Chancellor says Greensill scandal could ‘damage’ lobbying process – as it happened

Kalyeena Makortoff and Graeme Wearden

from on 2021-05-27 17:40 (#5JAQC)

MPs question the Treasury's permanent secretary, Tom Scholar, and the chancellor, Rishi Sunak, over Greensill Capital's failure

Latest: Treasury committee hearing into Greensill Capital collapse underway

Earlier:

6.40pm BST

NEXT WEEK: Join our panel of Guardian journalists, as they discuss the ongoing scandals engulfing the Conservative party, with Sonia Sodha, Jessica Elgot and me, Kalyeena Makortoff, on Wednesday 2 June, 7pm BST | 8pm CEST | 11am PDT | 2pm EDT.

You can book your tickets here:

Membership Event: Guardian Newsroom: Sleaze, scandal and a headache for Boris Johnson

6.39pm BST

And that's that.

Treasury Committee chair Mel Stride closes the session by thanking Sunak for appearing in front of the committee. Thus ends 4 hours+ Greensill committee inquiry marathon.

6.33pm BST

Sunak refuses to speculate whether he would sign off onto a scheme similar to the supply chain finance programme arranged for NHS-supplied pharmacies by Lex Greensill, which was crafted while he was controversially working in the Cabinet Office during Cameron's term.

However, he notes that it shouldn't be something that is massively necessary in the public sector" to deal with late payments.

6.23pm BST

Conservative MP Steve Baker asks whether Greensill's insistence that it was a fintech (despite doling out ages-old supply chain finance products) helped blind authorities to the risks:

Do you think the government might be vulnerable at all to a sense of excitement about innovation and, therefore, there may be a bit of vulnerability to anyone who ...can use the right buzzwords?

Do you think our enthusiasm might possibly sometimes bind us to conventional financial risks?

That's the challenge we have as policymakers.

6.02pm BST

On lessons to be learned from the Greensill collapse, Sunak (who seems to be excited to refer back to his HUGE binder) says he doesn't want to pre-empt any reviews by the Financial Conduct Authority, but there are some questions that need to be asked on the regulatory side.

They include whether the FCA has the right powers, and whether the appointed representative regime (which allows firm likes Greensill to outsource their regulatory responsibilities to a third party) should be reviewed.

That's something that we have already started to work on.

5.52pm BST

Labour MP Rushanara Ali says many people have tipped Rishi Sunak as a future PM.

She asks what kind of rules he want to be in pace to ensure a former PM's reputation is protected after they leave office and ensure that potential conflicts of interests do not damage the integrity of the political system.

5.42pm BST

A swift summary of the hearing so far from the BBC's business editor:

Treasury response to Greensill in short. We knew Wyelands (part of GFG) had problems, we had no concerns about Greensill (not part of GFG) itself at the time. We turned them down anyway, taxpayer exposure is about 5m not 1bn and we didn't spend much time on Cameron proposal.

5.40pm BST

Treasury Committee chair (and Tory MP) Mel Stride, politely takes issue Sunak's line of argument:

Can I just ask you this Rishi: why wouldn't you just say look at the end of the day, of course we all know that if a former Prime Minister weighs in and pushes a proposal that people are likely to take more notice of it, than if it's just some unknown individual. But at the end of the day, it went through the right process.

Yes it may have gone a little bit more attention along the way but the right thing was done by the Treasury. But of course if somebody at that level, pushes something, it gets more attention than otherwise what what I can't retreat,

Because we were dealing with a financial crisis [for] small to medium sized businesses and this was a proposal that potentially address a segment of that market.

- Sunak keeps insisting that Cameron got no special access for Greensill Capital

- Mel Stride, the *Tory* chair of Treasury committee, says it "doesn't seem credible" that the former PM didn't get more consideration than a random applicant

5.32pm BST

Based on Sunak's continued denial that Cameron's involvement had any influence on the amount of time that the Treasury took to consider Greensill's proposals, MP Angela Eagle says (a bit tongue in cheek):

I hope everybody watching has noted how pointless it will be at any time in the future for any minister or ex minister to try to go into the lobbying world.

