(qlmbusinessnews.com via news.sky.com– Tue, 18th Sept 2018) London, Uk – –
Donald Trump says further tariffs worth $267bn (£203bn) will be placed on Chinese imports if Beijing takes “retaliatory action”.
Donald Trump has intensified America's trade war with China by imposing new $200bn (£152bn) tariffs on imports.
The higher import taxes will start from Monday at 10% before rising to 25% on 1 January, the White House announced.
The US president said there would be further tariffs on $267bn (£203bn) in Chinese imports if Beijing takes “retaliatory action against our farmers or other industries”.
“Once again, I urge China's leaders to take swift action to end their country's unfair trade practices,” Mr Trump said.
“Hopefully, this trade situation will be resolved, in the end, by myself and President Xi of China, for whom I have great respect and affection.”
Mr Trump has threatened to target all $500bn (£380bn) of Chinese imports unless Beijing agrees to sweeping changes to its intellectual property practices and what his administration alleges are unfair trade practices.
China denies the allegations and has vowed to hit back with tariffs on $60bn (£45bn) in American goods.
The new tariffs reportedly apply to more than 5,000 items including handbags, rice and textiles.
In a victory for Apple and its US customers, smart watches and some other consumer electronics products were removed from the latest list.
In a statement, Mr Trump insisted China's trade practices “plainly constitute a grave threat to the long-term health and prosperity of the United States economy”.
The US had already imposed 25% tariffs on $50bn (£38bn) in Chinese imports.
Mr Trump said: “For months, we have urged China to change these unfair practices, and give fair and reciprocal treatment to American companies.
“We have been very clear about the type of changes that need to be made, and we have given China every opportunity to treat us more fairly. But, so far, China has been unwilling to change its practices.”
Mr Trump has previously complained about America's massive trade deficit – $336bn (£255bn) last year – with China, its biggest trading partner.
(qlmbusinessnews.com via bbc.co.uk – – Mon, 17th Sept, 2018) London, Uk – –
The International Monetary Fund has warned that a “no-deal” Brexit on World Trade Organization terms would entail substantial costs for the UK economy.
Such an outcome would affect “to a lesser extent” other EU economies.
It said challenges in getting a deal done were “daunting” and warned against further UK interest rate rises.
The IMF said it expected Britain's economy would grow by about 1.5% a year in 2018 and 2019 if a broad Brexit agreement was struck.
Christine Lagarde, the IMF's managing director, added: “Those projections assume a timely deal with the EU on a broad free trade agreement and a relatively orderly Brexit process after that.”
The IMF said that all likely Brexit scenarios would “entail costs for the UK economy”, but that a disorderly departure could lead to “a significantly worse outcome”.
Speaking at a news conference at the Treasury in London, Ms Lagarde said: “Any deal will not be as good as the smooth process under which goods, services, people and capital move around between the EU and the UK without impediments and obstacles.”
She said a “disorderly” or “crash” exit from the EU would have a series of consequences, including reduced growth, an increased deficit and depreciation of sterling, leading to a reduction in the size of the UK economy.
She pointed out that countries tended to trade mostly with their neighbours, adding: “I think geography talks very loudly.”
In July, the IMF said the UK economy would grow by 1.4% this year and 1.5% in 2019.
(qlmbusinessnews.com via bbc.co.uk – – Fri, 14th Sept 2018) London, Uk – –
The luxury goods maker Chanel has told the BBC it's elected to set up its global office in the UK.
For the first time in its 110-year history, the brand is gathering the majority of its global business functions under one roof.
Chanel, renowned for its tweed suits, handbags and perfume, had global sales of over £7bn last year, and employs more than 20,000 people.
It has over 30 million social media followers on Instagram.
Chanel told BBC Radio 4's Today programme that it “wanted to simplify the structure of the business and London is the most appropriate place to do that for an international company. London is the most central location for our markets, uses the English language and has strong corporate governance standards with its regulatory and legal requirements”.
The decision – which is understood to involve dozens of jobs – means that Chanel has picked London as the base for its global team over other locations such as New York, or even its creative hub of Paris.
Chanel, whose Little Black Dress has come to epitomise the label's Parisian heritage, is retaining its head designer Karl Lagerfeld and his team in the French capital.
Burberry stops burning unsold goods
Chanel lifts the veil on its profits
Justine Picardie, editor-in-chief of Harpers' Bazaar and Coco Chanel's biographer, hailed the move as a mark of the global powerhouse's confidence in the UK's long-term prospects.
She pointed out that it also moves Chanel closer to one of its fastest growing customer bases with “spending on luxury goods by affluent London households being only second to Hong Kong, in terms of growth”.
She added: “Chanel leads the way. My strong intuition is that other (luxury brands) will follow.”
The reasons Chanel gives for its decision echoes those cited by the likes of banks and manufacturers who've opted to move operations to the UK over the years.
The news comes as many businesses voice concerns about the continued uncertainty over Brexit and future trading arrangements, and the impact that may have on investment and jobs.
Chanel's decision will be welcome news to British designers as London Fashion Week gets underway. They're potentially facing upheaval to their supply chains in the form of tariffs, delays at the border and exchange rate volatility in the event of a no-deal Brexit.
Such concerns could, according to Paul Alger, of the Fabrics and Textiles Association, make buyers at catwalk shows hesitate to place orders, which would be due for delivery next spring.
The fashion industry contributed over £32bn to the UK industry in 2017, according to the British Fashion Council. That's an increase of 5.4% on 2016, making it one of the fastest growing sectors of the economy.
(qlmbusinessnews.com via bbc.co.uk – – Mon, 10th Sept 2018) London, Uk – –
The UK economy grew by 0.3% in July after being helped by the heatwave and the World Cup, according to the Office for National Statistics.
