The latest labour data shows big increase in full-time work in a timely boost for treasurer Joe Hockey as he prepares for next month’s budgetAustralia’s unemployment rate has fallen to 6.1% as the economy added a surprisingly strong number of jobs.The figure, which most economists had expected to remain static at 6.3%, will make the chances of another rate cut in May less likely.

Director of Institute for Fiscal Studies claims coalition’s move to cut the tax-free personal allowance achieves a similar outcome for low-paid workers

Gloomy view on UK economy says government spending on welfare may need to be higher than Treasury plans, while lower tax receipts will undermine growthBritain’s next government will face a tougher time than expected reducing Whitehall’s annual spending deficit, according to the International Monetary Fund, which said lower tax receipts and uncertainty surrounding the election would undermine growth forecasts.The Washington-based organisation said the current prediction of a £7bn surplus in the last year of the next parliament would instead be a £7bn deficit. The forecast blows a hole in George Osborne’s hopes that keeping to strict public spending limits for the next five years will deliver a surplus.High public debt levels pose headwinds to growthRelated: IMF chief hails UK economic recovery Continue reading...

Mario Draghi’s press conference in Frankfurt briefly suspended after a protester wearing a t-shirt showing “End the ECB dick-tatorship” threw paper and confetti at Europe’s top central banker

As general election looms and recession enters fourth year, once boom city of Oulu has little faith in politicians after collapse of big timber and NokiaA sudden flurry of spring snow has dusted the steps of an evangelical church in central Oulu, northern Finland, where about 100 people are crowded together for a Friday sermon.But perhaps the true object of their devotion is inside black binliners by the door. Once a week, food parcels and a free meal attract a mix of unemployed men, single mothers and pensioners to the church.It will take a while for Oulu to bounce back. But there is a feeling that we have to do it, there is no other way.A change of government won’t make any difference – new faces, same shit Continue reading...

Activist rushes on stage and throws confetti over European Central Bank president Mario Draghi

The latest global stability report warns of potential fissures in the world economy from numerous placesThe world’s most active volcanic region is the Ring of Fire girdling the Pacific Ocean. There are 452 active volcanoes in the region and they are constantly studied to see which might be the next to erupt.Reading the International Monetary Fund’s half-yearly global financial stability review feels like a similar exercise. Looking around the world, the experts at the IMF see billowing smoke emerging from the mountaintops and hear the ominous rumble of something getting ready to blow. Continue reading...

Rise in household debt lands UK on IMF financial stability report’s warning list of countries vulnerable to a credit crunch similar to the one that triggered 2008 banking crisisBritain’s reliance on households using loans and credit cards to spur economic growth has put the gradual recovery of the past five years in jeopardy, the International Monetary Fund has warned.A rise in household debt to one of the highest in the developed world puts the UK on a warning list of countries vulnerable to a credit crunch similar to the one that triggered the 2008 banking crash. Continue reading...

Jam tomorrow is the party’s promise – their pledge to cut current deficit makes them tougher than Labour, but not as tough as the ToriesThere are two groups of parties fighting the election: those who think the time for austerity is over and those who think it has to continue into the next parliament. The SNP and the Greens are in the first camp. Labour, the Conservatives and the Liberal Democrats are in the other.The Liberal Democrat manifesto makes it clear that the austerity will come first before making way for the commitments to spend more on the NHS, including mental health, and education later in the parliament. Voters are being offered jam tomorrow rather than jam today. Continue reading...

Growth is picking up across the economic superbloc but whether that’s beneficial for change is down to the reasons behind the upturnAfter a double-dip recession and an extended period of stagnation, the eurozone is finally seeing green shoots of recovery. Consumer confidence is rising. Retail sales and new car registrations are up. The European commission foresees 1.3% growth this year, which is not bad by European standards. But it could be very bad for reform.It is not hard to see why growth has picked up. Most obviously, the European Central Bank announced an ambitious programme of asset purchases – quantitative easing – in late January. That prospect rapidly drove down the euro’s exchange rate, enhancing the international competitiveness of European goods.Related: Greece is playing to lose the debt crisis poker gameRelated: The central banks and their bottom line Continue reading...

IMF forecasts show that Britain could join a tiny group of European countries that have shrunk the size of their states dramatically. But it needn’t be this wayIn the main parties’ election manifestos published this week, public spending is still public enemy number one. The Conservatives insist that a further £12bn in cuts to the welfare budget must be found over the course of the next parliament. If it isn’t, they warn, then the hordes of so-called skivers who receive unemployment benefit, child support, or disability benefits will keep draining Britain dry.Related: Which are the best countries in the world to live in if you are unemployed or disabled?The UK could become a place in which people live shorter, more brutal and less valued lives Continue reading...

