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  • Today's business and finance round up 18th March 2022

Today's business and finance round up 18th March 2022

📈Bank of England raises interest rates again

18th March 2022

Bite-sized business news from the UK and beyond

Good morning Bernard Arnault, the 73-year-old billionaire boss of Luis Vuitton owner LVMH, raised the company’s CEO age limit to 80 from 70 so that he can stay in charge for longer. The move appears to be teeing up a “Succession”-like showdown among his five kids.

Today's stories

  • Going up: Bank of England raises interest rates again

  • Rocketing valuation: Speedy grocery app Getir becomes a ‘decacorn’

ECONOMYBank of England raises interest rates again

What’s going on?

The Bank of England has hiked interest rates by 0.25% for the third time since December in an effort to cool inflation rates that have already ballooned past their target rate.

Why is this important?

With UK inflation at a 30-year-high of 5.5%, it came as no surprise that the Bank of England decided to raise interest rates to 0.75% - back to their pre-Covid level.The war in Ukraine has spooked energy and commodity markets, sending prices higher which will feed into wider consumer prices. Because of this economists predict that inflation could reach 10% in the coming months.To get inflation to the target rate of 2%, the cost of borrowing may need to rise further. Raising interest rates can keep a lid on consumer prices but may hamper economic growth.For that reason, the Bank took a fairly relaxed stance to future rate rises appearing to be more concerned about the effect of the war in Ukraine on economic growth than on inflation.Other central banks are also facing similar dilemmas. Earlier this week, the US Federal Reserve raised interest rates for the first time since 2018 and pencilled in multiple hikes for the rest of the year.

Zooming out

Who would want to be a central banker in 2022? Spiralling inflation driven by higher energy costs, fragile economies coming out of a pandemic and the geopolitical uncertainty of a war in Ukraine. If interest rates are too low, then soaring inflation could become hard to shift and would erode consumer spending power. If borrowing costs are too high, then economic growth could grind to a halt.The Bank of England and its counterparts across the world, will be walking a tightrope in the months ahead.

Other stories to keep you in the loop

  • Ukraine pain: OECD warns Ukraine war to push prices even higher

  • Overboard: P&O Ferries sacks all 800 crew members across entire fleet

  • No sharing: Netflix tests charges for sharing passwords between households

  • Soaring costs: Ocado puts up prices as costs soar and warns Ukraine war adding to inflation worries

  • Back to the movies: Cineworld pins hope on more blockbusters in 2022 as debt pile grows

  • Bad delivery: Deliveroo losses widen with warnings of future cost pressures

  • Metal chaos: Nickel trading suspended, again

  • On track: Trainline ticket sales better than expected despite the Omicron variant

DELIVERYSpeedy grocery app Getir becomes a ‘decacorn’

Stat of the day

Around a third of adults have a mortgage, another third rent their home and the final third have either never had a mortgage or have paid it off

Interesting links from around the web

  • How this 26-year-old turned her side hustle into a $170,000-per-year business

  • Why workers and employers are ghosting each other

  • Where to watch Servant of the People, the comedy starring Ukrainian President Volodymyr Zelensky

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