Yahoo Finance Cheap Chinese imports ‘distorting global prices’, warns US
The US Treasury Secretary has accused China of creating unfair competition that “distorts global prices” as it ramps up production of technologies aimed at shifting the world towards net zero.
Janet Yellen said the increased production in solar energy, electric vehicles and lithium-ion batteries by Beijing “hurts American firms and workers, as well as firms and workers around the world”.
Ms Yellen, who is planning her second trip to China as Treasury Secretary, said that she will convey her belief that Beijing’s increased production of green energy also poses risks “to productivity and growth in the Chinese economy”.
During a speech in Georgia, she will say: “I will press my Chinese counterparts to take necessary steps to address this issue.”
China is the dominant player in batteries for electric vehicles and has a rapidly expanding car industry.
A quarter of EVs sold within the EU this year will come from the country, according to analysis by Transport & Environment (T&E).
06:03 PM GMT
That’s all for today...
Thanks for joining us today. We’ll be back in the morning bright and early with all the latest company news, but in the meantime, here are a few of our latest business stories elsewhere on The Telegraph website:
Private equity binge threatens to trigger financial crisis, warns Bank of England
05:46 PM GMT
Reddit hit by ‘grossly overvalued’ claims
Reddit is expected to record its biggest one-day drop on the stock market after Hedgeye Risk Management said it was ‘grossly overvaued’ and should be priced around 50pc lower.
Shares in the social media website were down as much as 15pc to their lowest level since March 22, coming just a week after its initial public offering. They jumped 48pc in their market debut.
Analyst Andrew Freedman said: “Heading into the IPO, we put RDDT on the short bench, reflecting our belief that the stock is a fundamental short but that the days immediately following the IPO would likely be volatile and not the proper time to make it an active short.”
He said the company was “grossly overvalued” and should be trading nearer to its $34 IPO price. Its close price last night was around 50pc higher.
Mr Freedman said: “The deal was oversubscribed, the float small, valuation range looked reasonable, and they timed the IPO coincident with easy comparisons where the company is going to post accelerating revenue and user growth the first quarter out of the gate as a public company.”
Reddit declined to comment.
05:18 PM GMT
EV company Fisker slashes car prices amid cash crunch
Electric vehicle company Fisker has slashed its car prices by as much as 39pc as the business battles to stay afloat.
Fisker, the EV company started by James Bond car designer Henrik Fisker, said it was reducing the price of its higher-end Ocean “Extreme” electric SUV to $37,499. This would be a $24,000 discount.
Its other models - the Ultra and Sport models - are also facing significant price cuts.
Fisker said the reductions were taken to make its Ocean vehicles “a more affordable and compelling EV choice.”
However, it comes at a time of turmoil for the vehicle maker, which was forced to pause production earlier this month amid a cash crunch.
04:56 PM GMT
British drug company leaving London amid warning over market downturn
A British drug discovery company headed up by the former vaccine taskforce chief has unveiled plans to quit the London stock market, in the latest blow for the UK amid a spate of exits.
C4X Discovery said it would be delisting from London’s junior Aim market, saying “the recent downturn in the financial markets has adversely impacted our share price, and with it, our future ability to raise funds in the public markets”.
Clive Dix, the former chair of the UK’s vaccine taskforce during the pandemic, said C4X Discovery’s current valuation “does not reflect the underlying potential of our business or our achievements to date and that this is unlikely to change in the short-to-medium term”.
It comes as the latest company to plot an exit from the market, with Tui last month leaving the London Stock Exchange.
Building materials company CRH and plumbing equipment supplier Ferguson both shifted their listings to New York.
04:23 PM GMT
Euro zone pay growth returning to more normal levels, top economist says
Pay growth in the euro zone is returning to more normal levels, according to a top European Central Bank economist.
Speaking on an ECB podcast this week, ECB chief Economist Philip Lane said: “It’s desirable and inescapable that we do have several years of wage increases above a normal level.
“But what we need to make sure is it’s basically it returns to normal. It’s a normalization process. And this is where we’re looking at this, and I would say we’re confident that it’s on track.
