Business News 21st July 2017

This is the hopefully enjoyable and informative,  bite size business news compiled by the Credit Protection Association on Friday 21st July 2017 for its members and visitors.

Markets Round up

The UK stock prices surged following a positive ECB meeting during which Mario Draghi left ECB rates unchanged and suggested a dovish stance towards quantitative easing as he remarked that the Governing Council is set to discuss future path of quantitative easing in the autumn policy, while emphasizing improved growth in the currency bloc  . The Euro jumped sharply in response falling against the pound & dollar over 1% to 1.115 and 1.163 respectively. The weaker pound pushed up the value of the internationally focused FTSE 100 to 7488 (up 0.8%). The Euro stoxx 50 meanwhile remained  flat at 3499. US Stocks were flat overnight with the Nasdaq and S&P500 failing to move more that 0.1%, closing  at 6390 & 2473 respectively. The Nasdaq now has its biggest winning streak since February 2015 and closed at another record. Asian stocks edged lower as some profit taking took place after recent rises. Australian shares lagged the zone as they were hit by the strengthening Aussie Dollar. Worldwide The MSCI World index showed global stocks strengthened a quarter of a percent to 1963. Oil prices were down with WTI at $46.68 and Brent at $49.49, as signs indicated some producers were increasing output. Gold was up 0.8% to $1247 as traders took into account the Euro ‘s jump that has weakened the dollar. The pound was down against the Euro over 1% at 1.1164 but held steady against the dollar at $1.2994.

Hot weather boosts UK retail sales

The ONS has reported that UK retail sales rose by more than expected in June, rebounding from May’s decline. Sales rose by 0.6% last month, beating the 0.4% increase forecast by economists and following a sharp 1.1% drop in May. A better-than-expected June pushed up retail sales by 1.5% in the second quarter overall, following a 1.4% fall in the first quarter. Ian Geddes, head of retail at Deloitte, said the sunny weather had brought a “Glastonbury feelgood factor” to Britain’s high streets.

The Guardian, Page: 28    The Independent   BBC News    Financial Times    Financial Times   The Daily Telegraph, Business, Page: 29

UK public finances worse than expected as deficit jumps in June

Britain borrowed more than expected to balance the books in June, in a blow to the government’s fiscal plans.  The UK’s public sector net borrowing requirement jumped to £6.9bn in June 2017, which is £2bn more than in June 2016. That’s an increase on May’s £6.7bn. City economists had expected the monthly deficit would drop to £4.7bn, so this suggests that the public finance are in a worse state than hoped. These figures show that Britain has borrowed £22.8bn since the start of the financial year in April, £1.9bn more than in the same period in the previous financial year. Higher inflation and EU contributions have pushed borrowing higher

Goldman urges government to make Brexit transition deal

A “significant” Brexit transitional period needs to be agreed as soon as possible, to stop jobs being moved from the UK to Europe, according to the boss of Goldman Sachs International. Chief executive Richard Gnodde told the BBC he was spending money “every single day” on contingency plans for Brexit. The plans involve taking on more staff in Goldman’s European offices to serve EU customers post-Brexit. If a transitional deal was in place he could save that money, Mr Gnodde said. Goldman Sachs’ most senior employee outside the United States said the longer he had to wait for the government to clarify its position, the less useful any transition period would ultimately be.

BBC News

The benefits of repairing Britain’s broken retail prices index

The FT’s Chris Giles discusses the differences between the consumer price index and the retail prices index. He says the latter needs changing as it does not tally with real life.

Financial Times

US employment

A report released by the US Labor Department showed a much bigger than expected decrease in first-time claims for US unemployment benefits in the week ended July 15th. The report said initial jobless claims fell to 233,000, a decrease of 15,000 from the previous week’s revised level of 248,000. Economists had expected jobless claims to edge down to 245,000 from the 247,000 originally reported for the previous week.


