ONS says number of people unemployed also dropped in the three months to September, by 59,000 to 1.425 millionSigns that Britain’s long employment boom has come to an end emerged on Wednesday as official figures showed a drop in the number of people in work, a fall in full-time employment and a decline in the number of job vacancies.After a record-breaking run, the The Office for National Statistics (ONS) reported the first fall in employment since the immediate aftermath of last year’s Brexit vote.Related: UK real wage squeeze continues as employment total falls - business live Continue reading...

Motor industry says threatened new tariffs could add £1,500 to price of an imported car, and make exports more expensive tooThe devastating impact of a hard Brexit on the UK car industry was laid bare on Tuesday to MPs, who were told every 15 minutes of customs delays would cost some manufacturers up to £850,000 a year.Presenting the industry’s most detailed evidence yet to the business select committee, Honda UK said it relied on 350 trucks a day arriving from Europe to keep its giant Swindon factory operating, with just an hour’s worth of parts being held on the production line.Related: Brexit: failure to update customs system could be 'catastrophic'Related: EU business leaders tell PM: agree Brexit deal or face collapse in confidence Continue reading...

Official figures show prices were up by 4.2% last month on 12 months earlier, the highest level in four yearsBig increases in the price of fish, fats and vegetables have driven food price inflation to the highest level in more than four years.New data from the Office for National Statistics (ONS) shows food prices last month were up by 4.2% on 12 months earlier, a sharp increase on the 0.6% that food inflation was running at just a year ago. The October increase is the highest since 2013 and prompted the British Retail Consortium (BRC) to warn that consumers face the prospect of an expensive Christmas dinner this year.Related: 'Butter has gone up by 40%': readers on rising UK food pricesInflation is when prices rise. Deflation is the opposite – price decreases over time – but inflation is far more common.Related: Cost of living squeeze continues as UK inflation sticks at five-year high - business live Continue reading...

Those who voted for Brexit wanted migration to be managed, say Jonathon Porritt and Colin Hines. But Eric Goodyer voted remain to keep his freedom to work, live and retire anywhere in Europe. Plus John Hall says the benefits system must be reorientedWhat those who want to remain in a reformed EU that lessens people’s insecurity must grasp is that Brexit voters don’t want an apology, they want policies to deal with their desire for managed migration. What is still inadequately understood is that the one upside of the grim rise of the extreme right across Europe since the referendum has been the increasing discussions in the EU about adapting free movement of people with measures to manage migration.In our new report, The Progressive Case for Taking Control of EU Immigration – and Avoiding Brexit in the Process, on how Brexit can be reversed if progressives actively support these trends, we speculate that if Keir Starmer (on behalf of Jeremy Corbyn), Vince Cable and Caroline Lucas shared this analysis, they would prioritise seeking authentic agreement across the EU to properly acknowledge EU citizens’ concerns about migration. This would involve highlighting existing and proposing new measures to help “manage” migration. Then Brexit could be reversed.

As inflation sticks at a five-year high of 3%, readers share their experiences of how they are coping with the squeezeI shop at Lidl and Asda and consider myself a savvy shopper on a budget, as I’m on minimum wage. Butter has gone up by 40%, but is a little luxury I do not want to give up. Meat has increased so much that I rarely buy it and make do with very cheap chicken or pork shoulder – lamb and beef joints are out of the question, so I use minced beef and burgers from Lidl. I have entirely changed the way we eat – we have soup a lot for our main meal, for example – and make do with less, or change meals to use jars of ready-made pasta sauce for 52p and cheap spaghetti for 20p at the end of the month. On the plus side, nothing is wasted and we are very inventive, but I have the time and skills at this time of my life, but I worry about the younger people who are time and skill short. We spend a lot on existing, so there is nothing left for anything nice.

The pound’s weakness since the Brexit vote pushed consumer prices up by 3% in the last year, the joint-highest since early 2012

Pro-Brexit backbencher says dividend only possible with policy of free trade, reduced regulation and lower taxesThe UK economy could enjoy a post-Brexit financial dividend of £135bn in the five years after its departure from the EU, Jacob Rees-Mogg has said, an opinion that attracted a direct if brief endorsement from the Department for International Trade.At a speech in London, the leading pro-Brexit backbencher lambasted what he called the “false assumptions” of Philip Hammond’s Treasury before next week’s budget, insisting that leaving the EU would provide a huge economic boost. Continue reading...

