Top oil officials from Saudi Arabia, Russia and several key Opec members to discuss supply glutOil prices surged temporarily on Tuesday, reaching their highest levels in more than a week after Russia and Saudi Arabia provided the markets with hope of an eventual deal to tackle a deep supply glut.Representatives from two of the world’s biggest oil producers agreed to freeze production levels, in what could be the first deal between an Opec and non-Opec country in 15 years.Related: Why the falling oil price may not lead to boomRelated: Talks about cutting oil output show Russians and Saudis feel the pain Continue reading...

If the distinctive purple banknotes are scrapped, most Europeans won’t mind. But they keep Russia’s shadow economy afloatThe European Central Bank has said it may phase out the 500-euro note, news that most Europeans will probably greet with a shrug. But the distinctive purple bill has many fans abroad – especially in Russia, where it is popular among small-time savers and crooked officials.According to central bank board member, Yves Mersch, Russia is an “important market for euro cash” because the euro is “traditionally used as a stable store of value there”, he said.Related: Crime, terrorism and tax evasion: why banks are waging war on cash | Paul Mason Continue reading...

The Vermont senator’s success so far demonstrates the end of the politico-ideological cycle opened by the victory of Ronald Reagan at the 1980 electionsHow can we interpret the incredible success of the “socialist” candidate Bernie Sanders in the US primaries? The Vermont senator is now ahead of Hillary Clinton among Democratic-leaning voters below the age of 50, and it’s only thanks to the older generation that Clinton has managed to stay ahead in the polls.Related: Sign up for the Campaign Minute - the election condensed every day Continue reading...

Cost of living edged up to 0.3% in January, its highest rate for a yearInflation edged up to its highest rate for a year last month as rises in the price of alcohol and clothing pushed up the cost of living.The consumer prices index (CPI) rose to 0.3% in January from 0.2% in December, according to the Office for National Statistics (ONS).Related: Inflation rises, but we should still fear deflation Continue reading...

Central bank encouraging banks to lend, businesses to invest and savers to spendThe Bank of Japan’s negative interest rates came into effect on Tuesday in a radical plan already deemed a failure by financial markets, highlighting Tokyo’s lack of options to spur growth as global markets sputter.The central bank, which announced the shock decision on 29 January, will charge banks 0.1% for parking additional reserves with the BOJ to encourage banks to lend and prompt businesses and savers to spend and invest. Continue reading...

Resolution Foundation points to rising employment and falling inflation as incomes pass 2009 peak – but warns pace of recovery likely to slowLiving standards in the UK have finally made up the ground lost as a result of the financial crash following the boost to incomes provided by rising employment and falling inflation, according to the Resolution Foundation.The thinktank said that the longest squeeze on households in living memory had finally come to an end, with incomes surpassing their previous 2009 peak.Related: Each generation should be better off than their parents? Think againRelated: Now Britain needs clothes banks too. What sort of society are we living in? | Frances Ryan Continue reading...

Markets rise sharply in belief ECB president will move towards negative interest rates and further QE to ease deflation fearsMario Draghi, president of the European Central Bank, has helped calm jittery financial markets by saying he would not hesitate to take fresh action to boost eurozone growth and inflation.Stock markets across Europe, which were already rallying after a turbulent start to 2016, ended the day sharply higher in the belief Draghi would deliver on his pledge at the ECB meeting next month.Related: Draghi has financial markets hoping bad news is really good news Continue reading...

Weak economic figures from Japan and China overlooked as European Central Bank chief hints at further stimulus activityJapan’s growth figures were bad. The data for Chinese exports was even worse. A signal for the financial markets to have another dose of the heebie-jeebies? Not a bit of it. This was one of those days when bad news was good news.The thinking goes as follows. If the Japanese economy shrank by 0.4% in the final three months of 2015 and Chinese exports fell by more than 11%, policymakers will sit up and take notice. Central banks will stimulate activity by cutting interest rates, even when they are already negative, and by expanding their quantitative easing (QE) programmes. Continue reading...