5.31pm BST

MP Angela Eagle pushes the point that David Cameron had a financial interest - still undisclosed - in seeing Greensill grow and succeed via his lobbying efforts.

Don't you think that you should have been shown the red card for time wasting in the time of crisis in pursuit of this plan, which was really to shore up his own very lucrative personal interests?

5.21pm BST

Rishi Sunak says people shouldn't read too much into his turn of phrase" when he said he had pushed the team" to consider Cameron and Greensill's proposal to access the CCFF.

It's a really common phrase I would use on an almost daily or weekly basis, by talking about work that is being worked on in the department. It's nothing more than a phrase.

Hi David, apologies for the delay. I think the proposals in the end did require a change to the Market Notice but I have pushed the team to explore an alternative with the Bank that might work

No guarantees, but the Bank are currently looking at it and Charles should be in touch.

5.17pm BST

MP Angela Eagle also takes issue with Sunak's suggestion that greater transparency around lobbying is harmful for government:

I was quite shocked that you seem to be making the argument that transparency on these matters, or in this case, discovered by good investigative journalism, will actually worsen outcomes. Surely transparency when it comes to lobbying especially in one's own financial interests is absolutely crucial.

I completely agree transparency is important, that's why we have a set of guidelines and frameworks in place that manage that.

5.15pm BST

Labour MP Angela Eagle is the next to lob questions at Sunak, and she gets straight to the point:

Are you aware of how unusual it is for ex Prime Ministers to behave in this way lobbying in their direct financial interests so vociferously and so persistently?

5.12pm BST

The deputy political editor at The Sun catches Sunak's comments about his relationship with Cameron:

Rishi Sunak on David Cameron lovebombing him for Greensill. "I don't know David Cameron very well at all and I don't think I have spoken to him since I was a backbench MP and he was PM, so it was a surprise to receive the message."

5.09pm BST

Sunak says policy making process would be worse if business didn't engage with government as a result of the Greensill scandal:

And I would imagine this whole thing might change the way people feel about engaging with the government.

If people feel that they can't ... that will be enormous. They might backfire which would be disappointing and damaging to the policy process.

5.00pm BST

Sunak agrees with his permanent secretaries that the direct costs to the taxpayer as a result of Greensill's colapse will be around $8m.

He will not confirm reports that the indirect exposure/costs could run upwards of 400m, based on government-backed loans extended to firms in Sanjeev Gupta's GFG Alliance Group.

4.50pm BST

If there was any doubt about where Rishi Sunak stands on the Greensill lobbying question:

I stand very firmly by the approach we took.

I think it was entirely right that we considered these proposals on their merits given the context, at the time. And I stand by the decision that we made not to take the proposals forward.

4.47pm BST

Sunak denies that the Treasury allocated too much time to consider Greensill's proposal, and played down any sense that it distracted from other work.

My own view of the situation is that actually ...we spent the right amount of time on this situation to get to the right answer. And in the context of what was going on in the economy, it was absolutely right to be looking at ways to provide finance and credit and liquidity to small and medium sized companies

Of all the things that we looked at to provide finance credit liquidity to small and medium sized companies, this probably occupied among the least amount of our time.

It might look like that because all this attention on every email and everything else that is available, but of all the things we did....this occupied a very small amount of our time

4.38pm BST

Chancellor Rishi Sunak says David Cameron's involvement and lobbying was not a consideration when weighing the value of Greensill's proposal to gain access to the CCFF.

We look at the issue of it the issue on the merits, the identity of the person talking about it was not relevant to the amount of attention and proper diligence of the issue

That was a matter of enormous concern to me, and the department during this period.

4.33pm BST

Our evidence session with the Chancellor of the Exchequer @RishiSunak on Lessons from #Greensill Capital is starting now.

Watch it live here https://t.co/nwoYz7kSCx

4.31pm BST

The first session is over, but Chancellor Rishi Sunak is up next.

4.31pm BST

Labour MP Siobhain McDonagh asks Roxburgh:

Were you aware when you were in your correspondence with David Cameron and LEx Greensill that Greensill's biggest customer was under criminal investigation?

We did not disclose that further, because of these extraordinary strict rules.