It is extremely encouraging that World Bank president Jim Yong Kim is leading calls for an end to fossil fuel subsidies worldwide (End subsidy on fossil fuels now, 14 April). The World Bank has raised concerns about the impacts of climate change on the world’s poorest people for a number of years, but this is the first time that it has directly called for an end to government support for fossil fuels, and recognised that clean energy technology can be effective in supporting people out of poverty. The message this sends to global investors is clear.It is now time for the World Bank to pull its own financing out of fossil fuels. In 2013, it financed $2.7bn for fossil fuel projects, which included over $1bn for new fossil fuel exploration. By ending its own subsidies to fossil fuels, the World Bank would not just send a message, but generate a shockwave that could make a real transformation towards ending global fossil fuel dependency.

Labour’s focus on cutting the deficit means progressive voters will have to look elsewhere for inspirationLabour’s 1983 manifesto is widely known as the longest suicide note in history. Its 2015 manifesto is the longest till receipt in history. It is costed and funded, ordered and itemised, and will electrify anyone who is aroused by the high wild cry of accountancy.Labour has allowed the Conservatives to frame its politics. Frames are the mental structures through which we perceive the world. The dominant Tory frame, constructed and polished across seven years by its skilled cabinet makers, is that the all-important issue is the deficit. The financial crisis, it claims, was caused not by the banks but by irresponsible government spending, for which the only cure is austerity.Related: General election 2015: what happened to the push for women’s votes? | Anne PerkinsThe biggest landowners each receive millions of pounds a year in public money: a vast and toxic scandal Continue reading...

While the IMF skates over China’s slowdown and the Greek crisis, it should focus on deeper worries in the world economy

Guardian writers analyse the key policy pledges unveiled by David CameronRelated: Election 2015 live: Cameron promises to double free childcare and revive right to buyRelated: Conservatives election manifesto 2015 - the key pointsRelated: How much of the Conservatives' 2010 election manifesto was implemented? Continue reading...

Food and energy prices help to keep consumer prices index inflation unchanged, at the lowest rate since Macmillan was in No 10.

Bearish City strategist says coalition has left economy ‘up to its eyeballs in macro manure’ by failing to cut deficit, and that sterling will sufferThe UK economy is a ticking time bomb set to explode after the general election, according to a leading City commentator who has warned of a fresh crisis for the pound.Albert Edwards, who heads the global strategy team at investment bank Société Générale and is well known for downbeat views, chides the coalition for a legacy of “grotesquely wide deficits” in both the public sector finances and on the UK’s current account – its overall trading position with the rest of the world.

One would have thought that the AIIB’s launch, and the decision of so many governments to support it, would be a cause for universal celebrationThe International Monetary Fund and the World Bank are holding annual meetings, but the big news in global economic governance will not be made in Washington DC in the coming days. Indeed, that news was made last month, when the United Kingdom, Germany, France, and Italy joined more than 30 other countries as founding members of the Asian Infrastructure Investment Bank (AIIB). The $50bn AIIB, launched by China, will help meet Asia’s enormous infrastructure needs, which are well beyond the capacity of today’s institutional arrangements to finance.One would have thought that the AIIB’s launch, and the decision of so many governments to support it, would be a cause for universal celebration. And for the IMF, the World Bank, and many others, it was. But, puzzlingly, wealthy European countries’ decision to join provoked the ire of American officials. Indeed, one unnamed American source accused the UK of “constant accommodation” of China. Covertly, the United States put pressure on countries around the world to stay away. Continue reading...

David Cameron talked up a great recovery at the launch of the Conservatives’ manifesto, but this has been the slowest and weakest in recent historyThe Conservative party line on the economy has changed in recent weeks. At budget time, the message was that the repair job was only half done and tough decisions lay ahead.Since the election has been called, however, the language of restraint has disappeared and been replaced by promises of tax cuts and spending increases, most of them uncosted, in the next parliament. Sir Stafford Cripps, the austerity chancellor, has been placed in temporary cold storage and replaced by the famous pools winner Viv Nicholson. Continue reading...

Growth rate to speed up in next two years but recovery based on falling oil price and easing austerity still at risk from exchange rate shocks, debt and ageing populations

Inflation at 0.0% means the Bank of England is under no pressure to ease its stimulus, but rising or falling wages remain key to UK economic growthPut the “Britain slides into deflation” headlines on hold for another month. Higher petrol prices meant that the annual inflation rate in the UK in March was zero, the same as it was in February.Technically speaking, even had the Office for National Statistics announced that last month’s inflation rate had been negative, it would not have qualified as deflation. Continue reading...

