Tax credit cuts, the latest extension of Osborne’s policy, have for the first time provoked outspoken criticism of the chancellor from the right as well as the leftDavid Cameron is “delighted” that MPs backed the Conservatives’ plans for swingeing tax credit cuts last week. George Osborne told MPs on the cross-party Treasury select committee he was “comfortable” about the “judgment call” he had made.For the families who will receive letters in the coming weeks revealing precisely how much they will lose in April – £1,000 a year for more than 3 million households, according to the Institute for Fiscal Studies – that language will seem uncaring, casual even.Tax credit cuts may be the policy that sees Osborne’s carefully constructed political edifice crumble Continue reading...

An extraordinary week of diplomacy for President Xi’s visit generated a series of far-reaching agreements on trade, technology and cultureBritain’s diplomatic elite has been rushed off its feet catering for the largest contingent of Chinese officials and business executives to arrive in London for 10 years.In 2005, the chief concern was how to contain the noise from protesters angry at Beijing’s occupation of Tibet. This time the Dalai Lama and talk of human rights were kept off the agenda during a four-day visit that David Cameron said was the opening act in a “golden era” for UK-China relations. Continue reading...

In many ways, India seems the UK’s most natural trading partner in the east – but for now, the brute truth is that China has piles of cash looking for a return abroad, and India doesn’tAccording to Steve Hilton, former chief strategist to David Cameron, Britain is humiliating itself unnecessarily by “sucking up” to China when instead it could be “rolling out the red carpet” for India. “We should prioritise our relationship with India because that’s where the opportunity is,” he said this week on BBC Newsnight, striking a resonant chord with the many British citizens, of Indian origin and otherwise, who see India as the more natural and sympathetic ally. Parliamentary democracy, a free media, the English language, tea with milk: however ruthless and greedy British imperialism may have been, its 250-year history in India left that country with several of the imperfect institutions, beliefs and habits that Britain finds familiar and admirable.Related: Xi Jinping in London – in picturesRelated: Crowd chants 'Modi, Modi' as Indian PM winds up whirlwind Silicon Valley tour Continue reading...

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Government struggles to corroborate PM’s disputed figure as some of the deals listed have eerie similarity to ones made in pastDowning Street has insisted that the week-long Chinese state visit secured “up to £40bn” of trade and investment deals, after scrambling for much of Friday to substantiate the figure, brandished by David Cameron at a trade mission in Mansion House.The business secretary, Sajid Javid, said earlier this week that President Xi Jinping’s visit would increase trade and investment between Britain and China by £25bn; but the figure had leapt to £40bn by the time the prime minister spoke on Wednesday.Related: Xi visit shows China is dominant partner in a purely commercial coupling Continue reading...

On the last day of Chinese president’s trip, we look back on all the banquets and trade talks, as Britain left itself red in the face trying to make him feel importantAfter banquets, processions and trade talks, it’s the last day of the Chinese president’s trip to the UK.Related: Plenty to worry about regarding Britain’s close relationship with China | LettersRelated: Chairman Mao must be smiling in heaven | Letters Continue reading...

European markets rise as investors welcome boost from cheaper credit in China and prospects for further delay to Federal Reserve rate hike in USChina fuelled fears that its ailing economy is about to slow further after Beijing cut its main interest rate by 0.25 percentage points.The unexpected rate cut, the sixth since November last year, reduced the main bank base rate to 4.35%. The one-year deposit rate will fall to 1.5% from 1.75%.Related: Five reasons to be worried about the Chinese economy Continue reading...

Shipping giant seen as bellwether for global economy cites overcapacity, low demand and aggressive pricing for larger-than-expected profit fallAP Møller-Mærsk has downgraded its full-year outlook for underlying profit by $600m (£390m) to about $3.4bn, citing deterioration in the container shipping market.The Copenhagen-based shipping and oil conglomerate, which controls the world’s largest container shipping company Mærsk Line, said global market conditions were weaker than expected.Related: German and French economies strengthen unexpectedly - live Continue reading...

