News / 14 Aug 2024
Published: 14 August 2024
By Suzanne Evans, Director, Political Insight
Inflationrose back above theBank of England’s2% target in July according to figures released this morning by theOffice for National Statistics(ONS), which pegged price rises at 2.2% overall. Core inflation,however, which excludes volatilefood and energycosts, dropped to 3.3% last month, down from 3.5% in June. The increase marks the first since December 2023, since when inflation has fallen steadily. Economists had expected inflation to rise to 2.3% because of fast-rising prices inairline flights, package holidays, andhotelsbut,in fact, the ONS said, the largest downward contribution actually came fromrestaurantsandhotels.The largest upward contributions came fromhousingandhousehold services, as the prices ofgasandelectricityremained at elevated levels.Service price inflationalso fell for the second month in a row to 5.2%, down from 5.7% in June. This has ledformer Bank of England interest rate setterMichael Saunderto write in theinewspaper: “The big picture is disinflationary.Pay growthis slowing,economic growthis sluggish, the previous tightness in thelabour markethas unwound, and the upward effects on core inflation of the previous energy price surge are fading”. All in all, the detailed figures are “reassuring” he adds, concluding: “By the end of next year,interest ratesprobably will be at – or heading for – a number starting with a three once again”.
House pricesin the UK rose by 2.7% in the 12 months to June to an average of £288,000 theONSalso said this morning. June's annual increase was the same as May's, which was the joint-highest since March 2023. Rents for private housing also rose by 8.6% in the year to July, the same in the year to June.
TheInstitute for Fiscal Studies(IFS) has foundBritain’s poorest householdssaw the bill for theirweekly food shoprise by 29.1% at the height of thecost of living crisis, compared with 23.5% for better-off households, because the sharpest price increases fell oncheaper brands. The IFS calls this “cheapflation,” and saysgroceryitems that were among the cheapest, including staples such asmilk, pastaandbutter, rose by 36% over the two years to last September, while more expensive versions of the same items rose by just 16%. If the poorest 25% of households had faced the same inflation rate for groceries as the richest 25%, theirannual food billswould have been cut by £100, the IFS said, noting that in no equivalent 24-month period in recent times has there been such high differences in the inflation rates of these two groups.
Britainis set to steam ahead ofGermanyto become Europe’s largestentertainment and mediamarket next year, according toPwC’s Global Entertainment and Media Outlookfor 2024-2028. The UK’s entertainment and media sector is forecast to exceed £100bn in revenue for the first time in 2024, with growth expected to reach £121bn by 2028, driven by a huge increase ininternet advertising,cinema,andlive music.
65% ofalternative funds managers- which focus on markets beyondstocksandbondssuch asproperty, private equityandinfrastructure investing, have been hit with governance related fines or sanctions in the last two years due to governance failures,Bovill Newgate has found.Paul Ford, head of regulatory and governance at Bovill Newgate, said: “The alternative fund managers we surveyed have always taken governance extremely seriously, but the regulatory landscape is constantly changing and becoming even more complex, particularly for the global firms. Bovill Newgate are experts in global financial services regulation and compliance, their website says.
Chancellor Rachel Reevesis said to be considering reducing by £20m a £65m state aid package to expand anAstraZeneca vaccine-manufacturing site in Speke, Merseyside, promised byformer Chancellor Jeremy Hunt. The cut to funding is part of a wide-reaching review of all investment decisions taken by the previous administration, theFinancial Timessays, a review to plug a £22bn black hole in public finances Reeves claims was “covered up” by theConservativegovernment. “The decision to cut funding by a third would come as a blow to AstraZeneca, whosechief executive, Pascal Soriot– the highest-paid boss in theFTSE 100– announced last month that it was ‘absolutely ready to go’ with the scheme and hoped the investment could be concluded quickly,” theGuardiansays. ATreasuryspokesperson said: “We are committed to making the UK one of the best places in the world to develop and manufacture new and innovative medicines. The chancellor receives regular updates on this planned investment in Speke, and we are in positive discussions with AstraZeneca to support its delivery”.