In the three months to July, the economy expanded by 0.6%.
“Services grew particularly strongly, with retail sales performing well, boosted by warm weather and the World Cup,” said Rob Kent-Smith from the ONS.
“The construction sector also bounced back after a weak start to the year,” he added, but production contracted.
“The dominant service sector again led economic growth in the month of July with engineers, accountants and lawyers all enjoying a busy period, backed up by growth in construction, which hit another record high level,” said Mr Kent-Smith.
The 0.6% growth rate for the three months to July was at the top end of forecasts, and marks a pick-up from the 0.4% rate seen in the three months to June.
(qlmbusinessnews.com via theguardian.com – – Mon, 3 Sept, 2018) London, Uk – –
Energy regulator Ofgem due to set out the level of Theresa May’s price cap on Thursday
Households will discover this week whether they will save £100 on their annual energy bills as Theresa May promised them.
The energy regulator, Ofgem, is due to set out the level of the government’s energy bill price cap on Thursday, which will protect more than 10m households on default tariffs.
The figure will be crucial to determining big firms’ profit margins and whether the government can claim it has delivered on its pledge.
SSE offers the cheapest default tariff of the big six at £1,196 but has not yet announced a second price rise this year, unlike four of the other large suppliers.
The most expensive is Scottish Power on £1,257 from October, although that could be eclipsed by npower if it announces a second price rise.
Industry experts believe Ofgem will set the cap on default tariffs in the region of £1,150 to £1,200.
If it was at the lower end of that range, that would allow ministers to say they had saved some consumers about £100.
Gillian Guy, the chief executive of the consumer group Citizens Advice, said: “Loyal energy customers have been overcharged for too long. The price cap should stop the worst overcharging in the market, but still allow well-run firms to make a profit.”
However, she added that while the cap would save loyal customers money, the best way to cut energy bills was still to switch supplier.
A key question will be whether the cap will be below an existing one for 5m households, most of whom are on prepayment meters, which are typically used when people fall behind on payments. Prepayment meter customers cost energy firms more to serve than those on direct debits.
Ofgem recently said that cap would go up £47 a year to £1,136, because of rising wholesale energy prices.
Ed Reed, the head of research at the analysts Cornwall Insight, said: “It will be interesting to see how they can create a cap that’s cheaper than the prepayment meter one.
“How can you justify one that is the same as or higher than the existing one, when we know [prepayment] costs are higher?”
Ofgem will have little wiggle room because the new, wider cap is expected to factor in the costs of the roll-out of smart meters. The existing, narrower cap does not consider those.
The price cap number this week will be a predictive one, with the energy regulator publishing the final level in October. The cap takes effect at the end of December.
(qlmbusinessnews.com via uk.reuters.com — Fri, 31st Aug 2018) London, UK —
LONDON (Reuters) – The opening of Europe’s biggest infrastructure project, London’s new Crossrail train line, has been delayed by about nine months because the 15 billion pound scheme requires more time for testing to be completed, it said.
When fully open, the Elizabeth line, as it is officially known, will connect destinations such as Heathrow Airport in west London to areas such as the Canary Wharf financial district in the east.
It is desperately needed to alleviate overcrowding and speed up journeys between key transport hubs in Britain’s capital city. The central section was meant to open in December this year but it has now been delayed until the autumn, Crossrail said.
“The original programme for testing has been compressed by more time being needed by contractors to complete fit-out activity in the central tunnels and the development of railway systems software,” Crossrail said in a statement.
“Testing has started but further time is required to complete the full range of integrated tests.”
More than 200 million passengers are expected to use the Elizabeth line every year once it is operational.
Transport for London said it was working closely with Crossrail to ensure all necessary work was completed.
“The delayed opening is disappointing, but ensuring the Elizabeth line is safe and reliable for our customers from day one is of paramount importance,” said Mark Wild, London Underground and Elizabeth line Managing Director.
(qlmbusinessnews.com via uk.reuters.com — Wed, 29th Aug 2018) London, UK —
LONDON (Reuters) – House prices in London’s overvalued market will fall this year and next, a Reuters poll of analysts and experts predicted, and will tumble if Britain fails to reach a deal ahead of its departure from the European Union.
The quarterly poll of around 30 housing market specialists, taken in the past week, said house prices in the capital – where foreign investors have previously fuelled skyrocketing prices – will fall 1.6 percent this year and 0.1 percent next.
“Central London is tanking because the traditional international buyers are staying away – and the quantum of buyers is falling. A disorderly Brexit will exacerbate this trend,” said Tony Williams at property consultancy Building Value.
Uncertainty over how Brexit negations pan out has already spooked foreign investors. When asked what effect a disorderly departure would have on London prices, responses ranged from “short-term fall” to “damaging” to “disaster”.
“In the short term the additional uncertainty will disproportionately affect London, causing the value of some properties, particularly high value properties, to fall further,” said Ray Boulger at mortgage broker John Charcol.
Britain is due to leave the EU in March and sterling fell to a near one-year low against the euro on Tuesday amid no-deal angst. A weaker currency should make UK houses more attractive to foreign buyers but Brexit uncertainty is keeping them away.
When asked about the likelihood of a significant correction in London’s housing market before the end of 2019 the specialists gave a relatively high median of 29 percent. The highest was 75 percent.
But that might not be a bad thing – certainly for first-time buyers.
When asked to rate the level of London house prices on a scale of one to ten, where one is extremely cheap and ten extremely expensive, the median response was nine. Nationally they were rated seven.
“The weight of evidence suggests that housing is overvalued once more,” said Hansen Lu at Capital Economics.