For the good of the European cause as well as the Bank, the governor needs to tread carefully on political turfIt is a strange sight to witness the governor of the Bank of England, Mark Carney, waltzing towards the smouldering electoral controversy of our times, as he did in a speech on the EU this week. He has defensible reasons for wanting to get involved, but he needs to tread carefully on political turf, since his authority rests upon his claim to not being a politician.The whole purpose of the Bank’s independence is to keep it above the fray. A body of economic theory burgeoned after the inflationary 1970s to explain why any decision-maker who had to worry about elections would be tempted to duck tough decisions, and why they would furthermore be unable to make hard choices stick even where that was the sincere intent. There was a naked connection between interest rates and the political cycle; in election years like 1987, rates fell shortly before the votes were cast, then rose shortly afterwards.Related: George Osborne: Mark Carney has set out EU renegotiation principles Continue reading...

The European Central Bank boss is deliberating the launch of another round of quantitative easing, but other factors could lessen its effectivenessThere is a strong argument for Mario Draghi to sit on his hands and do nothing. The boss of the European Central Bank (ECB) may have failed earlier this year to slay the dragon of deflation when he launched €60bn (£43bn) a month of quantitative easing, but his policy worked to some degree and in any case, his weapons are ineffectual for now .The City loves cheap credit and is cheering on Draghi to cut interest rates or boost the QE programme, based on the time-honoured theory that central bankers with loose monetary policies can prevent their economies slipping into negative inflation.Related: Mario Draghi: ECB prepared to cut interest rates and expand QE Continue reading...

Bank’s president stuns markets with announcement, saying slowdown in emerging markets has weakened eurozoneMario Draghi, the president of the European Central Bank, has stunned markets by signalling that he is prepared to cut interest rates and step up quantitative easing to stave off the risk of a renewed economic slump in the eurozone.The value of the single currency dropped sharply on foreign exchanges on Thursday as Draghi announced that the ECB’s governing council had discussed expanding its €1.1tn (£795bn) bond-buying programme and cutting the rate on reserves held at the central bank.Related: Germany readies itself for more woe as scandal and slowdown hit economy Continue reading...

Shops look set for a bumper Christmas but more shopping and bigger sales volumes do not necessarily help the bottom line

September figures rose at fastest monthly rate for nearly two years, ONS says, as shops prepare for Black FridayFalling shop prices and Rugby World Cup promotions last month helped boost retail sales at the fastest rate for almost two years, according to official figures.Related: Bank of England governor under fire after Brexit intervention - business liveRelated: UK retail sales: all that glitters is not gold Continue reading...

Paul Mason relies on tired old cliches – and, bizarrely, his dislike of the Belgian police – to justify his claim that there is no democratic control over the European Union (G2, 19 October). He talks of “vast bureaucratic structures” and “the sheer size of EU directorates”, yet the whole European commission has around the same number of employees as Leeds city council. He says there should be a veto on whether Ukraine and Turkey should join the EU, seemingly oblivious to the fact that there is one – all current member countries would have to agree for them to join. He moans of the EU being too powerful, yet simultaneously bemoans that it hasn’t reached agreement on Ukraine or on Syrian refugees.He claims that it has imposed austerity on Greece, but can’t be bothered to mention that Greece had half of its debts written off and no fewer than three large bailout loans from its eurozone partners. He claims real power sits with large corporations, but fails to see that the EU is the one way we have the clout to stand up to them. Most astonishingly of all, he says that individual citizens have only “two channels” to influence the EU: the British government and the European court. Has he never heard of the European parliament, directly elected by those very citizens? The existence of a directly elected parliament makes the EU unique among all international structures – but for Paul Mason this is not even worth a mention. Continue reading...

Research linking economic performance to average temperature shows ‘stark repercussions’ of failing to tackle climate changeThe perfect average temperature for national economic success is 13C (55.4F), academics have discovered.But the fundamental link they have revealed between a country’s economy and its temperature has led them to warn that the costs of unchecked climate change will be many times worse than previously thought. Continue reading...

