Bank of England’s Mann: markets expect too many interest rate cuts this year

Senior policymaker says UK central bank is unlikely to move before US Federal ReserveBusiness live – latest updatesA senior Bank of England policymaker has warned that financial markets are expecting too many interest rate cuts this year and that the UK central bank is unlikely to move before the US Federal Reserve.Catherine Mann, an external member of the Bank’s rate-setting monetary policy committee (MPC), said there were risks that UK inflation could persist at higher levels than in the US or the eurozone. Continue reading...

The Guardian > Economics Bank of England’s Mann: markets expect too many interest rate cuts this year

UK food price inflation slows to 4.5% but many shoppers still struggling

Waitrose and Ocado win new shoppers while a quarter of households are feeling the squeezeBusiness live – latest updatesGrocery price inflation in Great Britain has slowed to 4.5%, its lowest level since February 2022, but one in four households are still struggling financially, retail researchers have found.However, the figures also suggest a change in sentiment with upmarket retailers Waitrose and Ocado the only grocers to win new shoppers in the past three months, according to the latest monthly figures from the analysts Kantar, as growth in more expensive branded groceries outstripped supermarket own-label. Continue reading...

The Guardian > Economics UK food price inflation slows to 4.5% but many shoppers still struggling

I knew the facts about millennials but I wasn’t ready to admit the life my parents had would never be mine | Miles Herbert

It took working on a podcast about what’s happening to young people for me to let go of the idealism about my future and face the sobering realityWho screwed millennials?: a new podcast seriesThe uncertainty facing my generation was not new to me. I have read articles just like the one I am now trying to write. I have seen the reports. I have watched the TikToks.But the life I am living was by far the biggest clue that my generation is facing a growing economic crisis. Continue reading...

The Guardian > Economics I knew the facts about millennials but I wasn’t ready to admit the life my parents had would never be mine | Miles Herbert

Better moment for UK economy likely to come too late for Rishi Sunak | Richard Partington

Prime minister has ruled out May election but households face high prices for sometime to comeThere had been feverish speculation it would be this week. The drive to Buckingham Palace, police outriders and news helicopters in tow. The lectern on Downing Street. The prime minister announcing a general election.Tuesday is the final day Rishi Sunak could dissolve parliament if he were to send voters to the polls on 2 May, one of the key dates in the 2024 election-watchers’ diaries, when local elections are also taking place. However, after the prime minister ruled out the possibility earlier this month, the waiting game continues. Continue reading...

The Guardian > Economics Better moment for UK economy likely to come too late for Rishi Sunak | Richard Partington

For the birds? Far from it. At last Rachel Reeves has given Britain a plan for economic liftoff | Will Hutton

Despite being called continuity Hunt, the shadow chancellor has set out a proposal for meaningful changeChancellor Jeremy Hunt likes to tell business leaders not to worry about political instability and more policy upset. He claims to be carefully building policy that will survive – win or lose the next election. If the shadow chancellor, Rachel Reeves, succeeds him, accepting nearly all his proposals, be reassured, he says, there will be continuity rather than change. In the run-up to her important Mais lecture last week, the pre-briefings seemed to warrant his judgment.She would reaffirm her iron attachment to fiscal rules and budgetary discipline, we were told. After all, she had beaten..

The Guardian > Economics For the birds? Far from it. At last Rachel Reeves has given Britain a plan for economic liftoff | Will Hutton

A minimum wage alone can’t fix the UK poverty scandal

The 25-year-old pay floor is justly celebrated but doesn’t tackle issues that mean exploitation and misery for manyNext month will mark 25 years since the national minimum wage was first paid in Britain: a quarter of a century during which what was once seen as a radical leftwing policy has won broad cross-party support.Over the past 14 years, the Conservatives have appropriated and expanded the policy, despite adopting a laissez-faire approach to other aspects of labour market regulation. Continue reading...