4.16pm BST

However, that low cost to taxpayers rests on the British Business Bank permanently cancelling the government guarantees on state-backed loans distributed by Greensill.

CLBILS were 80% government-backed.

That's direct cost and assumes the British Business Bank washes its hands of the guarantees provided to Liberty Steel through Greensill (on grounds that they broke the rules)

4.12pm BST

Lord Myners, who has been a critic of Greensill, previously told the Committee that the direct costs to taxpayers could run upwards of 1bn - and as high as 5bn when considering indirect costs.

I do not know how Lord Myners came up with that number, we don't recognise that. You'll have to ask Lord Myners how he arrived at it.

4.00pm BST

David Cameron of course does have a record of his text, but Scholar refuses to give his former boss permission to give them to the committee. Instead he wants them to go via Treasury FoI: "I think it should be handled as with all government information."

3.54pm BST

Scholar says the messages were wiped after the password was incorrectly entered too many times, locking the phone, sparking a reset that resulted in the rest of the messages being lost.

3.48pm BST

The Mirror's politics correspondent notes that Scholar's record-keeping lesson comes in light of his text replies having been wiped:

Tom Scholar at Treasury committee says key lesson of Greensill is maintaining good records of contacts. "When we went back to look at all the paperwork from this time we found it all"

Last week HMT said they'd lost all Sir Tom's text replies to Cameron as his phone was wiped.

3.39pm BST

Scholar says the Treasury treated Greensill's proposals with an appropriate degree of scepticism" and decided there were other ways to help small businesses and supply chains.

But when it comes to the lessons learned from this episode Scholar singles out ... record keeping:

The main lesson to learn is the absolute paramount importance of following proper, correct procedures when going about our work. So giving proper objective impartial advice, keeping proper records of telephone conversations, making sure its all stored correctly...recording contacts from companies or people acting on behalf of companies

3.30pm BST

Tom Scholar says it was news to me" that David Cameron was working for Greensill when he was originally approached.

However, he does not think he gave favourable treatment to Greensill as a result of Cameron's involvement.

Asked if he and the Treasury gave more attention to Greensill's request for financial support than they did other companies, Permanent Secretary to the Treasury Sir Tom Scholar replied: "No."

Permanent Secretary to the Treasury Sir Tom Scholar says he has seen David Cameron twice since he left office in 2016, adding: "We do exchange messages from time to time, but not at all often."

3.27pm BST

Roxburgh is asked whether he should have questioned Greensill about mounting concerns about its finances, following reports in papers including the FT.

Roxburgh retorts that the Treasury ultimately rejected their application to access the CCFF.

3.24pm BST

Roxburgh confirms that the chancellor Rishi Sunak was unlikely to have been aware of the foreign regulator's warning about control failings at Greensill - referring to the German authority's investigation.

3.21pm BST

Roxburgh says he only became aware that Greensill had applied to become a lender through other schemes - including CBILS/CLBILS - from late April. They were accredited in June.

Roxburgh says he does not know who they lent money to.

Do you think there was more the Treasury could have done to avoid the British Business Bank getting into that situation in the first place?

3.14pm BST

Roxburgh confirms he didn't have any suspicions or concerns that there might have been looming issues around the Greensill's finances.

3.12pm BST

Greensill provided a list of companies that it expected would benefit from the scheme if it had access to the CCFF, as part of its application.

But Roxburgh says he has gone back to that list and confirms no GFG Alliance firms were on it.

3.05pm BST

Treasury Committee chair Mel Stride seems concerned about whether the Treasury was able to track the complex connections between Sanjeev Gupta's GFG Alliance, the group's Wyelands Bank - majority owned by the Liberty Steel boss - and Greensill, which was one of Gupta's largest lenders.

(Wyelands and Greensill Capital have ceased trading and Wyelands is the subject of an investigation by the Serious Fraud Office.)

So you didn't join together ,at that point, the dots in terms of what was happening at Wyelands and GFG, [and] potential vulnerability on the part of Greensill?

