Category Archives: Business

Move over JR Ewing: oil discovered near Gatwick airport

Discovery of an estimated 20m barrels of oil near Surrey raises hopes that town could become UKs answer to Southfork RanchA town close to Gatwick airport has come a step closer to becoming Britains version of Dallas after test results showed an explora…
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US-led air strikes on Syria have killed more than 500 Isis and al-Nusra fighters

More than thirty civilians along with over 500 militants killed in strikes over past month, says Syrian ObservatoryUS-led air strikes on Syria have killed more than 500 people, mainly Islamist militants, since they began last month, activists said as f…
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Bank of England committee voted 7-2 to keep interest rates steady

Premature tightening in monetary policy could leave the UK vulnerable to shocks, say majority of MPC members in OctoberBank of England policymakers remained split over whether to raise interest rates immediately, with two members of the nine-strong mon…
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Weak wage growth blamed as UK public finances worsen — business live

Rolling business and financial news, as Britain borrows more than a year ago despite the recovery

10.53am BST

The TaxPayers Alliance argues that the solution is to cut more aggressively:

CEO Jonathan Isaby argues:

At a time when the deficit should be shrinking rapidly because of healthy economic growth, its very alarming to see it growing. Unless the Government gets a proper grip on spending, borrowing will continue to go up and the next generation will have to deal with the consequences.

Families across the country make budgets to ensure they dont spend more than they bring in, and the Government should be no different.

10.48am BST

The Telegraphs Jeremy Warner also blames low wage growth for Britains deficit reduction pains:

Thanks to low wage growth, deficit reduction is proceeding at glacial pace. Gov borrowing again up last month

10.24am BST

Economist Rob Wood of Berenberg Bank agrees that weak wage growth is hampering the governments debt reduction efforts, pushing the deficit higher this year.

He writes:

It is still early days and the figures could be significantly revised. But the trends seem clear enough.

The economic recovery is creating plenty of jobs which should help keep a lid on benefit spending, but still weak wage growth along with the Chancellors decision to increase the amount people can earn tax free has hurt income tax receipts and means borrowing stubbornly refuses to decline.

Some of that income tax weakness is a distortion related to shifting timing of bonus payments in 2013, but there is more to it than just a distortion.

10.21am BST

The rising deficit means George Osborne may have little opportunity to woo voters with pre-election goodies.

Howard Archer of IHS Global Insight says:

Mr. Osborne faces an awkward fiscal backdrop as he announces his autumn statement in December as the May 2015 general election draws every nearer. This gives him little scope to announce any major sweeteners.

Capital economics: “continued run of poor UK public borrowing figures looks set to severely hamper the CHXs ability to announce giveaways”

Fiscal policy and the public finances will be a key battleground for the political parties. Any tax promises and spending initiatives by the political parties in the run-up to the general election will need to be closely examined.

10.15am BST

And heres the rebuttal from Chris Leslie MP, Labours Shadow Chief Secretary to the Treasury.

He says todays public sector finance figures, showing a 10% rise in borrowing this year, undermine the chancellors credibility.

These figures are a serious blow to George Osborne. Not only is he set to break his promise to balance the books by next year, but borrowing in the first half of this year is now 10 per cent higher than the same period last year. As the OBR said last week, stagnating wages and too many people in low-paid jobs are leading to more borrowing.

We will reverse the £3 billion tax cut for the top one per cent of earners, stop paying the winter fuel allowance to the richest pensioners, raise child benefit by just one per cent for two years and cut ministers pay by five per cent. And we will act to secure a strong and balanced recovery that delivers more good jobs and rising living standards for the many, not just a few at the top.

10.06am BST

The Treasury claims that the recovery is on track, despite todays disappointing borrowing figures showing the deficit is rising.

The governments long term economic plan is working: delivering the fastest growing economy in the G7, putting more people into work than ever before, and reducing the deficit by more than a third.

We have seen stronger growth in receipts this month, but as todays figures show, the impact of the great recession is still being felt in our economy and the public finances. At the same time, we have to recognise that the UK is not immune to the problems being experienced in Europe and other parts of the world economy.

