Economics: Research Guide

From post and planes to TV, phones and retail chains – and even a central bank – here are the chiefs facing the most testing of timesA year is a long time in business: enough time for things to turn sour financially, or to engineer a comeback. Here are our picks of the figures across all sectors who face a testing year with something big to prove in 2025 Continue reading...

Joe Biden blocks Nippon Steel’s bid to purchase US SteelNovember’s money and lending data suggests that consumer caution around borrowing and saving has failed to fade in the wake of the Labour government’s budget, according to Capital Economics.Its analysts say this adds further downside risk to its Q4 GDP forecast of 0.0%.The £0.9bn rise in consumer credit in November was a bit lower than October’s rise of £1.0bn and the average gain of £1.2bn over the previous six months.This suggests households have become a bit less willing to take on more unsecured credit and it chimes with the retail sales figures which indicate households reined in their spending in Q4. Continue reading...

Live, rolling coverage of business, economics and financial markets as 2025 starts with trepidation over new US administration’s trade policies, and the global manufacturing sector strugglesNine out of ten new cars sold in Norway last year were powered by battery only, as the country approaches the feat of becoming the first to completely ditch petrol and diesel sales.Norway is aiming to completely phase out sales of cars with petrol and diesel engines by 2025. The latest data from the Norwegian Road Federation suggest that it is well on track.Norway will be the first country in the world to pretty much erase petrol and diesel engine cars from the new car market. Continue reading...

Pound drops to nine-month low against dollar after PMI for December signals further contraction in manufacturingBusiness live – latest updatesManufacturers in the UK have cut back output at the fastest rate in 11 months, compounding the gloomy picture for the British economy, according to a closely watched survey.The purchasing managers’ index (PMI) for manufacturing fell in December to 47, down from 48 in November – its weakest reading since February. Any reading below 50 signals a contraction. Continue reading...

Good for equities, good for the US, and good for crypto but the year spawned mixed blessings for the UK, China and EuropeGlobal stock markets climbed in 2024, helped by falling inflation and the US economy’s success in avoiding a hangover from a strong post-pandemic recovery.While Europe and the UK struggled to make headway, the US maintained pole position at the top of the rich nations’ growth league, pushing shares in New York to new record highs. Continue reading...

With threats of recession, global fracturing and increasingly angry voters, Labour’s sticky start is unlikely to get any easierThe 2020s have been a dismal decade. Five years ago, when the first reports emerged of a new virus that had its origins in the Chinese city of Wuhan, it was hard to imagine that Covid-19 would have such a devastating impact. Yet within months, the UK was in lockdown, the global economy was in a chokehold, trade flows had dried up and governments were spending freely to prevent deep recessions turning into something even more catastrophic.A second Great Depression was avoided, but half a decade on, the long-term effects of the pandemic are still being felt. Predicti..

‘Cautious optimism’ forecast despite end to key stamp duty relief and fears of higher taxes and interest ratesExperts have predicted a “buyer’s market” for house hunters in the year ahead, giving them greater negotiating power as the mood of the housing market shifts to “cautious optimism”.However, even the more hopeful expectations for 2025 were met with caution, as an important stamp duty relief for first-time buyers was scheduled to end in the spring, as well as potentially high interest rates and taxes bearing down on the market. Continue reading...

Rolling coverage of the latest economic and financial news, on the final trading day of the yearWall Street is set for a calm final session of 2024, judging by the latest futures prices which show the Dow flat:European gas prices are also higher today, with the month-ahead contract up 0.8% at €48.25/MWh.Gazprom said it would send only 37.2 million cubic metres on Tuesday compared to 42.4 mcm on Monday. Flows are expected to fall to zero from the early hours of Jan. 1 after the expiry of the five-year transit agreement.Its demise marks the almost complete loss of Moscow’s once mighty hold over the European gas market. Ukraine refused to negotiate a new deal because of the war. Continue re..

President seeks to allay fears that world’s second-largest economy will falter in 2025 because of high US tariffsChina’s economy is on course to expand by 5% in 2025, according to its president, Xi Jinping, meeting official growth targets and rebutting concerns that Donald Trump’s incoming US administration will harm Beijing’s prospects in the new year.Using his annual address to the nation, Xi sought to allay fears that the world’s second-largest economy would falter over the next 12 months after the government battled to prevent a slide towards recession during 2024. Continue reading...

Relaxing financial rules risks undermining stability, ignoring post-crash lessons and prioritising short-term gains over the long-term health of the economyRachel Reeves’s enthusiasm for the City of London – the “crown jewel in our economy” – raises concerns. Economists were worried enough to publicly warn her this month that liberalising financial sector regulations could undermine the government’s efforts to grow the economy, posing “particular risks to the government’s wider industrial strategy”. They also stressed the importance of not forgetting the painful lessons of the 2008 global financial crisis.The experts were responding to the chancellor’s November Mansion Ho..

