The Business: Monday March 10 2014
Company news, markets and financial talking points, available from 8am Monday to Friday
UK GDP will return to its pre-recession 2008 peak this summer, finally completing a five-year recovery, according to the British Chambers of Commerce. But the BCC’s Adam Marshall sounded a note of caution, telling the Radio 4 Today programme that although business investment is starting to grow again, it is from a low base and we're not seeing exports pick up. He added that the youth unemployment rate is expected to be three times the national average by 2016.
Air traffic controllers believe that a fourth runway at Heathrow would reduce the combined capacity of Heathrow, Gatwick, Stansted, Luton, Birmingham, City and Southend airports by 9 per cent because aircraft taking off and landing would block flight paths to other airports. The ‘confidential analysis’ has been prepared by air traffic control service Nats and handed to the Airports Commission, The Times reports. The submission has been described as a “game changer” by opponents of the fourth runway.
‘Forward guidance’ – the policy implemented by the Bank of England and other central banks of explaining ahead of time what will happen to interest rates – could be putting the global financial system at risk, according to the Bank for International Settlements. Investors are being encouraged to load up on risk because they believe forward guidance will warn them well in advance about any rise in interest rates, according to the BIS report, which is covered in the Financial Times.
The US has insisted it remains committed to maintaining a military presence in the Persian Gulf despite becoming increasingly energy self-sufficient thanks to fracking at home. Speaking at a conference in the United Arab Emirates, the US commerce secretary Penny Pritzker told the region’s biggest oil exporters that America has a shared “commitment to preserve security and stability throughout the Gulf,” the Daily Telegraph reports. “That commitment will not change as the US becomes more energy-independent.”
"It's the Saudi Arabia of food." Bate Toms, chairman of the British-Ukrainian Chamber of Commerce, tells the BBC that the Ukraine farming sector has potential and could be increased by 400% to feed the Middle East and North Africa.
Britain’s historically closed banking market is set to become more competitive with three new banks expected to receive a new licence this year and at least six more by early 2015, The Times reports. The Bank of England is said to be dealing with at least 22 applications in total. The influx of newcomers follows a simplification of the licensing process by the Bank of England. Buy-to-let lender Paragon, and private bank Scoban are the latest entrants to the market, following Metro Bank in 2010.
FTSE-100: down -1.12 to 6712.67
Dow Jones: up +0.19 to 16452.72
Dax: down -2.01 to 9350.75
Cac-40: down -1.15 to 4366.42
Nikkei: down -1.01 to 15120.14 Hang Seng: down -1.8 to 22252.84
US dollar: buys €0.71996 and £0.59817
Sterling: buys $1.67178 and €1.20362
Oil: $108.79 up +0.69