“In next year and the year after inflation should stabilize around our 2pc target. This is a good baseline. And essentially what we decided is, in these weeks from that meeting, we need to keep on checking this assessment. And what I would say is if this assessment is confirmed, then we will start looking more closely at reversing some of the rate increases we’ve made.”
03:57 PM GMT
Obesity drug makers face price questions after report claims they could be made for $5 a month
Obesity drug makers are facing questions over their selling prices, after a new study suggested treatments could be made profitably for less than $5 a month.
Novo Nordisk’s Ozempic could be made for $4.73 for a month’s supply, a report from researchers at Yale University, King’s College Hospital in London and the nonprofit Doctors Without Borders claimed. This price included a profit margin.
The Danish company makes the weight-loss jab Wegovy and Ozempic, a diabetes drug which is used off-label to treat obesity. In the US, Ozempic sells for around $968.52 a month.
Novo argues that it is investing heavily in scaling up production to allow it to provide the drugs more broadly.
A spokesman says: “While we are unaware of the analysis used in the study, we have always recognised the need for continuous evaluation of innovation and affordability levers to support greater access of our products. We continue to support greater health equity to those in need of diabetes treatment and care.”
Sales of its weight-loss and diabetes treatments ballooned by 38pc in 2023 to hit DKK 215bn (£24bn). Novo Nordisk is now making around £32m a day in profits.
03:38 PM GMT
Handing over
That’s all from me. The ever cheerful but formidable Hannah Boland will keep you up to speed with the very latest news from here.
I’ll leave you with a quick look at the markets, where the FTSE 100 is up 0.1pc today to 7,935.11.
The pound is down 0.1pc against the dollar. Brent crude oil has recovered through the day to move above $86 a barrel but remains down 0.2pc.
03:16 PM GMT
Car makers faced with tariffs as Canada trade arrangement to expire
The Government has warned that car makers will be hit with tariffs from next month as a trade arrangement with Canada expires.
Officials blamed Ottawa for the impasse after talks over a post-Brexit trade deal collapsed in January.
Negotiations lasting more than two years were halted by a row over meat and cheese exports.
The Comprehensive Economic Trade Agreement, a temporary deal in place following Britain’s departure from the EU, expires at the end of March and the lack of agreement on new rules could now drive up the prices of British goods – such as cars – in Canada, unless the UK changes its supply chains.
A Department for Business and Trade spokesman said:
Canada’s decision not to roll over these rules of origin will increase the cost of trade and hurt businesses on both sides of the Atlantic.
The UK government remains ready to work with Canada to find a solution that works for both countries, but we won’t accept rowing back on the current terms.
02:59 PM GMT
Scotland faces far larger deficit than rest of UK as oil prices drop
Scotland is to face a far larger deficit than the rest of the UK amid a slump in oil prices, the Institute for Fiscal Studies (IFS) has warned.
Our senior economics reporter Eir Nolsøe has the latest:
The shortfall between revenues and spending will be around £2,450 greater per person in Scotland than the rest of the UK in 2023-2024, the IFS said.
It comes following a decline in North Sea oil and gas revenues amid falling energy prices, with further decreases expected.
Uncertainty surrounding oil and gas revenues means Scotland’s underlying public finances are far more volatile than those in the rest of the UK, the IFS said.
While Holyrood’s borrowing and revenues are managed through Westminster, this would pose a challenge should it become fiscally autonomous or independent.
Read more of the IFS’s concerns.
02:54 PM GMT
US accuses China of distorting net zero costs with cheap imports
The US Treasury Secretary has accused China of creating unfair competition that “distorts global prices” as it ramps up production of technologies aimed at shifting the world towards net zero.
Janet Yellen said the increased production in solar energy, electric vehicles and lithium-ion batteries by Beijing “hurts American firms and workers, as well as firms and workers around the world”.
Ms Yellen, who is planning her second trip to China as Treasury Secretary, said that she will convey her belief that Beijing’s increased production of green energy also poses risks “to productivity and growth in the Chinese economy”.
During a speech in Georgia, she will say: “I will press my Chinese counterparts to take necessary steps to address this issue.”
China is the dominant player in batteries for electric vehicles and has a rapidly expanding car industry.
A quarter of EVs sold within the EU this year will come from the country, according to analysis by Transport & Environment (T&E).