Our economy is sick – and with next week’s budget, May and Hammond look sure to make it sickerThe obituary for this government was published within days of its birth. Theresa May was a “dead woman walking”, proclaimed former cabinet colleague George Osborne. Thus was a sniggering bully transformed into an acerbic prophet. Who now dares argue with that verdict? Two senior ministers out within a week, two more barely clinging on to their jobs, and an administration that makes no progress, but merely lurches from disaster to catastrophe.And so begins the Great Unravelling of the oldest political party in Europe, arguably the world. It leads the BBC bulletins. For the commentariat, it is their meat and drink and their tiramisu.Austerity is now the thudding drumbeat behind every ministerial misstepRelated: Theresa May’s position is unsustainable, yet she still can’t see it | Matthew d’Ancona Continue reading...

Neoliberalism and its usual prescriptions – always more markets, always less government – are in fact a perversion of mainstream economics. By Dani RodrikAs even its harshest critics concede, neoliberalism is hard to pin down. In broad terms, it denotes a preference for markets over government, economic incentives over cultural norms, and private entrepreneurship over collective action. It has been used to describe a wide range of phenomena – from Augusto Pinochet to Margaret Thatcher and Ronald Reagan, from the Clinton Democrats and the UK’s New Labour to the economic opening in China and the reform of the welfare state in Sweden.The term is used as a catchall for anything that smacks of deregulation, liberalisation, privatisation or fiscal austerity. Today it is routinely reviled as a shorthand for the ideas and practices that have produced growing economic insecurity and inequality, led to the loss of our political values and ideals, and even precipitated our current populist backlash.Related: Globalisation: the rise and fall of an idea that swept the world Continue reading...

Shadow chancellor John McDonnell to say ‘overwhelming challenge of climate change’ must be addressed from very centre of governmentThe risk posed by climate change would be factored into projections from the government’s independent economic forecaster if Labour took office, the shadow chancellor will announce on Tuesday.

Average pay packet will be more than £20 lower than when financial crisis started in 2007, the Resolution Foundation report saysThe average pay packet in Britain in five years’ time will still be more than £20 lower than it was before the start of the financial crisis as the biggest squeeze on wages since the end of the Napoleonic Wars extends well into a second decade, a leading thinktank has warned.The Resolution Foundation said that the downgrade to Britain’s future productivity performance expected in next week’s budget would have a negative impact on wage growth between now and 2022 and also limit the room for manoeuvre of the chancellor, Philip Hammond. Continue reading...

Investors spooked by rumours of revolt by Tory backbenchers and warning from IMF about UK crashing out of EU with no dealThe pound has come under pressure on international currency markets after investors were spooked by weekend rumours of a backbench revolt that could topple Theresa May’s government and add to the uncertainty surrounding Brexit talks.Sterling shed a cent against the US dollar, to below $1.31, and a similar amount against the euro to €1.122 on Monday as concerns about the stability of the government preyed on investors’ confidence in the outlook for the UK.Related: Business Today: sign up for a morning shot of financial news Continue reading...

Property website says new sellers being too optimistic by not discounting by more as overall market stalls and interest rates riseMore than a third of home owners trying to sell their house have been forced to reduce their asking price, with the number of price cuts at their highest level since 2012, according to Rightmove.Traditionally house sellers are often forced to cut asking prices in the pre-Christmas period but this year the nation appears to be holding a collective autumn sale, said the property website.Related: London falling? UK house price growth to halve with capital worst hit Continue reading...

Health of low-income households at risk as funding cuts slash support for replacing and repairing boilers, pressure group warnsNo gas boilers have been repaired since April under a government scheme intended to combat fuel poverty, as a result of spending cuts that risk leaving poorer Britons unprotected from the cold at home, according to a fuel poverty pressure group.National Energy Action (NEA), which obtained the figures from the Department for Business, Energy and Industrial Strategy (BEIS), said the drop in official support via the energy company obligation (ECO) threatens the health of low-income households. Peter Smith, NEA’s director of policy, said: “This leaves thousands of people with existing medical conditions facing a winter without any effective space heating or hot water.”Related: Business Today: sign up for a morning shot of financial newsWe know the tragic consequences of not being able to afford to service, repair or replace unsafe gas heating appliances Continue reading...