Rolling coverage of the latest economic and financial newsJapan’s blue-chip stock index has ended the year at its highest year-end finish on record, despite a small selloff today.The Nikkei stock average ended down 386.62 points, or almost 1%, today at 39,894 points.“There was much optimism in the first half of the year with hope for a favorable cycle in which wages increase in tandem with prices, alongside the weak yen for corporate profits.” Continue reading...

Study predicts an ‘intention economy’ where companies bid for accurate predictions of human behaviourArtificial intelligence (AI) tools could be used to manipulate online audiences into making decisions – ranging from what to buy to who to vote for – according to researchers at the University of Cambridge.The paper highlights an emerging new marketplace for “digital signals of intent” – known as the “intention economy” – where AI assistants understand, forecast and manipulate human intentions and sell that information on to companies who can profit from it. Continue reading...

Economic confidence polls reveal that 70% expect turnover to rise and 73% expect profitability to riseA majority of UK businesses expect a positive start to 2025, according to two economic confidence surveys which show managers planning for growth after a challenging period for the economy.About 70% of UK businesses expect their turnover to increase over the next year, up from 62% in December 2023. Meanwhile, 73% are confident of greater profitability, according to research from Lloyds bank. Continue reading...

Biden’s loan forgiveness efforts have faced major resistance, but people are bracing for worse under president-electJoe Biden has pushed during his presidency to cancel student debt for tens of millions of Americans. Now Donald Trump, who has branded such efforts “vile”, is preparing to succeed him – leaving borrowers at risk of losing relief they received, or had been waiting for.Mary Ann Rockwell, 72, is a librarian in upstate New York. She has grappled with her student loans for years, as interest ballooned while she often struggled to afford to make payments. Continue reading...

While Labour’s critics are circling, pay growth is resilient and inflation is coolingNot everything has gone smoothly for Keir Starmer. At the end of Labour’s first calendar year in power since Gordon Brown was in Downing Street a decade and a half ago, the prime minister is on the back foot after a run of disappointing economic updates.With a backlash over several unpopular tax and spending decisions, and as pressure mounts for a change in course early in the new year, the new government is in danger of losing control of its primary mission to revive Britain’s misfiring economy. Continue reading...

Treasury secretary says ‘extraordinary measures’ needed to avoid default, and urges lawmakers to raise borrowing limit Janet Yellen, the treasury secretary, has said her agency will need to start taking “extraordinary measures”, or special accounting maneuvers intended to prevent the nation from hitting the debt ceiling, as early as 14 January, in a letter sent to congressional leaders on Friday afternoon.“Treasury expects to hit the statutory debt ceiling between January 14 and January 23,” Yellen wrote in a letter addressed to House and Senate leadership, at which point extraordinary measures would be used to prevent the government from breaching the nation’s debt ceiling –..

Unpredictable change will sweep through America, while old problems, from war to inflation, are likely to afflict other countriesThe global economy is entering the new year with rising geopolitical tensions looming over its prospects, as the world’s leading central banks attempt to cut interest rates after the worst inflation shock in decades.Donald Trump’s second term in the White House is expected to dominate the economic agenda. Global trade tensions are on the horizon as the president-elect threatens to impose sweeping tariffs on US imports. Continue reading...

Rolling coverage of the latest economic and financial newsBoxing Day footfall down on UK high streets despite discountsMore drama in the currency markets!India’s currency, the rupee, hit an all-time low today before rebounding – sparking speculation that the Indian central bank was selling dollars via state-run banks to curb the weakness.The Reserve Bank of India “stepped in heavily” near the 85.80 level, which helped the rupee recover, a trader at a foreign bank said.Dollar demand related to maturing non-deliverable forwards (NDF) and currency futures weighed on the rupee on Friday while panic dollar buying from importers compounded the pressure, traders said. Continue reading...

Economists say EU countries hardest hit by 2010s debt crisis now in stronger position than France and GermanyThe European Central Bank is facing a tough balancing act in 2025 as it tries to navigate a reversal of fortunes in eurozone economies, as the hardest-hit nations of the 2010s debt crisis outperform the traditional core.Highlighting a potential shift in power dynamics within the single currency bloc, economists said countries in the EU periphery ravaged by last decade’s sovereign debt crisis were in a stronger position than northern Europe’s most powerful nations, including France and Germany. Continue reading...

Household incomes to stagnate or fall but will be offset by better public services, says Resolution FoundationHousehold incomes will stagnate or fall next year but the chancellor, Rachel Reeves, will be hoping people feel better off as a result of improvements to public services, a leading thinktank has said.The Resolution Foundation calculated a new measure of “real living standards” that took into account both disposable income and the “in-kind” benefits of public services. Continue reading...

Policy easing and stronger exports have helped economy, but country still faces property crisis and weak demandThe World Bank has lifted its growth forecasts for China’s economy, but called for deeper reforms and warned that the country will continue to face headwinds from a lingering property downturn.The Washington-based institution said that it expected China’s gross domestic product to rise by 4.9% in 2024 as a result of recent policy easing and stronger exports. That is up from June forecasts of 4.8% and is just shy of Beijing’s own 5% growth target. Continue reading...