02:45 PM GMT
Rail workers announce strikes
Rail workers on CrossCountry are to strike in a dispute over union recognition.
The Rail, Maritime and Transport union (RMT) said around 800 of its members would walk out on Saturday April 13.
The dispute involves workers in supervisory and clerical roles.
The RMT said it had been excluded from talks on pay and policy issues.
Mick Lynch, RMT general secretary, said:
CrossCountry’s refusal to guarantee our representation of members in negotiations is a disgrace and will not be tolerated.
Bosses cannot dictate who RMT members are represented by or be allowed to rip up long-standing agreements.
Therefore, our whole membership in CrossCountry will take strike action on April 13 and our industrial campaign will continue until we reach a resolution.
02:19 PM GMT
Coinbase wins partial victory in battle with US regulators
Coinbase has won a partial victory in its legal battle with US regulators alleging it is flouting rules.
The lawsuit by the US Securities and Exchange Commission against the exchange can move forward, judges have ruled, but they dismissed one claim.
The decision partly granted Coinbase’s motion to dismiss the US watchdog’s lawsuit in what could be a lengthy and expensive court battle.
The SEC sued Coinbase in June, saying the company facilitated trading of at least 13 crypto tokens that should have been registered as securities and was operating illegally as a national securities exchange, broker and clearing agency without registering with the regulator.
The case against the world’s largest publicly traded cryptocurrency exchange is a high-water mark in the regulator’s campaign to apply US securities law to the digital asset companies.
01:59 PM GMT
Pound edges down slowdown in plans to raise wages
The pound edged lower after a survey showed British businesses trimmed back plans for staffing and wage increases this month.
The Lloyds Bank Business Barometer’s measure of staffing plans - or the gap between firms planning to hire and those planning cuts - fell to 27pc from February’s almost two-year high of 36pc. The series’ long-term average is 22pc.
The share of companies expecting to raise wages by 3pc or more over the next 12 months fell slightly to 33pc from 35pc.
Separate Bank of England data on Wednesday showed British mortgage holders and businesses are generally coping well with high interest rates, with problem debt levels well below those seen after the 2008 financial crisis.
Markets have scaled back expectations for a June rate cut by the Bank of England and now see an 84pc chance of a cut in August after policymaker Catherine Mann said she thought markets were betting on too many interest rate cuts.
Pricing shows roughly a 54pc chance the British central bank will start cutting rates at its June meeting. On Tuesday, they were seeing a 65pc chance of such move in June.
The pound edged 0.1pc lower at $1.26 against the dollar, not far from a five-week low of $1.25 hit on Friday. It was flat against the euro at 85p.
01:50 PM GMT
Trump Media surges by another 20pc
Donald Trump’s wealth jumped further as shares of Trump Media & Technology Group continued their wild ride.
The owner of the money-losing Truth Social platform founded by former president Donald Trump rose another 20pc after trading began on Wall Street.
It was last up 14pc.
01:35 PM GMT
US markets rise at the open
Wall Street’s main indexes gained at the open as chipmakers and growth stocks rebounded in light trading ahead of crucial US inflation data.
The Dow Jones Industrial Average rose 179.65 points, or 0.5pc, at the open to 39,461.98.
The S&P 500 opened higher by 22.73 points, or 0.4pc, at 5,226.31, while the Nasdaq Composite gained 109.06 points, or 0.7pc, to 16,424.76 at the opening bell.
01:30 PM GMT
‘No-one is above the law’ as traders’ fraud convictions upheld
According to the Serious Fraud Office, Hayes was one of 19 people prosecuted for trader manipulation and one of nine convicted - all of whom have since brought unsuccessful appeal bids.
A Serious Fraud Office spokesman said:
The Court of Appeal’s judgment is clear that these convictions for fraud are still as relevant today as 10 years ago.
No-one is above the law and the court has recognised that these convictions stand firm.
12:53 PM GMT
Cocoa prices fall back from record highs
Cocoa prices have fallen in New York as investors closed positions a day after a rally that took prices above $10,000 a tonne.
The most-active contract slumped as much as 3.7pc, following Tuesday’s slight retreat from an all-time high of $10,080.
Prices have more than doubled this year as poor crops in key West African growers put the world on course for a third consecutive year in which there is a deficit of supply.