The Guardian > Economics A minimum wage alone can’t fix the UK poverty scandal

Longest sustained rise in people too sick to work since 1990s, says thinktank

Resolution Foundation points to legacy of Covid as it warns that near-record 2.7m people are too ill to workBritain is going through the longest sustained rise in the number of working-age adults who are too sick to work since the 1990s, according to a report warning that a benefits crackdown is unlikely to solve the country’s jobless crisis.The Resolution Foundation said economic inactivity due to long-term sickness – when people aged 16-64 are neither in work nor looking for a job because of a health condition – had increased in each year since July 2019, the longest sustained rise since 1994 to 1998. Continue reading...

The Guardian > Economics Longest sustained rise in people too sick to work since 1990s, says thinktank

UK interest rate cuts ‘in play’, says Bank of England governor

Comments come after MPC spoke of ‘encouraging signs’ of falling inflation that could lead to cutsBusiness live – latest updatesThe governor of the Bank of England has said interest rate cuts will be “in play” at forthcoming policy meetings amid progress in sharply reducing the UK’s headline rate of inflation over the past year.In a signal that Threadneedle Street is preparing the ground for a cut in borrowing costs within months, Andrew Bailey told the Financial Times: “All our meetings are in play. We take a fresh decision every time.” Continue reading...

The Guardian > Economics UK interest rate cuts ‘in play’, says Bank of England governor

300,000 more UK children fell into absolute poverty at height of cost of living crisis

Nearly fifth of population struggled with basic needs, it emerges, as charities accuse government of failing poorestYou’ve heard stories of poverty in Britain. Now here’s the irrefutable evidence of a society failing its poorestAbout 300,000 more children were plunged into absolute poverty in a single year at the height of the cost of living crisis amid soaring levels of hunger and food bank use, official figures show, prompting calls for an overhaul of the UK’s creaking welfare safety net.Campaigners accused the government of failing to protect the UK’s poorest families as the latest poverty statistics showed 600,000 more people fell into absolute poverty – ministers’ preferred ..

The Guardian > Economics 300,000 more UK children fell into absolute poverty at height of cost of living crisis

Have you passed on a decent job offer because of unaffordable housing?

We’d like to hear from people who decided not to take up a job offer because they could not find affordable housing close enough to the workplaceWe’re interested to hear from people who have recently opted to turn down a job offer they were interested in because they found housing in the area of the workplace too expensive.Whether you turned down a job because of unaffordable sale or rental prices for property within a reasonable distance to the workplace in question, and whether you chose to pass on the job offer or had no other choice, we’d like to hear from you. Continue reading...

The Guardian > Economics Have you passed on a decent job offer because of unaffordable housing?

Bank governor says ‘things moving in the right direction’ amid criticism for leaving rates on hold – as it happened

UK central bank faces criticism for keeping Bank Rate at 5.25% after a shock rate cut in Switzerland and a hike in Turkey todayFull story: Bank of England keeps interest rates on hold at 5.25%The Guardian view: it’s time to start cutting ratesThe Swiss franc has tumbled against the US dollar following Switzerland’s surprise interest rate cut:Here’s more early reaction: Continue reading...

The Guardian > Economics Bank governor says ‘things moving in the right direction’ amid criticism for leaving rates on hold – as it happened

Interest rates held by the Bank of England – but a cut is likely on the way

Rates remain at 5.25%, but inflation heading towards 2% all-but guarantees a welcome cut – and relief for Rishi SunakBusiness live – latest updatesThe Bank of England is inching closer towards the first interest rate cut since the Covid pandemic, but just not yet.After several months of inflation falling more sharply than anticipated by many economists, the question for the Bank has been when, rather than if, it would begin taking action to lower borrowing costs. Continue reading...

The Guardian > Economics Interest rates held by the Bank of England – but a cut is likely on the way

Bank of England leaves interest rates at 5.25% but signals future cuts

Bank’s survey finds expectation of 4.5% base rate by end of 2024 amid ‘encouraging signs’ on inflationBank of England policymakers signalled at least three interest rates cuts this year after seeing “encouraging signs” of falling inflation as they kept interest rates on hold at 5.25% for a fifth time.The financial markets expect three cuts of 0.25 percentage points this year, forecasting the first to take place in June. The Bank said its survey of financial companies found that they expected rates to fall to 4.5% before the end of 2024. Continue reading...

