The chancellor’s mini-budget “complicated matters” for the Bank of England as it battled to bring down inflation, the International Monetary Fund’s chief economist has told Sky News. In an interview at the IMF’s annual meetings in Washington, Pierre-Olivier Gourinchas warned the coming years would “not be very pleasant” for the global economy. He also said
Business
The economy unexpectedly shrank in August, contracting by 0.3% on the previous month. The growth in July has also been revised downwards, from the previously recorded 0.2% to 0.1%. The Office for National Statistics released its latest reading on the UK’s performance as the government frets over the prospect of recession ahead, given the toll
The Bank of England has warned of “a material risk to UK financial stability” as it widened its programme to buy up government bonds. The move has been made as a result of “further significant repricing of UK government debt” in one pension-linked market, the Bank said. It added that it was “dysfunction” and the
The Bank of England’s governor has ruled out extending its bond-buying support for pension funds beyond Friday’s deadline, prompting a dramatic fall in the value of the pound. Andrew Bailey told an event in Washington that funds had “three days left… to get this done” after a series of interventions to support the “dysfunctional” market
Mortgages continued to become more expensive despite the number of products on the market gradually increasing. The average mortgage interest rate on a two-year fixed term mortgage is now 6.3%, according to data compiled by financial information company Moneyfacts. A similar rise has taken place in the average five year fixed term mortgage, which has
The Bank of England has announced it is doubling the value of UK government bonds it can buy up as it enters the final days of its emergency bond buying programme in an effort to support the pension market and allay fears of a cliff edge ending. The Bank has said it is ready to
A former boss of crisis-hit Wasps is spearheading a takeover bid for the Premiership Rugby club that could save it from the threat of relegation or extinction. Sky News has learnt that David Armstrong, who stepped down as Wasps’ chief executive in 2017, is working with Terminum Capital, an investment firm, on a bid to
Octopus Energy is close to clinching a takeover of stricken rival Bulb in a deal that will crystallise up to £4bn of losses for British taxpayers. Sky News has learnt that ministers at the Treasury and the Department for Business, Energy and Industrial Strategy (BEIS) have been told that a sale of Bulb’s 1.6m-strong customer
University graduates across the UK want to see higher starting salaries for first jobs amidst the cost of living crisis. New research by careers platform Bright Network, shared with Sky News, reveals students expect starting salaries to be over £30,000 – 25% more than the current national average starting salary. Due to the impact and
Kwasi Kwarteng, the chancellor, has ruled out tearing up the regime put in place to segregate high street lenders’ investment banking arms that was put in place after the 2008 financial crisis. Sky News has learnt that Mr Kwarteng told a gathering of industry chief executives this week that bank ring-fencing would not be scrapped
The pound’s value ebbed and flowed on Friday – supported by a Bank of England deputy governor’s vow to persist in the fight against inflation but later hammered as stronger than expected US jobs data lifted the dollar. Remarks by Sir Dave Ramsden, a member of the monetary policy committee (MPC) which sets Bank rate,
The number of company insolvencies in England and Wales hit its highest level for 13 years in the second quarter of the year, according to official figures. The Office for National Statistics (ONS) recorded a total of 5,629 business failures between April and June. It was the highest quarterly number since the third quarter of
The latest information on the risks facing gas and electricity supplies suggests there is an increased risk of blackouts this winter – but they can be prevented. National Grid’s Electricity System Operator’s (ESO) updated report on the pressures facing power generators revealed contingency plans for three-hour blackouts in areas where gas-fuelled power falls short of
A measure of confidence in the UK’s creditworthiness has been slashed by another major ratings agency in the wake of the mini-budget, piling further pressure on the under-fire pound. Fitch revealed on Wednesday night that it had cut the outlook for its credit rating on UK government debt to “negative” from “stable”. It maintained its
Two million fewer barrels of oil are to be produced each day, equivalent to 2% of global supply, the Organisation of the Petroleum Exporting Countries (Opec) and Russia have agreed. The move is an effort to increase prices in countries feeling the heat from high energy costs. Members Saudi Arabia and Russia have led the
The taxpayer support for household energy bills could cost up to £140bn in an “extreme” scenario, an energy market expert has warned. Cornwall Insight, which became a prominent voice in predicting levels for the energy price cap before it was replaced by the government’s energy price guarantee (EPG) this month, said its findings showed a