In August the average asking price for a home nationally was 301,973 pounds and in London a whopping 609,205 pounds, according to property website Rightmove, putting home ownership out of the reach of many – despite historically low borrowing costs.
The Bank of England pushed interest rates above their financial crisis lows this month but signalled it was in no hurry to raise them further. It will add another 25 basis points in the second quarter of next year, taking Bank Rate to 1.0 percent, another Reuters poll predicted.
So with mortgage rates staying low house prices are expected to increase nationally by 2.0 percent this year and next – slower than inflation – and then 2.3 percent in 2020.
“We see little upward or downward pressure on house prices at current near-zero interest rates. However, risks lie substantially to the downside,” said Andrew Brigden at Fathom Consulting.
“Were interest rates to return to pre-crisis levels or higher, which may prove necessary if there were a sharp fall in sterling after a General Election, for example, then house prices could fall by around 40 percent.”
(qlmbusinessnews.com via uk.reuters.com — Thur, 23 Aug 2018) London, UK —
LONDON (Reuters) – Britain will on Thursday publish a series of notes advising people and businesses how to protect themselves from the potential disruption of a ‘no deal’ break with the European Union.
With less than eight months to go until March 29 when it leaves the bloc, Britain has yet to reach a divorce agreement with the EU. Negotiations resumed on Tuesday but diplomats in Brussels expect an informal deadline of October to be missed.
Around 80 technical notices are expected over the coming weeks covering everything from financial services to food labelling.
“Whilst we are setting out these technical notices today to deal with the unlikely eventuality of a no deal I am still confident that a good deal is within our sights,” Brexit Minister Dominic Raab told BBC radio.
“We are at every meeting making good progress on the outstanding separation issues.”
Several ministers have warned that the risk of leaving without an agreement has increased. Earlier this month trade minister Liam Fox put the chances at 60-40.
Raab will say that in some cases Britain will take unilateral action to maintain continuity in the event of a no-deal Brexit.
The notes are expected to be published on the government’s website at around 11.30 a.m. (1030 GMT).
The government will announce that British citizens who have lived and worked overseas risk losing access to their pensions, the Sun newspaper reported.
Many economists say failure to agree exit terms would seriously damage the world’s fifth-largest economy as trade with the EU, Britain’s largest market, would become subject to tariffs.
Supporters of Brexit say there may be some short-term pain for the economy, but that long-term it will prosper when cut free from the EU.
The opposition Labour party’s Brexit spokesman Keir Starmer said his party may back a second referendum if parliament votes down the prime minister’s plan.
Starmer said the talks with the EU are “going badly” and the publication of the documents on how to prepare for a no deal is a sign the government is “moving into panic mode”.
A survey this month by the Institute of Directors, a business lobby group, found that fewer than a third of company bosses had carried out contingency planning on Brexit.
“‘No deal’ preparations should have happened far earlier, and the onus is on government to move quickly and give businesses as much detailed technical information as possible to avoid significant disruption in any scenario,” Adam Marshall, Director General of the British Chambers of Commerce, said before the publication of the advice notices.
Customs and tax procedures, immigration rules and how to process transactions are among the things companies need more information from government on, Marshall said.
(qlmbusinessnews.com via bbc.co.uk – – Wed, 22 Aug 2018) London, Uk – –
Average earnings in the UK are still £13 lower than they were a decade ago, a study has found.
Job insecurity is now “widespread”, with 800,000 workers on zero-hours contracts, according to the Resolution Foundation, an independent think-tank.
However, 2.1 million more people have found jobs since the financial crisis in 2008, with 1.2 million of those in the poorest third of households.
The foundation said this was “a much-needed bright spark amidst the gloom”.
Its senior economic analyst, Stephen Clarke, said lower-income families had accounted for the majority of the jobs growth.
“While employment is at a record high, Britain is still some way off full employment and too much work remains low-paid and insecure,” he said.
“Steps to provide advance notice of shifts and a right to a regular contract for those working regular hours on a zero-hour contract would also help those in work who have precious little job security.”
TUC general secretary Frances O'Grady said the government was “turning a blind eye” to a crisis in living standards: “It's taking wages longer to recover from this crash than it did after the Great Depression.”
Shadow chancellor John McDonnell said the figures showed “the disastrous impact of nearly a decade of austerity on earnings, with workers in the UK losing out under Tory rule”.
A government spokesman said efforts were under way to give workers in zero-hours jobs a right to request more stable contracts.
He said: “We have more people in work than ever before, and the National Living Wage has helped to deliver the fastest earnings boost for the lowest paid in 20 years.
“Through our Good Work plan, we are going further to give millions of workers major new rights and protections, including increased financial security for workers on flexible contracts.”
(qlmbusinessnews.com via telegraph.co.uk – – Tue, 21 Aug 2018) London, Uk – –
Housebuilder Persimmon sought to reassure investors worried about a slowdown in the housing market after posting a rise in profits and selling more than 250 extra homes in the first half of the year.
Jeff Fairburn, chief executive, said the FTSE 100 company had “continued to experience good levels of customer interest” even during the typically quiet summer period as low unemployment and a “competitive mortgage market” helped spur demand.
Pre-tax profits rose 13pc to £516m in the six months to June after Persimmon sold 8,072 houses, 4pc more than in the same period last year. Revenues grew 5pc to £1.8bn.
The housebuilder has benefitted from the Government’s Help to Buy scheme, which offers first-time buyers financial support to buy new-build homes. It has also been helped by a relatively low exposure to the London market, which has seen a slowdown in recent months.
Persimmon’s bottom line was also bolstered by a 1pc increase in sales prices to £215,000 and tighter control of costs, which helped stretch its gross margin from 28.9pc to 30.8pc.