9.59am BST

It looks increasingly unlikely that George Osborne will achieve his target of cutting the deficit this year, compared with 2013-14.

Todays figures show that Britain has already borrowed £5.4bn more than a year ago.

Unless the exchequer gets a huge self assessment bumper in January it looks like borrowing will be up this financial year on last.

9.57am BST

£58.0bn public sector net borrowing excl. public sector banks Apr-Sept 2014, up £5.4bn on same period 2013

9.56am BST

Why is Britain borrowing more than a year ago, even though the economy has been growing pretty strongly over the last year?

The answer is weak wage growth, which means that income tac receipts are barely higher in April-September 2014 compared with 2013.

Growth better than OBR expected, hours worked higher & unemployment lower but borrowing overshooting. One big reason: weak wage growth.

The UK is learning the same lesson as much of the Eurozone – when inflation & wage growth are v low, it’s hard to bring a govt deficit down.

9.44am BST

Britains public sector finances have worsened, according to the latest figures.

The Office for National Statistics reports that the UK borrowed £11.8bn in September, which is 15% or £1.6bn more than a year ago.

Another pretty awfulUK psnb fig at £11.1b.

Ouch! Not again! UK PSNB ex was £11.8 billion in September 2014, an increase of £1.6 billion compared with September 2013. #GBP

9.32am BST

Back to the Chinese slowdown…and economists are arguing that todays data could have been worse.

Duncan Innes-Kerr, China analyst at the Economist Intelligence Unit, says

Perhaps the most pertinent observation on the China GDP data is this, the pessimists will point to this being the slowest pace of China GDP growth in five years, and then wax lyrical about Chinas structural problems above all in terms of its bad credit/loans problems (which are very real), but the fact remains that Chinas economy is now ca. 50% larger than it was five years ago.

Thus to expect it to sustain an annual GDP pace of 7.5-8.0% is in fact to show a complete misunderstanding of statistics, and if growth were to accelerate rather than decelerate further as it should given this base effect, is in effect to demand that the Chinese economy to overheat, and by extension to ensure that its bad loans/credit problems get worse.

9.16am BST

webuyanycar owner #BCA has scrapped its £1.2bn #IPO due to “volatility in global markets” -> the latest #float flop casualty

But they wont sell any shares

9.11am BST

Market volatility strikes again!

BCA Marketplace, the UK used car seller (formerly called British Car Auctions), has just called off its stock market flotation, which would have valued it at £1.2bn.

Given the volatility in global equity markets, the Board and Shareholders of BCA Marketplace (BCA) have chosen not to proceed with its initial public offering at this time.

The Board and Shareholders were very encouraged by the broad engagement and interest in BCA shown by investors and remain excited about supporting the next phase of the Groups growth.

9.01am BST

Profits at fashion website Asos slump 14% to £47m. Founder Nick Robertson says: “It’s been a challenging year, whichever way you skin it”.

8.55am BST

Shares in ASOS, the UK web fashion retailer, have jumped 15% this morning after it reported a 27% surge in sales over the last year.

Pre-tax profits fell by 14%, to £46.9m, due to the strength of the pound and a fire at its main warehouse last summer.

Despite all that happened this year, we still delivered 27% growth in sales, with the UK a standout performance at 35% growth.

8.45am BST

Consumer goods giant Reckitt Benckiser is leading the FTSE 100 fallers, down 2.1%.

Reckitt, whose products include Dettol, Nurofen painkillers and Veet hair-removal creams, said annual sales growth will be at the lower end of expectations.

Weak markets across South East Asia and Latin America contributed to weak growth in the LAPAC [Latin America and Asia Pacific area] areas.

8.35am BST

European stock markets have opened in the red, as the slowdown in Chinese growth weighs on investors.

The French CAC dipped by 0.6%, with Total dropping 1.5% following the death of CEO Christophe de Margerie at Moscows Vnukovo international airport.

8.20am BST

Russian president Vladimir Putin has expressed his condolences over Total CEOs Christophe de Margerie death in Moscow.

TASS cited his spokesman as saying that Vladimir Putin has long known de Margerie and had a close working relationship with him.