2.54pm BST

A reminder about the outcome of Cameron's lobbying efforts, from Sky News' business correspondent:

Despite Cameron's lobbying, the Treasury refused to include Greensill in the CCFF scheme. But the company was accredited by the British Business Bank to make (smaller) loans under the Coronavirus Large Business Interruption Loans Scheme (CLBILs)

2.51pm BST

Roxburgh admits that quite a lot of people" were asking the Treasury to expand the CCFF (that's the largest govt-backed Covid loan scheme), suggesting it wasn't just Cameron pushing the point.

However, it sounds like the questions were about involving non-investment grade companies in the scheme, rather than giving the money to a lender like Greensill, which hoped to use the money to lend onwards. That would have meant bending the CCFF's mandate.

2.45pm BST

Roxburgh says he only became aware of the difficulties facing Greensill Bank in Germany in October 2020 - which at the time was under investigation over its exposure to Sanjeev Gupta's GFG Alliance. They were notified via the foreign office, he says.

The specific issues facing Greensill (presumably referring to their financial struggles after the lender had its insurance cover pulled), he says, only became clear in February this year.

2.41pm BST

Treasury Committee chair Mel Stride gets straight to it, asking whether Charles Roxburgh, the Treasury's second permanent secretary, had any concerns about Greensill's finances when Cameron started lobbying ministers and officials on behalf of the lender back in early 2020.

That was about a year before it fell into administration in March 2021.

So we knew about their funding challenges in the market, but there was no evidence we had the Greensill corporate entity was facing financial difficulties

2.28pm BST

Next up, Parliament's Treasury Committee are holding further hearings as part of their inquiry into Greensill Capital, the collapsed supply chain finance company.

At 2.30pm, they'll hear from Sir Tom Scholar, Permanent Secretary, HM Treasury; and Charles Roxburgh, Second Permanent Secretary, HM Treasury.

In the first evidence session, the Committee is likely to examine how HM Treasury responded to lobbying from David Cameron, the supply chain finance industry, and what regulatory lessons can be drawn from the failure of Greensill Capital.

In the second evidence session, the Committee is likely to ask how Mr Cameron's lobbying of HM Treasury affected the Chancellor, the communications between Mr Cameron and the Chancellor, and the lessons for financial stability coming out of the failure of Greensill Capital.

One hour to go until the first of our two sessions this afternoon for our inquiry into Lessons from #Greensill Capital.

First up, we'll hear from @hmtreasury permanent secretaries Sir Tom Scholar and Charles Roxburgh.

Watch it live at 2.30pm herehttps://t.co/JVMYEk9whi pic.twitter.com/wAahnkJ2we

The second evidence session today for our inquiry into Lessons from #Greensill Capital is with the Chancellor of the Exchequer @RishiSunak.

Watch it live at 4pm herehttps://t.co/2nWEPzerr4 pic.twitter.com/XxrQ2oIYbV

2.01pm BST

The drop in US jobless claims to 406,000 last week shows that America's economy is strengthening as the Covid-19 vaccine rollout continues, says John Leiper, chief investment officer at Tavistock Wealth.

Leiper adds that the jobs recovery could lead to more market jitters about interest rate rises.

With half of all Americans having now received at least one dose of Covid-19, and the ongoing easing of government restrictions, more businesses are re-opening every day. This is reflected in the number of initial jobless claims filed last week which fell to 406,000, below the consensus forecast of 425,000 and the prior week's pandemic-era low of 444,000. Continuing claims, which have gone sideways for the last few weeks, came in marginally lower than expected at 3.642 million versus 3.68 expected and 3.751 during the prior week.

Investors are watching the jobs data closely because the Fed has made it clear it will prioritise full employment over price stability objectives. Any sign that the economy is starting to overheat could prompt a dramatic volte-face as monetary policy is normalised at a faster rate than current market expectations imply. This raises the prospect of a renewed bout of market volatility later this year. 10-year US Treasury yields rose 3bps in the run-up to the release and are currently trading around 1.61%."

The initial jobless claims number came in better than expected. The demand for labour from business is spiking as the economy re-opens and there may even be a need to reduce the enhanced benefits for not working to avoid a labour shortage.

An increase in wages would have the same effect but that would up fuel the pick-up in inflation. The overall story remains the same; the US economy is surging ahead."