The continent’s elites have to reject the notion that being ‘modern’ and ‘civilised’ means aping the westOne of the greatest ironies in the history of the collapse of any civilisation must be the initial interaction between Africans and Europeans. The Igbos in the east of Nigeria, for instance, initially saw the Europeans as madmen of strange appearance and ill-formed ideologies. On banking, the Igbos wondered how an adult in his right mind could hand over his possessions for others to keep for him. By the end of the 19th century, the “madman” had overturned their civilisation, and they had adopted his.The irony is especially relevant in these times when, given the relative failures of most former western colonies, there have been renewed calls for recolonialisation. In September, American professor Bruce Gilley wrote an essay arguing for a recolonialisation of some states, replicating colonial governance of the past “as far as possible” and even building new colonies from scratch.This has resulted in Africa being slowly emptied of its essence, and becoming a relicRelated: We’re all connected now, so why is the internet so white and western? | Mark Graham and Anasuya Sengupta Continue reading...

Data expected to show rising inflation, falling real pay despite record employment, and first annual drop in retail sales in almost five yearsThe chancellor, Philip Hammond, is to receive some crucial evidence about the health of the UK economy this week as he puts the finishing touches to one of the most difficult budgets in recent times.Official figures are expected to show the squeeze on household finances has intensified in recent weeks, as wage growth fails to keep pace with inflation despite low unemployment.Inflation is when prices rise. Deflation is the opposite – price decreases over time – but inflation is far more common. Continue reading...

More 70 years ago progressive policies reined in the robber barons, but today’s superrich face no foe in the White HouseAmerica’s role as the world’s economic superpower was established in the period between 1870 and the start of the first world war. The country boomed, immigrants arrived in their millions and the rich coined it in. Even now the names are familiar: John D Rockefeller; Andrew Carnegie; the Vanderbilt family. They called it the Gilded Age.

Credit Suisse’s ‘wealth’ report will show how higher prices and rising inflation are hitting ordinary Brits – and make fast-growing differences in wealth even starkerWhile consumers may be able to tell from the cost of their weekly shop that the Brexit referendum has made life more expensive, this week we will get some indication of how the wealth of the nation as a whole has fared since the vote last year.Credit Suisse is due to release its annual global wealth report, containing details of how the average household has withstood a year of currency drops and inflation rises. Last year the report revealed that £1.2bn had been wiped off the wealth of the UK after the vote, but that Britain remained a very attractive place for ultra-high net worth individuals, beaten only by the US and China. Continue reading...

More than 40% of regional venues forced to cut opening hours due to budgetsThe legacy of 1066 and all that means that Hastings will forever be identified with the pivotal battle between Normans and Anglo-Saxons. Yet the East Sussex seaside town now faces a fight to preserve access to the study of its role in English history.Two years ago the Old Town Hall Museum of Local History, one of two museums run by the borough council, closed down for good. The remaining Hastings Museum and Art Gallery was left to promote the heritage of one of the most significant locations in the country.Related: Coalpit pin-ups: Leeds museum pays tribute to queens of industrial age Continue reading...

The value of cryptocurrencies is rising fast. But is it sustainable? And how does it work, anyway? These questions, and many more, answered…The money has become too much to ignore and so bitcoin and cryptocurrencies are back in the news. You may have heard about Ethereum, a cryptocurrency that has risen in value by more than 2,500% over the course of 2017. Or maybe you’ve heard about one of the many smaller cryptocurrencies that raised hundreds of millions of dollars in the first few days they were on sale, during their “initial coin offering”. Or you’ve just spotted that bitcoin, which made headlines in 2013 for hitting a high of $200, is now worth nearly $7,000 (£5,250), making a lot of people very rich in the process.Are these cryptocurrencies simply speculative bubbles or will they actually transform our financial system? It’s time to answer a few common questions about this new technology – and assess whether a lot of people have just pulled off the investment of their lifetime or made a huge mistake. Continue reading...

Any bid Philip Hammond makes to raise money for the exchequer is shouted down by backbenchers. The next budget will see him scrabbling for small changePhilip Hammond is trapped in a prison cell of his party’s making. On one side, the chancellor is hemmed in by Tory MPs ready to veto almost any tax-raising measure that could give him some room for manoeuvre. On another there are his own and the Treasury’s conservative rules about what to do about the annual spending deficit, which they agree must drop to zero within the next 10 years.Hammond is also cramped by the Treasury’s financial forecaster, the Office for Budget Responsibility, which shadows his every move with deliberately conservative predictions about Britain’s economic health. And finally, the chill wind that has blown the cell door shut is the ongoing uncertainty over the Brexit negotiations.The OBR forecast will rob him of at least half of the £26bn he allowed himself to offset the effects of Brexit Continue reading...