The president highly appreciated de Mergeries business skills, his continued commitment to the development of not only bilateral Russian-French relations but also on multifaceted levels, Peskov also said.

8.14am BST

Alexei Kudrin, Russias former finance minister and a noted economic liberal, tweets that Christophe de Margerie had done a lot to bring investment to Russia.

He describes the Total chiefs death as a heavy tragedy:


8.09am BST

Frances prime minister has led the tributes to Christophe de Margerie, following the Total CEOs death at Moscows Vnukovo international airport over night.

PM Manuel Valls said France had lost an extraordinary business leader who turned Total into a world giant..

Touché par la mort de C. de Margerie: un grand capitaine d’industrie, un patriote, un homme de conviction et d’amitié. Tristesse et respect

Russian probe finds snowplow driver in total CEO crash was drunk – from Russian investigators

Total confirms the death of Chairman and CEO Christophe de Margerie

7.50am BST

The Chinese slowdown is likely to weigh on European stock markets this morning. The main indices are being called down a few points:

Updated Opening Calls – #FTSE 100 expected to open -8 #DAX to open flat #CAC40 to open -12

7.45am BST

7.41am BST

Economists are warning that Chinas economy remains a concern after economic growth slowed to a five-year low in the last quarter.

GDP rose by 7.3% , year-on-year, in the July-September quarter, according to data released overnight. Thats slightly better than the 7.2% which was forecast, but otherwise there is little to cheer.

Chinese growth beats expectations but still at a five year low.

Powerful headwinds from the property market correction and severe overcapacity in many upstream industries, coupled with the reduced potency of policy easing amid an overleveraged economy, means the policy response seems to have only succeeded in stabilising growth rather than driving a strong rebound.

As long as growth holds up, though, theyre not going to panic.

Every 1% drop in China growth = 0.2% off annual US growth = effect of a $20/barrel rise in oil prices – Moody’s Analytics chief econ #ausbiz

7.24am BST

Good morning, and welcome to our rolling coverage of the financial markets, the world economy business, and the eurozone.

Four items on the agenda today.

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Posted in Business, China, Economics, Euro, Eurozone crisis, Financial sector, Public finance, World news | Comments Off

Total oil CEO Christophe de Margerie killed in Moscow plane crash

Head of oil giant and three crew died when private jet hit snowplough during takeoff, say Russian sources Continue reading…
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Bank of England payment system crashes leaving homebuyers in limbo

Bank apologises for failure of system used for large transfers as governor Mark Carney orders urgent investigationThe Bank of England apologised last night after a crucial payments system collapsed, forcing Mark Carney to launch an urgent investigation…
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Didcot B power station blaze investigation begins

Arson and terrorism ruled out as causes of fire which ripped through cooling tower at plant in OxfordshireFire investigation officers are due to travel to the site of a gas-fuelled power station following a major blaze.More than 25 fire appliances atte…
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What would you cut? Durham council asks residents to find £100m savings

Local authority consults public amid expectations that it will have to cut £90m more after already pruning a third of £400m budget since 2010

Durham county council has devised a fun game for residents to play at public consultations. Designed to mimic the Monopoly board, the game is about cutting rather than spending money, and encourages players to find £100m-worth of savings to council services out of the budget of £400m.

Players who select the arts, museums and theatres box save the council £3m. Players who land on residential and nursing care for adults wipe a satisfying £58m from the budget. Land on the street cleaning box save £6m. Abandon housing advice and homelessness support cut £19m.

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As cracks in its economy widen, is Germanys miracle about to fade?

As the markets tumbled last week, Germany, hailed only months ago for its resilience in the European crisis, came under fresh scrutiny. What lies ahead for the European powerhouse? Continue reading…
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Living ethically isnt cheap, Vivienne

When it comes to food and fashion, most of us could buy better. But for many, caring costs too muchVivienne Westwood, whose designs I love but which far exceed most peoples price range, including mine, announced this week that she feels clothes cost to…
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Posted in austerity, Business, Economics, Environment, Ethical and green living, Fashion, Fashion industry, Food, Food & drink industry, Life and style, UK news, Vivienne Westwood, World news | Comments Off