Post Office IT boss Chris Brocklesbyis stepping down after failing to replace the company’s faultyHorizonsoftware, which led to hundreds ofsub-postmastersbeing wrongfully convicted on fraud related charges in one of Britain’s largest miscarriages of justice. Brocklesby joined as chief transformation officer last August on a one-year contract. He will leave next month, to be replaced on an interim basis byAndy Nice, who led a turnaround plan atformer National Lottery operator Camelot.The Post Office began work to replaceHorizonin 2021, and expected to so by next year, but the switch is proving disastrous: a series of delays is said to mean the system could remain in place for many more years, while the cost to replace it has ballooned.The TelegraphsaysThe Treasuryhas been asked to contribute a further £1bn towards the replacement bill, yet the project was expected initially to cost £180m.
BPis to use its expertise gaineddrilling for oil“in extreme environments” on Earth to helpNasain its quest to establish a base onthe Moon,The Telegraphreports. The British energy giant has signed a deal with the US space agency that could ultimately lead to collaboration on a range of technology, includinghydrogenpower, high-capacitybatteriesand smallnuclear fission systems. Nasa is working on creating the firstlunar space station, while future plans include develop living accommodation on the moon’s surface, along with energy systems, and this is where BP’s expertise in said to come in. BP said the initial phase of the agreement will focus on developing standards that “allowengineersandscientiststo visualise equipment in remote locations more than 7,000 feet underwater or millions of miles away on another planet”. Last year,TheUK Space Agencyagreed £2.9m in funding forRolls-Royceto explore hownuclear powermightsupport a future moon base.
John Lewisis shedding 153 jobs as part of a major restructuring plan,Retail Weekreports. The headcount reduction equates to around 1% of its current workforce, and the department store giant says it hopes to achieve the cut by natural attrition and voluntary redundancies.
Asdais continuing to lose market share according to the latest data fromKantar. Sales at Asda have fallen by nearly £300m over the past year, from £4.52bn to £4.25bn, and its market share has dropped 1.1%. Meanwhile overall sales have increased by 3.8% atTesco, Sainsbury’sandLidlin the four weeks to 4thAugust, compared with the same period a year ago.
Bellwayhas walked away from plans to buy smaller rival housebuilderCrest Nicholson. Bellway made three proposals before its £720m offer was deemed acceptable, and last week the two said the deal was progressing well. No explanation for the surprise decision has been given by Bellway.
Flutter Entertainment, the owner ofPaddy Power,is in detailed talks to buySnaitech, the Italian consumer gambling arm of London-listedPlaytech, for about £2bn - a deal worth more than Playtech’s entire current market capitalisation,Sky Newssays.
The Advertising Standards Authority(ASA) has banned adverts featuringDragons’ Den star Steven Bartlettfor nutrition brandsZoeandHuelafter ruling they “omitted material information” by failing to disclose their commercial relationship with the celebrity entrepreneur. Bartlett, who made his fortune after co-foundingSocial Chainin Manchester, is an investor in Zoe and a Director at Huel. The advert for Zoe, posted onFacebook, featured an image of Bartlett with a Zoe patch on his arm, with a quote from him saying: “If you haven’t tried Zoe yet, give it a shot. It might just change your life.” Defending the ad, Zoe said the average consumer would understand that there was a commercial relationship if a celebrity appeared in an ad for a brand, and argued that the consumer did not need to know the exact nature of that relationship. Huel, whose ads featured Bartlett stating that itsDaily Greenspowder was the “best product” it had released, argued pretty much the same. However the ASA disagreed, saying many consumers were unlikely to understand from the ads that Bartlett had a financial interest in the brands’ performance.
Avon Products Inc(API), which owns beauty brandAvonin the UK, Europe and Latin America, has filed forbankruptcyas it tries to off-load more than $1bn of debt, including millions of dollars in liabilities linked to lawsuits alleging thattalcin its products caused cancer. API has filed for Chapter 11 bankruptcy in the US, a move it says will allow it to address its debt obligations in an “orderly manner”. Parent companyNaturahas proposed buying back its trading operations outside the US for $125m (£97m) after the bankruptcy process is complete. API has already spent $225m in costs defending itself againstpersonal injury lawsuitsand settlement payments and said it does not have “sufficient liquidity” to defend or settle the 386 individual talc-related cases. The company has total debts of $1.3bn and liabilities relating to talc claims worth $78m.
Why Media is an award-winning design, marketing, digital communications and PR agency offering tailored solutions to companies on a global scale. We have extensive experience in delivering design and marketing services to a spectrum of companies including professional services, property companies, financial institutions and shopping centres. We have offices in London UK, Hertford UK, Finestrat ES & Brescia IT.
Marketing Contact
Name:Claire White
E-Mail:claire@whymedia.com
Telephone:01992 586 507
