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UK economy shrinks as outlook on recession darkens

by www.bbc.co.uk Leave a Comment

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The UK economy shrank between April and June as experts forecast a gloomy outlook with recession on the horizon.

The economy contracted by 0.1% in the second quarter of the year, the Office for National Statistics (ONS) said.

This was partly due to Covid schemes like Test and Trace ending, retail sales falling and the Queen’s Platinum Jubilee bank holiday in June, it said.

The Bank of England has forecast the UK will fall into recession towards the end of the year as energy costs soar.

Despite shrinking between April and June, the UK economy avoided recession because it grew by 0.8% in the first three months of this year.

A recession is defined as the economy getting smaller for two consecutive three-month periods.

Up until now most economists – and the Bank of England – did not expect a recession to begin until the final three months of 2022.

Many expected a small rebound in economic growth between July and September. But the latest figures from the ONS have prompted some experts to warn that recession could come earlier than previous predictions.

The National Institute of Economic and Social Research said it expected the UK economy to continue falling over the next three quarters.

Capital Economics said there was now a greater risk that the economy will shrink by 0.2% between July and September before worsening.

But investment bank Goldman Sachs still predicted growth of 0.4% in the third quarter of 2022. A spokesperson said: “We had previously assumed a sharp bounce back in July but now expect a more muted rebound.”

Kingdom Thenga, who owns a number of local bars and restaurants in Chester, says for him, it already feels like the UK is in a recession.

“I think we are not too far away from it because of the consistent blows we’re getting from energy bills, from people not going out, to the cost of living, it just seems that’s where we’re heading,” he said.

He says his business is currently “in survival mode”.

“It’s not about making money, it’s not about trying to expand or trying to grow our business, it’s just about stabilising the business especially after the pandemic over the last two years,” he told the BBC.

Mr Thenga says the biggest issue he’s facing is rising costs – with everything from poultry to vegetable oil soaring in price – while the amount of money his customers have in their pockets is going down.

“Energy bills are ridiculous, the cost of fuel is ridiculous and I appreciate people don’t necessarily have the money or can’t spend what they used to, because everyone is so worried about what the bills are going to be,” he says.

The UK is facing the worst rate of price rises – or inflation – in 40 years as energy costs continue to soar.

Shrinking

Commenting on the 0.1% contraction between April and June, the ONS said that the biggest contributor was from “human health and social work activities” as Covid test and trace and vaccination programmes were wound down. There was also a fall in retail sales volumes.

However, it said areas such as tourism, bars and entertainment showed strong growth.

“Health was the biggest reason the economy contracted as both the test and trace and vaccine programmes were wound down, while many retailers also had a tough quarter,” said Darren Morgan, director of economic statistics at the ONS.

“These were partially offset by growth in hotels, bars, hairdressers and outdoor events across the quarter, partly as a result of people celebrating the Platinum Jubilee.” This included rises in mobile food stands and takeaway food shops.

The ONS said that in June alone the economy shrank by 0.6% in June due to the extra bank holiday to celebrate the Queen’s Platinum Jubilee.

However, that figure was much better than the 1.3% fall predicted by economists. The ONS said that while the bank holiday impacted on monthly GDP, it had “little impact” on the quarterly figure.

The Chancellor, Nadhim Zahawi, told the BBC that these are “challenging times”.

“What the numbers show today is that the contraction is partly because of some of the Covid activities reducing but also real resilience in the private sector which actually in many ways bodes well… But nevertheless these are challenging times,” he said.

But Labour accused the Conservatives of “losing control of the economy”.

Shadow Chancellor Rachel Reeves said: “With the Bank of England forecasting a recession lasting the whole of next year, the Conservative leadership contenders need to stop playing to the gallery and start coming up with a serious plan to get Britain’s economy back on track.”

A big part of the drop in Gross Domestic Product in June was because of the Platinum Jubilee – which meant two fewer working days of producing goods and services, in contrast to May, which had one additional working day.

It was always expected that that would magnify the downswing from May to June and economists expected a sharper drop in activity.