Uber drivers must be treated as workers, judge rules, meaning they qualify for minimum wage and holiday pay

US president’s tirade against predatory economic policies comes just hours after he heaped praise on ChinaDonald Trump has abruptly ended the diplomatic streak he displayed on his 12-day tour of Asia by launching a tirade against “violations, cheating or economic aggression” in the region, just hours after heaping lavish praise on China.

Compromising independence to enhance political accountability would be like throwing the baby out with the bathwater. They must stay freeOn 11 November 1997, the Bank of England took a big step towards independence, courtesy of the second reading in the House of Commons of a bill amending the Bank Act of 1946. The bill gave legislative affirmation to the decision, taken by the then-chancellor of the exchequer, Gordon Brown, to free central bank operations from governmental control. This was a landmark event for an institution that had been under the yoke of government for a half-century. It symbolised how the need for central bank independence had become conventional wisdom.Now, however, this wisdom is being questioned, and not just in the UK. So long as inflation was the real and present danger, it made sense to delegate monetary policy to conservative central bankers insulated from pressure to finance government budget deficits. Today, in contrast, the problem is the opposite, namely the inability of central banks to raise inflation to target levels.

Statistics also show better trade performance, but construction has officially fallen into recessionA weaker pound and a pick up in the global economy helped deliver the fifth straight monthly rise in UK factory output in September, providing a much-needed boost to Philip Hammond ahead of his budget later this month.After a bruising period for the government, the improved performance by manufacturing will provide the chancellor with tentative evidence that the economy is edging out of the period of slow growth which has persisted since the start of the year.Related: Shortage of factory workers starts to push up pay rates Continue reading...

Senior representatives to warn prime minister that firms will assume and act on worst case scenario if no transition deal is achieved soon

European Commission says Brexit uncertainty will hurt UK investment, but the rest of Europe is doing ‘significantly better than expected’

Brussels’ health check of member states sharply cuts UK forecast to 1.5% as eurozone enjoys best year since financial crisis of 2007The European commission enters key Brexit talks with the government with the eurozone economy in its best shape for a decade and activity in the UK weaker than expected six months ago.In its half-yearly health check, the commission sharply cut its forecast for UK growth this year and said it was likely to continue struggling in 2018 and 2019 even on the assumption that trade would not be disrupted by its departure from the EU.Related: EC slashes UK growth forecasts but sees best eurozone growth in a decade - business live Continue reading...

Research by IPPR North shows northern regions are more dependent on trade with EU than the south

Bank of England and businesses say firms raising wage offers to find staff, as level of unemployment drops and Brexit vote cuts number of EU workers in UKA shortage of factory workers is starting to push up pay rates but wage rises in the services sector remain rooted at around 2%, according to the latest feedback from the Bank of England’s regional agents.The central bank said its agents, which are based in offices across the country, found that shortages this month across the manufacturing sector were leading to a “slight increase in pay growth” that would take average rate of pay rises up by half a percent, from 2-3% this year to 2.5%-3.5% in 2018.Related: UK firms expect higher pay rises, as Brexit hits investment plans - business live Continue reading...

Heather Stewart is joined by Juliette Garside, Hilary Osborne, Phillip Inman and Nicholas Shaxson to discuss the industrial-scale tax avoidance revealed in the Paradise Papers leak. Plus Mark Wallace of ConservativeHome on the government’s latest week from hellAfter another leak from an offshore law firm, tax avoidance is back on the political agenda this week. The Paradise Papers investigation by the Guardian and others has shone a light on the vast offshore industry based in many of the UK’s crown dependencies. Even the Queen and Prince Charles have been shown to hold offshore investments via their private trusts.Joining Heather Stewart to discuss it all are the Guardian reporters Juliette Garside and Hilary Osborne, the Observer’s economics editor, Phillip Inman, and the author of Treasure Islands, Nicholas Shaxson. Continue reading...

