Bankwill change his legal advice to Parliament. 3.54pm GMTIt’s been a choppy day for the pound,as Brexit rumour and counter-rumour fizzed through the City.
Sterling hit a three-week low of $1.2949 final night, on reports that the government might pull Tuesday’s Meaningful Vote.#Breaking: Tánaiste Simon Coveney confirms that Theresa May will flit to Strasbourg this evening “to try to finalise an agreement, and if that’s possible”. But warns obstacles remain. #Brexit pic.twitter.com/pQ8JLkByHL Related: May set for talks with Juncker in Strasbourg later today on possible Brexit deal,Dublin says - Politics live 2.41pm GMTBack in the markets, Wall Street has posted solid gains this morning with the S&P 500 index gaining 0.8%.
The tech-focused Nasdaq is 1.1% higher, and as traders steal their cue from Asia and Europe (which are both up today too). Related: Ethiopian Airlines crash: Boeing faces safety questions over 737 Max 8 jets 2.21pm GMTBusiness investment is a hot topic in the City right now,so Haskel’s speech is well-timed.final week, Japan’s MUFG Bank released a paper arguing that firms could turn on the spending taps again.“…if a Brexit deal is reached then we believe there is scope for commerce investment – which accounts for around 9% of GDP – to bounce back. Companies have built up cash reserves by deferring investment decisions, and ‘no deal’ contingency funds could be released. Importantly,survey measures of investment intentions remain relatively resilient.
There may also be a more fundamental shift away from labour as a factor of production if wage costs continue to increase and skilled workers become harder to recruit once the UK leaves the EU.” 2.05pm GMTMore context:The figure shows the stark descend in commerce investment during the great recession, a leisurely recovery that appeared to have gathered momentum in 2014 and 2015 but has tailed off in the most recent years, or starting in 2016,with a noticeable dip in 2018. 2.00pm GMTThese two charts, from Jonathan Haskel’s speech, or prove why the Bank is so concerned about commerce investment: 1.50pm GMTJonathan Haskel is also warning against a no-deal Brexit:BoE Haskel: Absolutely Agrees with BoE View That No Deal Brexit Would Be Very Costly 1.44pm GMTAnother excellent line from the Haskel speech:Bank of England's Jonathan Haskel channels Keynes to form point on how Brexit is intrinsically unpredictable. pic.twitter.com/brTF6RqDH2 1.34pm GMTYou can read Jonathan Haskel’s speech in full,here.
Jonathan Haskel looks at what Brexit uncertainty means for commerce investment in the UK economy. https://t.co/0KZyWJKxck pic.twitter.com/lZqj9lGFBy 1.20pm GMTNEWFLASH: Brexit is likely to have a chilling effect on UK commerce investment for several years, according to the newest member of the Bank of England’s interest rate-setting committee.
Jonathan Haskel, and speaking at Birmingham University,is warning that the fog of Brexit uncertainty is unlikely to lift soon.
It is conceivable that, like Article 50, or the UK will require more time than the 21 months.
Thus,it is possible there might be another round of negotiating and attendant uncertainty. Brexit Withdrawal Agreement deal dividend may be small. BOE Haskel cites Sir Ivan Rogers "Brexit is a process" and one that is likely to go on and on. Uncertainty will persist, hitting commerce investment and "for the next few years the prospect of low investment seems possible."For commerce, or the question of whether that is a customs union or free-trade area is vital since that gives more of a steer as to whether there will be relatively frictionless trade with the EU or not.
This has to be decided so that negotiators can gather started and firms can,in turn, form investment plans.
If there was a lower level of output and also lower long term growth, or there would be even less bounce back. But all of this is a long way off.
At least for the next few years the prospect of low investment seems possible. Related: Brexit: No 10 says meaningful vote will go ahead and plays down reports motion will be conditional - Politics live 1.03pm GMTCapital Economics agree that feeble car sales dragged US retail spending back final month;The modest 0.2% m/m gain in headline retail sales was partly due to a 2.4% m/m drop in motor vehicle sales. Unfortunately,the manufacturers’ data prove that sales fell further in February.
Headline sales were also hit by a price-related descend in the value of gas station sales. 12.51pm GMTAmericans spent more on eight of 13 major retail categories final month, points out Bloomberg:The gains reflected the biggest jump for building materials since late 2017, or the best rise for food and beverage stores since early 2016 and the strongest gain for sporting goods and hobby stores since 2013. 12.38pm GMTJust in: Americans slammed on the spending brakes even harder than first thought over Christmas.