Goods travel 6,462 miles in 14 days as part of efforts to resurrect ancient trade route connecting east with EuropeA long-distance cargo train has travelled from China to Iran as part of an attempted revival of the ancient Silk Road, a trans-Asian trade route connecting the east to Europe and the Mediterranean Sea.The 32-container train, which arrived in Tehran on Monday, took 14 days to complete the 6,462 mile (10,399km) journey from China’s eastern Zhejiang province through Kazakhstan and Turkmenistan – one month less than the sea route from Shanghai to the Iranian port of Bandar Abbas.Related: World's oldest tea remains discovered on ancient trade routeRelated: Eurasia is an idea whose time has come around again Continue reading...

Economist lays out headaches for EU if UK voted to leave, including lower investment, more migration, smaller budget and less influence on global stageThe UK’s exit from the European Union could leave weak member countries exposed to a rise in migrants and reduce the influence of the remaining 27 states on the global stage, according to a leading economist.Jennifer McKeown, senior European economist at Capital Economics, said: “The EU is in a precarious state already, with GDP in most countries still below its 2008 level, refugee inflows adding to pressure on resources and policymakers struggling to respond.Related: German poll finds one in three firms would leave UK after Brexit Continue reading...

Economy shrank at an annualised rate of 1.4% in the last quarter of 2015 – a contraction that was more severe than many had forecastJapan’s economy shrank at an annualised rate of 1.4% in the last quarter of 2015, new figures showed on Monday, dealing a further blow to attempts by the prime minister, Shinzo Abe, to lift the country out of stagnation.

Sir John Vickers says UK banks are still at risk, with Beijing prepared to spend billions propping up Shanghai market as fears grow of new crashBritain’s banks are vulnerable to a global financial shock despite efforts to shore up their finances, according to the official who led the inquiry into the safety of UK banks following the 2008 crash.Sir John Vickers, who led the Independent Commission on Banking, said: “The Bank of England proposal is less strong than what the ICB recommended.”Related: Seven-and-a-half years on, this is a distressingly fragile recoveryRelated: Are we heading for a crash? | Albert Edwards, Aditya Chakrabortty, Linda Yueh, Ruth Lea, Fred Harrison, Vicky Pryce, Dambisa Mayo, Yanis Varoufakis, Mariana Mazzucato Continue reading...

Osborne claims inequality is declining but the economy – and society – will suffer if he fails to invest in the younger generationGeorge Osborne is known for his helicopter trips to Tory dinners, his £4m trust-fund fortune and links to the aristocracy as heir to an Irish baronetcy. Cementing his reputation as a champion of the richest 1%, the chancellor cut the 50p top rate of tax, cut tax credits (despite making great play of not doing so) and handed bankers an escape clause by making it easier for them to dodge prosecution in the event of another financial crash.All these measures have boosted the income and power of the richest, while the poorest have seen basic public services squeezed and real wages flatline. Continue reading...

Deputy Federal Reserve chair Bill Dudley said the US economy has momentum to withstand weakness from abroadA recovery in US consumer spending revived battered stock markets in Europe and New York on Friday, despite the latest eurozone GDP figures showing a broad slowdown across the currency union and Greece slipping back into recession.

Several European countries favour high-value banknotes, but law enforcement authorities are less convincedHe had the tastes of a typical millionaire. He owned a gold and silver Rolex and a fleet of expensive cars. He liked to dabble in modern art. But although this Chinese businessman had several companies and a palatial villa in the Madrid suburbs, he had almost no money in the bank, a detail that piqued the interest of Spanish authorities.

According to Europol, the high-value banknote accounts for a third of all the euro notes in circulationEU finance ministers have called for an investigation into the €500 note, amid growing concern it is making life easier for terrorists, money launderers and drug barons.The French finance minister, Michel Sapin, said it was right to ask questions about the use of the euro’s largest-denomination note. “The €500 note is more used to conceal then to purchase, more used for easing dishonest transactions than to allow you and I to buy something to feed ourselves,” he said.Related: Big bucks: high denomination bank notes - in pictures Continue reading...