Analysts at The Hightower said: “With three sessions left before quarter-end and a holiday weekend, cocoa fell victim to a wave of profit-taking late in the day.”
12:39 PM GMT
Hayes was ‘ringmaster’ of global network manipulating Libor
At his trial in 2015, prosecutors said that Hayes was the “ringmaster” of a global network of 25 traders and brokers from at least 10 firms who tried to manipulate Libor on an industrial scale to maximise profit.
By 2017, a dozen banks had paid penalties approaching £8bn for rigging the benchmarks.
However, criminal prosecutions outside of the UK rarely materialised and those that did in the US were ultimately overturned.
The judges in 2015 said there was “indisputable documentary evidence showing that what Mr Hayes was seeking to do, to move the Libor rate, was accompanied by attempts to maintain secrecy, as well as his frank admissions of dishonesty in the scoping interviews.”
12:04 PM GMT
Jailed Libor trader loses appeal against fraud conviction
The first trader jailed worldwide for his part in the interest rate rigging Libor scandal has lost his appeal against his conviction.
Tom Hayes, a former star Citigroup and UBS trader, was convicted in 2015 of conspiracy to defraud by manipulating the London Interbank Offered Rate, known as Libor.
The benchmark rate was once used to price trillions of financial products globally but prosecutors said Hayes and other traders acted illegally by taking into account the commercial interests of themselves or their employer when they made submissions.
Hayes, who was released from prison in 2021 after serving half of an 11-year sentence, has always said that the Libor rates he requested fell within a permissible range – and that his conduct was common at the time and condoned by bosses.
His appeal against his conviction was heard alongside that of Carlo Palombo, a former Barclays trader convicted in 2019 of skewing Libor’s euro equivalent, Euribor.
Their cases were referred to the Court of Appeal in London after a landmark US court decision in 2022, in which two former Deutsche Bank traders’ convictions for Libor rigging were overturned.
Hayes and Palombo’s appeals were dismissed, senior judges announced on Wednesday after a hearing which began last week.
Judge David Bean said in a summary of the Court of Appeal’s decision that both Libor and Euribor “required the submission of what the individual bank ‘could’ borrow, which must mean the cheapest rate available to it”.
Hayes and Palombo were given 14 days to apply for permission to appeal to the Supreme Court.
11:49 AM GMT
Morrisons sales grow as new boss prepares to battle Aldi and Lidl on price
Morrisons has revealed its strongest sales growth in three years as its new chief executive prepares to enter a price battle with Aldi and Lidl.
The supermarket said like-for-like sales excluding fuel and VAT were up 4.6pc in the three months to January 28.
New boss Rami Baitiéh, who took over as chief executive from David Potts in November, hailed the “next chapter” for the business after the launch of an Aldi and Lidl price match scheme in February. He said:
Those plans are now in full swing with the whole business engaged in the three key pillars of work that will be the foundation of the future for Morrisons: commercial excellence, operations optimisation and new value creation.
Across the business we have identified many areas where we can raise our game and make small improvements which collectively will result in a significantly enhanced shopping experience for our customers.
11:37 AM GMT
H&M ‘on the right track’ as it battles for market share
Fashion giant H&M revealed better-than-expected profits for its financial first quarter as shoppers snap up its spring collection.
Daniel Erver, chief executive of H&M, said the retailer has seen signs it is “on the right track” as it seeks to maintain its market share amid the rapid growth of fast fashion rivals such as China’s Shein.
The company said net sales dipped by 2pc for the three months to the end of February, compared with the same period last year. This was a smaller fall than predicted by analysts.
The group said sales were moving in the “right direction”, with an increase of 2pc so far in March.
Meanwhile, it said recorded higher-than-expected operating profits of 2.1bn krona (£155m), up from 725m krona (£54m) a year earlier.
Mr Erver said: “The quarter’s sales gradually improved during February with well-received spring collections, which is a positive sign that we are on the right track.”
Robyn Duffy, senior analyst at RSM UK, said: “With new chief executive Daniel Erver focused on profitability and improving margin, we’ve seen gains in these areas which should go some way to reassuring investors.”
H&M shares were up 12.9pc.