Elon Musk is planning to buy Twitter for his original offer price – and he’s hinted at his plans for social media. The world’s richest man is proposing to go ahead with purchasing the platform for $54.20 per share, a total value of $44bn (£38.4bn), following months of legal battles. After news of the deal’s
There is a mounting risk that fuel prices could soon begin to rise again as major oil-producing countries ponder a big cut in output. The Opec+ cartel, which includes Saudi Arabia and Russia among its main members, is expected by markets to reveal this week a collective target to reduce delivery by more than one
The energy regulator has warned the UK is facing a “significant risk” of gas shortages this winter. The information, which was revealed in a letter sent from Ofgem last week and first revealed by The Times, spoke of the possibility of “gas supply emergency” measures to help preserve stocks due to the impact of Russia’s
The pound and government bond yields have recovered some poise in the wake of the government’s U-turn on abolishing the top rate of income tax. Kwasi Kwarteng revealed early on Monday morning that the decision to axe the 45p rate – part of his growth plan revealed last month – would now not happen in
Leaves on the line disrupting train services promise to be a thing of the past for many more travellers with new technology being introduced by a major train operator. Northern, which runs nearly 2,000 daily services, is fitting a system to 16 passenger trains which will combat slippery rails by spraying water onto them. The
The owners of Britain’s second-biggest steel producer are seeking an urgent package of financial support from taxpayers amid renewed fears for thousands of industrial jobs in the north of England. Sky News has learnt that Jingye Group, which bought British Steel out of insolvency in 2020, has told ministers that the company’s two blast furnaces
Rail passengers have been urged to only travel if “absolutely necessary” today as members of four trade unions stage a 24-hour walkout. The latest strike by members of the Rail, Maritime and Transport union (RMT), Aslef, Unite and the Transport Salaried Staffs’ Association (TSSA) is expected to cause the worst rail disruption of the year
Liz Truss has for the first time acknowledged that “there has been disruption” to the UK economy following last week’s mini budget. Since the chancellor’s announcement of £45bn in tax cuts the value of the pound has plummeted, nearly half of mortgages have been pulled and the Bank of England launched a £65bn bail-out to
Gas and electricity bills are going up as the new energy price cap takes effect. You may have read that from 1 October the price cap will mean average energy bills will increase by 27% from £1,971 a year to £2,500. But it isn’t as simple as that. House prices warning as growth slows to
Britain’s economy grew by 0.2% in the three months to June, reversing the initial estimate of a 0.1% contraction, official figures show. The upward revision of the second quarter GDP by the Office for National Statistics implies the UK is not in recession, as predicted by the Bank of England earlier this month. Quarter of
Liz Truss will meet the head of the UK’s independent fiscal watchdog tomorrow after a powerful group of cross-party MPs demanded the chancellor release a full economic forecast by the end of October – a month earlier than planned. Chancellor Kwasi Kwarteng will join the prime minister as they meet the Office for Budget Responsibility’s
Shares in companies that depend on consumer spending have plunged after Next, the fashion to homewares retailer, cut its sales forecast for the second half of its financial year and annual profit guidance. The company used the publication of its half-year results to the end of July to say that there were too many variables
The Bank of England’s dramatic intervention today was in response to a “run dynamic” emerging in the British pensions system which could have resulted in the collapse of a swathe of institutions within hours, Sky News understands. Bank staff worked through the night on Tuesday and into Wednesday morning to prepare the unprecedented package, which
Chancellor Kwasi Kwarteng is due to meet bankers today in an effort to calm nerves after his mini-budget spooked the markets and sent the pound crashing. The Treasury has categorically denied he will ask financiers not to bet against the pound, which has fallen to record lows against the dollar in recent days. He is
If the government does not reverse its fiscal plans in the coming weeks, it may be left with little option but to cut public spending so significantly it could result in the end of the National Health Service, according to one of Britain’s leading economic policymakers of recent decades. Sir Charlie Bean, a former deputy
The market turmoil caused by Friday’s seismic mini-budget has hit mortgage offerings as providers withdrew partial and entire lending ranges. Virgin Money and Skipton Building Society have temporarily withdrawn their entire mortgage product range, while Halifax, the country’s largest mortgage lender, said it is to remove fee-paying mortgages. Fee-paying mortgages allow borrowers to pay a
The overnight fall in the value of the pound, descending to its lowest level against the dollar since decimalisation in 1971, matters because of what it says about global market confidence in the UK economy. The plunge in sterling’s value, against a backdrop of a strong dollar globally, gathered speed on Friday following the publication
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