Banking advisory group calls for risk disclosure and stress tests to protect against climate inaction should move to low carbon economy happen too lateThe EU’s financial watchdog has called for governments to consider imposing asset disclosures on industry and stress tests on banks as a guard against the economic crisis that could be caused by an emergency switchover to clean energy.The European Systemic Risk Board – set up by the EU in the wake of the 2008 crash to monitor risks to financial markets – has warned in a new report of economic “contagion” if moves to a low carbon economy happen too late and abruptly.

More QE and rate cuts loom as poor figures from Finland, Germany and Greece reveal next phase of eurozone crisis is about to beginGreece is back in recession. Italy is barely growing. Portugal expanded but only at half the expected rate. The message could hardly be clearer: the next phase of the eurozone crisis is about to begin.On the face of it, the performance of the eurozone economy in the final three months of 2015 looks solid if unspectacular, with growth as measured by GDP up by 0.3%.Related: Eurozone recovery falters as Greece slips back into recession Continue reading...

Italy slows to near stagnation as eurozone GDP expands just 0.3% in final quarter despite ECB stimulus and cheap oilThe eurozone recovery remains disappointingly weak after Greece fell back into recession and Italy slowed to near stagnation.The single currency area grew by just 0.3% in the final quarter of 2015, statistics body Eurostat reported on Friday.Greek Q4 GDP contracts 0.6 pct QoQ, recession of 0.7 pct in 2015 https://t.co/vopG1HUAOG #Greece #economy #euro pic.twitter.com/mkw2DWmHbcRelated: Market turmoil: Stocks rally despite Greece falling back into recession - live updatesThe slowdown in emerging markets, particularly China, has dampened external demand for German products. The upside should come from the weaker euro, which should partially mitigate soft external demand“In particular, any slowdown of the US economy could turn out to be a double whammy for Germany.”0.4% => 0.3% => 0.2% => 0.1%...

Shinzō Abe was heralded for his plan to pull Japan out of deflationary spiral but programme is on brink after dismal weekNot long ago, Shinzō Abe was being heralded for the early success of his grand design to bring Japan out of a deflationary spiral that had haunted the world’s third-biggest economy for two decades.Soon after Abe became prime minister in December 2012, the first two of the three tenets of his “Abenomics” programme – monetary easing and fiscal stimulus – were having the desired effect.Related: Japanese stock market plunges 5% as global rout gathers paceRelated: Tokyo: the city that came out of the shadows Continue reading...

Price of Rapper’s YEEZY Boost Adidas trainers has risen 1,300% in two months on eBay, easily outperforming goldThe lack of safe investments in today’s febrile economic climate has led to rare whisky and even handbags being touted as the best place to stash your cash.But it turns out that the most profitable investment of the lot might be US rapper Kanye West’s snazzy trainers.Related: The Birkin bag: a better investment than stocks and shares Continue reading...

Gold and yen rise in value as weekly falls in Europe reach 6% and 11% in Japan, Tokyo’s biggest weekly drop since 2008A turbulent week in global stock markets is ending with Europe attempting to stage a recovery.Fears about a severe slowdown in the world economy have sent investors scurrying for safe havens such as gold and the Japanese yen, despite Tokyo trying to weaken the currency, and sent stock markets tumbling.Related: Market turmoil: Stocks rally despite weak Italian and Portuguese growth - liveGold pic.twitter.com/njMg8enh6tAs another nerve shredding week draws to a close there appears to be some mild relief for investors as equities try to drive higher. However, it may take some time before investors are truly convinced that a move back in to riskier assets is worthwhile, as the market turmoil emanating from Asia and the eurozone shows no sign of going away any time soon. Continue reading...