The company was embroiled in a fierce row with investors and politicians earlier in the year after it emerged Mr Fairburn was in line for as much as £100m because of a non-capped bonus scheme linked to its share price.
The debacle cost the jobs of Persimmon’s former chairman Nicholas Wrigley and the head of its remuneration committee Jonathan Davie. Mr Fairburn and other senior bosses who benefited from the scheme eventually agreed to hand back £50m.
(qlmbusinessnews.com via news.sky.com– Tue, 21 Aug 2018) London, Uk – –
The International Trade Secretary is launching a range of initiatives to help businesses take advantage of export opportunities.
Britain can become a “21st century exporting superpower”, Liam Fox will claim as he outlines plans to encourage greater exports post-Brexit.
The International Trade Secretary who once accused UK businesses of being “lazy” wants to increase exports as a proportion of GDP from 30% to 35%. However, the department has not set a timescale for reaching this ambition.
Dr Fox told Sky News that there are 400,000 UK firms that could export but currently don't, and that the UK needs to do more to exploit “the rise of the global middle class”.
The department is launching a range of initiatives including what Dr Fox describes as “an opportunity sweep” where his department will post export opportunities on to an online information hub. They promise to have found tens of thousands by the end of the year.
Dr Fox wants more firms to make use of £50bn of government finance assistance and export insurance. His department will also set up a mentoring system so newcomers to exporting can learn from established businesses.
Official figures released in June showed exports of UK goods and services hit a record £620bn last year.
In a speech to a business audience Dr Fox will say: “UK businesses are superbly placed to capitalise on the rapid changes in the global economic environment and I believe the UK has the potential to be a 21st century exporting superpower.
“As an international economic department, we are determined to support, connect and grow UK companies on the world stage through our international network.”
Mike Cherry, Federation of Small Businesses (FSB) national chairman, said the Government's export strategy is “strong on aspiration”.
He added: “An assessment of financial incentives, including export vouchers, as mentioned in the strategy, is a step in the right direction, but we are fast running out of time.
“The clock is ticking. If the Government doesn't act quickly and introduce financial incentives there is a risk the current uncertainty will have a serious and detrimental impact on the growth of small businesses.”
CBI Director-General Carolyn Fairbairn said: “This strategy is a timely signal that the Government is committed to improving the United Kingdom's international competitiveness.
“The CBI strongly supports the ambition to make exports 35% of GDP, which will put the UK out in front of many of our international competitors.”
Shadow international trade secretary Barry Gardiner said: “After record trade deficit figures, staff cuts in trade promotion and delays to trade show funding for business, the government is finally publishing an export strategy – some two years after the trade department was established.”
“Our businesses need a strong future export relationship with the EU. The Tory export strategy has thus far been based on controversial one-off arms sales.
“That is no substitute for a customs union with our most important trade partners, which is what the next Labour government will deliver.”
(qlmbusinessnews.com via uk.reuters.com — Thur, 2nd Aug 2018) London, UK —
LONDON (Reuters) – Britain’s construction industry unexpectedly gained momentum last month to grow at its fastest rate in over a year, boosted by the biggest increase in housebuilding since the end of 2015, an industry survey showed on Thursday.
Just hours before the Bank of England is expected to raise interest rates for the only the second time since before the financial crisis, the IHS Markit/CIPS construction Purchasing Managers’ Index (PMI) rose to its highest since May 2017.
“July data reveal an impressive turnaround,” IHS Markit economist Tim Moore said.
The PMI jumped to 55.8 from June’s reading of 53.1, beating all forecasts in a Reuters poll of economists that had predicted a slight slowdown in growth to 52.8.
The figures contrast with a more lacklustre reading for manufacturers on Wednesday, who were their most downbeat in nearly two years due to concerns about Brexit and the value of the pound.
Thursday’s construction PMI also showed some Brexit worries and higher costs for steel used in construction — a possible reflection of European Union tariffs imposed on steel imports to the bloc in response to U.S. tariffs.
Nonetheless, the overall tone from the construction industry was positive. New orders flowed in at the fastest rate since May 2017 and both house-building and employment in the sector rose by the most since December 2015.
The figures contrast with a weak start to 2018, when unusually icy weather hurt the sector, causing first-quarter output to fall by 0.8 percent according to official data.
“While the recent rebound in construction work has been flattered by its recovery from a low base earlier in 2018, there are also signs that underlying demand conditions have picked up this summer,” IHS Markit’s Moore said.
Last week the National House-Building Council reported year-on-year increases in housing starts in most of Britain during the three months to the end of June, though a sharp fall in London dragged down the national average.
(qlmbusinessnews.com via bbc.co.uk – – Wed, 25 July 2018) London, Uk – –
Banks could be forced to set a minimum interest rate on their savings accounts, the Financial Conduct Authority (FCA) has suggested.
The FCA said it was concerned that savers who stay with the same bank or building society for a long time get poor returns on their money.
Some banks currently pay just 0.05% a year on instant access accounts.
The Basic Savings Rate (BSR) would apply to all easy access cash ISA products, as well as savings accounts.
It would be applied after the account had been opened for a set period, for example one year.
FCA considers texts to warn of low savings rates
Why hasn't my savings rate gone up yet?
“Providers can take advantage of high levels of customer inaction to pay lower interest rates to longstanding customers,” said Christopher Woolard, executive director of strategy and competition at the FCA.
He said customers who do not shop around for higher rates should be treated fairly by their banks or building societies.
Citizens Advice said the average amount that savers were losing by not switching accounts was £48 a year.
The FCA suggested it would be up to each bank to set their own BSR, which would apply across all their instant access accounts. The rates would then be published on the FCA's website, so consumers could compare them easily.
Banks said they had already taken measures to improve competition in the savings market.