End to Chafta standoff follows government offer to amend migration regulations to ensure employers make genuine efforts to recruit local workers firstThe Coalition and Labor have reached a deal to pass legislation for the China-Australia free trade agreement (Chafta), ending an intense political dispute in Canberra and clearing the way for tariff cuts before the end of the year.The breakthrough follows the government’s offer to amend migration regulations to ensure employers have made genuine efforts to recruit Australian workers before seeking them from overseas under a work agreement.Related: Labor caucus says yes to China-Australia free trade deal – politics liveRelated: Coalition opens door to deal on China-Australia free trade agreementRelated: What would Howard do? How Tony Abbott could salvage China trade deal Continue reading...

Labour party leader raises issue of steel imports as well as human rights record in meeting with Chinese presidentThe Labour leader, Jeremy Corbyn, has raised China’s human rights record and the impact of its imports on the UK steel industry at a meeting at Buckingham Palace with President Xi Jinping, which the party described as “cordial and constructive”.A statement from Labour following Corbyn’s meeting stressed the good nature of the exchange, and praised “the remarkable Chinese achievements in poverty-reduction, lifting over 600 million people out of poverty”.Related: My advice for David Cameron – treat Xi Jinping’s promises with caution | Mark Kitto Continue reading...

Paul Johnson, head of the IFS, says today’s pensioners have fared extraordinarily well relative to their predecessorsPensioners have benefited from an “amazing” period of rising living standards relative to the rest of society, and the government should scrap its triple lock that protects the value of the state pension, according to Paul Johnson, head of the Institute for Fiscal Studies.In a lecture on Tuesday evening, the thinktank’s director, whose pithy interventions framed the economic debate in the run-up to May’s general election, argues that today’s pensioners have fared extraordinarily well relative to their predecessors. Continue reading...