Federal Reserve chair Yellen has told senators that negative interest rates are being examined, as shares slide in Europe and the US

Investors buy gold and government bonds and sell shares in banks and companies exposed to lower commodity pricesPanicked investors sought refuge in the safe havens of gold and government bonds on Thursday as a fresh spasm of global selling sent share prices crashing in Asia, Europe and North America.Banks and companies exposed to lower commodity prices were among the biggest losers in London, where the FTSE 100 Index fell by 135 points, a drop of more than 2%. An index of Britain’s banks fell to levels not seen since the depths of the post-Lehman Brothers recession in early 2009.Related: Market turmoil: Wall Street falls; negative rates not off the table says Yellen - liveRelated: If there is another economic crash, Europe’s far right is ready for it | Owen JonesRelated: The five fears stalking the global banking industryRelated: What's holding back the world economy? Continue reading...

The Bank of England’s next move could be more QE or even interest rate cuts. But would Osborne ever consider the activity booster of infrastructure investment?A record was broken during the latest wave of selling on the world’s stock markets. As share prices plunged the yield on 10-year UK government gilts fell to levels never seen before.Should he wish to do so, George Osborne could borrow money in the markets more cheaply than any of his predecessors: neither Benjamin Disraeli nor William Gladstone (a particular hero of the chancellor) enjoyed interest rates as low as 1.29%. Continue reading...

Vehicles travelled 317.8bn miles in 2015, overtaking previous record from 2007, according to Department for Transport figuresBritain’s roads were at their busiest ever in 2015, when total traffic overtook the pre-financial crisis peak.

Morgan Stanley and Goldman Sachs, which agreed to pay $5.06bn last month, are two of the last big banks to pay up for their role in the 2008 economic crisisMorgan Stanley will pay $3.2bn to settle federal and state charges that it misled investors in residential mortgage-backed securities during the financial crisis, New York’s attorney general announced on Thursday.The deal comes a month after Goldman Sachs agreed to pay $5.06bn to resolve civil claims related to the firm’s securitization, underwriting and sale of residential mortgage-backed securities from 2005 to 2007. The Goldman Sachs settlement included $875m in cash payments and $1.8bn in consumer relief.Related: Goldman Sachs profit drops after $5bn mortgage-backed bond settlement Continue reading...

Children are truanting because they don’t have school uniforms, so entrenched is poverty. But clothing’s a need people don’t like to talk about, says Louise CookeLouise Cooke, a 46-year-old ex-teacher and community worker in Nottingham, has never been elected nor is her work funded by the taxpayer – but she is filling in the gaps left by the government.For the past two years, volunteering out the back of her local church, Cooke has been running Sharewear – what, in austerity’s language, we could dub a “clothes bank”. This isn’t packets of pasta or boxes of veg but winter coats and children’s shoes. Cooke describes the people who come through the doors as in “crisis”: anyone from job seekers to Syrian refugees, from low-paid workers to people on benefits (“We have people coming in on disabled people’s behalf because they’re housebound,” she adds).Related: Why should Rachel Watt have to sleep in her wheelchair? | Frances RyanIt’s like we’re living in the developing world – but it’s the UKRelated: Phil Brehaut has Parkinson’s. Threatening to cut his benefits won’t help | Frances Ryan Continue reading...

History should be warning enough: the left must prepare a coherent alternative to the slash and burn of austerity – and fastThe last economic crisis never ended, and another one may loom. Europeans have endured years of unemployment and underemployment, stagnating or falling living standards, and cuts to state services on a scale ranging from steep to decimation. The disintegration of Syria has sent a tidal wave of human misery crashing over the country’s borders, some of it lapping on the shores of the European continent. And already the populist, anti-immigration right is in a strong position, from Sweden to France, Greece to the Netherlands. So when Greece’s motorcycling former finance minister Yanis Varoufakis warns that Europe could be falling into “a modern 1930s”, it is time to sit up, listen – and prepare.Related: The five fears stalking the global banking industryRelated: UK industrial production shrank in 2015 Continue reading...