“These include communicating more clearly with customers about the rates they receive, faster cash ISA transfers and enhanced customer prompts before a rate is reduced,” said Peter Tyler, director of conduct and savings policy at UK Finance, which represents the High Street banks.
The FCA has tried previously to encourage savers to shop around for better rates, but with limited success.
“Efforts to encourage customers to switch have had limited impact and we remain concerned about the way firms are treating customers,” Mr Woolard said
“This is why we are considering the introduction of a basic savings rate for older accounts, which would promote competition and help get customers a better rate of interest.”
The highest returns are generally offered by current accounts, where savers can get up to 5% a year in some cases – although such accounts have strict limits on the amount of money that can be put in.
Analysis, Simon Gompertz, BBC personal finance correspondent
The FCA has tried forcing banks to tell customers how to switch accounts. It's tried naming and shaming the ones paying the worst rates.
But none of these measures has made much difference.
So now it is looking at a more powerful weapon to use against savings providers who exploit their customers.
This isn't the FCA reaching for the nuclear button of setting minimum rates itself, because each institution would set its own Basic Savings Rate.
But the measure would prevent the least savvy savers being left behind and make it easier to compare what's on offer.
The danger – if this ever happens – is that the new weapon explodes in the FCA's face, if banks react by setting the lowest Basic Savings Rates they can get away with.
The FCA said a Basic Savings Rate (BSR) could enable customers jointly to earn up to £480m a year more than they do at the moment.
It said around a third of accounts were opened more than five years ago.
And on average, customers with such accounts earned 0.82% less than people whose accounts were opened more recently.
Interested parties can respond to the FCA's discussion paper between now and 25 October.
(qlmbusinessnews.com via bbc.co.uk – – Wed, 18th July 2018) London, Uk – –
Inflation remained at 2.4% for the third month in a row in June, according to the Office for National Statistics, after clothing prices fell.
The Consumer Price Index (CPI) measure of inflation had been expected to rise to 2.6% last month.
However, the summer sales weighed on inflation after clothing prices were cut, in particular on men's fashion.
The unchanged figure means that wages remain above inflation despite pay growth slowing to 2.7%.
The pound fell against the dollar following the surprise reading, slipping 0.60% to $1.3037.
There had been expectations that the Bank of England would raise interest rates in August.
But Ben Brettell, Senior Economist, Hargreaves Lansdown, said that June's figure meant it is not “a done deal”.
He said: “Markets had been pricing in around an 80% chance the Bank would lift borrowing costs in August, but today's inflation data combined with yesterday's lacklustre wage growth figures could force policymakers into a rethink.”
Neil Wilson, chief market analyst at Markets.com, said: “The Bank of England's policymakers seem to be guiding a hike and the market has quietly acquiesced but data this week does not support the case for an imminent raising of rates.
“My bet is the Bank will – as in May – be forced by softer data to be forced away from raising rates too quickly.”
The ONS said that the price of clothing and footwear fell by 2.3% between May and June compared to a 1.1% decline in the same period last year.
While it said it was normal for prices to drop at this time of year due to the start of the summer sales season, the ONS said the fall was the largest since 2012 and “the effect came mainly from men's clothing”.
The price of computer games also fell. The ONS said: “Prices for these games are heavily dependent on the composition of bestseller charts, often resulting in large overall price changes from month to month.”
However, the cost of motor fuel and household energy prices rose to keep inflation steady.
Petrol prices rose by 2.7p per litre to 128p between May and June 2018 – the highest average price since September 2014.
Diesel prices also rose, up 2.9p to 132.1p. Both petrol and diesel prices fell between May and June last year.
Mike Hardie, head of inflation at the ONS, said: “Consumers have been feeling the benefit of the summer clothing sales, and computer game prices have also fallen.
“However, gas and electricity and petrol prices all rose, with consumers seeing the highest price at the pump for nearly four years, with inflation remaining steady overall
(qlmbusinessnews.com via uk.reuters.com — Tue, 17th July 2018) London, UK —
LONDON (Reuters) – British workers’ pay growth has slowed to its weakest in six months despite record employment, challenging the Bank of England as it considers whether to raise interest rates next month for only the second time since the financial crisis.
Average weekly earnings rose by 2.5 percent on the year in the three months to May, slowing from the previous three month period when they grew by 2.6 percent and the weakest since the three months to November, the Office for National Statistics said on Tuesday.
Pay growth excluding bonuses, which the BoE says sometimes gives a better picture of the underlying trend, slowed by a similar amount, to 2.7 percent. Both readings were in line with the average forecast in a Reuters poll of economists.
There was little immediate market reaction to the data, which economists said was unlikely to dissuade the majority of the BoE’s policymakers from raising rates on Aug. 2 after their next meeting.
“There’s next to nothing here that will make the BoE more cautious with regards to an August hike,” said David Cheetham, chief market analyst at brokerage XTB.
Britain’s economy appears to be picking up after a slow first three months of the year, when unusually heavy snow hurt demand, and the central bank worries it is bumping up against the speed limit that would start to push up inflation.
Tuesday’s data showed the unemployment rate remained at its joint-lowest since 1975 at 4.2 percent while the proportion of people in work rose to a record high of 75.7 percent after 137,000 jobs were created over the three months to May.
But economic growth since 2016’s Brexit vote has been weak by historic standards due to high inflation and business uncertainty, and on Monday the International Monetary Fund cut Britain’s growth forecast for 2018 to 1.4 percent.
Moreover, the BoE has been repeatedly surprised over the years as the labour market has tightened but wages have risen less than expected – a pattern seen to a slightly lesser degree in most other advanced economies in recent years.
