Economics: Research Guide

Brent crude dips to $90 per barrel as markets monitor Israel-Iran, while 14,000 jobs could be cut at TeslaMiddle East crisis live: Israel calls for new sanctions on Iran at heated UN security council meetingTesla to cut 14,000 jobs as Elon Musk bids to make it ‘lean, innovative and hungry’After 90 minutes trading, London’s stock market is lagging behind the rest of Europe.The FTSE 100 is currently down 42 points, or 0.5%, at 7953 points, dragged down by losses among oil companies BP and Shell, and precious metals producer Fresnillo.Investors are on alert for retaliatory action following Iran’s attack on Israel. Fears are brewing that a dangerous new episode of escalating conflict is ..

Poverty reduction drive all but halted across many nations as Bank calls for more money to tackle a ‘great reversal’Larry Elliott: At last G20 is showing how to fund an assault on povertyThe devastating impact of the pandemic on the world’s poorest countries has brought poverty reduction to a halt and led to a widening income gap with nations in the rich west, the World Bank has warned.In a report released to coincide with its half-yearly meeting, the Washington-based organisation said half of the world’s 75 poorest nations had seen income per head rise more slowly than in developed countries over the past five years. Continue reading...

Brazilian president Lula’s proposals have the backing of the World Bank. Now we need action All things considered, the world’s richest countries have emerged from the global pandemic in better shape than they could have imagined when Covid-19 first appeared just over four years ago.To be sure, the impact of lockdown and its aftermath has been painful, but the effects on poor countries have been far more severe. Continue reading...

When I met the Dutch politician Geert Wilders years ago, he was set on ‘Nexit’. Now he too would rather stay in the EUExports are performing badly, pace the fantasy world of the Daily Express; supply lines for imports once regarded as routine are disrupted or discontinued altogether; staff shortages owing to new restrictions on travel and employment of our fellow Europeans are hurting the hospitality trade in what we used to boast about as our “service economy”. The UK’s economy is “5% worse off than it would be in the EU” according to a recent well-researched report by Goldman Sachs. Welcome to Brexit Britain!In the early days of the Brexit disaster, I met Michel Barnier, the ..

Fragile recovery, low growth, global debt, AI, the climate … The organisations founded in 1944 have lots to talk about this weekThere is likely to be a sense of relief when the International Monetary Fund and the World Bank hold their half-yearly meetings in Washington this week. Not because the world is crisis-free – it clearly isn’t – but because since they met six months ago no fresh crisis has emerged.The past half-decade has been as tough as any period in the history of the two organisations. First there was the pandemic, then the surge in inflation as lockdown restrictions were lifted. The cost of living problems were amplified by the war in Ukraine. Then, last October, two day..

The government might be celebrating falling inflation, but higher prices for goods and services are here to stayTwo years ago, a two-litre bottle of supermarket olive oil cost about £7. Step into your local branch today and that same bottle will set you back more than £16. Grab a packet of pasta, or some broccoli, and you will pay 95% and 50% more, respectively, than in 2022. If your car insurance renewal is due, that will be an extra 35%-50%.The Russian invasion of Ukraine almost 26 months ago set off a chain reaction that caused energy and food bills to jump, and ultimately sent inflation in the UK spiralling, reaching a peak of 11.1% in October 2022, the highest rate in 41 years. Contin..

Chancellor cheers 0.1% rise in GDP, but IoD fears economy still fragileBank of England forecasts undermined by out-of-date-methods, report findsUK takes another step on path to exit recession as GDP risesCity experts sound confident that the UK economy will pull itself out of recession.Today’s news that the economy grew by 0.1% in February and 0.3% in January bolsters hopes that GDP did not shrink in the January-March quarter.“The UK has continued its positive start to the year as GDP grew again in February, albeit only marginally, and looks on course to be pulled out of the short and shallow recession it entered at the end of last year.“UK GDP is estimated to have risen 0.1% in Februa..