Watchdog warns plans for reduction in tax credits will take heavy toll on households facing cuts in hours or lower wagesWorking families on low incomes will be among the biggest losers when the next recession hits, after their finances were weakened by welfare spending cuts in the wake of the 2008 financial crash.The Institute for Fiscal Studies, a leading tax and spending watchdog, said plans for a reduction in tax credits – which boost the incomes of low paid workers – will take a particularly large toll on households where one or more adults face cuts in hours or lower wages.Related: Families thousands of pounds worse off after years of cuts, study finds Continue reading...

Join our panel discussion on the future of work and take part in our masterclass on creative thinking in London on Tuesday 16 January 2018, 6pm-9pmThe Guardian Business Made Simple events series comes to London with an expert masterclass and panel debate on Tuesday 16 January 2018. You can sign up below.The panel discussion, which will be chaired by the Guardian’s economics editor, Larry Elliott, will explore the workplace of the future. Continue reading...

Tory MP Anna Soubry accuses government of ‘gross contempt’ after Commons motion demanded immediate publicationThe government will take up to three weeks to release dozens of papers detailing the economic impact of Brexit despite a Commons motion demanding their immediate publication, ministers said on Tuesday.The announcement prompted Labour to accuse the government of using “semantics and double-speak” to ignore the will of MPs. It also brought criticism from some Conservatives with one, Anna Soubry, calling the move a “gross contempt” of parliament.Related: Are we happier after the Brexit vote? Only in England, official figures claim Continue reading...

A fierce focus on contracts, competition and outsourcing has leached away the spirit and energy of volunteering and community actionEveryone wants a harmonious relationship between councils and the voluntary sector. The Lords committee on charities, chaired by Michael Bichard, published a report (pdf) in March (which still awaits a response from ministers) hailing a genuine partnership approach. Commentators such as John Tizard, who knows both sides well, continue to produce recipes for collaboration, while Julia Unwin’s inquiry hopes for peace and tranquillity.Related: Charities and Brexit: where are we now?Related: Two-thirds of charities subsidising public sector contracts to surviveThere are endless tales about harsh funding regimes, with smaller organisations feeling squeezed and marginalisedRelated: The best way for charities to spend money is to challenge austerity | Fiona Weir Continue reading...

ONS detects small rise in England for life satisfaction, wellbeing and happiness but Scotland, Wales and Northern Ireland stay flatThe UK has become a happier place since the Brexit vote, according to official figures, but the country’s bonhomie is entirely driven by an uptick in England’s mood as wellbeing in Scotland, Wales and Northern Ireland stayed flat.Key barometers of happiness and wellbeing measured by the Office for National Statistics (ONS) showed small improvements over the year to the end of June – the first 12-month period since the EU referendum.Related: Business Today: sign up for a morning shot of financial newsRelated: They voted for Brexit in a cry of pain – what happened to the left-behind? | John Harris Continue reading...

Economy is facing significant risks which could be exacerbated by unexpected developments, says National Audit Office reportPhilip Hammond, the chancellor, has been warned by Whitehall’s spending watchdog that continuing uncertainty over Brexit could jeopardise the public finances.In a report released on Tuesday, the National Audit Office (NAO) says high levels of government borrowing since the financial crash meant there are already significant risks to the UK’s finances.

Allowing the very richest to secede from the rest of society and choose the jurisdiction they operate under has led to an astonishing rise in global inequalityThe millions of leaked files in the Paradise Papers once again shine a bright light on where the uber-elite stash their cash. Until very recently the hidden web of investments made by the super-rich operated in the comforting darkness offered by secretive tax shelters. The disinfecting sunlight provided by whistleblowing-led investigations since 2013 has fundamentally altered how the world looks at, and regulates, tax affairs. Last year’s Panama Papers cost the leaders of Iceland and Pakistan their jobs. More than a dozen nations have changed their laws and the offshore law firm at the heart of the Panama Papers closed offices in tax havens. It is work that is both necessary and brave: one of the journalists involved in investigating the Panama Papers was blown up by a car bomb last month.This latest dump of data centres around the Bermudian law firm Appleby, a 119-year-old operation favoured by the global super-rich and big corporations, as well as the Singaporean company Asiaciti Trust and the mostly opaque company registries of 19 tax havens. The first stories have already generated global headlines: about why millions of pounds from the Queen’s private estate went into an offshore portfolio which included an investment in the retailer BrightHouse, criticised for exploiting poor families with high-interest loans to purchase white goods; and about why anti-poverty campaigner Bono has so much money he didn’t know some of it bought a piece of a Lithuanian shopping centre via a tax haven. Continue reading...