Pay growth is one of the pieces of data the Bank of England looks at most closely for signs that domestic inflation pressures are rising strongly enough for inflation to be at risk of breaching its 2 percent target over the medium term if the BoE does not raise rates in the immediate future.
BoE Governor Mark Carney said at the start of the month that both the economy as a whole and pay were growing as the central bank had forecast in May, smoothing the way for an August rate rise.
But last week one of his deputies, Jon Cunliffe, who opposed November’s rate rise, said pay growth did not seem to be breaking out of its recent 2.5-3.0 percent range and heading towards the 3 percent growth rate that the BoE predicts for the end of the year.
Britain had seen numerous “false dawns” for pay growth in the past, and there could be more spare capacity in the labour market than the central bank thought, he added.
“Low unemployment is yet to generate serious wage pressures and Brexit uncertainties continue to reign,” said Ian Stewart, chief economist at accountants Deloitte. “The case for raising interest rates in August may have strengthened, but is hardly compelling.”
(qlmbusinessnews.com via bbc.co.uk – – Fri, 13th July 2018) London, Uk – –
Donald Trump has said the UK will “probably not” get a trade deal with the US, if the prime minister's Brexit plan goes ahead.
He told The Sun the PM's plan would “probably kill the deal” as it would mean the US “would be dealing with the European Union” instead of with the UK.
Downing Street has not yet reacted to Mr Trump's remarks.
Theresa May has been making the case for a US free trade deal with Mr Trump, on his first UK visit as president.
She said Brexit was an “opportunity” to create growth in the UK and US.
Mr Trump also said that former Foreign Secretary Boris Johnson – who disagrees with the PM on Brexit and resigned this week – would make a “great prime minister”, adding “I think he's got what it takes”.
In his interview, he renewed his criticism of London Mayor Sadiq Khan over last year's terror attacks in the capital, saying he had done “a terrible job”.
The president and his wife were given a red carpet reception at Blenheim Palace, Oxfordshire on Thursday evening.
They were at a black-tie dinner with Mrs May as news broke of his interview with the newspaper, which said it was conducted while he was in Brussels.
After it was published, White House spokeswoman Sarah Sanders said the president “likes and respects Prime Minister May very much”, adding that he had “never said anything bad about her”.
Mr Trump – who has been a long-time supporter of Brexit – told The Sun newspaper that the UK's blueprint for its post-Brexit relations with the EU was “a much different deal than the people voted on”.
He said the Brexit proposals Mrs May and her cabinet thrashed out at the PM's country house Chequers last week “would probably end a major trade relationship with the United States.”
“We have enough difficulty with the European Union,” he said, saying the US was “cracking down” on the EU because “they have not treated the United States fairly on trading”.
‘I told May how to do it'
He also said he had told Mrs May how to do a Brexit deal, but: “She didn't agree, she didn't listen to me.”
“I told her how to do it. That will be up to her to say. She wanted to go a different route,” he said.
Tom Newton Dunn, the Sun journalist who interviewed Mr Trump, said the US president seemed “sensitive” and knew about the “Trump baby” inflatable.
“He's really quite stung by the criticism he's been getting,” said Mr Newton Dunn. “He knew all about the baby blimp. I think it hurt him.”
The BBC's political editor, Laura Kuenssberg, said Mr Trump's interview had “driven a bulldozer” through Mrs May's claim that the UK would be able to get decent trade deals with the wider world, while sticking to the EU rules.
Foreign Office minister Sir Alan Duncan said things had “moved on” since Mr Trump's interview – which was carried out before he arrived in the UK – and it was “very early days for the detailed negotiations of any trade deal”.
He said the mood at Thursday night's Blenheim Palace dinner was “fantastically positive and it did indeed focus a lot on trade”.
The government does not see Mr Trump's behaviour as “rude”, Sir Alan said, adding: “Donald Trump is a controversialist. That's his style.”
Responding to Mr Trump's criticism of his response to terrorism, Mayor of London Sadiq Khan said it was “interesting” that the US president “is not criticising the mayors of other cities” which have also experienced terror attacks.
He defended his decision to allow the giant Trump baby inflatable to fly over London, saying: “The idea that we limit the right to protest because it might cause offence to a foreign leader is a slippery slope”.
Shadow Foreign Secretary Emily Thornberry said the PM had done “everything she could to be nice to him and he has slagged her off in the press”.
“This is not the way to behave and then what does she do, she holds his hand again,” she said, adding: “She should be standing up to him.”
Mr Trump's comments came on the same day the UK government published its proposal for its long-term relationship with the EU.
The plan is aimed at ensuring trade co-operation, with no hard border for Northern Ireland, and global trade deals for the UK.
But leading Brexiteers Boris Johnson and David Davis resigned from the cabinet days after ministers reached agreement on the plan at Chequers a week ago. Mrs May said the plan “absolutely delivers on the Brexit we voted for”.
At Thursday's dinner, Mrs May said that more than one million Americans work for UK-owned firms, telling Mr Trump there was an unprecedented opportunity for a trade deal which creates jobs and growth in the UK and US.
As Mr Trump arrived in the UK, protesters gathered outside the US ambassador's residence in Regent's Park, London, and an estimated 1,000 of them demonstrated near Blenheim Palace itself, the birthplace of wartime Prime Minister Winston Churchill.
On Friday, Mrs May and Mr Trump are due to watch a joint counter-terrorism exercise by British and US special forces at a military base.
The pair will then travel to Chequers – the PM's country residence in Buckinghamshire – for talks with Foreign Secretary Jeremy Hunt.
Extra security is in place to police protests planned for the second day of Mr Trump's visit.
The president and first lady will travel to Windsor on Friday afternoon to meet the Queen, before flying to Scotland to spend the weekend at Mr Trump's Turnberry golf resort. This part of the visit is being considered private.