The 0.1% drop over the three months from April to June was only half as bad as some economists thought.

Nevertheless, given the backdrop of the global squeeze on incomes due to soaring energy prices, no-one can say this drop in activity is just a blip.

The squeeze on the hard-pressed consumer is tightening its grip, with activity in consumer-facing services down by 4.9% compared to before the pandemic.

And with France, Italy and Canada seeing growth, no-one can say this is a stellar economic performance.

All in all, it’s not yet the recession the Bank of England has forecast: more a precursor.

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Biden, Democrats try to redefine ‘recession,’ ‘women,’ and more

by www.foxnews.com Leave a Comment

Ronna McDaniel: Even Bernie said this won’t help inflation

RNC Chairwoman Ronna McDaniel slams the Biden administration’s massive spending bill and their failure to address inflation

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This week, the Consumer Price Index soared by 8.5 percent compared to last year as Americans continue to struggle to afford everyday items. Instead of acknowledging the inflation crisis and the impact it’s having on families nationwide, Joe Biden tried to claim that the numbers showed “zero” inflation. As Biden settles into a week-long beach vacation, he doesn’t care about what voters think: he cares about avoiding blame for the crises he created. In other words, he is lying, and it’s not the first time.

Remember how he and his administration described inflation as “temporary” and “transitory” even as skyrocketing prices kneecapped families and made essential goods almost unattainable? Obama-Biden administration economists warned that pumping needless trillions into the economy would have negative consequences, but for Joe Biden all that matters is trying to change the narrative for political gain.

Biden tried the same cheap sleight of hand with the gas crisis his policies created. Gas prices are close to $2 more per gallon than when Biden took office, and yet he had the audacity to claim Americans are “saving” money on gas. In fact, the average family has lost $1,500 due to higher energy prices since Biden took office.

Two weeks ago, new economic data clearly illustrated that America is experiencing a recession. Joe Biden seems to be the only person who disagrees. When asked that same day if we were experiencing a recession, Biden replied that “doesn’t sound like a recession to me” before walking away from the press.

BIDEN CHIEF OF STAFF GIVES ‘KUDOS’ TO NY TIMES REPORT CLAIMING BIDEN IS ‘RIGHT’ ON RECESSION

Let’s get something straight: a recession happens when we see two consecutive quarters of negative growth in our economy. Don’t believe me? Ask Biden’s own advisors, CNN, The Washington Post, PolitiFact, and USA Today – they’ll all tell you the same thing. Biden tried to re-write the definition of the word to cover for his own administration’s failure. The American people know that we’re in a recession. 72 percent of voters think the economy is “weak” and 64 percent say their financial situation is “getting worse.” Senate Democrats’ response? Passing a bill that will make inflation worse and raise your taxes.

Go back further to when Biden oversaw a deadly and disastrous withdrawal from Afghanistan. The American embassy was hurriedly evacuated, images of desperate  Afghans clinging to planes went viral, and hundreds of Americans were left behind. Thirteen brave U.S. service members died in a bombing that didn’t have to happen. Now, the brutal, repressive Taliban is running Afghanistan into the ground as a result of the Biden administration’s failure.

Any reasonable person would look at the facts and deem such a foreign policy debacle a failure. Biden called it an “extraordinary success.”

The Biden administration has also described mothers as “birthing people” and failed to label the ongoing disaster at our southern border as a crisis. News flash for Joe Biden and his administration: women are women, and four million illegal immigrants crossing the border since he took office is, in fact, a crisis.

That’s not even to mention the fact that since October, Border Patrol agents have apprehended 56 immigrants on the FBI’s terrorist watch list. Fentanyl – one of the deadliest drugs in the world – is also pouring across the open border and has become the leading cause of death for Americans age 18-45. Again, the facts are clear: this is a crisis. And once again, Joe Biden would rather play absurd word games than own up to the problems his policies have created.