1.52pm BST

The number of Americans filing new claims for unemployment benefit has fallen to a fresh pandemic low, as firms look to hold onto staff as the economy strengthens.

Just 406,000 new initial claims' were filed last week (on a seasonally-adjusted basis), down from 444,000 in the previous seven days.

Weekly Initial Unemployment Claims decrease to 406,000 https://t.co/tKuhnBhrfN pic.twitter.com/OadHFN8BJS

UI claims dropped again last week, falling to 514K (420K UI initial claims NSA + 94K PUA claims), reaching an intra-crisis low for the 4th wk in a row.

Initial claims have been cut in half in just the last ~2 months as the labor market improves.#joblessclaims 1/ pic.twitter.com/wJNpucTDAA

Continuing claims resumed their decline in this wk's report, though the effect may be seasonal. Hard to seasonally adjust during a pandemic, but seasonally adjusted continuing claims have fallen only 11k since the Apr #jobsreport reference week.#joblessclaims 2/ pic.twitter.com/ysES9EQXqx

This week's report covers the May #jobsreport reference week, and NSA continuing UI claims declined 262K from Apr-May, a slowdown from the 450K drop from Mar-Apr.

Not definitive by any means, but a slightly pessimistic data point for the May jobs report#joblessclaims 3/

1.41pm BST

The US GDP report also shows that consumer spending, business investment and stimulus packages all drove the recovery:

Unchanged Q1 #GDP estimate featuring:
+ demand
+ inventory destocking
+ imports

consumer spending +11.3%
business investment +10.8%
residential invest +12.7%
gov spend +5.8%

massive inventories drag -2.8ppt
net trade drag -1.2ppt

Strong domestic demand! pic.twitter.com/KPwoQJogTZ

Relative to pre-#COVID19:#GDP -0.9%

Residential investment +17.8% (housing)
Fed gov +5.8% (stim)
Business investment +1.1% (stim)

Imports +1.1% (rebound in cons)
Consumer spending 0.0% (health/stim)
S&L gov -2.1% (budgets)
Exports -11.6% (weak global growth) pic.twitter.com/i1YAFNvPdj

1.39pm BST

Here comes the flurry of US economic data...

And first up, we have confirmation that America's economy grew at a pacey 1.6% in the first quarter of this year (or 6.4% on an annualised' basis)

US GDP (QoQ) (Q1) announced.

Forecast: 6.5%

Actual: 6.4%#gdp #America #usdjpy #NASDAQ100 pic.twitter.com/kgE6BpC8mJ

BREAKING: US GDP QoQ 2nd Estimate Actual 6.4% (Forecast 6.5%, Previous 6.4%)

1.30pm BST

While the pound is rallying, the blue-chip FTSE 100 index has dipped today - down 13 points or 0.2% at 7013.

Jet engine maker and services Rolls-Royce is still the top riser, now up 4.7%, as Airbus's production plans boost sentiment. Melrose, which owns GKN Aerospace, are up 2.9%.

China's industrial profits growth slows in April amid high commodity prices https://t.co/qw6J9QNKxJ

Johnson Matthey hoists dividend and sets 2040 net zero target https://t.co/U548f1I8am While revenue was up 8 per cent to 15.673 billion, pre-tax profit dipped 22 per cent to 238m. The reported revenue increase was driven by higher average precious metal prices. pic.twitter.com/MPvDuiwQWg

1.03pm BST

The pound has jumped half a cent, after Bank of England policymaker Gertjan Vlieghe suggested that UK interest rates could rise sometime early next year.

In a lecture at the University of Bath, Vlieghe said his central forecast is that the first rate rise (from the current record low of 0.1%) would come well into" 2022, given unemployment is likely to rise as the furlough scheme ends.

My central scenario is that the economy evolves similarly to the MPC's central projection in May, but with somewhat more slack than in the central projection. Relative to the MPC's central projection, I worry that the transition out of furlough does involve a modest rise in the unemployment rate, while the economy's supply potential is somewhat less adversely affected, so that there is still some excess supply around the turn of the year.

In that scenario, the first rise in Bank Rate is likely to become appropriate only well into next year, with some modest further tightening thereafter.