The Guardian > Economics Bank of England leaves interest rates at 5.25% but signals future cuts

Turkish central bank stuns market by hiking interest rates to 50%

Hawkish rise 10 days before local elections is seen as a signal of independence from politicsTurkey’s central bank unexpectedly raised interest rates to 50% on Thursday, citing a deteriorating inflation outlook and pledging to tighten further if it looks like inflation is significantly and persistently worsening.The hawkish move came 10 days before local elections and was seen by analysts as a signal that the central bank was independent from any political constraints and determined to tackle price rises. Continue reading...

The Guardian > Economics Turkish central bank stuns market by hiking interest rates to 50%

UK government borrows more in February than forecast with highest debt since 1960s

Higher than expected figure of £8.4bn in February could derail OBR forecast for £114.1bn deficit for 2023-24Business live – latest updatesJeremy Hunt has been handed disappointing news from the public finances after government borrowing was higher than expected in February, leaving the national debt at the highest levels since the 1960s.The Office for National Statistics said public sector net borrowing was £8.4bn in February, £3.4bn less than in the same month a year ago. However, it was higher than any economist expected in a Reuters poll that predicted a deficit of £6bn. Continue reading...

The Guardian > Economics UK government borrows more in February than forecast with highest debt since 1960s

When will Rishi Sunak’s zombie parliament end? Politics Weekly UK – podcast

Jeremy Hunt has implied the election will be in October, but even with a boost from falling inflation figures, can Rishi Sunak really hold this zombie government together for the next seven months? And what does Rachel Reeves’s Mais lecture tell us about Labour’s economic vision in these grim times? John Harris is joined by former No 10 director of communications Sir Craig Oliver and Guardian columnist Gaby Hinsliff Continue reading...

The Guardian > Economics When will Rishi Sunak’s zombie parliament end? Politics Weekly UK – podcast

Fed leaves interest rates unchanged but signals three cuts this year

Rates to stay at 25-year high of 5.25% to 5.5% as central bank says ‘inflation has eased over the past year but remains elevated’The Federal Reserve announced on Wednesday that it would leave US interest rates at a 25-year high as it continues to assess their impact on cooling inflation and the wider economy.After a two-day meeting, the Fed announced rates would be unchanged at 5.25% to 5.5%, where they have been since July. But the Fed signaled it still expects to cut rates three times this year. Continue reading...

The Guardian > Economics Fed leaves interest rates unchanged but signals three cuts this year

Rachel Reeves is staking it all on economic growth. So where's her plan to achieve it? | Larry Elliott

Promising to reform the planning system, boost investment and improve skills is all very well, but the detail is missingThe pursuit of growth is an obsession for politicians the world over. Olaf Scholz thinks more growth would make him a more popular German chancellor. Xi Jinping sets growth targets in China and they are invariably met. Here in Britain, Rachel Reeves mentioned the word 58 times when she delivered the prestigious Mais lecture this week.The almost fetishistic worship of gross domestic product as a measure of how well a country is doing is curious, because even the statisticians responsible for producing economic data accept it is an incomplete performance measure. GDP rises as..

The Guardian > Economics Rachel Reeves is staking it all on economic growth. So where's her plan to achieve it? | Larry Elliott

UK inflation falls to 3.4%, but rents rise at record pace; HMRC halts plans to turn off tax helpline over summer – as it happened

UK inflation falls to lowest rate since September 2021, helped by slowdown in rising food pricesHMRC halts plan to close tax helpline for six months a yearFull story: UK inflation falls to 3.4% in February to lowest level for two and a half yearsRachel Reeves MP points out that prices are still high, at a time when households are also being hit by rising taxes and higher mortgage rates.The shadow chancellor says:“After fourteen years of chaos and uncertainty under the Conservatives working people are worse off. Prices are still high, the tax burden is the highest it has been in seventy years and mortgage payments are going up.Now Rishi Sunak is putting forward a reckless £46 billion unfun..