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The American people deserve better than Biden’s failed leadership. We also deserve a mainstream media that holds Biden and his advisors accountable for blatantly going back on their previous statements. People like Speaker of the House Nancy Pelosi and National Economic Council Director Brian Deese have already gone on the record agreeing to the definition of recession that Democrats are now frantically trying to rewrite. Most of the mainstream media refused to call out out that clear discrepancy — instead, the RNC did, and we will continue to do so as many in the media run cover for Biden’s policy failures.

CLICK HERE TO GET THE FOX NEWS APP

Above all, Americans deserve better than an arrogant president who thinks that he can explain away real-life problems by simply hoping that Americans fall for his cheap political spin. The classic novel 1984 by George Orwell warned of a totalitarian political movement that would tell voters to “reject the evidence of your eyes and ears.” As Biden and his cronies take a hatchet to the dictionary for their own political gain, we’re watching that disturbing scenario play out in real time. It’s more important than ever that we elect Republicans in November.

CLICK HERE TO READ MORE FROM RONNA MCDANIEL

Ronna McDaniel (@GOPChairwoman) is Chairwoman of the Republican National Committee.

UK economy shrinks in 2nd quarter, sharpening recession fear

by www.sfgate.com Leave a Comment

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LONDON (AP) — The United Kingdom’s economy shrank in the three months to June, figures released Friday showed — a smaller-than-expected contraction that nevertheless added to jitters about the rocky months ahead.

The Office for National Statistics said Britain’s gross domestic product fell by 0.1% between April and June, down from 0.8% growth in the previous quarter. GDP shrank by 0.6% in June, and growth estimates for May were revised down from 0.5% to 0.4%.

The statistics office said health spending was the biggest contributor to the fall, as the government scaled down coronavirus testing, contact tracing and vaccination programs.

“Many retailers also had a tough quarter,” said ONS director of economic statistics Darren Morgan. “These were partially offset by growth in hotels, bars, hairdressers and outdoor events across the quarter,” partly as a result of celebrations of Queen Elizabeth II’s Platinum Jubilee in June.

Analysts said the decline did not necessarily mean the start of a recession, often defined as two quarters of economic contraction. The Bank of England, however, says the U.K. will likely fall into recession later this year as a cost-of-living crisis worsens and inflation rises above the current 9.4%.

The average U.K. household fuel bill has risen more than 50% this year as the war in Ukraine squeezes global oil and natural gas supplies, and another increase is due in October, when the average’s bill is forecast to hit 3,500 pounds ($4,300) a year.

“The fall in U.K. GDP during the second quarter was largely down to noise,” said James Smith, developed markets economist at ING Economics. “But the risk of recession is rising quickly, with gas futures hitting new highs for next winter and our latest estimates suggesting the household energy price cap could come close to 5,000 pounds in the second quarter of next year. Much now depends on fiscal policy announcements in the autumn.”

Anti-poverty campaigners, consumer groups and opposition politicians are pressing Prime Minister Boris Johnson’s Conservative government to help people cope with soaring bills. But Johnson is in his final weeks as prime minister and says “significant fiscal decisions” must be left to his successor, who will take office in September.

Brexit LIVE: ‘Greatest error’ Truss warned Boris’ departure will cripple post-EU ‘fantasy’

by www.express.co.uk Leave a Comment

Rishi Sunak promises new Brexit delivery department

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Mr Johnson’s exit from Number 10 will “bring down the curtain on the Brexit fantasy,” according to a commentator. Writing for the Irish Times, Eoin Burke-Kennedy argues that until now Covid and its fallout had provided a “smokescreen” for the damage caused by Britain’s “messy, and as yet unfinished” EU exit. In a scathing critique of the UK’s decision to leave the bloc, Mr Burke-Kennedy claims Brexit has caused travel chaos and spiralling inflation among other problems. He insists the “fantasy” of Brexit in Britain is over, as shown by a series of byelection defeats, particularly Tiverton and Honiton, which saw an unprecedented 30 percent swing to the Liberal Democrats. The solutions offered by “would-be leader Liz Truss” will fall short of capturing the national spirit and delivering a Brexit worth celebrating, he believes. Mr Burke-Kennedy concluded: “Drummed up in a fervour of nationalism and post-2008 populism but sold as an act of political and economic sovereignty, the Brexit project will go down as one of the great strategic errors in modern British history.”