Scottish government accused of blocking cross-party plans to give Fiscal Commission authority to review Holyrood’s budgetsScotland’s finance secretary has been accused of killing off proposals in Holyrood to give a financial watchdog far greater powers to scrutinise his spending and borrowing plans.Labour and Conservative members of Holyrood’s finance committee said they were stunned after the Scottish National party’s MSPs on the committee suddenly rejected proposals they had helped draft to give the Scottish Fiscal Commission more independence and authority to review John Swinney’s budgets.Related: Scotland's debt mountain: Holyrood's borrowing could hit £50bn by 2020 Continue reading...

A carelessly drawn-up laundry list of legislative odds and ends will define the legacy of the Cameron eraPolitics is a Darwinian business, and failure can be cruelly punished. But so can success, as the Conservatives are now finding out. The party rode into the election with an enviably minimalist campaign message – you remember it, rhymes with “long-term economic flan” – and a laundry list of eyecatching policies that they would, oh so regretfully, ditch at the merest whiff of coalition negotiations.And then they won an overall majority. Their backbenchers were thrilled; those pesky Liberal Democrats had been crushed, and now the country would see the full glorious might of a full-bore Conservative government. Sunlit uplands, good times, boogie.‘Well, I suppose Cameron kept the seat warm’ is no one’s idea of a great political epitaphRelated: David Cameron’s mother has spoken out against cuts - will her son finally listen? | Patrick ButlerRelated: Experts say housing bill signals end of the road for affordable housing Continue reading...

Biggest daily drop in six months looms for Hong Kong markets opening after the lunar New Year breakHong Kong’s stocks took a battering on Thursday, with the benchmark index falling 4% in late morning trade as worries about the health of the global economy, particularly China, sparked a sell-off in financials and energy shares.Stocks were set for their biggest daily drop in six months after they reopened from a three-day break, catching up with global peers. China-related stocks and banks were singled out for special punishment.Related: Stock market rout intensifies amid fears central banks are 'out of ammunition'Related: Deutsche isn't the only drama in banking's new negative-yield world Continue reading...

Employers’ organisation reduces forecast for GDP increases in 2016 and 2017 to 2.3% and 2.1% respectivelyBritain’s leading employers’ organisation, the Confederation of British Industry, has warned that the growth prospects for the UK economy have dimmed since George Osborne’s autumn statement three months ago.Cutting its forecasts for both 2016 and 2017, the CBI said a weaker performance at the end of last year coupled with a less rosy outlook for household spending, trade and investment had led to the growth downgrade. Continue reading...

Fed chair has warned that turmoil in global financial markets could knock the US recovery, and hinted that interest rates will only rise gradually

Wall Street unimpressed after Fed chief refuses to rule out return to modest increases should financial market turmoil blow overThe chair of the Federal Reserve has dropped the broadest of hints that it has put future US interest rate increases on hold following the plunge in global stock markets since the start of the year.In testimony before Congress, Janet Yellen admitted that the selloff in shares on Wall Street had affected the growth prospects for the world’s biggest economy and left investors in little doubt that the US central bank had no intention of following last December’s increase in the cost of borrowing with a second increase in March.Related: There wasn't much Yellen could say that wouldn't have spooked the marketsRelated: Global markets fall after US jobs report raises prospect of interest rate riseRelated: Federal Reserve keeps interest rates unchanged while monitoring markets Continue reading...

Below-zero interest rates may prove a threat to the whole financial sector if they last for too longDeutsche Bank’s shares rose 10% on Wednesday. Is the panic over Germany’s biggest bank over? Well, a quick bounce in the share price is a useful start but any other reaction would have been alarming given the force of the verbal counter-offensive.Chief executive John Cryan had declared Deutsche to be “absolutely rock-solid” and Wolfgang Schäuble, the country’s finance minister, was obliged to lend a hand by saying he had “no concerns” about the bank. Even after these proclamations, Deutsche’s shares are still down 33% since the start of the year and the bank is priced at half its book value. So, no, the crisis is not over – not for Deutsche and not for the wider banking sector. Continue reading...