The Guardian > Economics UK inflation falls to 3.4%, but rents rise at record pace; HMRC halts plans to turn off tax helpline over summer – as it happened

UK inflation: which goods and services have changed most in price?

From milk to pasta and bicycles to vet bills, how the cost of everyday things variesUK inflation falls to 3.4% in February to lowest level for two and a half yearsThe fight against UK inflation is being won – but when will interest rates be cut?Business live – latest updatesThe UK’s annual inflation rate fell to 3.4% in February amid a slowdown in food and restaurant price rises.The Office for National Statistics compiled the overall reading using the consumer prices index but also logs prices for individual goods and services. Here we look at how the cost of many of those everyday items has changed over the past year. Continue reading...

The Guardian > Economics UK inflation: which goods and services have changed most in price?

UK inflation falls to 3.4% in February as food price rises slow

Decline in consumer prices index reading to more than two-year low adds to speculation of summer interest rate cutThe fight against UK inflation is being won – but when will interest rates be cut?Business live – latest updatesUK inflation fell to 3.4% in February – the lowest level for two and a half years – driven in part by a slowdown in the pace of food and restaurant price rises. .The bigger-than-forecast decline in the consumer prices index (CPI) from 4% in January will give a boost to Rishi Sunak, who has pledged to reduce inflation, and add to speculation that the Bank of England will cut interest rates in the summer. Continue reading...

The Guardian > Economics UK inflation falls to 3.4% in February as food price rises slow

The fight against UK inflation is being won – but when will interest rates be cut?

Prices are still going up but the tide has turned, raising expectations the Bank of England may cut rates in responseUK inflation falls to 3.4% in February to lowest level for two and a half yearsBusiness live – latest updatesThe battle against inflation is being won – and it is being won slightly more quickly than economists expected. Prices are still going up but the tide has turned. Unless something sudden and unexpected happens, the annual increase in the cost of living will be below the government’s 2% target within months.Those are the clear messages from the latest inflation data from the Office for National Statistics (ONS). What is less clear is when the Bank of England will s..

The Guardian > Economics The fight against UK inflation is being won – but when will interest rates be cut?

UK politics: Jeremy Hunt hints at October election – as it happened

Chancellor says date would allow a spending review to be carried out in time for next AprilSir Jacob Rees-Mogg, the Tory MP and former business secretary, has described as “barmy” a ruling from Ofcom saying that GB News broke impartiality rules because it allowed him to present news during his show on the channel.Ofcom said GB News had broken these rules on five occasions – two relating to programmes presented by Rees-Mogg, and three relating to programmes presented by Esther McVey, the Cabinet Office minister, and her husband, the Tory MP Philip Davies.This strikes me as completely barmy that reporting, in a programme that lasts for an hour, an event that has happened, where somebody ..

The Guardian > Economics UK politics: Jeremy Hunt hints at October election – as it happened

HMRC to close tax helpline for six months a year from April; jobs at risk as Ted Baker ‘prepares to appoint administrators’ – as it happened

HMRC’s self-assessment phone line will be closed between April and September each year and open only to taxpayers with “priority queries” between October and March.HMRC to close self-assessment helpline for six months a yearJapan raises interest rates for first time since 2007Criminal fraud trial of UK tech tycoon Mike Lynch beginsReaction to today’s landmark interest rate rise in Japan is pouring in.The Saxo Strategy Team say:The Bank of Japan has entered a new era as it scrapped negative interest rates and yield curve control, while also ending its ETF purchases.The central bank has set the short-term interest rate at between 0-0.1% in its first rate hike since 2007, although comme..

