Firms preparing for difficult year as ‘potent cocktail’ of difficulties takes hold, says industry lobby group
UK manufacturers are cutting their recruitment plans after being hit by a slowdown in orders as a downturn looms, a new survey shows.
Britain’s manufacturers are “battening down the hatches” amid a sharp drop in activity, according to the latest quarterly data from Make UK, which represents manufacturers, and the business advisory firm BDO.
Continue reading...Biden adviser Heather Boushey urges UK and Europe to increase climate friendly investment to reboot growth
Governments around the world must drastically increase public investment in green technologies to combat global heating and drive sustainable economic growth, a top adviser to President Joe Biden has said.
Heather Boushey, a member of the White House council of economic advisers, said countries including the UK needed to ramp up green investment to reboot economic growth, boost energy security, and protect against future inflation shocks.
Continue reading...Weak consumer spending as, people – especially in Germany, the EU’s largest economy – put more into savings
Interest rates went up again across the eurozone on Thursday – probably for the last time during this cycle of hikes that has become a familiar story in the single currency bloc, as it has in the UK and US.
The European Central Bank (ECB) raised its main deposit rate by a quarter of one per cent to 4% – the highest level in the euro’s history.
Continue reading...Growth in prices still remains far below the decades-high inflation rates that were seen last summer, when rate peaked at 9.1% in June
US inflation in August rose for the first time since June 2022, rising to 3.7% as a sharp increase in energy prices pushed prices up toward the end of the summer.
Growth in prices still remains far below the decades-high inflation rates that were seen last summer, when the rate peaked at 9.1% in June. Still, an increase in inflation means the US economy is further from the Federal Reserve’s target rate of 2% and will likely make officials consider pushing interest rates up later this year.
Continue reading...Jump in borrowers unable to make payments with landlords particularly hit and ‘worse to come’
Mortgage arrears jumped by 13% in the second quarter of the year to the highest level since 2016, according to Bank of England figures that underscore the stress in the UK mortgage market.
Rising interest rates and unemployment over recent months have put pressure on household disposable incomes, forcing some families to cut or suspend their monthly mortgage payments.
Continue reading...S&P Global’s chief economist Paul Gruenwald believes interest rates will stay elevated for some time
Soft landings, sticky inflation, the dash to decarbonise and great power rivalry including the emergence of India are among subjects exercising Paul Gruenwald, S&P Global’s chief economist.
New York-based Gruenwald, whose career includes stints at the International Monetary Fund and ANZ, was speaking ahead of an economists’ briefing in Sydney on Tuesday.
Continue reading...Survey of businesses gives further indication that Bank of England could limit future interest rate rises
Businesses are pulling back on hiring and slowing their output under the strain of rising borrowing costs, according to a study that gives a further signal that the Bank of England could limit future interest rate rises.
A modest pickup in manufacturing in August failed to prevent a slowdown in broader UK private sector economic activity, a survey of businesses by the accountancy firm BDO found.
Continue reading...Woking declared itself bankrupt in June. Now, residents want answers as care, arts and leisure facilities face funding cuts
On a clear day, the council’s ambitious plan was for Woking’s tall buildings to be seen from the viewing levels of the Shard in London. Residents, however, view the unfinished towers with much less pride and a symbol of the Surrey town’s financial woes.
Woking borough council this week announced a sweeping package of cuts to local services, after the local authority in effect declared itself bankrupt in June, revealing a £1.2bn deficit racked up from a risky investment spree overseen by its former Conservative administration. The towers were at the centre of the problem, with cost overruns adding to vast debts.
Continue reading...Slow domestic consumption, high youth unemployment and decline in exports among factors dragging on post-Covid recovery
China’s consumer price index rebounded in August as the world’s second-largest economy emerged from deflation, official data released on Saturday suggested, despite sluggish domestic consumption that is complicating its post-Covid economic recovery.
Last month’s CPI, the main gauge of inflation, rose 0.1% year on year, the national statistics bureau said.
Continue reading...Fresh signs of weakness in Chinese economy and weak UK and eurozone data spook investors
Fears about the health of the global economy have intensified following downbeat news about service sector activity in China, the eurozone and the UK.
Share prices fell in Asia and the pound dropped to a 12-week low against the US dollar after fresh signs of weakness in China triggered speculation that its post-lockdown recovery was running out of steam.
Continue reading...European stocks hit three-week high as China’s government tries to prop up ailing economy
The share price of the ailing Chinese developer Country Garden has jumped by as much as a fifth after its creditors agreed a delay on debt repayments, offering some respite from the country’s crisis-hit property market.
The company agreed over the weekend to extend the payment dates on a 3.9bn yuan (£430m) private bond, to the relief of investors who had thought it would default on payments due on Saturday. Country Garden will instead have three years to repay the debt, after it won a narrow vote with the backing of 56% of its creditors, Reuters reported.