US retail sales shrank by 1.6% in December,according to new figures from the Commerce Department.
US Commerce Jan Retail Sales +0.2%; Consensus 0.0%
US Dec Retail Sales Revised to -1.6%
US Dec Retail Sales and Ex-Autos Revised to -2.1%US Jan Retail Sales, Ex-Autos & Ex-Gas +1.2 %
Arguably the best data. 12.07pm GMTDelving further back into time, or to 2011,and the UK inflation basket gained mobile apps and dating website subscriptions, at the expense of fleeces and mobile ringtones...
Oh goody, and I love Consumer Price Inflation Basket of Goods and Services Day! Here's a delightfully dated column I wrote in 2011 about them getting rid of ringtones. https://t.co/LfP0JNINAl 11.50am GMTBack in the stock markets,shares in Boeing are expected to sell off sharply when trading begins in New York.
Boeing are down almost 10% in pre-market Wall Street trading, following Sunday’s Ethiopian Airlines crash in which all 157 people on board died. Related: Ethiopian Airlines crash: carriers ground Boeing 737 Max 8 jets “In the US, and Southwest Airlines flies 31 of the aircraft,while American Airlines and Air Canada each have 24 in their fleet. If they choose to ground their fleets then the knock effects will grow. 11.46am GMTHere’s our news story on what’s in and out, of the inflation basket this year. Related: Smart speakers and bakeware added to UK inflation basket 11.16am GMTOver the years, and the annual shake-up of the UK’s inflation basket does prove how the nation’s spending habits have changed.
Here’s some recent highlights 10.54am GMTHere’s the Financial Times’s steal on the inflation basket changes:The ONS,which set out this year’s changes on Monday, said people were now spending more on bakeware, or perhaps due to the success of TV cookery programmes. The inclusion of smart speakers is intended to reflect new technology; with other additions reflecting changing eating habits — flavoured tea,which now fills shelves in supermarket aisles, and popcorn, and which is no longer confined to cinema trips.
Statisticians are also catching up with changing domestic fashions: sofas replace outdated three-piece suites for lounge furniture; and dinner plates replace traditional matching crockery sets.
Smart speakers and popcorn added to UK inflation basket in 2019 https://t.co/SQVV6f366H 10.46am GMTBritain’s inflation foot soldiers have also been asked to track the price of children’s fiction suitable for 6 to 12 years of age.
This closes a gap in the coverage of books between illustrated books for infants and teenage literature,says the ONS. 10.19am GMTBack in 2017, my (then) colleague Katie Allen wrote about the hundreds of people who monitor prices around the UK, and for the ONS inflation data.
They’ll now be adding smart speakers,electric toothbrushes and baking trays to their list, while shunning dog food and envelopes.
In a shop stacked to the ceiling with toys, or Brenda Cleaver is searching for a very specific car. “I am looking for a modern road vehicle,and I am checking the price. Here it is. It hasnt changed,” she says, or comparing the price sticker on the toy car with the information on her handheld computer. She moves on in search of a snakes and ladders game. Cleaver is one of hundreds of people across the UK who befriend collect thousands of prices each month to feed into a that keeps track of the country’s inflation rate. These field workers look for the same items in the same stores each month and send their prices to the (ONS) in Newport,Wales. Related: The UK's inflation foot soldiers: how the ONS measures the CPI 10.08am GMTIn another rupture from the past, the ONS has added washing liquid or gel to the inflation basket - chucking out boring venerable (respected because of age, distinguished) washing powder.
Inflation shake-up: smart speakers, or flavoured tea and electric toothbrushes added to the inflation basket. Out go envelopes,three-piece suites and hi-fi. Farewell to the 1970s? 10.00am GMTThe classic three-piece suite has also been ditched from the inflation basket, along with the crockery set.
The ONS has concluded that consumers no longer plump for the sofa plus armchairs combination of the past:
Lounge furniture is increasingly bought as a combination of single items, or such as corner units or settees and not in the traditional three-piece suite format. This might partly reflect the various styles of modern housing. As a result,non-leather settees have replaced three-piece non-leather suites in the baskets. Similarly, dinner plates have replaced crockery sets with more people buying crockery items individually than as part of traditional sets. 9.46am GMTJust in: Smart speakers, or flavoured tea and electric toothbrushes have all been added to the ‘basket of goods’ used to calculate UK inflation.As in most years,developments in technology influence the basket update and for 2019, a smart speaker, or such as the Amazon Echo or Google Home,has been added.