Tata jobs to go in Scunthorpe and Scotland; one in six UK steelworkers face redundancy5.31pm BSTWe are wrapping up for the day. Thank you for all your great comments, and we’ll be back tomorrow.5.11pm BSTThe Chinese president, Xi Jinping, has lauded the close ties between his country and Britain during a speech to the UK parliament. It is the first full day of his four-day state visit to Britain, aimed at boosting trade.It is fair to say that China and the UK are increasingly interdependent and are becoming a community of shared interests.I am already deeply impressed by the vitality of China-UK relations and the profound friendship between our peoples.”4.32pm BSTAbout half of the 1.6bn tonnes of steel made globally comes from China, and firms operating in the UK simply can’t compete, says Guardian contributor Karl West. He writes:The latest grim chapter in the long, slow death of Britain’s steel industry may have been decided in India, but it was scripted in Beijing.4.22pm BSTJust to recap, the UK’s foreign secretary, Philip Hammond, has indicated that the government won’t press the Chinese president, Xi Jinping, too hard on the “dumping” of steel.Hammond told the Today programme on BBC Radio 4:We have got to get the balance right: trying to protect our steel industry in a sensible way, which we are doing, but recognising that we are operating in a global economy. We can’t simply build a wall around the UK.”3.21pm BSTGovt to China: “Invest in UK. It’ll make you money” Govt to itself: “Don’t invest in UK. Cut, add more austerity, let steel industry die"3.18pm BSTGuardian contributor Karl West has sent us this:The management team at Tata Steel’s Scunthorpe steel mill are eyeing a buyout of the loss-making plant, according to sources.2.32pm BSTOutside Dalzell steel works in Motherwell https://t.co/QaQmVpEVd22.16pm BSTMore from Libby Brooks, who has been speaking to Tata workers in Motherwell:John McKenna, who worked at Ravenscraig before joining Dalzell eight years ago, said that he was ‘disappointed’ at the news. “I’m disappointed they’ve decided to treat us this way. I think there’s definitely a future if someone is in their right mind to take this on. There’s a good workforce here. There’s a future is the government wants to make it that way.”2.01pm BSTAnother Tata executive has been speaking. After talking to workers in Scunthorpe, Bimlendra Jha, executive chairman of the Long Products Europe business, said (quotes from PA):“These are very distressing times.1.48pm BSTTor Farquhar, human resources director for Tata Steel Europe, has been taking questions outside the Motherwell plant.He says that this is a very difficult day for the company and workers: “This is the worst news you can ever give your employees.”1.45pm BSTLocal Labour MSP John Pentland has also called on the Scottish government to act, writes Libby Brooks: “The Scottish Government can intervene and support strategic assets when they are threatened, as it has shown several times. It acted when Prestwick was threatened; it acted when Fergusons was threatened; it acted when Grangemouth was threatened; and it can act again, to save our steel industry.”Pentland also said that it was “shocking” that the new Forth crossing project was being built with overseas steel, including steel manufactured in China.1.44pm BSTDespite Sajid Javid’s repeated proclamations that prime minister David Cameron will raise the issue of steel dumping with Chinese president Xi Jinping, there seems some doubt as to how strong the protests will be. Our political correstpondent Rowena Mason writes:David Cameron’s spokesman will not reveal how strongly he is prepared to object to China’s steel-dumping in his meetings with Xi. She would only say he will “raise” the matter and discuss how the actions of one country can impact on another. There is little sense that he plans to complain forcefully about China’s behaviour.1.28pm BSTLib Dem Greg Mulholland: all concentration on Chinese visit is on banking, will issue of steel be raisedJavid: there will be an announcement of £20bn of business deals with China which I;m sure he will welcome.1.26pm BSTLabour Ian Lucas: how big should industry be for strategic reasons, how retain capacityJavid: we’ve seen a steady decline in capacity, need to supply more stability so they can plan for future.1.25pm BSTLabour Phil Wilson: problems with supply chain, how than they be helpedJavid: number of good suggestions from summit. Will be working with industries using steel to see how can hard wire requirement for British steel in their products.1.22pm BSTLabour Angela Smith: inexcusable minister won’t commit to a long term strategy for industry, for steelJavid: Steel summit on Friday did discuss strategy. Since then, already set up metal strategy which steel is a major part.1.21pm BSTSNP Margaret Ferrier: Must do everything we can for the workers. Welcome action by Scottish government to set up taskforce. But what will UK government do, about dumping, high energy costs?Javid: We will support Scottish task force. Must do all we can for workers and families.1.17pm BSTLabour Tristram Hunt: China needs to know, we are more than just a theme park. What talks is he having, when will he stand up for BritainJavid: there will be further announcements which will help sustain jobs. Prime minister will discuss whole issue of unfair trade.1.16pm BSTConservative Jeremy Lefroy: Steel is vital national industry. No point in buying cheap steel which will have problems laterJavid: right to raise this point. We will be looking very closely at this.1.15pm BSTLabour Tom Blenkinsop: EU partners have taken action against Chinese dumping.Javid: For first time ever, a British government supported duties by EU and will take further action when evidence is there.1.13pm BSTConservative Peter Bone: let us put in place what we think is right and worry about what EU thinks afterwards.Javid: Understand point, but rules on unfair state aid etc exist to protect British manufacturers as well. Need to have clean hands if we complain about others violating rules.1.12pm BSTDUP Sammy Wilson: Problem partly also green energy policies which have pushed up costs.Javid: right to raise this issue, energy costs are high, some of them are imposed directly some through EU policies. Are paying compensation, want to pay more, so want EU approval as soon as possible.1.10pm BSTLabour Andy McDonald: has he pursuing anti dumping initiativeJavid: we have started taking action, voted at EU, it is an EU led process, we have provided evidence where he have it.1.04pm BSTConservative Stephen Hammond: how to make dumping not endemic?Javid: we have been taking action, voted for it, will be pushing for action to be taken more quickly.1.03pm BSTLabour Stephen Doughty: Why does secretary not go over to Brussels and sort out state aid?Javid: Not in full control of UK government. It is a priority, and it is too slow. We are doing everything we can.1.02pm BSTConservative Martin Vickers: could we have more detail about the task force in Lincolnshire.Javid: Task force just been set up. We need to listen to task force and local leaders. First meeting will take place tomorrow.1.01pm BSTLabour’s Nick Dakin said action must be taken now.Javid said some of the actions require working with our EU partners, working as quickly as possible.1.00pm BSTJavid:It’s a shame he [Brennan] wants to play politics.12.58pm BSTBrennan:Despite the rhetoric the government seems content to let the industry disappear in the face of Chinese dumping.12.57pm BSTJavid is ticked off by by the speaker for exceeding his allotted time.12.56pm BSTBusiness secretary Sajid Javid said the industry was facing unprecedented challenges, and the situation was devastating.The situation is difficult and deeply worrying for workers. The government is doing and will continue to do everything in its power to support you in the weeks and months to come.12.45pm BSTAnd now the urgent parliamentary question in Parliament from Kevin Brennan, shadow minister for trade and investment. Brennan said:Will the business secretary make a statement about what action government taking to secure future of steel industry?12.16pm BSTDescribing the announcement as a crushing blow for the workforce, Grahame Smith, Scottish Trades Union Congress (STUC) General Secretary welcomed the decision to mothball the plants, and said that it was essential that the UK and Scottish Governments responded quickly to the crisis.“The UK Government must work with the industry to prevent the unfair dumping of Chinese steel on the UK market and provide a package of support similar to those routinely provided by other European nations to their energy intensive manufacturing sectors.12.04pm BSTAngela Eagle, shadow business secretary, said:11.55am BSTUK Steel also points to the potential loss of vital national assets, including the ability to process the steel used in Trident submarines:

