Good morning. Today we're talking about the drop in the cost of living, the UK beating Spain with batteries and the return to working from home.
Back in the single digits
UK inflation fell to 8.7% in April, the first time it’s been less than 10% since last August. However it had been expected to come in at 8.2% because of rapidly falling energy prices and it is still higher than in the US, Germany and France. Frustratingly for consumers food prices remain stubbornly high with grocery inflation reaching 19.1%, near record highs despite the falling costs of key inputs like energy and grains. The news adds pressure on the Bank of England to keep raising interest rates through the summer. The market now expects rates to peak at 5.5% this year from the current rate of 4.5%.
UK’s battery win
The UK has beaten Spain to win a major battery plant contract for electric vehicles from Jaguar Land Rover. The factory is likely to be built in Somerset and could create up to 9,000 jobs with £500m of government investment. The decision would give a much needed boost to the British car industry after major manufacturers like Vauxhall owner Stellantis and Ford warned that looming post-Brexit trade rules risked making it unviable. The news also comes months after the collapse of Britishvolt, the UK company once hailed as the backbone of a plan to modernise the country’s car industry as it transitions to electric vehicles.
Staying at home
London employees now appear in the office less than half of the week, suggesting they’re gaining the upper hand in the battle with bosses over working from home. Older workers are leading a shift toward remote jobs, which risks stunting the development of young staff and hurting city centres, according to the research group Centre for Cities. It found that people in London spent on average 2.3 days in the office per week in April, down from 3.9 days just before the pandemic. The figures suggest that workers are taking advantage of an ultra-tight labour market to gain more flexibility even as employers and government ministers voice concerns about the impact of home working. Surveys suggest many employers would prefer to see people back in the office, raising concerns about the productivity of those at home.
Down to earth: Virgin Orbit, the satellite launch company founded by Richard Branson, will permanently cease operations, just months after a major mission failure.
Taking over: Microsoft lodged a formal appeal against British regulators’ decision to block its $75bn takeover of Activision Blizzard, the Call of Duty maker.
Paying up: UK mortgage holders will see their monthly payments jump to up to 30% of their income from about 20% over the past few decades, the boss of Barclays has said.
Cutting back: The new owner of Silicon Valley Bank's US operations, First Citizens, is cutting around 500 roles.
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