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'Greatest error' Liz warned Boris departure to cripple post-EU 'fantasy'

‘Greatest error’ Liz warned Boris departure to cripple post-EU ‘fantasy’ (Image: GETTY)

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Tara Fair

‘Made in Britain’ labels fuel £7.6bn post-Brexit surge in UK alcohol exports

Britain’s drinks exports has received a massive post-Brexit shot in the arm, surging by almost a fifth last year, new research has indicated.

In a huge endorsement of outgoing Prime Minister Boris Johnson’s Global Britain strategy, UK brands are now seen as bywords for luxury the world over, the analysis, published by Chartered Accountants and Business Advisers Hazelwoods, concluded.

Drinks exports rocketed from £6.4billion in 2020 to £7.6billion in 2021 an increase of 19 percent, data indicates.

Global exports of Scotch rose by £4.51billion – although 19 percent – year-on-year.

Exports of whisky to the US also spiked thanks to the scrapping of tariffs imposed as part of a US-European trade dispute.

The measures were in place for a year until June 2021, with exports recovering sharply in the second half of 2021.

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Tara Fair

Remainer torn apart after sharing image of stocked shelves as Brexit dig: ‘Same here’

A Remoaner has sparked an online debate after he shared a picture of full supermarket shelves in the EU in an apparent Brexit dig.

He claimed that “Brexit voters” needed to “fess up” that domestic issues were caused by Brexit.

However, people were quick to mock the tweet, pointing out that Britain also had full shelves.

Simon Manning said on Twitter: “Fresh fruit and veg galore. No shortages of staff. Fuel at €1.68 (£1.42). All is good in the EU, affected by the same Covid pandemic and same Ukraine invasion.

“UK politicians and Brexit voters need to fess up that domestic issues are Brexit related and deliver their solution.”

However, others were quick to point out that food was readily available in Brexit Britain

Haighy replied in a tweet: “Yes same here in Wakefield. Payed £1.69 for petrol, no empty shelves at supermarket. What’s your point?”

Another user, Robbie, taking a dig at the EU’s energy crisis added: “Wow, I love Europe. Will the lights still work in the winter though?”

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Tara Fair

Expert blames Leo Varadkar for Protocol problems

Dublin-based eurosceptic Anthony Coughlan has suggested Leo Varadkar pulled the plug on talks that could have resolved the Brexit wrangle over the Irish border, shortly after becoming Taoiseach.

He said: “Leo Varadkar is the person primarily responsible for the problems associated with the Northern Ireland Protocol.

“When Mr Varadkar became Taoiseach in 2017 he ordered the promising contacts between the Irish and British Revenue authorities, initiated by his predecessor Enda Kenny, to cease.

“He did this in order to facilitate the EU’s desire to use the Irish border issue as a means to keep the whole of the UK in the EU single market and customs union.

“This was at a time when Theresa May and her advisers were willing to play along with that objective once she had lost her House of Commons majority in the 2017 UK general election.”

Expert blames Leo Varadkar for Protocol problems (Image: GETTY)

Tara Fair

VDL warned she could be kicked out as she refuses to give cash

Ursula von der Leyen has been threatened to be overthrown after refusing to dish out recovery funds to Poland.

Poland’s leader Jaroslaw Kaczynski has pledged his government will take no further steps to meet the EU Commission’s demands on the rule of law debate.

Poland has been waiting for €35 billion to be unlocked for its country’s recovery from the coronavirus pandemic on the condition it would make changes to its judicial system.

Mr Kaczynski insisted Poland has now met its side of the deal with the EU executive and that it is prepared to take legal action against Ursula von der Leyen’s team unless the money is released.

Speaking to the pro-government Sieci news portal, he said: “We have shown maximum goodwill, but concessions have yielded nothing.

“It’s time to learn lessons.