On the upside, should the transition out of furlough happen more smoothly, with the unemployment rate at or a little below current levels by the end of the year, with associated signs of upward inflation and wage pressure beyond the temporary and base effects, then a somewhat earlier rise in Bank Rate would be appropriate.

It would probably take until the first quarter of next year to have a clear view of the post-furlough unemployment and wage dynamics, so a rise in Bank Rate could be appropriate soon after, along a slightly steeper path than in my central case.

GBP liking something, not sure anything Vlieghe said warrants the jolt higher though. pic.twitter.com/TVuxFcDzZb

While Vlieghe is leaving the BoE. The fact that he is typically more dovish and is now pointing to scenarios where a hike in 2022 could be appropriate is noteworthy. Possibly giving a sense of where the more moderate MPC members stance lies pic.twitter.com/mypGITP5cc

On the downside, the economy might not recover as quickly, perhaps as lingering concerns about variants of concern" continue to weigh on demand, which in turn results in more adverse unemployment dynamics as fewer furloughed workers are hired back straight away, with weaker underlying wage pressure.

In that case, it is still possible that monetary policy might be required to simulate the economy a little further to help eliminate slack and ensure inflation, after its temporary rise later this year, does not subsequently fall back below its 2% target persistently.

That was apparent before we were hit by the Covid shock, when Bank Rate was just 0.75% and inflation pressures were too weak. A low neutral interest rate will remain relevant once the Covid shock has passed. If anything, Covid may have lowered it by increasing the perception of tail risks.

So if interest rates do need to rise once the data show that medium-term inflationary pressures are rising, then I suspect that interest rates will not need to rise very much to slow the economy to a pace that is consistent with our 2% inflation target.

Gertjan Vlieghe talks about the rise in government bond yields. He says it is not due to rising inflation worries or high government debt. Its main cause is the improved economic outlook in the UK. https://t.co/22paBiWBCQ pic.twitter.com/cykrFRAWiU

12.18pm BST

UK bed and mattress retailer Dreams is being bought by US bedding giant Tempur Sealy in a 340 deal, from private equity Sun European Partners.

The deal comes eight years after Sun took Dreams out of administration for 23m, after it collapsed with the loss of 400 jobs.

We are delighted to be joining the Tempur Sealy family. Today marks a milestone for Dreams.

It is recognition of the transformation we have delivered, and is an endorsement of our customer-focused strategy, our culture and our values. With Tempur Sealy we expect to drive our growth strategy and build on our position as the most recommended, specialist bed retailer. I would like to take this opportunity to thank our 2,000 colleagues for their hard work, dedication and commitment. Together we will continue to improve what we make, sell and deliver, to provide better sleep for all our customers."

Bedding products giant Tempur Sealy is buying retailer Dreams for 340m.

Mike Logue - who is staying on after the deal - has done a great job turning around Dreams.

Tempur Pedic $TPX raising view again, does a $475M deal for Dreams, leading specialty bed retailer in the UK which will nearly double its Int'l sales

Such a great Co. and still trades 12.2X Earnings

11.57am BST

Airbus has told suppliers it is planning for record production of its bestselling planes within two years in a sign of the manufacturer's hopes for a belated but strong recovery for aviation from the coronavirus pandemic.

The European manufacturer said on Thursday it would increase production of A320 single-aisle aircraft to 45 per month by October, up from 40.

11.55am BST

Here's more reaction to Airbus's plan to boost aircraft production, particularly for its A320 jet.

It is kind of remarkable that Airbus dropped its output of A320s to *only* 40 per MONTH during the pandemic. Targeting as many as 75 per month by 2025. https://t.co/ifU4g5Qvj6

Airbus has said it envisages producing 14 of its A220 airliners every month within the next five years.

The wings for the A220 are made at the Spirit AeroSystems plant in Belfast.

11.44am BST

Boris Johnson has been warned by business leaders that a fresh package of economic support would be required if rising Covid-19 infections prevent the further relaxation of pandemic restrictions next month, my colleague Richard Partington explains.

After the reopening of hospitality venues indoors across all four nations of the UK, the Guardian's latest monthly assessment of economic developments suggests the country is on course for a short-term growth boom this summer.