The Washington based International Monetary Fund announced another financial boost for Greece in the form of a $1.8bn loan. The IMF executive board statement said the “precautionary stand-by arrangement” was approved in principle. A second executive board decision is needed to make the arrangement effective. It will become effective only after the IMF receives “specific and credible” assurances from Greece’s European partners to ensure debt sustainability. It also will depend on whether Greece’s economic programme remains on track. The arrangement will expire on August 31, 2018, shortly after the expiration of the European Stability Mechanism programme.

Creative Tax requests

New figures from HMRC show the number of claims for Film Tax Relief (FTR) reached a record high in 2016-17 with film companies making 630 claims for FTR in 2016-17, up from 535 in the previous year. In total, HMRC paid out £415m to the UK film industry, a 23% rise from 2015-16. HMRC also detailed reliefs claimed by other sectors of the creative industries including high-end television, animation and video games. Dan Robertson, a tax partner in RSM’s technology, media, and telecoms team, said: “The UK already has a thriving creative industry sector and it’s clear that these tax reliefs are proving ever more popular. However, in times of public spending pressure, these tax reliefs can always be under review. It is to be hoped that the government recognises the value of these reliefs, and the economic benefits that they bring.”

The Guardian, Page: 29

Small housebuilders buy up 90% more land than last year

Increased Government funding and more accessible finance is propelling urban land purchases by small housebuilders in regional cities, according to research from Savills. The firm found that small housebuilders bought 89% more land in the last twelve months than the year before while medium-sized builders also bought 22% more sites than last year. Investment from international developers in strong regional cities is also boosting demand for land, especially in Birmingham, Manchester and Glasgow with Bristol considered the next hot spot.

The Daily Telegraph

BBC attacked over off the books pay

The BBC has come under fire for continuing to pay staff through personal service companies. The Mail says the corporation was supposed to have banned the use of PCS’s five years ago but admitted to the paper that employees are still using them. Labour MP Margaret Hodge said: “For the BBC not to have dealt with the issue of personal service companies – which are only a vehicle to avoid tax – is just inexcusable”. Tory MP Philip Davies added: “It is totally and utterly unacceptable for the BBC to be colluding with presenters to help them avoid paying tax. If they are full time employees, they should not be paid through companies. This loophole must be closed and the BBC should reveal the names of the people being paid in this way.”

Taylor Report – Genuinely self-employed should be protected

Myron Jobson considers what the government response will be from the Taylor Report into the gig economy in the Mail. Mike Cherry, chair of the FSB, says Matthew Taylor’s recommendations “strike a balance between fairness and a flexible labour market” but he said the government must “protect the genuinely self-employed from being dragged into a new category of dependent contractors”. Mr Cherry said “the tax system must continue to recognise the risk and insecurity faced daily by the genuinely self-employed – this is right in principle, [but ministers] must make no attempt to single them out for tax hikes.”

Daily Mail

Companies preparing for pay fallout

The Times’ Greg Hurst predicts anxiety within UK companies following the furore over the gender pay gap at the BBC. Companies with more than 250 employees must publish their pay gap figures by April, with banks and financial services companies expected to be particularly worried by the fallout. Sarah Churchman, head of diversity and inclusion at PwC, comments: “If this week’s publicity encourages more women to query and negotiate their pay – activities that women have tended to be less inclined to do compared to men – then that can only be a good thing.”

The Times, Page: 17

Treasury moots “City visa” plan

The Treasury has launched a battle in Whitehall for a “City visa” to protect the stream of vital international talent to the financial sector after Brexit. City minister Stephen Barclay is due to meet immigration minister Brandon Lewis next week to make the case for special rules because of the importance of the sector to the UK economy and tax revenues.

Evening Standard, Page: 6

The benefits of effectively auditing a supply chain

The Telegraph provides some advice for small business owners on how an effective audit can boost the supply chain. One key message is to collaborate with other parties in a supply chain to gather data to create a broad picture. Collaboration and increased transparency derisks the supply chain too and can help improve quality and legal and ethical standards.

The Daily Telegraph

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Previous News pages

Business News 20th July 2017

Business News 19th July 2017

Business News 18th July 2017

Business News 17th July 2017

Business News 14th July 2017

Business News 13th July 2017

Business News 12th July 2017

Business News 11th July 2017

Business News 10th July 2017

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