11:21 AM GMT
Revolution Beauty increases profit forecasts as it moves past accounting scandal
Troubled makeup brand Revolution Beauty expects to make bigger profits this year as it hopes a new strategy has turned around its fortunes.
The business said that underlying profits will be “at least” £12.5m in the year which ended a month ago.
That is an increase from the company’s previous expectation, that the figure would hit between £11m and £12m.
Revolution Beauty also told shareholders to expect that it will report a 2pc rise in revenue in the year to the end of February. That sheds more clarity on the previous guidance that revenue would grow in the “low single digits”.
It has been a tough time for Revolution of late. The business last month came to an agreement with its former boss Adam Minto which will see him pay nearly £3m to the company.
At around the same time BDO quit as auditor to the cosmetics brand nearly two years after uncovering a series of accounting and management errors.
The company was thrown into crisis in 2022 when its auditors refused to sign off on its accounts for the previous year.
Its shares were suspended, and a subsequent investigation found that the accounts had counted £10m of sales towards revenue that should not have been included.
11:01 AM GMT
Sweden hints at May or June interest rate cuts
Sweden’s central bank kept its key interest rate at a 16-year high, but forecast a possible cut in May or June if inflation stays under control.
The Riksbank said that while “inflation is in the process of stabilising at the target” of 2pc, it added that “inflationary pressures are still somewhat elevated.”
Swedish inflation slowed sharply in February to 4.5pc year-on-year. The bank’s benchmark indicator, adjusted for fixed interest rates (CPIF), reached 2.5pc.
“It is likely that the policy rate can be cut in May or June if inflation prospects remain favourable,” the Riksbank said in a statement.
But it added that given the high inflation seen in recent years, its executive board “wants further confirmation that inflation will stabilise close to the target.”
In September, the central bank raised its key rate to 4pc, its highest level since 2008.
"If the inflation prospects remain favourable, the policy rate may well be cut in May or June"
This is today's policy statement from #Sweden's #Riksbank, not the Bank of England, but surely applies to the UK too!
more here: https://t.co/Z00VO9a4kZ— Julian Jessop (@julianHjessop) March 27, 2024
10:33 AM GMT
Consumers plan to spend more on experiences in sign recession is over
Most British consumers are planning to spend more this year on things like travel, food and live music in a further sign the UK is moving out of recession.
Some 51pc of Britons said they will spend more on experiences in 2024 compared to last year, when the economy experienced a downturn, according to a study.
The top things people plan on spending money on are travel and tourism (63pc), food-related experiences (41pc) and live music (39pc). Almost nine in 10 people (88pc) said they plan to spend the same, or more, on experiences in 2024, compared to 2023.
Natalia Lechmanova, chief economist Europe at Mastercard, which carried out the research, said:
As headwinds from high inflation and high interest rates gradually recede, consumers are likely to deploy their stronger purchasing power on discretionary spending.
Excitement driven by prominent events such as global sporting competitions, music artist tours, and international film festivals coming to Europe this year will likely keep the spend on experiences high.
10:13 AM GMT
Minimum wage rises could ramp up inflation, warns CBI chief
The impending rise in the minimum wage risks driving up inflation, the head of the Confederation of British Industry (CBI) has warned.
Rain Newton-Smith said low growth in the UK economy meant there was a risk in raising the National Living Wage from £10.42 to £11.44 from April 1 in the third largest increase since it was introduced in 1999.
The CBI director-general will tell a Resolution Foundation event:
We will have ended relative low pay, but with more people feeling low paid than ever before.
That’s what happens when you focus on minimum wages without driving growth.
The CBI will argue that the minimum wage was a success when the UK had an expanding economy, but now risks stoking price pressures. Almost half of the CBI’s members said last year’s increase was passed on to consumers.
09:50 AM GMT
German economy suffers dramatic downgrade under Scholz
The German economy is expected to barely grow this year, leading economic institutes said, as inflation, high interest rates and weaker exports stall the economy in a blow to chancellor Olaf Scholz.
Europe’s largest economy will expand by just 0.1pc in 2024, five think-tanks said in a joint statement, a sharp downgrade from their earlier forecast of 1.3pc growth.
It would put Germany on track to be the worst performer in the G7 for a second consecutive year, based on forecasts by the International Monetary Fund (IMF).
