Editor Brian Harrod Provides Comprehensive up-to-date news coverage, with aggregated news from sources all over the world from the Roundup Newswires Network
The foreign secretary has decided legislation is required to cut the aid budget since the current fiscal uncertainty means the government may feel obliged to miss the commitment to spend 0.7% on gross national income on overseas aid for longer than a year.
Legislation would be laid, Dominic Raab told MPs in an oral statement, but he did not give a date for doing so. The Foreign Office has indicated it is unlikely to be introduced until the second half of next year.
Accountancy firm warns of stalled economic recovery without EU trade agreement
Failure to strike a post-Brexit trade deal would cut the UK’s economic growth rate by more than half next year, delaying a full recovery from the coronavirus pandemic, according to a report.
The accountancy firm KPMG said the economy would suffer heavily should the UK fail to secure a trade deal with the EU before the end of the Brexit transition period at the end of December, just as the country attempts to escape the deepest recession since records began.
World economic outlook says 2020 impact is less than thought but there will be deep scars
The International Monetary Fund has scaled back its estimate of the hit to the global economy from Covid-19 this year but warned that the final bill for the pandemic would total $28tn (£21.5tn) in lost output.
Gita Gopinath, the IMF’s economic counsellor, described coronavirus as the worst crisis since the Great Depression, and said the pandemic would leave deep and enduring scars caused by job losses, weaker investment and children being deprived of education.
Reductions in government support as the original furlough scheme ends point towards a brutal round of redundancies
The UK economy continued its rapid rebound from the depths of the coronavirus lockdown in August, the latest official data on growth is expected to show on Friday, but many economists are braced for a grim winter as job losses mount.
The Bank of England’s chief economist, Andy Haldane, predicted last week that GDP would be “only around 3-4% below its pre-Covid level” by the end of the third quarter, covering July to September.
Several Conservative backbenchers argue that focus must be on supporting a continued economic recovery
The chancellor, Rishi Sunak, has been urged not to introduce tax hikes in his November budget by Conservative backbenchers who argue they would damage economic recovery.
The intervention followed speculation the Treasury could raise £20bn through extra levies to deal with the fallout from Covid-19.
Mark Haefele, chief investment officer, UBS Global Wealth Management, said:
While we expect the Fed to shy away from more radical easing measures, such as explicit controls on government bond yields, we believe Powell will likely outline other dovish measures. These could include a move toward average inflation targeting, giving the central bank more leeway to allow inflation to overshoot the 2% target while keeping rates pegged close to zero.
Maybe the age of the independent, activist central bank head is also coming to an end. Fiscal policy is more powerful and monetary policy needs to work in harmony with it. Monetary policy is being asked to do things (like tackle economic inequality) that it really isn’t suited to. But, here we are, waiting for Jay Powell to turn up at Grafton’s Saloon. He’s already done everything he can, he’s almost out of bullets and he may even have already won the fight, but we have placed our faith in him and desperately want fresh encouragement.
The economic collapse in Britain during the second quarter of 2020 was the most brutal on record. Unemployment is forecast by the Bank of England to soar to 2.5m by Christmas. The Brexit cliff edge approaches. Yet in the City, the FTSE 100 has been on the up.
Never has the disconnect between financial trading and economic fundamentals appeared so extreme. What explains surging asset prices (the FTSE jumped 2% on the same day it was revealed the economy had slumped by 20%) when the outlook for many workers is so grim?
Britain has entered the deepest recession since records began as official figures on Wednesday showed the economy shrank by more than any other major nation during the coronavirus outbreak in the three months to June.
The Office for National Statistics (ONS) said gross domestic product (GDP), the broadest measure of economic prosperity, fell in the second quarter by 20.4% compared with the previous three months – the biggest quarterly decline since comparable records began in 1955.
Official measure to be declared this week as coronavirus lockdown shrinks GDP by 21% in second quarter
Britain’s economy will be officially declared in recession this week for the first time since the 2008 financial crisis, as the coronavirus outbreak plunges the country into the deepest slump on record.
Figures from the Office for National Statistics on Wednesday are expected to show that gross domestic product (GDP), the broadest measure of economic prosperity, fell in the three months to June by 21%.
One month after a national lockdown was declared in an attempt to limit the spread of Covid-19, it is clear that Britain is heading for the deepest recession in living memory.
Boris Johnson’s government launched unprecedented restrictions on 23 March, telling the British public that they must stay at home and bringing life as the nation knew it to an abrupt halt.
It is as if the lights have been switched off. The global economy has been plunged into darkness as countries hunker down in response to the Covid-19 pandemic.
Most recessions develop gradually over time. When the last one started in 2008 it took the Bank of England six months to spot it. This time it is different. Then it was a financial virus, this time it is the real thing. Commentators often say the economy is hitting the wall or is falling off a cliff on the weakest of evidence. Today the cliches are horrifyingly true.
The world is sleepwalking towards a fresh economic and financial crisis that will have devastating consequences for the democratic market system, according to the former Bank of England governor Mervyn King.
Lord King, who was in charge at Threadneedle Street during the near-death of the global banking system and deep economic slump a decade ago, said the resistance to new thinking meant a repeat of the chaos of the 2008-09 period was looming.
Rolling coverage of the latest economic and financial news as Mario Draghi expected to prepare central bank for interest rate cuts
It will be too late for the ECB’s interest rates decision, but the latest measure of German business confidence from the influential Ifo Institute shows that morale has sagged more than expected in July.
The closely followed measure fell to a reading of 95.7 – well below the consensus expectations of 97.1.
Boris Johnson is planning to set out his “priorities for government” in his first appearance as prime minister in the house of commons – at about 10:30am BST.
Perhaps he can shed some more light on what will be happening by 31 October, the Brexit deadline.
Following Business Qs, there will be one government oral statement in the @HouseofCommons today:
European commission warns of ‘major shock’ and slashes growth forecast the union
The threat of a full-blown trade war between the US and China and Brexit uncertainty are posing mounting risks to the EU economy, the European commission has warned, after downgrading its growth outlook for 2019.
Brussels’ executive arm said a recent slowdown in global trade volumes had taken its toll across the continent, as it cut its GDP growth forecast for the 28-nation bloc for 2019 to 1.4%, down from a forecast of 1.9% in the autumn.