The Guardian > Economics HMRC to close tax helpline for six months a year from April; jobs at risk as Ted Baker ‘prepares to appoint administrators’ – as it happened

‘It’s been rocky – but childcare is a silver lining’: how one UK family copes with soaring living costs

The Dalys in Norwich say budget made little difference and they are sticking to cost-saving measures“I think we’ve got used to it,” says Jess Daly with some resignation of the experience of juggling family finances in a cost of living crisis that is now into its third year.The latest UK inflation data for February is due out on Wednesday, with analysts expecting the headline rate to fall to 3.5%. In January the figure remained unchanged at 4%, as rising gas and electricity bills were offset by the first fall in food prices in more than two years and winter sale bargains. Continue reading...

The Guardian > Economics ‘It’s been rocky – but childcare is a silver lining’: how one UK family copes with soaring living costs

Rachel Reeves: Treasury will ‘hardwire’ growth into tax and spending decisions

Shadow chancellor to outline plans to shake up department after Labour election victoryThe Treasury under a Labour government would “hardwire” raising Britain’s growth rate into its budget tax and spending decisions as part of plans to shake up Whitehall’s most powerful department, Rachel Reeves is to announce.The shadow chancellor will use a lecture in London on Tuesday to say that a decade of national renewal must start with “day one” reform after a Labour election victory to make growth more pivotal to the Treasury’s work. Continue reading...

The Guardian > Economics Rachel Reeves: Treasury will ‘hardwire’ growth into tax and spending decisions

World’s largest solar manufacturer to cut one-third of workforce

China’s Longi looks to slash costs as renewable energy sector faces tough headwinds from inflationThe world’s largest solar manufacturer has slashed nearly a third of its workforce after a cost-cutting drive that included telling staff to only print in black and white fell short and as a chill ripples through the renewable energy sector.China’s Longi is to cut as much as 30% of its workforce, in an acceleration of cost reductions that began late last year, Bloomberg reported. Continue reading...

The Guardian > Economics World’s largest solar manufacturer to cut one-third of workforce

Record 6.7m people in Britain are in financial difficulty, warns debt charity

Surge in requests for help reported as nearly 30% of 18- to 24-year-olds miss three or more credit or bill paymentsA record 6.7 million people in Britain are in financial difficulty, a campaign group has claimed, as the cost of living crisis pushes more households into debt.A survey for Debt Justice found that 13% of adults had missed three or more credit or bill payments in the last six months, a figure that rose to 29% among 18- to 24-year-olds and a quarter of 25- to 34-year-olds. Continue reading...

The Guardian > Economics Record 6.7m people in Britain are in financial difficulty, warns debt charity

The UK economy is a long way from blossoming despite glimmers of hope

A deeper recession was avoided only thanks to record immigration, and the MPC is bound to be cautious about cutting interest ratesIt may be too little, and too late, to rescue Rishi Sunak from a thumping election defeat, but there are signs the UK economy is on the turn. After two years of drift, some green shoots of recovery are finally appearing.Last week’s growth figures suggest the economy is emerging from a short and shallow recession in the second half of last year. Surveys of consumer and business sentiment have been more upbeat since the beginning of the year. More houses are changing hands and property prices have started to rise. Continue reading...

The Guardian > Economics The UK economy is a long way from blossoming despite glimmers of hope

The Guardian view on the Bank of England’s week ahead: it’s time to start cutting rates | Editorial

High rates only prolong economic stagnation and the farce of big bank profits while Britons can’t feed themselvesAs 2021 ended, an article in the Guardian by the economist Isabella Weber went viral. Its online spread was lubricated by heresy. Dr Weber doubted interest rate hikes would bring down inflation. Instead, she argued that post-pandemic prices were rising because corporations were exploiting bottlenecks in supply chains to charge more and scoop windfall profits. Hence, attempts to lower inflation with higher rates, which decrease real wages and reduce employment, would not work.The problem was the pricing power of capital not workers. Dr Weber suggested using price controls, which ..

The Guardian > Economics The Guardian view on the Bank of England’s week ahead: it’s time to start cutting rates | Editorial