blanket import checks from April could fuel long delays and damage future crops

The UK’s fruit and flower growers face an “existential threat” from new post-Brexit border checks that could damage business and affect next year’s crops, the country’s biggest farming body has said.

The National Farmers’ Union (NFU) warned that changes to import rules in April, which will impose checks at the border for nearly all young plants coming into the country, could cause long delays and result in plants being damaged or destroyed.

Continue reading...

S&P 500 hits new record high amid signs of easing US economic gloom

Posted on by

Index climbs to all-time high of 4,838, clearing record set two years ago, as US consumer confidence rises while inflation concerns ease

The S&P 500 scaled a new all-time high on Friday amid signs that the economic despondency that has gripped US consumers may be easing.

The index climbed 1.2% to 4,838 on Friday afternoon, clearing a record last set two years ago. It has rallied more than 17% since late October.

Continue reading...

Retail slump raises spectre of recession as Hunt looks more Truss-like by the day

Posted on by

Surprise fall in December sales damages chancellor’s claims that UK economy is on right track

The UK economy was probably in recession during the second half of 2023 if the latest retail sales figures are anything to go by.

A surprise 3.2% slump in the level of sales in Great Britain during December appears to show the cost of living crisis was continuing to hurt household finances despite a rise in wages that gave many consumers a bit more spending power.

Continue reading...

Davos day one: Volodymyr Zelenskiy rallies support for Ukraine after ‘upbeat’ meeting with CEOs – business live

Posted on by

Rolling coverage of the opening day of the World Economic Forum in Davos

Ukraine’s president, Volodymyr Zelenskiy, has met business chiefs at a session for “CEOs for Ukraine”, here at the World Economic Forum, before his speech this afternoon.

He was seated alongside Ursula von der Leyen, European Commission President, who will also address WEF today:

Continue reading...

Geopolitical tensions and AI dominate start of World Economic Forum

Posted on by

Ukraine, Middle East and Taiwan overshadow annual meeting at Davos, with artificial intelligence also high on agenda

Growing concern that heightened geopolitical tension could damage an already shaky global economy has dominated the start of the annual gathering of the world’s business and political elite in Davos, Switzerland.

Three potential flash points – Ukraine, the Middle East and Taiwan – threatened to overshadow the meeting of the World Economic Forum (WEF) aimed at rebuilding trust after the series of setbacks suffered in the past four years, including war, the Covid-19 pandemic and the cost of living crisis.

Continue reading...

AI will affect 40% of jobs and probably worsen inequality, says IMF head

Posted on by

‘Crucial’ that countries build social safety nets to mitigate impact on workers, says Kristalina Georgieva

Artificial intelligence will affect 40% of jobs around the world and it is “crucial” that countries build social safety nets to mitigate the impact on vulnerable workers, according to the head of the International Monetary Fund.

AI, the term for computer systems that can perform tasks usually associated with human levels of intelligence, is poised to profoundly change the global economy with advanced economies at greater risk of disruption.

Continue reading...

Oil prices hit $80 a barrel as fears grow over Red Sea disruption to trade

Posted on by

Experts warn of economic impact of sustained shipping attacks and Middle East tensions

Oil prices have hit $80 (£62.83) as fears grew about the economic impact of disruption to international trade through the Red Sea and escalating tensions in the Middle East.

Raising concerns about a possible inflation shock for the world economy, Brent crude prices jumped by about 4% to a high of $80.75 a barrel on Friday, while US West Texas Intermediate crude also increased after US and UK airstrikes against Houthi rebel sites in Yemen.

Continue reading...

UK economy returns to growth amid Black Friday spending lift

Posted on by

GDP rises by 0.3% in November after October decline, with car leasing and video games fuelling bounceback

The UK economy returned to growth in November after a recovery in consumer spending driven by Black Friday sales, with shoppers hunting for bargains as the key Christmas shopping season got under way.

Gross domestic product rose by 0.3% on the month, after a decline of 0.3% in October, according to the Office for National Statistics (ONS). City economists had forecast more modest growth of 0.2%.

Continue reading...

US inflation ticked up to 3.4% in December as policymakers mull rate cuts

Posted on by

Consumer price index exceeds economists’ expectations as Fed weighs when to start cutting borrowing costs

Inflation ticked higher in the United States last month as the Federal Reserve weighs the latest stage of its battle against price growth.

The headline consumer price index increased at an annual pace of 3.4% in December, according to the Bureau of Labor Statistics, up from 3.1% in the previous month, and exceeding economists’ expectations of about 3.2%.

Continue reading...