Former US Fed boss Ben Bernanke criticises failure to admit mistakes and change courseDo better: Bernanke gets strict with Bank of EnglandThe Bank of England’s recent record of forecasting inflation and the path of interest rates was undermined by out-of-date methods and a failure to communicate clearly with the public, according to a bruising independent assessment.The report by the former US Federal Reserve boss Ben Bernanke said the Bank spent much of its time attempting to justify its poor judgment rather than admitting its failures and changing course. Continue reading...

Report by former US Federal Reserve boss reveals faulty economic model and reluctance to admit mistakesBank forecasts undermined by out-of-date-methods, report findsThe Bank of England has got markedly worse at forecasting the economy in recent years. Its economic model is faulty. Its systems are out of date. It has been reluctant to admit past mistakes. Communication with the public could be better.If Threadneedle Street thought it was going to get an easy ride when it called in the former head of the US central bank, Ben Bernanke, to conduct a review of how decisions on interest rates have been made in recent years, it was mistaken. Continue reading...

February growth of 0.1% comes despite construction and retail being hit by wet start to yearBusiness live – latest updatesBritain’s economy has taken a step closer to exiting recession as official figures showed growth continued in February despite a washout month for construction and retail after one of the wettest starts to a year on record.The Office for National Statistics (ONS) said gross domestic product (GDP) rose by 0.1% in February, matching City economists’ forecasts and extending a recovery after growth in January was revised up from 0.2% to 0.3%. Continue reading...

Kristalina Georgieva also cautions of danger of ‘tepid twenties’ – a decade of sluggish economic growthBusiness live – latest updatesUK politics – latest updatesThe world’s leading central banks must resist calls from politicians for early interest rate cuts amid concerns over stubbornly high inflation on both sides of the Atlantic, the head of the International Monetary Fund has urged.Kristalina Georgieva said high inflation across advanced economies was “not fully defeated” and could require a longer wait before reducing borrowing costs. Continue reading...

European Central Bank says rate cuts would be appropriate if inflation keeps falling, as BoE policymaker Megan Greene argues UK rate cuts are a way offThere’s takeover drama in the self-storage world this morning, as another UK company falls to a foreign buyer.Europe’s Shurgard has agreed a deal to buy London-listed Lok’nStore, in a deal worth £378m. Continue reading...

Exclusive: Australian Energy Markets Commission set interim value for cutting emissions that should reach $420/t CO-e by 2050Follow our Australia news live blog for latest updatesGet our morning and afternoon news emails, free app or daily news podcastNew energy market laws should set a carbon price starting at $70 a tonne, rising steadily to six times that by mid-century, according to the agency that sets the nation’s electricity and gas market rules.In a report released without fanfare at the end of March, the Australian Energy Markets Commission (AEMC) announced an interim value of cutting emissions, starting at $70 per tonne of carbon dioxide-equivalent in 2024. That price should incre..

Thanks to near-monopolies in many industries, corporations are seeing record profits as consumers struggle with high pricesWe learned this week that the Consumer Price Index climbed 3.5% in March from a year earlier, up from 3.2% in February, and faster than most economists anticipated.This poses a conundrum for central bankers who have made it clear they want to see further evidence that inflation is cooling before they cut interest rates.Robert Reich, a former US secretary of labor, is a professor of public policy at the University of California, Berkeley, and the author of Saving Capitalism: For the Many, Not the Few and The Common Good. His newest book, The System: Who Rigged It, How We ..

Additional measures from 30 April for imported animal and plant products could hike costs by 10% in first year, says Allianz TradeNew post-Brexit UK border controls coming into force later this month will cost British businesses £2bn and fuel higher inflation, according to a report warning that UK-EU trade will be damaged as a result.With less than a month before the introduction of new checks on animal and plant products from 30 April, the insurer Allianz Trade said the controls agreed under Boris Johnson’s Brexit deal could add 10% to import costs over the first year. Continue reading...