Campaigners call for action in 2025, as crippling repayments prevent spending to cut poverty and tackle climate crisisCampaigners are urging Labour to lead the charge for global debt relief in 2025, as new analysis shows lower-income countries spent 15% of their revenue on repayments this year – the highest level for three decades.Calculations by the charity Debt Justice, based on data from the World Bank, show repayments from poorer countries bottomed out at 4.4% of income in 2011 but have since trebled. Continue reading...

Rolling coverage of the latest economic and financial news, on a shortened Christmas Eve trading session in LondonUK car industry hails plan for Prius-style hybrids to stay on sale after 2030Jonathan Webster-Smith, chief investment officer at Bowmore Asset Management, makes an important point about the Santa rally concept:“Every year investors hope for a Santa rally – but they should be careful about trading on the back of it.”“The years in which this occurs are a bit too random”.The FTSE 100 has risen in three of the past five years (2019-2023, inclusive) for the ten-day period leading up to New YearSince its creation in 1896, the Dow Jones index has historically risen in 77% of y..

Brics nations’ plan to create rival to greenback is bound to fail even without president-elect’s measuresIn 2023, the leaders of Brazil and the other Brics countries at the time – China, India, Russia, and South Africa – discussed collaboration on a new shared currency. The Brazilian president, Luiz Inácio Lula da Silva, has been a vocal proponent of an alternative to the US dollar, the dominant global currency for the past 75 years, and the Russian president, Vladimir Putin, publicly promoted the idea during the Brics summit in October by brandishing a symbolic Brics banknote. The bloc’s new members – Egypt, Ethiopia, Iran, and the United Arab Emirates – would presumably also..

Financial markets don’t expect a cut until April but a fall in the Australian dollar on Monday suggests confidence one is on the cards Get our breaking news email, free app or daily news podcastA shopping surge on Christmas and Boxing Day could help determine the timing of interest rate relief as the Reserve Bank of Australia watches for a recovery in weak economic activity.Consumers are predicted to splash $3.7bn in the last week of 2024 on top of an expected $70bn in the lead-up to Christmas, according to projections from the Australian Retailers Association and Roy Morgan.Sign up for Guardian Australia’s breaking news email Continue reading...

Peter Malinauskas calls situation ‘tricky’ but says state government will continue to monitor Sanjeev Gupta’s GFG Alliance and act where it canGet our breaking news email, free app or daily news podcastThe South Australian premier says it would be a “national disaster” if Whyalla steelworks closed to leave Australia’s construction industry dependent on imports.“It simply cannot be allowed to happen,” Peter Malinauskas told reporters on Tuesday. “What workers at the Whyalla steelworks should have confidence in is that I do not believe this nation wants to see steel making capacity lost.”Sign up for Guardian Australia’s breaking news email Continue reading...

CBI survey finds firms planning to reduce hiring amid weakest expectations for growth since November 2022British firms are predicting a sharp fall in business activity in the new year, in the latest economic snapshot to warn of an increasingly gloomy outlook for the UK in 2025.The growth indicator survey from the Confederation of British Industry (CBI) indicates firms are preparing to cut down on hiring and reduce output over the next three months. Continue reading...

UK GDP flatlined in the July-September quarter, ONS reports, as companies warn October budget has hurt economy tooMeta to Murdoch: Take the Guardian’s Christmas business quizSharp fall in UK business activity forecast as economic gloom deepensA £3.7bn takeover in the UK insurance sector has been agreed, putting jobs at risk.Aviva has reached agreement with Direct Line to take over its smaller rival in a cash and share deal.“This deal is excellent news for the customers and shareholders of Aviva and Direct Line. It builds on our track record of delivering four years of strong financial performance and, in line with our strategy, it accelerates our growth in capital light business.Aviva a..

The UK’s number-crunching body is still playing catchup over job figures after the pandemic, with validity of survey data being questionedUK economy flatlines, putting pressure on Rachel ReevesThe Office for National Statistics (ONS), with its number-crunchers and crack-of-dawn data dumps, is an unlikely backdrop for turmoil.But in recent months the Newport-based institution has come under repeated attack over questionable jobs figures, which experts have said leave policymakers“flying blind”. On top of this, questions are now being asked about survey data used to formulate its GDP readings, which were revised down for the second and third quarters on Monday. Continue reading...

Tories point finger at Rachel Reeves’s budget but economy has been misfiring for best part of a decadeUK economy flatlines, putting pressure on Rachel ReevesBusiness live – latest updatesEconomic growth revised to zero, stubbornly high inflation, and warnings of job losses on the horizon. After less than six months in office, a narrative is taking hold that Keir Starmer’s government is fumbling his number one mission to reboot Britain’s economy.On the eve of the prime minister’s first Christmas in Downing Street, the early indicators certainly aren’t looking good. After growth was revised down from 0.1% to zero in the third quarter, and with the Bank of England forecasting more o..