Stefan Kooths, head of economic research at the Kiel Institute for the World Economy, said: “Cyclical and structural factors are overlapping in the sluggish overall economic development.
“Although a recovery is likely to set in from the spring, the overall momentum will not be too strong.”
Germany is struggling with slow growth in China, a major trading partner, which has experienced a muted rebound from the pandemic and is in the grip of a property crisis. Germany is battling its own housing downturn, as falling property prices force developers to cancel projects.
Last month, Germany’s central bank the Bundesbank warned that “uncertainty regarding climate and transformation policy remains elevated” in Germany.
Mr Scholz’s government was plunged into crisis last year after a constitutional court blew a €60bn (£51bn) hole in its net zero budget, after ruling ministers could not repurpose unspent Covid emergency funds to fight climate change.
09:39 AM GMT
Pictured: Carney and US bosses meet China’s Xi
A picture of China’s president Xi Jinping meeting with North American business leaders has been published by state media.
Attendees at the meeting included Mark Carney, the former governor of the Bank of England, and Blackstone chief executive Stephen Schwarzman.
09:18 AM GMT
FTSE 100 falls amid declining oil prices
The FTSE 100 has fallen amid declines in energy stocks over falling oil prices.
The export-heavy index was down 0.3pc and the domestically-oriented FTSE 250 was down 0.2pc.
Energy companies dropped as much as 1.2pc as oil prices fell for a second day after a report showed US crude stockpiles increased. Brent crude, the global benchmark, was down 1.2pc and heading towards $85 a barrel.
Bank stocks fell 1.1pc as the yen dropped to a 34-year low against the dollar, raising the prospect of an intervention by the Bank of Japan.
DS Smith jumped 7.7pc after the company confirmed it was in discussions with International Paper over an all-stock buyout for £5.7bn from its US listed rival.
Meanwhile, specialized products and service distributor Diploma soared 11.1pc to the top of the FTSE 100 after the company said it will acquire Peerless Aerospace Fastener for £236m.
Market participants remain focused on a key reading of the U.S. personal consumption expenditure price index (PCE), the Federal Reserve’s preferred inflation gauge, which is due on Friday, when most global markets will be shut for the Good Friday holiday.
08:51 AM GMT
China’s Xi woos US chief executives in Beijing amid economic downturn
China’s President Xi Jinping met with American business leaders in Beijing as he scrambled to shore up support for his country’s struggling economy.
Bosses were invited to the Great Hall of the People on Wednesday, as the government tries to woo foreign investors back into the country.
Attendees included former Bank of England governor Mark Carney, Blackstone chief executive Stephen Schwarzman, FedEx boss Raj Subramaniam and Cristiano Amon, the boss of chips manufacturer Qualcomm.
Beijing wants to boost growth this year in the world’s second largest economy, after foreign direct investment into China shrank 8pc in 2023 as investor concern grew over an anti-espionage law, exit bans and raids on consultancies and due diligence firms.
President Xi’s increasing focus on national security has left many companies uncertain where they might step over the line, even as Chinese leaders make public overtures towards overseas investors.
“The history of China-US relations is a history of friendly exchanges between our two peoples,” Xi said, according to state media.
He called on the two countries to “seek common ground and build more consensus”.
08:43 AM GMT
Advertising agency S4 Capital reveals boardroom shake-up
Sir Martin Sorrell has hired a former senior partner at EY to the board at S4 Capital as the advertising agency battles against declining sales.
Jean-Benoit Berty will become chief operating officer and the company will adopt a “more traditional, streamlined board structure”, with four executives stepping down at its next AGM.
It comes as the agency, founded by Sir Martin after he left WPP in 2018, revealed net revenues declined by 2.1pc to £873.2m, although it managed to return to an operating profit of £20.2m after losses of £135.3m in 2022.
Shares slumped as much as 10.2pc in early trading as it predicted net revenue would fall this year and told clients “to remain cautious in the near term, despite the possibility of interest rate reductions later in 2024”.
08:27 AM GMT
Spain’s inflation rises amid higher energy costs
Spanish inflation accelerated in March due mainly to higher energy costs, preliminary official data showed.
Consumer prices rose 3.2pc, up from 2.8pc in February, national statistics office INE said.