Rolling coverage of the latest economic and financial newsRising home and gas costs pushed US inflation higher than expected in MarchTesco says grocery inflation has lessened as it plans £500m efficiency savingsRatings agency downgrades China debt outlook over economic uncertaintyFitch’s downgrading of China’s credit outlook today highlights the dilemma that policymakers are facing, as they try to stimulate growth and cut debt levels, explains Lynn Song, chief economist for Greater China at ING:On one hand, there is certainly a need to support economic growth in the near term, and fiscal support in our view is important in order to avoid falling into a so-called “Japanisation” trap,..

Call for caution amid fears government intervention could lead to costly mistakes and prompt subsidy battleAggressive use of industrial policy by the world’s most powerful economies risks becoming an expensive mistake that could trigger a tit-for-tat subsidy war, the International Monetary Fund has said.In a warning shot to governments around the world, the IMF said attempts to increase innovation only worked under certain limited conditions and were not a “magic cure” for slow growth. Continue reading...

The consumer-price index, driven by fuel and housing costs, rose 0.4% from February, higher than the 0.3% expectedGlobal financial markets have scaled back expectations for an imminent cut in interest rates on both sides of the Atlantic after figures showed US inflation rose by more than expected in March.Figures from the US Department of Labor show a jump in fuel and housing rental costs drove up the consumer price index (CPI) to 3.5% in March compared with a year earlier, higher than expected by Wall Street economists. Continue reading...

Simon Stiell calls for reform at development banks to enable governments to provide more climate finance to developing world The World Bank must take a “quantum leap” to provide new finance to tackle the climate crisis or face “climate-driven economic catastrophe” that would bring all the world’s economies to a halt, the UN climate chief has said.Simon Stiell warned that there were just two years left to draw up an international plan for the climate that would cut greenhouse gas emissions in line with the goal of limiting temperature rises to 1.5C above preindustrial levels. Continue reading...

Small business owner Scott Richardson chose Trump to shake things up but a strong economy means he’s sticking with BidenFor the past 35 years, Scott Richardson and his wife, Theresa, have run a small, cheerful restaurant and catering business outside Philadelphia. Occasionally Yours has long been a community meeting spot in the town of Swarthmore. More recently, it has taken on another, unexpected, role – on the stage of national politics.Richardson is an independent-minded small business owner in a key swing state – exactly the kind of person US presidential candidates are desperate to woo. In 2016, when Pennsylvania went Republican for the first time since 1988, he voted for Donald T..

Output improves to 20-month high and job losses slow but global problems continue to restrict foreign ordersA jump in domestic orders helped pull UK factories out of almost two years of contraction last month, according to a leading business survey.Output from the manufacturing sector improved to a 20-month high in March, marking the end of a period of shrinking activity that started in July 2022. Continue reading...

It’s regularly being created and destroyed – and economic models that don’t reflect that fact are not even slightly usefulGet our weekend culture and lifestyle emailIn the classic 1946 film It’s a Wonderful Life, depositors demand their money from a small-town building society. Its manager, George Bailey (in an unforgettable performance by James Stewart), explains that the money is not in the building society’s vault; it has been lent to other people in the town. “The money’s not there,” Bailey pleads. “Your money’s in Joe’s house … And in the Kennedy house, and Mrs Macklin’s house, and a hundred others.”Bailey’s explanation reflects a widespread idea of how ban..

Retailers cut the price of Easter treats, clothing and electrical items as consumer spending slowedInflation in shop prices in the UK has eased to the lowest level for more than two years after retailers cut prices on Easter treats, clothing and electrical goods amid a slowdown in spending by consumers in the cost of living crisis.Industry figures show prices rose at an annual rate of 1.3% in March, down from a rate of 2.5% in February – the slowest pace since December 2021, according to the latest monitor from the British Retail Consortium (BRC) trade body and the market research firm NielsenIQ. Continue reading...