(qlmbusinessnews.com via uk.reuters.com — Tue, 10th July 2018) London, UK —
LONDON (Reuters) – Britain’ economy picked up a bit of speed in May after slowing in early 2018, according to official figures that are likely to give the Bank of England more confidence about raising interest rates next month.
A new monthly reading of gross domestic product showed the world’s fifth-biggest economy grew by 0.3 percent in May from April.
That was up from growth of 0.2 percent in April and in line with the forecast in a Reuters poll of economists, marking the strongest growth since November, the Office for National Statistics said on Tuesday.
Sterling fell against the dollar after the data, which showed a mixed picture of the economy. Growth came mostly from the dominant services sector while factory output disappointed.
But Cathal Kennedy, an economist at RBC Capital Markets, said the figures should support expectations that the BoE would raise rates in August.
“The gradual momentum into May really backs up what the Bank has been saying of late. We have seen a bounceback from the first quarter,” he said.
BoE Governor Mark Carney and other top officials at the central bank opted not to raise rates in May because of the early 2018 slowdown.
Instead, they decided to wait for signs the weakness was temporary and caused by unusually cold winter weather rather than a sign of broader problems before Britain’s exit from the European Union next year.
However, upheaval in the government of Prime Minister Theresa May — battling to keep her grip on the ruling Conservative Party, which is split over Brexit — could yet affect confidence among employers, a potential new hurdle for the BoE.
Britain’ economy grew by 0.2 percent in the three months to May, as expected, after stagnating in the three months to April.
In annual terms, the economy was 1.5 percent bigger than in May last year, the ONS said.
The BoE’ rate-setting committee is expected to raise rates by 25 basis points to 0.75 percent — only its second rate increase in more than a decade — on Aug. 2, according to a Reuters poll of economists.
The ONS said the warm weather and spending around the royal wedding of Prince Harry and Meghan Markle helped the economy.
Britain’s services industry grew 0.3 percent month-on-month in May, slowing from an upwardly revised 0.4 percent in April.
Over the three months to May, growth in services — which makes up 80 percent of economic output — picked up speed to 0.4 percent from 0.2 percent.
But industrial output fell unexpectedly in May by 0.4 percent on the month, hit by the shutdown of the Sullom Voe oil and gas terminal.
Manufacturing growth also disappointed, rising only 0.4 percent on the month — less than half the growth rate expected in the Reuters poll.
May capped the weakest three months for British factories since December 2012.
There was better news from construction, which had struggled in the bad weather of early 2018. Output jumped 2.9 percent in May, far exceeding expectations and marking the first growth in the sector since December.
Separate data showed Britain’s deficit in goods trade during May was broadly unchanged from April at 12.362 billion pounds ($16.37 billion).
By Andy Bruce, William Schomberg
Editing by Larry King
(qlmbusinessnews.com via uk.reuters.com — Fri, 6th July 2018) London, UK —
BEIJING/WASHINGTON (Reuters) – The United States and China slapped tit-for-tat duties on $34 billion worth of the other’s imports on Friday, with Beijing accusing Washington of triggering the “largest-scale trade war” ever in a sharp escalation of their months-long conflict.
Hours before Washington’s deadline for the tariffs to take effect, U.S. President Donald Trump upped the ante, warning that the United States may ultimately target over $500 billion worth of Chinese goods, or roughly the total amount of U.S. imports from China last year.
China’s commerce ministry, in a statement shortly after the U.S. deadline passed at 0401 GMT on Friday, said that it was forced to retaliate, meaning $34 billion worth of imported U.S. goods including autos and agricultural products also faced 25 percent tariffs.
However, an ensuing three-plus hour delay before Beijing confirmed that it had implemented retaliatory tariffs sowed confusion in markets.
“After the United States unfairly raised tariffs against China, China immediately put into effect raised tariffs on some U.S. goods,” foreign ministry spokesman Lu Kang told a daily media briefing on Friday afternoon.
China’s soymeal futures fell more than 2 percent on Friday afternoon before recovering most of those losses, amid market uncertainty over whether China had implemented tariffs on a list of U.S. goods, including soybeans.
Some Chinese ports had delayed clearing goods from the United States, four sources said on Friday. There did not appear to be any direct instructions to hold up cargoes, but some customs departments were waiting for official guidance on imposing added tariffs, the sources said.
Ford Motor Co said on Thursday that for now, it will not hike prices of imported Ford and higher-margin luxury Lincoln models in China.
An analysis of over four dozen imported U.S products facing higher duties showed that prices were little changed on Friday afternoon versus earlier in the week. The products, all sold on Chinese e-commerce platforms, ranged from pet food to mixed nuts and whiskey.
While Chinese state media have slammed Trump’s protectionism and on Friday likened his administration to a “gang of hoodlums,” the trade conflict has gained little traction on China’s tightly controlled social media, not cracking the 50 top-searched topics on the Twitter-like Weibo platform.
The dispute has roiled financial markets including stocks, currencies and the global trade of commodities from soybeans to coal in recent weeks.
Chinese shares, which have been battered in the run-up to the tariff deadline, reversed earlier losses to close higher, but the yuan remained weaker against the dollar. Asian equities wobbled but also managed to end up.
In the run-up to Friday’s tariff implementation, there was no sign of renewed negotiations between U.S. and Chinese officials, business sources in Washington and Beijing said.
“We can probably say that the trade war has officially started,” said Chen Feixiang, professor of applied economics at Shanghai Jiaotong University’s Antai Colege of Economics and Management.
“If this ends at $34 billion, it will have a marginal effect on both economies, but if it escalates to $500 billion like Trump said then it’s going to have a big impact for both countries,” Chen said.