Continue reading...Exclusive: Sources believe deal will not be struck before meeting with Narendra Modi at G20 summit
Rishi Sunak has ruled out a quick-fix trade deal with India, making it impossible to get an agreement over the line in time for this week’s G20 summit in Delhi – and possibly even by next year’s elections.
Multiple sources close to the negotiations told the Guardian the prime minister has rejected the idea of an “early harvest” deal, which could have lowered tariffs on goods such as whisky but would not have dealt with trickier subjects such as professional services.
Continue reading...Huw Pill says he prefers longer, more steady use of interest rates of Table Mountain model over sharp rise and fall of Matterhorn approach
Tourist attraction, backdrop to millions of selfies and one of the world’s most easily identifiable landmarks. Cape Town’s Table Mountain is all of these things, but now it has found a new role: as a guide to what will happen to UK interest rates.
For Huw Pill the opportunity was too good to pass up. Invited by South Africa’s central bank to speak at a high-level conference, the Bank of England’s chief economist said there were two ways for Threadneedle Street to bring UK inflation back to the government’s 2% target.
Continue reading...Jay Powell tells symposium in Wyoming that inflation is still too high but that US central bank will ‘keep at it until the job is done’
Federal Reserve chair Jerome Powell used a closely watched speech on Friday to warn that the fight against inflation in the US is not over.
Speaking at the Federal Reserve Bank of Kansas City’s annual gathering of central bankers in Jackson Hole, Wyoming, Powell said inflation was still too high and that interest rates may have to rise further to tamp it down.
Continue reading...UK trade secretary Kemi Badenoch is expected to progress talks with Indian counterparts in Jaipur, during a meeting of G20 trade ministers
A UK-India trade deal is likely to stay “tantalisingly out of reach”, one commentator warns.
Striking a deal would be a“game changer” for post-Brexit Britain, Susannah Streeter, head of money and markets at Hargreaves Lansdown, says.
Hopes that the UK can give its very sluggish growth prospects a boost with a big trade win this autumn are fading after reports that a major deal with India remains elusive.
It appears that final negotiations have run into the long grass, with thorny issues such as visas for Indian workers still likely to be problematic.
Continue reading...Supermarket operator posts 4.8% rise in full year cash profit, lifted by strong rise in groceries revenue. Follow today’s live news updates
AEC monitoring disinformation about electoral processes
Rogers said the AEC has seen an increase in mis- and disinformation over the last few years, particularly around the electoral process itself.
It’s all about the electoral process. We’re seeing an increase in [disinformation]. We’re seeing an increase in threats to staff. Which is very disappointing. And we’re monitoring that very closely.
At the last federal election, we had similar issues. We’re seeing behaviours we haven’t seen previously. The people who work elections are community members … Treat people with respect and civility.
We’re ready for it whenever it may be. That’s what we do in any case. We’re used to these events when we don’t know the date until a few weeks out. We’ve got all systems go.
We would ultimately like the rate to be exactly the same as the general roll, but it’s very close.
Continue reading...A profit warning from housebuilder Crest Nicholson has compounded fears of a housing market slowdown, as Rightmove data reveals a further drop in asking prices
AJ Bell investment director Russ Mould said that while weak house price data (as was “hardly a surprise”, Crest Nicholson’s profit warning has “laid bare the the scale of the impact of a housing slowdown on the housebuilding sector.”
Sales of new homes have plunged alarmingly and, while not all developers in the space are created equal, the news, allied to Rightmove’s latest reading on the property market, has had a knock-on effect on share prices in the rest of the sector this morning.
The £7,000 drop in the average asking price observed by Rightmove in the last month, allied to a big drop in transaction volumes, is the kind of statistic to make estate agents distinctly uneasy.
Continue reading...Central bank reduces one-year loan prime rate but surprises analysts by leaving five-year rate unchanged
China’s central bank has cut one of its key lending rates but left another unchanged, surprising economists who had expected more forceful action to support economic growth amid widespread concerns over its path.
The world’s second-largest economy is in the midst of a slowdown, and has slipped into deflation with prices falling year on year as slowing domestic spending weighs on the country’s post-Covid economic recovery.
Continue reading...Evergrande has filed for bankruptcy protection and firms covering 40% of Chinese home sales have defaulted
China’s property crisis has deepened with two major developers facing severe financial difficulties that threaten to send shock waves through the country’s economy and beyond.
Evergrande, the poster child for the woes of China’s property sector, filed for chapter 15 bankruptcy protection in New York on Thursday. The provision permits the company to protect its US assets and will allow cross-border bankruptcy proceedings as it undergoes a restructuring.
Continue reading...Both sides of constitutional debate use Gers data to argue case for and against independence
Scotland’s public spending deficit has fallen from a record peak last year, as oil and gas revenues reached their highest-ever level after a global rise in oil prices.
The government expenditure and revenue Scotland (Gers) report calculated a per-person deficit – the gap between the amount raised through all tax and spending on all public services – as £1,521 in the 2022-23 financial year, down from £2,184 the previous year.
Continue reading...