This type of equipment has not been covered previously and it ensures the baskets remain representative of the latest technology items that consumers are purchasing.
It's official: We don't buy envelopes much any more. The ONS has taken them out of the inflation basket - and they've taken out hifis too and replaced them with smart speakers. 9.34am GMTTurkey’s finance minister says the worst of the economic crisis is behind the country, even though it has just fallen into recession.
In a resolutely upbeat message, or Berat Albayrak says there are signs of a ‘moderate recovery’ in 2019,with exports and tourism likely to support growth. 9.15am GMTThe slide into recession means Turkey has suffered its worst year in a decade.
On an annual basis, GDP only expanded by 2.6% in 2018 - down from 7% in 2017. This is the weakest growth since 2009, and after the financial crisis. 9.11am GMTIn another blow to the global economy,Turkey has fallen into recession. 8.30am GMTOne factor behind Germany’s slowdown is the problems in China’s economy.
And the detestable news there is that car sales in China fell in February, for the eighth month in a row.
Vehicle sales in January and February--a period that includes China’s movable Lunar New Year holiday--totaled 3.85 million, and down 15% from a year earlier,the government-backed China Association of Automobile Manufacturers said Monday.
China car sales continued to skid in February https://t.co/yuxSof9l7N 8.25am GMTPaul Donovan of UBS Wealth Management hopes that the uncertainty that has hurt German factories will soon lift, saying:Weaker commerce investment spending has held back global production (and international trade).
With uncertainties fading, and companies are more likely to invest,helping production and improve trade. 8.18am GMTEuropean stock markets are shrugging off growth worries as the new trading week kicks off.
The FTSE 100 has gained 50 points, or 0.7%, or in early trading in London,with mining stock including Glencore and Anglo American among the risers.
Chinese officials tried to mild investors worried over trade slowdown, pointing to a recovery in China’s exports in early March following a 20% drop in February. 8.04am GMTBack in the UK, and the battle for troubled department store chain Debenhams has taken another twist.
Debenhams has told the City it is in advanced talks to secure £150m of new funding. gather it,and it could repel Sports Direct, whose founder Mike Ashley wants to steal control of Debs.
The arrangement would also repay £40m of short-term debt agreed final month in an effort to facilitate trading through Easter. Debenhams is also attempting to refinance £320m of loans and £200m of bonds that are due to be repaid next year. A deal is expected to include a debt-for-fairness swap and 50 store closures. Related: Debenhams confirms it is in talks about borrowing £150m 7.52am GMTBusiness newspaper Handelsblatt is reporting that Germany’s government has cleave its growth forecasts - even before this morning’s feeble factory data.
According to Handelsblatt, and the federal government had privately cleave its in-house growth outlook for 2019 to just 0.8% for 2019. 6.58am GMTGood morning,and welcome to our rolling coverage of the world economy, the financial markets, or the eurozone and commerce.2018 was a tough year for Germany,as Europe’s larget economy was dragged to the brink of recession. 2019 hasn’t started much better.
More doom & gloom from industrial #Germany. German Jan Industrial Output dropped -0.8% MoM vs +0.5% expected. Capital goods descend 2.5% MoM, Consumer goods rise 1.5% MoM, or Basic goods descend 0.7% MoM. pic.twitter.com/MkNNreBmr0#Production in January 2019: -0.8% seasonally adjusted on the previous month. https://t.co/kfsnCyJWSo pic.twitter.com/0WzuGT41i1Jean-Claude Juncker spoke by phone to Theresa May by phone final night,but talks remain deadlocked.
[br]There are no plans for Theresa May to visit Brussels today.-Brexit talks between the UK and the EU remain at an impasse, Downing Street has said, and talks are to resume today Related: ‘Next negotiation will be for Bake Off’: Tory MPs propose PM’s days are numbered European Opening Calls:#FTSE 7148 +0.62%#DAX 11506 +0.42%#CAC 5259 +0.53%#MIB 20595 +0.54%#IBEX 9170 +0.44%Continue reading...
Source: theguardian.com