Native English speakers can’t simply rely on the rest of the world’s desire to learn their language, say Gabrielle Hogan-Brun and Jennifer Jenkins, while Jane Sjögren quotes Nelson Mandela on the importance of linguistic skills and Trevor Stevens says learning a foreign language should be compulsory at GCSEThe UK is not only “mired in the relegation zone of European linguistic proficiency” (Editorial, 4 November); there is also an enormous cost to British businesses from reliance on English. Government figures show that the UK economy loses about £50bn a year in failed contracts because of a lack of language skills in the workforce. Yet studies abroad show that GDP can increase by about 10% if native bilingualism is exploited. But that is not all that is lost. In the words of Richard Hardie, senior adviser of the investment bank UBS: “A deep understanding of foreign languages is often essential to the combination of cajolery and seduction many companies require in their international negotiations.”Native English speakers cannot simply rely on the rest of the world’s desire to learn their language. Just as monolingual Britons will not grasp the subtleties of interactions in international business, they will not know what gets lost in translation either. After Brexit, trade agreements with China, Russia and other developing markets will lead to missed deals for the UK if negotiations are only conducted in English. Continue reading...

Unless urgent changes are made to increase benefits and tax credits, and reform universal credit, the impact on poor families will be devastating, says Mike Stein. Meanwhile, David Higdon is shocked to find a woman at the checkout in tearsThe Institute for Fiscal Studies research predicting increases in child poverty to 37% over the next five years lays bare the current role of fiscal welfare in exploiting the poorest members of society through punishment, deterrence and regulation (Benefit cuts to leave 5m children in poverty, 2 November). Unless urgent changes are made to increase benefit and tax credit levels and reform universal credit, the impact on poor parents will be devastating. Research from the Nuffield Foundation has shown that pressures of poverty are associated with more children being placed on child protection plans and removed from their families. The impact of these benefit cuts will be greatly intensified by the severity of the government’s austerity measures, including reductions in essential services to support vulnerable children, families and young people.

Alan Partridge | Celtic’s undefeated run | Adam Smith Institute | M&S fashion | Dirty-old-men-ocracy? | Theresa May at churchPeter Bradshaw’s timely reminder about the re-emergence of Alan Partridge in Brexit Britain (The revenge of Alan Partridge, G2, 6 November) is underlined by the inclusion in recent TV schedules of such absurd real-life programmes as The Ganges with Sue Perkins and Gordon Ramsey on Cocaine, which might have been dreamed up by the great man in a previous television incarnation. Alan’s previous suggestions of Youth Hostelling with Chris Eubank and Monkey Tennis are surely now ripe for production.

British exporters could lose billions after two-thirds of EU firms saying they expect to move part of supply chain out of UKBritish exporters have been put on notice that they could lose billions of pounds worth of business after almost two-thirds of EU businesses who work with UK suppliers warned they expect to use more firms inside the single market after Brexit.The Chartered Institute of Procurement & Supply (CIPS) said 63% of the EU companies surveyed last month said they planned to move some of their supply chain out of the UK as a result of the decision to leave the single market and customs union. The results represent a large increase on a survey in May, when 44% of EU businesses said they were preparing to switch.A hard Brexit would take Britain out of the EU’s single market and customs union and ends its obligations to respect the four freedoms, make big EU budget payments and accept the jurisdiction of the ECJ: what Brexiters mean by “taking back control” of Britain’s borders, laws and money. It would mean a return of trade tariffs, depending on what (if any) FTA was agreed. See our full Brexit phrasebook.Related: Business Today: sign up for a morning shot of financial newsRelated: UK firms want a Brexit transition deal by March Continue reading...

Economics is gripped by its own mystery drama: why are central banks setting interest rates on the basis of a seemingly broken economic model?As mysteries go, it doesn’t rank with Murder on the Orient Express or the identity of Gerald the mole in Tinker Tailor Soldier Spy but the economics profession is currently gripped by its own drama.This story won’t make it to the silver screen with starring roles for Kenneth Branagh or Judi Dench, but a lot depends on how it ends. For central banks, in particular, the question of Who Killed the Phillips Curve? is a nail-biter. They badly want to know how it ends.Inflation is when prices rise. Deflation is the opposite – price decreases over time – but inflation is far more common.Related: Business Today: sign up for a morning shot of financial newsRelated: Struggling Brexit Britain can barely afford this rise in rates Continue reading...