11.37am BST

Here's Reuters's take on the jump in restaurant booking last week:

British diners flocked to restaurants over the past week after lockdown restrictions lifted across most of the United Kingdom, and the number of furloughed workers fell to its lowest since the start of the year, weekly official data showed.

The figures add to signs that economic life is returning to normal as lockdown restrictions ease following the roll-out of COVID vaccines which now cover more than 70% of the adult population.

Largely upbeat news on #consumer spending & also on #jobs market as proportion of workforce on #furlough down to 8%. #UK #restaurant bookings soar as indoor dining restarts https://t.co/OxuWRAWCCh

11.35am BST

This chart shows how UK online job adverts have now risen to 18% above their pre-pandemic level.

In today's @ONS report, our @adzuna data shows online job ads climbing to 118% of February 2020 levels, up 4 percentage points week-on-week. #Retail & #Hospitality vacancies are both back at pre-pandemic levels. Still a way to go for #Graduate jobs: https://t.co/Vh6H6RRdf3 #jobs pic.twitter.com/97EuZPgbyK

11.09am BST

The proportion of workers on furlough has fallen to its lowest level this year, as the UK economy emerges from lockdown.

New figures from the ONS shows that 8% of the workforce were furloughed in the two weeks to May 16, the lowest total seen so far in 2021. That equates to around 2.2m, and is down from 10% around the start of the month.

The proportion of the UK workforce on furlough has decreased to 8%, the lowest level seen so far in 2021, according to initial results from the Business Insights and Conditions Survey.

This is equivalent to approximately 2.2 million people https://t.co/3s8yPhVnd4

Since the re-opening of indoor dining across most of the UK, @OpenTableUK figures show the average number of seated diners in the week to 24 May was at 132% of its level in the same week of 2019 - an increase of 59 percentage points from the previous week https://t.co/ldInREb8AJ pic.twitter.com/KOqQPLnYlt

This follows a recent upward trend for this category, having risen by 55 percentage points since 9 April 2021, just before the first easing of hospitality restrictions when pubs and restaurants reopened in England.

10.43am BST

Top US and Chinese trade negotiators held candid" talks today, their first under the Biden presidency, as Washington continues to raise concerns over Beijing's trade practices.

In the long-awaited first official engagement between the US trade representative Katherine Tai and the Chinese vice-premier, Liu He, held virtually on Thursday morning Beijing time, the two sides emphasised the importance of the bilateral trade relations and agreed to further negotiations.

10.41am BST

The pandemic has hit profits at the publisher of the Daily Mail, although its investment in online car retailer Cazoo is more than cushioning the blow.

Pre-tax profits at Daily Mail and General Trust fell 45% in the six months to the end of March to 42m, down from 77m a year earlier. Revenues dropped to 547m, from 642m.

Our financial flexibility enabled us to continue to invest in Cazoo through multiple funding rounds. Despite the near-term economic uncertainty, we had conviction in its opportunity to transform the used car market.

Cazoo continues to go from strength to strength and its proposed SPAC combination on the New York Stock Exchange would value our stake at US$1.35bn, a return of eight times on our capital.

10.03am BST

Rolls-Royce, the jet engine maker, is leading the FTSE 100 risers this morning - up 3% - as Airbus's announcement lifts the sector.

Warren East, Rolls-Royce's CEO, told Radio 4's Today Programme that predicting the precise timing of the recovery was very difficult.

The pandemic will undoubtedly change certain behaviours, and that's reflected in our expectation of a smaller market in future than we would have expected pre-Covid.

But we absolutely expect continued growth, because aviation is such an important part of the world economy.

9.44am BST

While the pandemic has hit air travel, it has also created a boom in pet ownership.

The retailer and vet chain estimated that pet numbers increased by 8% during a year in which many people were stuck at home. The boom has led to pet food shortages.

The pandemic structurally altered the dynamics of the UK pet care market", the company said, with increased home working removing a barrier to pet ownership and increasing the emotional attachment to - and willingness to spend on - animals.

9.37am BST

The global rollout of Covid-19 vaccines is lifting future demand for travel, as economies reopen and tourism picks up.