QE and low interest rates have handed extra wealth to richest households by propping up stock markets and supporting booming house prices, says reportBank of England policies to help Britain’s economic recovery have made inequality worse and increased the wealth gap between young and old, according to a leading credit ratings agency.A study by Standard & Poor’s has found thatthe low interest rates and quantitative easing used to rescue the economy after the 2008 crash have handed extra wealth to the richest households by propping up stock markets and supporting booming house prices.Related: If there is a fresh banking crisis, taxpayers deserve to be protected Continue reading...

“Nonetheless, any progress in reducing the trade deficit is likely to be extremely slow in the near term, leaving the recovery reliant on domestic demand.” So said an analyst quoted in your report on the UK goods trade gap having reached a record £125bn last year (Financial, 10 February). So, if I go out and exchange my four-year-old car for an expensive one that I cannot afford, apparently I shall have “recovered”.In fact, though the chancellor might be happy in the short term because of the VAT he would harvest, I should be feeling decidedly queasy wondering how I was going to service the debt I had taken on to make the purchase. But no, according to current economic theory, I would be in recovery. Makes you wonder, doesn’t it?

The Fed chair’s testimony to Congress in the wake of the controversial interest rate rise had to be circumspectInterventions by central bank governors to soothe troubled financial markets come in two forms: the ones that have a modest, transitory effect and the much rarer ones that make a real difference.Mario Draghi’s “whatever it takes” speech in London in July 2012 fell into the second category. When the president of the European Central Bank said he was prepared to take on the speculators attacking Italy and Spain, the markets got the message: the ECB was prepared to use unlimited firepower to act as a lender of last resort. The speculators backed off immediately. Continue reading...

As the international poster child for austerity, Ireland isn’t equipped to deal with the rise in serious gun crime that has links to ex-terrorists and drug traffickersIs Dublin in the grip of a vicious crime war? Two execution-style gangland murders in the space of a week – one at a crowded boxing event at a hotel in the Irish capital – have caused widespread shock and just weeks before a general election, political consternation.Ireland’s homicide rate is broadly similar to its EU neighbours. It stands at about 1.1 per 100,000 citizens on an annual basis. This is slightly higher than the UK, with a homicide rate of 0.96 per 100,000. France is slightly higher again at 1.2 persons per 100,000. Ireland’s central statistics office states that a total of 1,068 Irish people died by homicide between 2004 and 2014.Related: Dublin boxing weigh-in shooting death linked to gangland feudUp to now, Irish criminal gangs have typically used small caliber handguns such as Glock automatic pistolsRelated: Dublin gang wars: council advises estate residents to move out for safety Continue reading...

Mary Cameron has signed a petition against the closure of children’s services in Oxfordshire. The austerity programme is set to lead to rebellion by rural ToriesThe prime minister’s mother, Mary Cameron, has signed a petition against the planned closure of children’s services in Oxfordshire, the Tory-run council that covers her son David’s Witney constituency. There is a delicious piquancy to her act of rebellion – cue Twitter fantasies that her wayward son faces a maternal dressing down over Sure Start cuts, and might even be sent to the “naughty step”.Related: David Cameron's mother signs petition against cuts to children's servicesRelated: David Cameron hasn’t the faintest idea how deep his cuts go. This letter proves it | George Monbiot Continue reading...

Christine Lagarde says it is hard to see the programme continuing ‘without substantial effort’ to improve governanceThe International Monetary Fund has warned it will halt its $40bn (£28bn) bailout programme to Ukraine unless the conflict-torn eastern European country takes immediate action to tackle corruption.The IMF’s managing director, Christine Lagarde, said on Wednesday that “without a substantial new effort” to improve governance, it was hard to see how the Washington-based organisation could continue to provide financial help. Continue reading...