Fed policymakers vote to leave rates near zero after two-day meeting but indicate rate hike is near by dropping warnings about economy’s fragilityThe Federal Reserve on Wednesday kept interest rates unchanged at their record low of near-zero, but raised the likelihood of a rate hike in December by dropping previous warnings about the fragility of the global economy.

It’s almost Halloween and pumpkins are out in full force – but they’re not just decorating front door stoops or used for pie filling. Since the Pumpkin Spice Latte was introduced by Starbucks 12 years ago, pumpkin has become a flavor in products from hummus to beer to dogfood Continue reading...

Fates of Redcar mill and Tata and Caparo plants in balance as business secretary calls emergency summit on steel industry and trade regulationsDavid Cameron has pledged to award backdated compensation for high energy costs to struggling British steel producers as soon as the government gets clearance from Brussels.The prime minister’s promise was delivered as steelworkers travelled to Westminster to make the case for political intervention in the industry.Related: Life after steel: can Redcar rise from the ashes?Related: Government promises support for British steel industry Continue reading...

The government wants us to believe our economic growth is sustainable, and that budgetary surplus will fix all our problems. But these are dangerous mythsBritish public life has always been riddled with taboos, and nowhere is this more true than in the realm of economics. You can say anything you like about sex nowadays, but the moment the topic turns to fiscal policy, there are endless things that everyone knows, that are even written up in textbooks and scholarly articles, but no one is supposed to talk about in public. It’s a real problem. Because of these taboos, it’s impossible to talk about the real reasons for the 2008 crash, and this makes it almost certain something like it will happen again.I’d like to talk today about the greatest taboo of all. Let’s call it the Peter-Paul principle: the less the government is in debt, the more everybody else is. I call it this because it’s based on very simple mathematics. Say there are 40 poker chips. Peter holds half, Paul the other. Obviously if Peter gets 10 more, Paul has 10 less. Now look at this: it’s a diagram of the balance between the public and private sectors in our economy:Related: ‘Living within our means’ makes no economic sense. Labour is right to oppose it | Ha-Joon Chang Continue reading...

According to figures from the Office for National Statistics, construction output fell by more than 2% while industry contracted for a third successive quarter Continue reading...

The UK has become an easier place to do business in past year, says World Bank, after reforms to red tape and corporate taxThe government’s drive to cut red tape and corporate tax has seen the UK move up the international league table for doing business in a year that has seen both rich and poor countries strive to ease regulations on setting up and running companies, the World Bank said.Britain rose from eighth to sixth place in the Washington-based organisation’s rankings and was the highest placed of the G7 group of leading industrial nations. Continue reading...

Sector outpaces wider economy in third quarter, up 5.9% on previous three months thanks to productions such as Star Wars: Rogue OneBritain’s film and music industries have confirmed their status as two of the fastest growing sectors in the country, according to the latest GDP data.The film, video, TV and music publishing industries outpaced the wider economy between July and September, up 5.9% on the previous quarter, thanks to productions such as Star Wars spin-off Rogue One, which was shot at Pinewood Studios over the summer.Related: GDP growth in the UK slows more than expected to 0.5% Continue reading...

Rolling coverage as Britain’s growth figures miss forecasts, with manufacturing and construction both shrinking, while US data also disappoints