Joanne, at the Soho Theatre, depicts five women at the frontline of overstretched public services dealing with the fallout from one unseen young woman’s life“This is the bit of the job I love. Loved. The human-contact bit, the breaking-the-ice bit. The breaking-into-a-smile bit,” says Stella, played by Tanya Moodie, a social worker whose project funding has run out just as she is trying to help a vulnerable young woman, called Joanne.Stella is one of five characters in a five-act play depicting women at the frontline of overstretched public services. There’s also a police officer with a troubled past, an NHS receptionist working nights in A&E for just £9 an hour, the manager of a homeless hostel who’s mopping the rooms because the cleaner is off with stress and agency staff cost too much, and a teacher, haunted by the memory of a vulnerable pupil she wished she’d been able to help, called Joanne (yes, the same one). We never see this young woman, but she draws together each of the separate monologues, written by five different playwrights, and is the name of the play being staged in London by award-winning theatre company, Clean Break.Related: Joanne review – angry sketches of the invisible woman Continue reading...

Governor Mark Carney to list possible fiscal effects of EU withdrawal researched by secret Bank taskforce ‘Project Bookend’Mark Carney, the governor of the Bank of England, will use a speech on Wednesday to spell out what the Bank believes will be the financial implications of Britain leaving the European Union.In a carefully trailed lecture at St Peter’s College in Oxford, Carney is expected to discuss the implications of Brexit for the Bank’s key tasks of controlling inflation and protecting financial stability.Related: So what does Europe really think about the Brexit debate? Continue reading...

Foreign secretary says Britain cannot build wall around steel industry struggling to cope with falling prices amid global surplusBritain cannot build a wall around its steel industry, the foreign secretary, Philip Hammond, has said as he indicated that David Cameron was unlikely to press the Chinese president, Xi Jinping, too harshly on the “dumping” of steel.Amid predictions that Tata Steel is to announce almost 1,200 job losses in Scunthorpe and Scotland, the foreign secretary said that the steel industry was struggling to cope with falling prices in the face of a global surplus in supply.Related: Tata Steel to axe 1,200 jobs in the UK Continue reading...