The main factor pushing up inflation was a rise in the price of electricity and fuel, which offset slower growth in food and non-alcoholic drink prices, it added.
Spanish inflation hit a record 10.8pc in July 2022, its highest level since 1985 as Russia’s invasion of Ukraine sent consumer prices soaring, but it has since eased.
Adrian Prettejohn, Europe economist at Capital Economics, said:
We think it is likely to increase further over the coming months due to base effects in energy inflation, higher VAT rates on energy and foods, and services firms hiking prices.
Meanwhile, the tightness of the labour market suggests that inflation could stay above 2pc over the next couple of years.
Socialist Prime Minister Pedro Sanchez in 2022 put in place a series of measures to help households cope with higher inflation such as free commuter rail travel which it plans to start phasing out this year.
Inflation Rate in Spain increased to 3.20 percent in March from 2.80 percent in February of 2024.https://t.co/dY6uE6T2Bo pic.twitter.com/Xzl2cakDrz
— TRADING ECONOMICS (@tEconomics) March 27, 2024
08:17 AM GMT
Japan prepares to step in as yen plunges to 34-year low
The yen has plunged to its lowest level against the dollar in 34 years just over a week after the Bank of Japan announced a much-anticipated interest rate hike.
The yen traded at 151.97 per dollar overnight, down about 0.2pc and weaker than the 151.94 when Japanese authorities last made an intervention to buy and strengthen the currency in October 2022. It stands at 191.39 against the pound.
Japan’s finance minister issued his strongest warning to date about yen weakness as it fell to its lowest level since the country’s financial bubble burst in the early 1990s, which was followed by decades of economic stagnation.
Shunichi Suzuki said authorities could take “decisive steps,” a phrase he previously used just before Japan last intervened in the market to stem weakness in its currency.
He said: “We’re monitoring market movements with a high sense of urgency. We will take resolute action against excessive moves, without ruling out any options.”
Last week, the Bank of Japan ended the era of negative interest rates as it increased borrowing costs for the first time in 17 years from minus 0.1pc to zero to 0.1pc.
08:08 AM GMT
UK markets mixed at the open
Stock markets in London lacked direction as trading began following a negative day on Wall Street amid concerns that the latest equities rally in the US may have run out of steam.
The FTSE 100 fell 0.1pc to 7,920.63 while the midcap FTSE 250 was fractionally higher at 19,779.55.
08:05 AM GMT
Asos, Boohoo and Asda agree not to ‘mislead’ shoppers over green claims
Asos, Boohoo and Asda have agreed not to make “misleading” claims about their green initiatives after an investigation by the competition regulator.
The three retailers have signed formal agreements to use only accurate and clear green claims about their eco-friendly clothing lines.
The Competition and Markets Authority launched a crackdown on companies overhyping their green credentials in 2021.
It said the companies would now “change the way they display, describe, and promote their green credentials, meaning millions of customers can expect to see clear and accurate green claims”.
07:47 AM GMT
Low EuroMillions jackpots hit National Lottery operator’s profits
National Lottery operator Allwyn has revealed falling sales and earnings in the UK as it was held back by unfavourable EuroMillions jackpots and a lack of new products ahead of the licence handover.
Allwyn said sales in the UK fell 4pc to €3.9bn (£3.3bn) in 2023 while underlying earnings were 5pc lower at €181.4m (£155.5m).
The group - which bought previous National Lottery operator Camelot in February last year in the run-up to it taking over the next 10-year licence - blamed “unusually unfavourable EuroMillions jackpot cycles”.
It said there were only 14 draws for EuroMillions with a jackpot above €100m, compared with 33 such draws in 2022.
Allwyn also said its UK performance was held back by “limited product and channel developments towards the end of the previous licence”.
07:39 AM GMT
Ithaca in talks to create North Sea’s second largest operator
Ithaca Energy, one of the companies behind the Rosebank oil field, is in exclusive talks with Italy’s Eni which will see it hand over up to 39pc of its shares in return for Eni’s assets in the UK.
The deal will create the second largest independent company operating in the UK North Sea, Ithaca said.
“Eni has granted Ithaca Energy exclusivity in respect of the assets, the subject of the potential combination, for a period of four weeks from the date of this announcement,” the business said.