‘GANG OF HOODLUMS’
China’s commerce ministry called the U.S. actions “a violation of world trade rules” and said that it had “initiated the largest-scale trade war in economic history.”
Trump has railed against Beijing for intellectual property theft and barriers to entry for U.S. businesses and a $375 billion U.S. trade deficit with China.
“You have another 16 (billion dollars) in two weeks, and then, as you know, we have $200 billion in abeyance and then after the $200 billion, we have $300 billion in abeyance. Ok? So we have 50 plus 200 plus almost 300,” Trump told reporters aboard Air Force One on Thursday.
Throughout the escalating conflict, China has sought to take the high road, positioning itself as a champion of free trade, but state media ramped-up criticism of Trump on Friday.
“In effect, the Trump administration is behaving like a gang of hoodlums with its shakedown of other countries, particularly China,” the state-run China Daily newspaper said in an English language editorial on Friday.
“Its unruliness looks set to have a profoundly damaging impact on the global economic landscape in the coming decades, unless countries stand together to oppose it.”
While the initial volley of tariffs was not expected to have major immediate economic impact, the fear is that a prolonged battle would disrupt makers and importers of affected goods in a blow to global trade, investment and growth.
“For companies with supply exposure to tariffs, they will move sourcing country of origin if they can; if they can’t, they’ll pass on as much of the tariff cost as they can, or see a cut in margins,” said Jacob Parker, vice president of China operations at the U.S.-China Business Council in Beijing.
A China central bank adviser said the planned U.S. import tariffs on $50 billion worth of Chinese goods – $34 billion plus a planned follow-on list worth $16 billion – will cut China’s economic growth by 0.2 percentage points, although the overall impact would be limited, the official Xinhua news agency reported Friday.
“This is not economic Armageddon. We will not have to hunt our food with pointy sticks. But it is applying the brakes to a global economy that has less durable momentum than appears to be the case,” Rob Carnell, chief economist at ING, said in a note.
U.S. Customs and Border Protection officials were due to collect 25 percent duties on a range of products including motor vehicles, computer disk drives, parts of pumps, valves and printers and many other industrial components.
China’s tariffs on hundreds of U.S. goods include top exports such as soybeans, sorghum and cotton, threatening U.S. farmers in states that backed Trump in the 2016 U.S. election, such as Texas and Iowa.
By Adam Jourdan in SHANGHAI, Michael Martina, Christian Shepherd, Dominique Patton and Elias Glenn in BEIJING, David Lawder and Jeff Mason WASHINGTON; Writing by Tony Munroe;
(qlmbusinessnews.com via news.sky.com– Thur, 5th July 2018) London, Uk – –
Ahead of a critical cabinet meeting, the country's biggest carmaker joins BMW and Airbus in a warning to government over Brexit.
UK plants and at least 40,000 jobs are at risk if the country leaves the European Union without a free trade deal, Britain's biggest carmaker has warned.
Jaguar Land Rover (JLR) has told the government that, while its “heart and soul” are in the UK, a bad Brexit could force a re-think, with a “no-deal” scenario forcing it out of the UK because of an expected £1.2bn surge in tariff costs.
JLR exports 80% of its cars worth £18bn annually.
Dr Ralf Speth, chief executive of JLR, said: “We, and our partners in the supply chain, face an unpredictable future if the Brexit negotiations do not maintain free and frictionless trade with the EU and unrestricted access to the single market.
“We urgently need greater certainty to continue to invest heavily in the UK and safeguard our suppliers, customers and 40,000 British-based employees.”
There are also a further 260,000 jobs connected to the company's supply chain.
Dr Speth added: “A bad Brexit deal would cost Jaguar Land Rover more than £1.2bn profit each year.
“As a result, we would have to drastically adjust our spending profile.
“We have spent around £50bn in the UK in the past five years, with plans for a further £80bn more in the next five.
“This would be in jeopardy should we be faced with the wrong outcome.”
He was more specific on a potential exit from the UK in comments to the Financial Times when he said: “If I'm forced to go out because we don't have the right deal, then we have to close plants here in the UK and it will be very, very sad.
“This is hypothetical, and I hope it's an option we never have to go for.”
His words follow similar warnings from BMW and Airbus.
Airbus said in June that it was making plans to leave the UK in the event of a no-deal Brexit, which could lead to the loss of tens of thousands of jobs.
BMW also weighed in – its customs manager Stephan Freismuth warning the company “cannot” manufacture its products in the UK if Brexit means its supply chain is disrupted.
The intervention by big business in the Brexit debate has strained relations with the government ahead of Theresa May's meeting of cabinet ministers at Chequers on Friday to decide a strategy for exiting the EU.
Health Secretary Jeremy Hunt has described, what he sees as, threats from firms as “completely inappropriate” while Boris Johnson, a leading Brexiteer on the top table of government, has not denied saying “f*** business”.
In his response to JLR's latest warning, the business secretary Greg Clark tweeted: “JLR is a great British success story. We are determined to make sure that it can continue to prosper and to invest in Britain.”
The PM has also insisted firms are being listened to.
The British Retail Consortium became the latest to warn of the consequences of any cliff-edge Brexit in March 2019 by warning that consumers in the UK and EU food producers would lose out if there was no deal to allow the free movement of goods.
Its chairman, Richard Pennycook, said: “Frictionless trade is essential if the industry is to continue to provide the level of choice and value in shops that UK consumers are used to seeing.
“It is now of the utmost importance that the UK Government proposes a workable solution to the backstop that gets the withdrawal agreement over the line and allows for a smooth transition.
“We need the EU to be flexible and creative in negotiation and recognise what is at stake for exports to the UK.”