Chinese president is in the UK this week, the first visit by a Chinese head of state in 10 years. Here we look at the two countries’ ties in charts and figuresXi Jinping is in the UK for the first state visit to Britain by a Chinese head of state in 10 years. Hu Jintao, Xi’s predecessor, visited the country in 2005, when Tony Blair was prime minister.This visit reciprocates several made by Conservative politicians to China. David Cameron led a trade mission to Asia’s biggest economy in 2013 and George Osborne was there just last month.Related: David Cameron dismisses risk of rift with US over ChinaRelated: Chinese ambassador: we do not shy away from discussing human rights Continue reading...

Tax credit cuts will hit struggling families, but Osborne has plenty of budgets to put things rightHow threatening is the head of steam building up against the chancellor’s savage tax credits cuts? Single mother Michelle Dorrell hit a raw spot with her tearful outrage on BBC Question Time: “Shame on you!” But is George Osborne ashamed? Is he bothered? Don’t count on it.Today in the Commons Labour will try to make the government squirm over multiple injustices in the welfare bill – and squirm they will. After all, 3.2 million low-paid families will see their tax credits fall by on average £1,300 a year. Forget nonsense about the Conservatives becoming the party of “working people” as rewards for hard work will be weakened, not strengthened. From now on, any extra that people earn will be worth far less than before. Consider this shocking figure: for every extra pound those on tax credits earn under universal credit, they will keep just a paltry 24p, the Resolution Foundation finds.Related: Is George Osborne correct to say workers will be £2,000 a year better off?This isn’t really taking off, except in the echo chamber of social media – that’s Osborne’s gambleRelated: Labour launches drive to register voters as boundaries get redrawn Continue reading...

A lesson learned from the otherwise successful UK gas-cooled reactor programmes was that excessive diversity of design prevents economies of scale during construction and is inefficient during the plant’s working life.A Chinese reactor at Bradwell would be the fourth different new power reactor design in England. Commercial and security issues may be soluble at nominal cost. But can the UK muster sufficient indigenous expertise to master the details of the technology and design of so many types in order to become an expert customer and subsequently operate the reactors safely and economically for their expected life?Related: The howls of China’s prisoners will haunt this royal welcome for Xi Jinping | Ma JianRelated: China deal means meltdown time for pro-nuclear 'greens'Related: Errors revealed at Chinese nuclear firm seeking to invest in UK plantsRelated: What to expect from President Xi Jinping’s visit to Britain Continue reading...

Owen Jones is right to highlight the plight of the working poor but wrong to suggest the answer should have ever been tax credits (Opinion, theguardian.com, 16 October). It can never be right to subsidise poverty-pay corporate employers with the revenue collected from low- and middle-income workers. Employers should be compelled to pay living wage rates.Of course the problem of the working poor was in part created by the sham of New Labour’s minimum wage legislation, which, far from troubling exploitative employers, functioned in their interests.Related: Cameron responds to Question Time tax credits complaint Continue reading...

Ahead of Xi Jinping’s arrival, Labour MPs question why UK is touting HS2 contracts to China while allowing its steel firms to failDavid Cameron was accused of putting economic engagement with China ahead of the long term interests of the UK, as the president of the world’s most populous country arrived in London for a lavish four-day state visit.Downing Street said the visit from Xi Jinping would “unlock” £30bn of trade deals that would lead to 3,900 new British jobs - but critics said that the prime minister was ignoring China’s impact on UK steel , its poor record on human rights and any risks of allowing it to invest in nuclear power.Related: Nothing off the table in talks with Chinese president, says No 10Related: Risk of further job losses in British steel industry Continue reading...

It is said central banks should not try to head off a bubble, just clean up the mess. Now the cost is so high, and the cleanup so long, maybe we should change tacticsVery soon after the magnitude of the 2008 financial crisis became clear, a lively debate began about whether central banks and regulators could – and should – have done more to head it off. The traditional view, notably shared by the former US Federal Reserve chairman, Alan Greenspan, is that any attempt to prick financial bubbles in advance is doomed to failure. The most central banks can do is clean up the mess.Bubble pricking may indeed choke off growth unnecessarily – and at high social cost. But there is a counter-argument. Economists at the Bank for International Settlements (BIS) have maintained that the costs of the crisis were so large, and the cleanup so long, that we should surely now look for ways to act pre-emptively when we again see a dangerous buildup of liquidity and credit.Related: China should avoid financial meltdown Continue reading...