Ten years of austerity has put the UK in the doldrums: that fact, coupled with the referendum, means there is scarcely a need to dampen things down furtherYou can look at it two ways. After ten years of inertia, Bank rate has doubled. Or: after 10 years of inertia, Bank rate has been raised by one quarter of one per cent, to half of one per cent. Big deal!Of course, for most businesses and individuals, the official rate is meaningless. It is the rate to which everything else is geared, but everything else is usually a lot higher than 0.25% or 0.5%. We read reports daily of how so many desperate borrowers find themselves struggling to pay the usurious interest rates associated with credit card debt. Continue reading...

Australia shouldn’t get too smug about Donald Trump Jr’s tone-deaf Halloween tweet. We have our own capitalist idiocyOn becoming New Zealand’s prime minister, Jacinda Ardern said that capitalism was a blatant failure, and in light of the deluded positions taken by proponents of capitalism and free markets this week it is hard not to agree.Ardern’s comments are revealing in how she framed the question. She suggested, “If you have hundreds of thousands of children living in homes without enough to survive, that’s a blatant failure. What else could you describe it as?”Related: Donald Trump Jr schooled on Twitter after Halloween 'socialism' tweetRelated: If greedy bosses have broken capitalism, who will fix it? | Hugh MuirRelated: Unions seek dramatic pay increases to ensure minimum ‘living wage' Continue reading...

Falling profits and increasingly tough high street trading fuels expectations of a much bolder restructuring plan from M&SMarks & Spencer is expected to ramp up its store-closure plan next week as a result of falling profits and tough trading conditions on the high street.Last year M&S announced it would close 30 stores as part of an overhaul designed to slash by 10% the amount of shopfloor space devoted to its struggling clothing arm. But industry sources suggest M&S’s chief executive, Steve Rowe, has been working on a bolder restructuring plan with the new chairman, Archie Norman, before its first-half trading update on Wednesday.Related: New M&S chairman faces tough task turning round high-street institution | Shane Hickey Continue reading...

Richard Kozul-Wright and Dianna Barrowclough of the United Nations Conference on Trade and Development on industrial strategyYour report (UK-wide official pledge on ‘basic infrastructure’ urged, 1 November) outlines an independent commission’s call for the British government to provide “universal basic infrastructure” for every citizen as part of an ambitious new industrial strategy. The commission’s report supports Unctad’s broader argument across many countries and contexts. Industrial strategy needs to be embraced as a long-term plan, managed strategically and embedded through government.Within hours of the report’s release, critics fretted about governments’ abilities to “pick winners” and eagerness to abuse the public purse. But with chancellor Philip Hammond’s forthcoming budget promising to boost productivity, it is timely to recall how industrial policies galvanised structural transformation in other times and places, from the Tennessee Valley Authority in the 1930s to China’s ambitious Manufacturing 2025. Continue reading...

Flurry of orders appears to bolster Bank of England decision to raise interest rates, pushing stock market index to new record highShares in Britain’s top 100 companies reached an all-time high on Friday, after buoyant sales across the services sector last month showed the economy remained resilient following the post-Brexit vote slump.A flurry of orders that appeared to bolster the Bank of England move to raise interest rates this week, helped send the FTSE 100 index to 7,560, beating the previous end of day high of 7,556 on 12 October.Related: US jobs rebound strongly in October, while FTSE 100 reaches new record close - business liveLenders have already bumped up the cost of fixed rate mortgages ahead of the Bank of England’s decision to raise base rate from 0.25% to 0.5%, and mortgage borrowers on tracker and variable rates will see their monthly payments become more expensive in the coming days. ​ Continue reading...

America’s closely watched non-farm payrolls report shows a 261,000 jobs rise in October after hurricanes triggered a sharp fall in September

Poorer families and unemployed will be especially badly hit, says thinktank report calculating cost of walking away from EU without trade dealHouseholds face increases of up to £930 in their annual shopping bills if Britain walks away from Brexit talks without a trade deal, according to new research that reveals a disproportionate impact on poorer families and the unemployed.