“Since the European Commission is not fulfilling its obligation to Poland in this area, we have no reason to fulfil our obligations to the European Union.”

READ MORE

Tara Fair

What is the Northern Ireland protocol?

The Northern Ireland protocol is the piece of legislation that prevents a hard border from being in place between Northern Ireland and the Republic of Ireland.

Before Brexit, it was easy to transport goods between Northern Ireland and the Republic because both sides were subject to the same EU rules.

However, after Brexit, a new system was needed as the EU has strict rules and requires border checks when certain goods arrive from non-EU countries.

The protocol agreed that there would be no checks at the Irish border but there would instead be checks on goods coming from Great Britain to Northern Ireland.

However, the UK government now wants to rip up parts of the protocol and remove the need for goods checks between Britain and Northern Ireland.

The Northern Ireland protocol is the piece of legislation that prevents a hard border (Image: GETTY)

Tara Fair

‘It should go now!’ Leigh voters FURIOUS over Liz Truss broken Brexit promise

A Leigh voter has expressed his fury over a broken Brexit promise from frontrunner Liz Truss.

Ms Truss today answered questions from voters in the Greater Manchester town in the hope of securing their votes.

They have until September 2 to put a cross behind either the current Foreign Secretary or former Chancellor Rishi Sunak.

During the question-and-answer session, a voter expressed his frustration at the failure of the Government – of which both leadership candidates have been significant members – to fulfil a long-touted Brexit promise.

Trevor Bell asked Ms Truss: “How can any government in the current situation justify keeping VAT on gas and electric?

“It was a Brexit promise that we would be free to get rid of that tax.

“It should go now.”

READ MORE

‘It should go now!’ Leigh voters FURIOUS over Liz Truss broken Brexit promise (Image: GETTY)

Tara Fair

Sneering elites SILENCED by entrepreneur influx- Britain finally ‘unshackled’

Sneering elites have been silenced by an influx of American entrepreneurs poised to unleash the power of Brexit Britain.

Nile Gardiner, a former aide to Margaret Thatcher, has revealed a wave of American businessmen coming to the United Kingdom despite the liberal media “hissing” at Brexit.

Writing in the Telegraph, Mr Gardiner said: “The East and West Coast elites sneer at British sovereignty, worship Brussels and cheer the imminent departure of their hated transatlantic nemesis, Boris Johnson.”

But, he added: “Despite their mocking tone, however, there is a growing exodus of wealthy elites from big Democrat-run US states, particularly from California, with many executives now ironically relocating to Brexit Britain.

“As much as US elites like to hiss at Brexit, Global Britain, free of the shackles of the EU, is an increasingly attractive place to do business for Americans, especially in comparison to Left-wing California, frequently derided today as a socialist basket case by US conservatives.”

Adam Mosseri, head of Instagram, is amongst the people abandoning the US for Brexit Britain, as is former deputy Prime Minister and ardent Remainer Nick Clegg, who relocated to Silicon Valley for social media giant Meta in 2018.

Tara Fair

UK meringue company ends all exports to EU over Brexit ‘disaster’

Meringue manufacturing firm Flower and White previously exported to 12 countries across the bloc. But the company’s owner Leanne Crowther said Brexit has been a “disaster” for her business, which is based in Telford.

Mrs Crowther said thousands of pounds worth of stock had been left stranded at ports due to confusion over rules for exporting food products.

She and her husband Brian decided to halt exports to the EU after six months of chaos.

Mrs Crowther said it had been “tricky to plan” for the future of her business before a Brexit deal was struck.

She told the BBC: “The problem we had was nobody really knew what was happening.

“Because we use egg, there was a real problem with ‘do we need to get a vet in to certify the egg?’ and we were being pushed from pillar to post from [the Department for Environment, Food & Rural Affairs] and the Department for Trade and it was so difficult to understand.

“One person would tell us one thing and another would tell us another.”