Leading economists and experts give their take on the slowdown in British economic growth over the third quarterThe UK economic recovery has lost momentum, with growth slowing to 0.5% in the past three months, from 0.7% in the previous quarter. Here is what economists made of the official figures.The main reason for the slowdown was the sharp fall in construction, a sector which is traditionally volatile and erratic. However, our strong services sector continues to keep the recovery on track.Our economic growth remains unbalanced ... The trade deficit also widened in this quarter, and we are still heavily reliant on consumer spending.Today’s findings don’t give huge cause for celebration, but neither are they too gloomy. The economic recovery may be built on relatively fragile foundations, including the imbalance between different sectors, but growth is still ticking along for now. Certainly employment levels and household spending power are improving domestically.The key threat on the horizon comes from a cooling global economy alongside a less-supportive inflationary environment next year. Cebr still expects the UK economy to expand comfortably above the 2% mark this year, but this will be followed by a gradual slowdown over the next few years.”The preliminary estimate of GDP confirmed that the economic recovery cooled in the third quarter. We think that this will be only temporary. Nonetheless, the news clearly further reduces the chances of an interest rate rise in the near future.”We expect a better growth number in the fourth quarter. The economy is creating jobs again in significant numbers, wages are rising nearly 3% in real terms and consumer confidence is at high levels. This suggests that the domestic growth story looks good. Inflation is also set to start rising as the falls in commodity prices seen late last year drop out of the annual comparison and rising domestic costs (most obviously wage costs) are increasingly passed on to the end consumer. Consequently, we continue to look for a rate rise in the second quarter of 2016 – after the Federal Reserve, but well ahead of market expectations of late 2016/early 2017.”A slowdown in growth does not necessarily mean that rate hikes should be deferred. But either way, today’s GDP surprise is small so will not have first order implications for the upcoming inflation report forecast, due for publication next Thursday.The really key issue for the MPC to address next week is whether/how to push back against market rate expectations, which are not pricing in the first Bank rate hike until Q1 2017. Our call remains that the MPC will begin to tighten policy in Q1 2016!”It was not a weak report, but obviously undershooting the Bank of England’s 0.6% assumption.To put it in context a 0.5% q/q reading in the US (later in the week) would be an upward surprise, so the UK economy is still posting a respectable pace of growth.The cause for concern here is that the business surveys indicate that the slowdown is spreading from the struggling manufacturing sector to the far larger services economy, meaning growth looks set to slow further in the fourth quarter.There are signs that companies are becoming more risk averse as global growth worries intensify, pulling back on their hiring, investment and spending intentions, which could lead to the slowdown becoming deeper and more entrenched. The economy therefore looks to be on course to grow by 2.3% in 2015, down from 2.9% in 2014 and below its long term trend rate.” Continue reading...

The alarms bells are not ringing yet but the British economy is coming off the boil with even the services sector showing some early signs of coolingGeorge Osborne has plenty on his plate at present. The chancellor is in a fine old mess over tax credits; now the latest evidence is that the economy is coming off the boil as well.In the short term, it will be digging himself out of the hole over welfare reform that will be causing Osborne the most concern.Related: UK GDP growth slows more than expected to 0.5%Related: UK economic growth slows to 0.5% - live updates Continue reading...

ONS data likely to delay any rate rise but construction slump and manufacturing recession deals blow to George OsborneThe already remote prospects of an interest rate rise from the Bank of England this year have all but disappeared after a recession in manufacturing and the biggest slump in construction output in three years slowed the UK economy by more than expected in the third quarter of 2015.City analysts said news that the economy’s rate of expansion eased to 0.5%, from 0.7% in the previous quarter, had ruled out an increase in the cost of borrowing until the spring or summer of next year.Related: UK GDP growth figures released - live updatesGDP is 0.5%. UK continues to outperform other major economies. But global risks mean we go on with tough decisions to live within our means Continue reading...

The chancellor will still take £4.5bn from the low-paid in tax credit cuts, but the rebellion is a political setbackThe drama of the House of Lords vote was essentially an absurdist spectacle. The Tory press harrumphed against the outrageous impertinence of unelected peers, the government was browbeaten with dark threats. But since the Tories have no intention of reforming the 800-heavy upper house, Liberal Democrat and Labour peers who are committed to an elected chamber are absolutely free to sabotage its present idiotic conventions. And so they did. After strong criticisms of tax credit cuts from all sides of the house, they voted for a delay, demanding that George Osborne fully reveal the impact of the cuts.The constitutional sideshow highlights the full monstrosity of the government’s benefit cuts: worse is still to come. Ministers and minions have been sent out to spread shameless deceptions about the impact of cuts announced so far. Osborne refuses to produce an impact assessment with a distributional analysis of who is hit and how hard. Andrew Tyrie, the Treasury select committee chair, has lost patience with evasive and bamboozling figures designed to mislead and wants a full document by 31 October. Don’t hold your breath for straight answers.Related: Tax credits vote: PM accuses Lords of breaking constitutional conventionThere is no tweak to fix this – except to put the well-targeted tax credits back into the pockets of those who need them Continue reading...

Official figures on Tuesday offer a first take on the country’s performance in the third quarter, with most economists predicting a slowdownThe UK economy looks like it has been losing momentum, stymied by China’s downturn, a construction slump and ailing manufacturers.Related: UK GDP growth figures released - live updatesBritons have found a job, and then a shop. The UK recovery has relied on this surge in domestic demand in the last five years, which has proved resilient to a handful of risks such as the general election and, recently, the emerging market rout and China slowdown.”The manufacturing sector is the biggest cause for concern, where several surveys and official data point to a marked slowing in activity. Indeed, manufacturing is already in its third recession in less than a decade, and the level of activity in August 2015 was some 7% below its 2007 peak.”Construction output nosedived 4.3% month on month in August after a drop of 1.0% in July ... Barring any revisions to the July/August data, construction output will need to have grown 8.2% month-on-month in September to have just been flat quarter-on-quarter in the third quarter.” Continue reading...