London-listed Ithaca Energy and Norwegian state energy company Equinor were given approval last year to carry out the development of the Rosebank oil field 80 miles off the coast of Shetland, which holds up to 500m barrels of oil.
07:32 AM GMT
Travis Perkins boss to step down
Travis Perkins chief executive Nick Roberts will step down from the role after five years at the helm, Britain’s biggest supplier of building material has revealed.
Mr Roberts, 55, has agreed to remain in the role until a successor is identified, the company said.
The company said he and the board had agreed that “now is the right time to search for a new leader to take the business forward”.
His departure comes weeks after Travis Perkins flagged another year of challenging demand following a 39pc drop in its 2023 profit.
Earlier this month, the company said it was reviewing some of its consumer-facing Toolstation businesses in Europe.
07:27 AM GMT
Chinese EVs to take quarter of European market this year
China is clawing a greater share of the electric vehicle market away from European rivals as new figures suggest a quarter of EVs sold within the EU this year will come from the country.
Almost a fifth of electric vehicles sold in Europe last year were made in China and this is on track to reach 25pc this year, according to new analysis by Transport & Environment (T&E).
While Chinese imports into Europe have largely been Tesla, Dacia and BMW cars produced there, it is projected that Chinese brands such as BYD could secure 11pc of the European EV market this year and 20pc in 2027.
The forecast comes as the EU is considering import tariffs to counter subsidies for China’s EV industry.
Julia Poliscanova, senior director at T&E, said: “Tariffs will force carmakers to localise EV production in Europe, and that’s a good thing because we want these jobs and skills.
“But tariffs won’t shield legacy carmakers for long. Chinese companies will build factories in Europe and when that happens our car industry needs to be ready.”
The EU is widely expected to increase tariffs on EVs from China after an investigation into whether local subsidies helped electric cars made in China undercut European-made models.
Raising the EU tariff on all vehicle imports from China to 25pc would make medium-sized sedans and SUVs more expensive than their European equivalents – making the case for EU manufacturing, said T&E. Compact SUVs and larger cars imported from China are expected to remain slightly cheaper with such a tariff.
However, it warned that the EU should not aim to “shield its carmakers from meaningful competition”, which would limit the offer of affordable electric cars for Europeans.
It said: “It is crucial that a higher tariff is accompanied by a regulatory push to increase production of EVs, including electrification targets for company car fleets by 2030 – on top of the agreed 100pc clean car goal in 2035.”
07:21 AM GMT
Good morning
Thanks for joining me. China’s car brands could command a fifith of the European electric vehicle market by 2027, according to industry figures.
A quarter of the electric cars sold in Europe are already expected to have been made this year in the world’s second largest economy, Transport & Environment (T&E) said.
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What happened overnight
The Japanese yen hit a 34-year low against the dollar, just over a week after the Bank of Japan announced a much-anticipated interest rate hike in a shift away from years of ultra-loose monetary policy.
The currency weakened to 151.97 per dollar, its softest since 1990, but Tokyo stocks ended higher with investors seeking to secure dividend rights as the current financial year draws to a close.
The benchmark Nikkei 225 index rose 0.9pc, or 364.70 points, to end at 40,762.73, while the broader Topix index added 0.7pc, or 18.48 points, to 2,799.28..
Asian shares were mixed after Wall Street slipped a bit further from its record highs.
Chinese shares slipped even as China’s central bank governor told a high-level business conference in Beijing that the ailing property industry was showing signs of recovery and that the impact from defaults of dozens of developers was limited.
Hong Kong’s Hang Seng index lost 0.8pc to 16,485.26 and the Shanghai Composite index was down 0.5pc at 3,015.74.
The S&P/ASX 200 added 0.2pc to 7,799.10. In Bangkok, the SET was little changed. India’s Sensex was up 0.3pc and the Taiex in Taiwan also advanced 0.3pc.
US stocks fell even further from record heights on Tuesday.
The S&P 500 fell 0.3pc to 5,203.58 for its third straight modest drop since setting an all-time high.
The Dow Jones Industrial Average dipped 0.1pc to 39,282.33, and the Nasdaq composite fell 0.4pc to 16,315.70.