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UK meringue company ends all exports to EU over Brexit ‘disaster’ (Image: GETTY)

Tara Fair

Brexit Britain set for huge win as 17 new factories to make UK manufacturing giant again

Brexit Britain’s manufacturing sector is poised a make a huge comeback with over 17 major new factories opening up.

Jefferson_MFG, an advocate for Britain’s manufacturing sector and the founder of Factory Now tweeted: “We don’t make anything anymore?

“Aston Martin, Moog, Britishvolt, Siemens, Johnson Matthey, Ciner, Forterra, Knauf, Envision AESC, Ball, Crown, Swizzels, Pensana, SeAH, Stannah, ITM Power and Rolls-Royce are just some of the manufacturers building new factories in the UK.”

Responding to this tweet, Richard Marks, of the University of Reading, tweeted: “Having spent 25 years as a system engineer working with British Manufacturing companies before leaving to be an industrial historian and being ridiculously busy for all of it, I can safely second this.

“British Manufacturing is alive & well, we just don’t talk about it enough !”

READ MORE

Brexit Britain set for huge win as 17 new factories to make UK manufacturing giant again (Image: GETTY)

Tara Fair

Good morning

Good morning from London. I’m Tara Fair, I’ll be bringing you all the latest developments on Brexit. Please feel free to get in touch with me as I work if you have a story or tips to share! Your thoughts are always welcome.

Email: [email protected]

Twitter: @TaraFair_

Asian Stock Markets Post Steep Loses Following Wall Street

by www.chiangraitimes.com Leave a Comment

Asian stock markets posted steep losses Thursday after Wall Street suffered one of its most significant crashes in two years.

Worries about consumer resilience and corporate profitability were exacerbated by disappointing earnings reports from retailers on Wednesday, leading to a volatile market.

Hong Kong’s stock price was down more than 3% on Thursday morning, while Tokyo’s was down about 2.5%.

After its disappointing first-quarter results, Chinese tech giant Tencent’s stock dropped more than eight percent in Hong Kong.

Thailand’s stock market had decreased for three consecutive sessions, losing almost 40 points or 2.4 percent. Thailand’s Stock Exchange now sits just below the 1,585-point plateau, but it is expected to stop the bleeding on Monday.

After losses from the financial sector and mixed results from the energy sector, the SET ended Friday slightly lower.

The SET index fell by 0.14 points or 0.01 percent to 1,584.38 after trading between 1,578.11 and 1,597.58. Shares traded at 22.376 billion worth 75.432 billion baht. There were 920 gainers and 872 losers, with 442 stocks finishing unchanged.

Elsewhere in the region, Australia posted its lowest jobless rate in 48 years. This potentially boosts Prime Minister Scott Morrison two days ahead of tightly contested federal elections.

According to the official statistics body, Australia’s unemployment rate fell to 3.9%, the lowest level since 1974.

Read: The Top Trading Platforms for Investing in Stock Market

However, stocks in Sydney, Singapore, Shanghai, Seoul, and Taipei all fell, although Jakarta rose by over 2%.

Stephen Innes at SPI Asset Management called Wednesday’s losses “the largest daily decline since June 2020.”

“The weakness occurred as Target’s earnings added fuel to the recession risk narrative,” he said.

Despite higher sales, earnings at Target, a big-box retailer focusing on North America, miss expectations by around 25%.

In results similar to Walmart’s, the company cited higher operating costs as a factor.

In response to the rising prices of food, gasoline, and other household staples, retailers said profits were under pressure, and some consumers avoided discretionary purchases.

Read: New PS5 Stock Heading to Very, Game, and AO

The Dow lost more than 1,150 points or 3.6%, the Nasdaq fell 4.7%, and all three major US indices dropped.

The European stock markets were also down.

Fawad Razaqzada at City Index says, “the big falls in shares of this retail…show the damage inflation is causing to their profit margins.”.

“What’s more, consumers are getting squeezed as well, and if they now start to cut back on spending, retailers could suffer even further,” he added.

Federal Reserve Chair Jerome Powell said Tuesday that the US central bank would raise interest rates until there is “clear and convincing” evidence that inflation is on the decline.