Children from poorest families in north of England are falling behind peers in south before age five, IPPR North thinktank findsChildren born into the poorest families in the north of England are falling behind comparable children in the south before they even reach school, according to new research that highlights a host of educational and other inequalities the government must tackle to succeed in creating a ”northern powerhouse”.The thinktank IPPR North has welcomed the aspirations of the chancellor, George Osborne, to tackle the UK’s north-south divide, but warned that children in the prospective northern powerhouse area are already disadvantaged prior to turning five because families are affected by higher unemployment and low pay in a local economy suffering from weak productivity and underinvestment.Related: Huge disparity in job creation between north and south – ONS reportRelated: London 'to grow twice as fast as north despite Conservative policies' Continue reading...

Rolling economic and financial news, as German bosses are more optimistic about future prospects but UK factories suffer and US home sales disappoint5.46pm GMTThe euphoria following hints of more QE from the European Central Bank and news of a Chinese interest rate cut has worn off at the start of the new week. Ahead of some key events - UK GDP, the latest US Federal Reserve meeting, eurozone inflation and Apple results - investors turned cautious once more. There was some disappointing economic data, from UK manufacturing to US new home sales, although German confidence figures came in better than expected, enabling the Dax to outperform other stock markets. The final scores showed:5.29pm GMTFrance has reported one of the biggest falls in its jobless numbers since before the financial crisis began.The number of people out of work fell by 23,800 in September to 3,547,800. This was down 0.7% month on month, but up 3.1% on a year earlier. The number of jobless young people dropped for the fourth month in a row.5.18pm GMTIn the UK, TalkTalk shares have slumped more than 12% in the wake of last week’s cyber attack on the company.Since the news was announced that the attack could have led to the theft of personal data from its 4m customers, some £360m has now been wiped off the company’s value.5.00pm GMTDespite some differences and more work needing to be done, Greece and its creditors are making progress in talks to allow the country to receive its next batch of bailout funds, Associated Press reported:Greece and its bailout creditors remain divided over how to toughen foreclosure laws, a European Union official said Monday, though the overall talks on getting the country the next batch of loans are on track.Valdis Dombrovskis, a European Commission vice-president for the euro, said Greece has already done many reforms, quickly. But he warned “there is no time to lose. There is a need to work very actively to modernize the Greek state and economy.”There is no time to lose. Lot to do and much effort on-going. Successful 1st review will be a key step for #Greece to return to growth.Greece has committed to broad reforms, savings and tax hikes to secure its third bailout package from its European partners. Bailout creditors are currently reviewing the government’s compliance with the measures they had agreed upon before paying the country a €2bn loan installment.Greece is under pressure to lower the income and wealth criteria based on which non-compliant borrowers’ primary residences enjoy protection.About 40% of all Greek bank loans are now in serious arrears, as successive income cuts over more than five years have left borrowers struggling to repay. At the heart of the issue are housing loans.The left-led government says it wants protection for borrowers whose homes are worth up to €300,000, and who earn up to €35,000 a year, about 75% of those affected. It says the creditors’ counter-proposal protection for homes worth up to €120,000 would expose nearly 80% of borrowers to the threat of foreclosure.3.59pm GMTSpanish prime minister Mariano Rajoy has called a general election for 20 December, in the hope that a recovery in the economy would see his party returned to power. Associated Press reports:Rajoy said he had fulfilled a promise made on taking office in 2011 by reducing sky-high unemployment and spurring economic growth.He said the country had gone from being threatened with needing a bailout to one of full confidence among investors and from record unemployment to a situation of job creation.3.50pm GMTGlobal markets are edging lower, with the weak US home sales dampening sentiment. But the real market moving events come later in the week. Spreadex analyst Connor Campbell said:It is likely that today is a mere moment of respite between last week’s market-moving announcements from the European Central Bank and the People’s Bank of China and the wave of important figures and earnings releases still to come before October ends (including the mid-week peak of the latest Federal Open Market Committee statement).On Tuesday alone there is the preliminary third quarter GDP number for the UK, US consumer confidence and durable goods figures and arguably the most anticipated release of the entire earnings season in the form of Apple’s fourth quarter results.3.15pm GMTThe Bank of England will not raise rates until the second quarter of next year, according to a poll of economists by Reuters.This is later than previously thought: two weeks ago in a similar poll, economists believed a rate rise would come in the first quarter.2.34pm GMTMore mixed US data.The Dallas Fed manufacturing index of business activity for October has come in at -12.7, compared to -9.5 in September and forecasts of an improvement to -6.5.2.15pm GMTThe home sales figures have helped push Wall Street lower, with the Dow Jones Industrial Average now down 30 points.2.15pm GMTBiggest miss in New Home Sales relative to expectations since August 2013. $ITB $XHB2.08pm GMTThere are signs that the US housing market may be cooling off.New single-family home sales fell 11.5% to a near one year low in September after two months of gains, according to the US Commerce Department. The seasonally adjusted annual rate of 468,000 units was the lowest level since November 2014 and well below expectations of 550,000.Disruption in new home sales will definitely influence Fed decision on rates.2.02pm GMTWorries about the US government reaching its debt ceiling if Congress does not vote to raise it seem overdone, according to ratings agency Moody’s. In a new report it said:Failure to raise the US government’s statutory debt limit before the Treasury has exhausted the “extraordinary measures” that it is using to fund the government’s spending, does not mean that the US is about to default on its debt.US Treasury Secretary Jacob Lew told Congress earlier this month that the government will have exhausted the measures in place to fund the government by, or around, November 3. Without an agreement to raise the statutory debt limit by then, the Treasury will be forced to begin cutting expenditures to ensure that its spending matches its income.“Even if the debt limit is not raised, we believe the government will order its payment priorities to allow the Treasury to continue servicing its debt obligations,” says Moody’s Senior Vice President Steven Hess.However, the risk that Congress will fail to raise the debt limit in time to prevent this scenario is small, Moody’s says in a report entitled “Debt Limit Deadline Next Week Does Not Imply Debt Default.”1.48pm GMTUS markets have opened virtually unchanged, with investors remaining cautious ahead of the latest US Federal Reserve meeting this week. Almost no one expects any movement on interest rates this month - there is no scheduled press conference for a start. But economists will be looking for clues about the Fed’s current thinking as to whether it will move at the December meeting. That debate still seems finely balanced.Markets are also a little hesitant ahead of a big week for technology company results, including Apple.1.42pm GMTTime for a very quick recap:The Chinese five year plan, which is currently being formulated by China’s top leadership, may play down growth targets for 2016-2020, since despite the vigorous efforts of the government the Chinese economy has failed to pick up.“The uncertainty whether the proposed minority government will be tolerated by the parliament had a negative impact on the country’s bonds.”1.26pm GMTPortuguese government bonds are coming under some pressure today as investors react to the unfolding political crisis in Lisbon.While most eurozone bonds have strengthened today, Portugal has gone the other way, pushing up the yield (or interest rate) on its 10-year debt from 2.37% to 2.45%.