Julian Richer, a landlord himself, says markets have created only disaster and the nation must shift from its focus on ownershipBritain is a nation obsessed with home ownership. A fundamental necessity for all turned commodity to speculate on, it is featured on daytime TV as entertainment, the sure-fire profit-spinner open to anyone.The truth, as we all know, is that the prospect of home ownership is drifting increasingly out of reach for millions. Figures released last week show that as few as 7% of local authorities in England and Wales have homes that can be bought for less than five times workers’ earnings and are therefore deemed “affordable”. In 1997 the figure was 88%. Continue ..

The Conservatives’ pernicious reign, defined by a toxic belief in self-organising markets, has brought Britain to its knees. But we now have an opportunity to turn things around – by reimagining the UK as a ‘we’ society rather than an ‘I’ societyIf there is any consensus in our otherwise fractured, toxic national debate it is that we cannot go on like this. Our economy is in crisis, exemplified by an annual £100bn shortfall in public and private investment, which must be lifted decisively for Britain to break out of today’s triple whammy of stagnant growth, productivity and living standards. Society reels from alarming gaps in the provision of crucial public services and the y..

The shadow chancellor is often criticised for her centrist positions, but Labour’s plan for a long-term rescue is a vital difference between the partiesWhen preparing to become Labour’s chancellor in 1964, James Callaghan used to go up to Oxford for economics lessons at Nuffield College. The present shadow chancellor, Rachel Reeves, is already steeped in economic knowledge, including that of the UK’s economic history, as her recent Mais lecture at Bayes business school made clear.I was amused by some of the pre-lecture media speculation that Reeves might express her admiration for Margaret Thatcher. On the contrary, she let it be known, in an aside not in the printed text, that distast..

Guardian Australia’s Full Story co-host Jane Lee and reporter Matilda Boseley investigate the mystery of who screwed young people out of affordable housing, education and secure workWith rising house prices, a decade of wage stagnation and ballooning student debt, young people in Australia are living through what author Jill Filipovic describes as ‘a series of broken promises’. In episode 1 of this new series from Guardian Australia, Full Story’s co-host Jane Lee and reporter Matilda Boseley sort through these broken promises, investigating why young people are living in a time of such economic strain.In this episode, we hear from a handful of experts featured in Who screwed millenni..

Live, rolling coverage of business, economics and financial markets as minister says water company’s leadership has been a ‘disgrace’The UK government has said it is prepared for “a range of scenarios” for Thames Water.A government spokesperson said:Like any company needing to secure new investment there are a wide range of options available to water companies, including the injection of new equity from any prospective investors.Ofwat, as the financial regulator of the water sector, continues to engage with Thames Water to improve its financial resilience.I don’t want to pollute rivers, and nor does anyone in Thames Water. I would point out that E coli has many different sources...

Greater fall per head and latest trade data illustrate longer term decline of economy• Blow for Sunak as revised figures confirm UK went into recession last yearBusiness live – latest updatesAs the UK economy struggled for momentum, with households tightening their belts, higher defence spending in the second half of last year was a factor that prevented it from contracting by more than it did.The second estimate by the Office for National Statistics of national income, as measured by gross domestic product last year, showed that extra cash for the military, and an increase in government spending more generally, masked a deep and persistent recession in manufacturing and downturns in sev..

Although there are significant financial and emotional benefits to returning to the nest, it should be a choiceThe 2021 census already confirmed it: more adult children than ever are still living with their parents. But the Financial Times has recently revealed just how drastically the scales have tipped: about 40% of 18- to 34-year-olds now live with their parents, making it the most common domestic arrangement for this age group. Previously, it was living as a couple with children.It’s not just an epidemic of Young, Dumb and Living Off Mum – I’ve moved back home twice since graduating in 2018, and I know plenty of young well-to-do professionals who have felt obliged to do the same, o..