Debate rages on over whether China is stuck in an industrial rut or rebalancing towards servicesChina is on the road to recovery. Or maybe it isn’t, at least not for some time, say the contradictory reports on the world’s second-largest economy.The latest GDP figures, showing a growth rate in the third quarter of 6.9%, down from 7% in the second quarter, have done little to lay this particular debate to rest.Related: Xi Jinping plays down China's economic 'growing pains' Continue reading...

According to the Office for Budget Responsibility (OBR), letting English universities recruit as many students as they like will mean 1,000 more home and EU undergraduates in the coming years. Given that 400,000 full-time undergraduates begin their studies each year, that is both imperceptible and implausible.It is less than one extra student from each school and college with a sixth form. Yet universities are now free to recruit as many students as they like from the other 27 EU states as well as the four parts of the UK. Continue reading...

Bank’s chief executive blames volatility in global markets for disappointing third-quarter results as trading revenue plummetsMorgan Stanley’s profits have slumped for the second consecutive quarter as uncertainty about the timing of a US interest rate rise and concerns about China’s cooling economy drive investors from bond, currency and commodity markets.The last of the big US banks to release third-quarter results, it said earnings applicable to common shareholders had fallen 42.4% to $939m (£606m), or 48 cents a share, from $1.63bn, or 83 cents a share, a year earlier. Analysts had been expecting 62 cents a share. Continue reading...

The party is split over tax credit cuts: some Conservative MPs are deeply uneasy about rhetoric suggesting working families won’t be worse off next AprilAusterity enters its next phase. Many still don’t use that word or understand what it means. But we are now crossing the line from austerity-lite to deep austerity. One of the chief indicators is that the kind of protests we are seeing are not coming from the much demonised “underclass” – who are presumably too busy breeding, smoking and eating saturated fats – but from those who are “nice” and recognised as “respectable”.Last week, a tearful woman on Question Time talked about how tax credit cuts may affect her. Tory MPs everywhere are shuffling nervously, not exactly certain how to sell the rhetoric of taking money from the working poor. It’s not as easy for them as cutting benefits, which could simply be depicted as taking candy from obese babies and their feckless mothers.Related: A Tory-voter breaks down on TV over tax credits cuts. Here’s Labour’s chance | Owen JonesThe new wave of protest will not come from the 'shirkers' who government has already written off, but the strivers Continue reading...

Chinese leader says ahead of UK visit that he will focus on increasing overseas trade relationships, including starting a ‘golden era’ with BritainXi Jinping has acknowledged that China’s leaders are concerned about the economy, but described the problems as “growing pains”, as he prepared to leave for his first state visit to the UK, bringing with him billions of pounds of planned investment.In the wake of stock market jitters that rocked China and the wider region recently, and with imminent growth figures likely to confirm the slowest growth rate since 2009, the Chinese president said China was looking to external deal-making with countries such as Britain as a way of diversifying its economic base.

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CEBR study claims potential £58bn of growth and 790,000 new jobs would be lost if Britain had to renegotiate access to markets after leaving EUIf Britain opts to stay in the European Union and achieves the market reforms it wants, it could receive a £58bn economic boost and 790,000 new jobs by 2030, a London-based economic consultancy has said.The Centre for Economics and Business Research (CEBR), which produced its report for the campaign group Britain Stronger in Europe, said on Sunday that creating a single digital market and opening up the financial, transport and energy sectors could increase British GDP by 2.8%, equating to £2,832 per household.Related: Every cabinet minister is a Eurosceptic, says Michael Fallon Continue reading...

Analysts do not rule out European Central Bank boosting QE this week, although December is still seen as the most the likely monthThe European Central Bank is expected to hint at fresh stimulus measures to ward off the threat of deflation when it holds its next monetary policy meeting on Thursday.This week’s gathering takes place in Malta, under the governing council’s policy of occasionally departing from its Frankfurt HQ to visit other areas of the eurozone. Continue reading...