So aircraft bosses need to take decisions now if they want suppliers to be ready for higher output in future.

The outlook for a longer-term recovery in aviation has improved with the global rollout of vaccines despite regional flare-ups.

One of the biggest challenges for the industry is ensuring that its long, intricate supply chains are ready to ramp up production to meet the expected demand.

Airbus to increase A320 aircraft production in sign of aviation recovery https://t.co/Kra20EDAyG

9.31am BST

Reuters says Airbus has laid out sweeping goals' to expand production of its A320 jetliners over the next few years (initially from 40 per month today to 45 by the end of the year, and 64 per month by Q2 2023).

Demand for single-aisle jets is recovering as domestic travel rebounds, especially in the United States and China.

In anticipation of a continued recovery in that market, Airbus is asking its suppliers to enable a scenario" where it can produce 70 single-aisle jets a month by the first quarter of 2024.

Airbus sets higher jet output targets as recovery looms https://t.co/4SE3ydfodo pic.twitter.com/t1TV16dO5m

9.20am BST

Airbus is telling suppliers to prepare for an aggressive ramp up' of jet production, explains Richard Schuurman, aviation reporter for Air Insight.

. @Airbus proposes aggressive ramp up of production options to suppliers. For the A320 from current 40 to 45 in Q4, to 64 in Q2 2023, and potentially to 70 in 2024 and 75 in 2025. That's the highest since cutting back from 63 in early 2020.

For the A220, @Airbus confirms a ramp up from 5 now to 6 in 2022 and possibly 14 around 2025.
The A350 should grow from 5 to 6 per month in 2022.
The A330 will remain flat at rate 2 per month.@BoeingAirplanes reportedy also plans steep ramp up MAX to rate 70 in near future.

9.08am BST

Airbus has boosted optimism for a global aviation recovery by alerting its suppliers prepare for a sharp increase in A320 production, says Bloomberg:

Airbus SE is preparing to gear up production of its best-selling A320-series jets beyond pre-pandemic levels within two years, lending a jolt of optimism for a recovery in global aviation.

The shares jumped after the world's largest producer of commercial jetliners told suppliers to be ready to raise output of its top-selling narrow-body to a rate of 64 per month by the second quarter of 2023. That figure could rise to 70 a month early the following year and could reach 75 by 2025, Airbus said in a statement Thursday.

Airbus plans for a surge in production of its best-selling A320 series jets beyond pre-pandemic levels https://t.co/xm3xBEDxST via @business

8.59am BST

Shares in Airbus have jumped around 6% in early trading in Paris, as investors welcome its plans to boost production output over the next few years.

They're currently up 5.7 at 103.4, close to April's one-year high.

8.29am BST

Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.

After seeing demand battered by the pandemic, aerospace manufacturer Airbus says the recovery is beginning.

The aviation sector is beginning to recover from the COVID-19 crisis"

The message to our supplier community provides visibility to the entire industrial ecosystem to secure the necessary capabilities and be ready when market conditions call for it.

In parallel, we are transforming our industrial system by optimising our aerostructures set-up and modernising our A320 Family production facilities. All these actions are set in motion to prepare our future."

This news is nothing short of extraordinary, and it will have massive implications for the Australian oil and gas industry.

Chevron, ExxonMobil and Shell are three of Australia's largest oil and gas producers, and therefore three of our largest carbon polluters.

On Tuesday, oil majors Shell, Chevron and Exxon suffered three humiliating blows from investors and judges over their inadequate pollution strategies.

If everyday was like this, climate change would be managed in an instant https://t.co/gPftL8H2kr

Some of the week's froth has come out of the markets in Asia today, with equities edging lower, along with energy and precious metals and our good friends, the cryptocurrency space, while the US Dollar edged higher after an impressive rally overnight.

All the financial markets space, the price action looks corrective, rather than a structural turn, as short-term momentum ran out of the inflation is dead, buy everything" that has swept markets this week.

Source	RSS or Atom Feed
Feed Location	http://feeds.theguardian.com/theguardian/business/economics/rss
Feed Title
Feed Link	http://feeds.theguardian.com/