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Daily business and finance update 24th May 2023

UK's economic U-turn

Good morning. Today we're talking about the UK’s economic upgrade, billionaire increases BT stake and Meta says goodbye to Meta.

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UK's economic U-turn

The UK will not fall into a recession this year, according to the International Monetary Fund which upgraded its economic expectations of the country. Just six weeks ago the economic body had said the UK would be the worst performing economy of the G7. But yesterday it said the economy would grow 0.4% this year, instead of contracting 0.3% as previously predicted. That would lift it above Germany, which is expected to stagnate. Earlier this month the Bank of England also said it was more optimistic about the UK and expects the country to avoid a recession in 2023. The IMF cited lower energy costs, stronger consumer demand and less Brexit uncertainty for the upgraded forecasts. But it said inflation "remains stubbornly high" and that higher interest rates will need to remain in place if it is to be brought down.

Billionaire tightens BT grip

Patrick Drahi, the French telecoms billionaire, has bought 650m more shares in BT for almost £1bn, raising his stake to 24.5%. But Drahi has restated his position that he does not intend to make an offer for the entire group. The news comes days after BT announced it would streamline its business by removing 55,000 roles in the next decade with some replaced with AI. Drahi has been buying up shares in the UK’s biggest telecoms firm since June 2021 and quickly became the biggest shareholder. Last August the government reviewed Drahi’s ownership under new powers to block the takeover of vital national assets but concluded there were no national security concerns.

Meta’s costly sale

The owner of Facebook and Instagram announced it would sell animated-images platform Giphy for $53m despite paying $400m for it. Meta bought Giphy in 2020 but since then there’s been an ongoing back and forth with the UK competition regulator which launched an investigation into the deal. The concern was that Meta could behave anti-competitively and hurt consumers by cutting off the supply of GIFs to rivals and demanding more data from Giphy’s customers to keep using the service. In October the final ruling was given that Giphy must be sold. The new owner, stock image service Shutterstock, accepted that Giphy is unlikely to be transformational and expects it to make minimal revenue in 2023.



Chaotic meeting: Shell’s annual shareholder meeting in London descended into chaos with more than an hour of climate protests delaying the start.

Pricey groceries: Food inflation fell for the second month in a row in May but remains "incredibly high", says research firm Kantar.

It begins: Netflix has started its long promised crackdown on password sharing in the UK and the US.

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$200 million

The price of the most expensive house in California, recently acquired by Beyoncé and Jay-Z in cash.

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