Today's business and finance round up 29th July 2022
Shell and British Gas face backlash over bumper profits
29th July 2022
Bite-sized business news from the UK and beyond
Good morning Today marks two momentous pop culture events:1. After 37 years and nearly 9,000 episodes, the final episode of Australia’s longest running soap opera Neighbours will air later today in the UK. 2. And at noon a High Court judge is expected to deliver a verdict on the infamous ‘Wagatha Christie’ case between football WAGs Colleen Rooney and Rebekah Vardy.
Today's stories
Energised: Shell and British Gas face backlash over bumper profits
The ‘R’ word: US (sort of) enters a recession
ENERGYShell and British Gas face backlash over bumper profits
Other stories to keep you in the loop
Rise of Omicron subvariants sends UK staff absence soaring
Barclays profits almost halved to £1.5bn after US trading blunder
Apple and Amazon beat expectations but still see profits slip as inflation bites
BT staff prepare to strike despite best pay deal in 20 years
City salaries rocket to £185,000 for newly-qualified lawyers in war for talent
Nestle reports higher sales even as it raises prices
USUS (sort of) enters a recession
Yesterday official data showed that the US economy shrunk by 0.9% in the three months to June, after falling 1.6% in the first quarter of the year. Two consecutive quarters of negative growth meets the textbook definition of a recession which many countries use. However the world’s largest economy chooses instead to rely on the National Bureau of Economic Research, a group of academics, which uses a wider range of factors including employment and income rates. The NBER is yet to pass the recession judgement. Entering a recession, a period of lower economic activity, is generally in tandem with lower household incomes and investment and higher unemployment. So it’s no surprise that the US government and policymakers are keen to avoid using the dreaded ‘R’ word:
President Biden is facing low approval ratings and has focused on economic measures like high job growth as the key achievements of his administration.
On Wednesday the US central bank raised its base interest rate by 0.75% for the second consecutive month in a bid to cool down inflation running at 9.1%, a 40-year-high. Falling into a recession could mean the bank is less likely to raise rates again -and get inflation under control - as it could risk slowing down the economy even further by increasing the cost of borrowing, a so-called ‘hard landing’.
The US is not alone in facing a combination of high inflation and low or negative growth – aka stagflation. Earlier this week the IMF issued a gloomy report that the global economy is on the brink of a recession and that the UK is forecast to have the weakest growth of the seven richest nations next year.
Stat of the day
UK homes are pricier than ever and now cost 8.7 times the average annual household income
Interesting links from around the web
The pandemic impulse purchases we grew to hate
How to navigate multiple job offers and buy yourself time to decide
The 16-part plan to be the next Tory leader