Findings reveal that new export orders fell at fastest pace in three years, while domestic demand is also easingBritish manufacturers are suffering from waning demand from home and abroad, according to the latest business survey highlighting the impact of sputtering global growth and a strong pound.The survey of factory bosses by the business group CBI suggests order books have deteriorated at the fastest pace for three years. Facing a gloomier outlook, manufacturers have scaled back hiring in recent months and are looking to cut spending on training and innovation. Continue reading...

Exit poll points to Beata Szydło becoming the country’s next prime minister as ruling party concedes defeat

Li Keqiang makes comments before Communist party central committee meeting to set five-year planChina’s premier has said the country’s target for economic growth is not set in stone as the leadership in Beijing prepare to meet and prioritise economic and social goals for the next five years.Li Keqiang said it was not necessary for the economy to grow by the 7% target for this year. Li set the goal in March after China narrowly missed its 7.5% target for last year.Related: The global economy warrants a big dose of caution Continue reading...

When central banks feel the need to inject more economic stimulus a full six years into a recovery it is a sign of further trouble aheadThe People’s Bank of China was preparing to spring a surprise while President Xi Jinping was taking a selfie with Manchester City star Sergio Aguero. On Friday, the central bank in the world’s second-biggest economy cut the cost of borrowing for the sixth time in a year.This move has implications, none of them especially cheery despite the knee-jerk increase in share prices that followed. Those investors who thought the announcement in Beijing was a big buy signal should ask themselves whether this was a sign of strength or a sign of weakness.Related: China interest rate cut fuels fears over ailing economy Continue reading...

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...