In the recent downturn, trading off pay increases for jobs has meant that the economic pain has been spread aroundA lively spat is going on between two former members of the Bank of England’s monetary policy committee. On one side is David “Danny” Blanchflower, who says the UK has experienced its slowest and worst recovery since the aftermath of the South Sea Bubble in 1720. On the other side is Andrew Sentance, who says the performance of Britain’s labour market since the recession undermines the idea that the country has been going through an unprecedented period of economic purgatory.So who’s right? Given the nature of economics, it will hardly come as a surprise that both Blanchflower and Sentance can claim to be right. Nor, given that the pair repeatedly clashed when they were on the MPC together and have not exactly buried the hatchet since, is it that surprising that they are talking past each other. Continue reading...

John McDonnell’s U-turn was typical of the peril that can befall the treasury opposition brief. At least he knew, as his predecessor did, when to stop diggingIt is proving quite a month for chancellors and shadow chancellors. The symmetry with which Geoffrey Howe, chancellor 1979-83, followed Denis Healey, chancellor 1974-79, both in life and in death (they died within a week of each other) was remarkable.They both lived to a ripe old age – Healey to 98 and Howe to 88 – and got on famously, despite the oft-quoted jibe by Healey that being attacked by Sir Geoffrey (as he then was) in parliament was like being savaged by a dead sheep. Continue reading...

On the eve of his first state visit to the UK, the Chinese president speaks in glowing terms about the prospect of closer ties between London and BeijingChinese president Xi Jinping praised Britain’s “visionary and strategic choice” to become Beijing’s best friend in the west as he prepared to jet off on his first state visit to the UK, taking with him billions of pounds of planned investment.The trip, Xi’s first to Britain in more than two decades, has been hailed by British and Chinese officials as the start of a “golden era” of relations which the Treasury hopes will make China Britain’s second biggest trade partner within 10 years.

Economists, analysts and politicians are divided over the pros and cons of the UK chancellor’s fêting of China for investment and ordersThe ancient Silk Road, along which caravans of traders brought fine Chinese cloths and exquisite porcelain to markets across Asia, never stretched as far as chilly Britain. But George Osborne is determined that its 21st-century successor will terminate in London.China’s plan to step up renminbi-denominated trading in the City is just the latest evidence of what the chancellor hopes will be a “golden era” of economic and financial cooperation between China and the UK.Related: Osborne kicks off China visit vowing to be Beijing's best friendRelated: George Osborne’s flirtation with China is steering us into uncharted waters | Rafael Behr Continue reading...

Kristin Forbes signals she may vote for an interest rate hike by downplaying potential fallout for UK from emerging markets slowdownAn interest rate hike in the UK will come “sooner rather than later” and pessimism about the state of the global economy is overdone, according to a Bank of England policymaker.Kristin Forbes, a member of the bank’s rate-setting monetary policy committee (MPC), was also upbeat about the domestic economy. She argued that the country had only limited exposure to emerging markets such as Russia and Brazil and that, despite signs of a slowdown in those markets, British businesses should not be deterred from building stronger links with them.Related: World stock markets hit two-month highs as stimulus hopes build - business liveKristin Forbes says despite increased risks the current “gloom and doom” on emerging markets is “overblown” http://t.co/SnyNwS3fZjRelated: China should avoid financial meltdown Continue reading...

Retailer’s annual How We Shop, Live & Look report shows shoppers are snapping up 70s-influenced furniture and fashion. Macrame pouffe, anyone?Crank up the Demis Roussos, break out the stuffed olives and warm the Black Tower. Britain is getting its Abigail’s Party started as we return to the 1970s in our shopping habits, according to John Lewis.With sales of vinyl records soaring, John Lewis’ annual survey of its customers shopping habits reveals retro-technology including record players and wall clocks are returning to homes being decorated in the brown and orange tones of Mike Leigh’s 1977 play about a suburban drinks party. Continue reading...