Fall in clothing and gas prices boosts disposable incomes as CPI measure stays at zeroBritain’s inflation rate has held at its record low of zero, giving disposable incomes a boost and leaving the country on the brink of a period of falling prices.

Pickup in food and homeware sales brings relief in March but experts warn of softer spending as election uncertainty weighsShoppers splashing out on Easter foods and new homewares helped UK retailers enjoy a bounceback in sales last month, according to industry figures.The latest British Retail Consortium report showed sales up 3.2% on a like-for-like basis from a year ago, but the figures were flattered by the earlier timing of Easter this year compared with 2014.All in all, retailers can also be satisfied with the consumer response to their Mother’s Day and Easter offerings, but it is important to note that April figures will be impacted by the absence of Easter this year.”While supermarkets may be selling more, they are pedalling hard to stand still.”Any retail recovery is built on confidence, and uncertainty around the outcome of the election continues to cast a shadow over the long-term recovery of the sector. If the result causes concern and confusion, this could be the factor that stifles consumer spending.” Continue reading...

Finance chiefs rank risk of policy change and referendum on EU membership as biggest threats to UK business

No doubt governing boards across England were pleased to see your coverage of school budgets as they consider how they are going to balance the books in the coming financial years. However, one of the statements in your editorial (7 April) gives very much the wrong impression; you conclude that beneficial changes have meant “all schools are treated in a similar way”.School funding is hideously complicated, and in fact the result of changes to funding allocations made by central government over the past five years has been to increase the differences between similar schools in different parts of the country. The Institute for Fiscal Studies has charted the increasing variations from the mean of funding per pupil over a long period. Continue reading...

Beijing has made clear that after initially cushioning the slowdown with a massive fiscal stimulus, it is now aiming to engineer a shift to a more sustainable growth modelThe worse-than-expected trade data from China on Monday was the latest evidence of the struggle Beijing faces in achieving a soft landing for the world’s second-largest economy.Before the Great Crash of 2008, China’s role as the world’s manufacturing powerhouse, shipping cut-price goods from shoes to smartphones out across the world, seemed like the economic equivalent of alchemy: turning the sweat and toil of hundreds of millions of workers into gold. Continue reading...

Jim Yong Kim calls for five-point plan to deliver low-carbon growth, including removal of incentives to exploit oil, gas and coalPoor countries are feeling “the boot of climate change on their neck”, the president of the World Bank has said, as he called for a carbon tax and the immediate scrapping of subsidies for fossil fuels to hold back global warming.Jim Yong Kim said awareness of the impact of extreme weather events that have been linked to rising temperatures was more marked in developing nations than in rich western countries, and backed for the adoption of a five-point plan to deliver low-carbon growth.Related: Climate change: why the Guardian is putting threat to Earth front and centre | Alan Rusbridger Continue reading...

A rise in the online economy has been matched by a rise in van sales, so if you’re seeing more of them on the road, it’s thanks to all those phone covers, candles and sheds people are orderingName: Vans.Age: Between 100 and 200, if you count the word being applied to covered wagons in the 19th century. Continue reading...

Sheffield council’s groundbreaking jobs scheme has kept graduates in the city, with more than 100 now in high-skilled jobs with smaller employersWhen Jade Hearsum graduated from the University of Sheffield she would have moved anywhere for a job. She considered London, but shuddered at the expense. She thought about Norwich, where she grew up.

Guardian experts analyse the key election policies unveiled by Ed Miliband

Weakest exports for a year and poor imports affect markets worldwide before Chinese shares rally on expectation Beijing will step in to stimulate economyA surprise fall in Chinese exports fanned fears that global growth is losing momentum and sent ripples through world markets on Monday.Figures showing the biggest drop in overseas sales from China for a year and a slump in imports took financial markets by surprise. In the UK, fears about the strength of the world’s second largest economy knocked the FTSE 100 share index off its record highs as mining stocks in particular were sold.Related: Chinese export fall raises growth fears - liveA bigger than expected slide in both March exports and imports has raised concerns about the prospects of the Chinese economy hitting its 7% GDP target later this week …These data misses raise concerns that not only is the Chinese economy failing to rebalance with demand remaining low, but also the global economy’s demand for Chinese exports is also falling back, raising concerns about the state of the global recovery as well.In China, growth will moderate further, to 7.1% in 2015 and 6.9% in 2017, reflecting continued policy efforts to address financial vulnerabilities and gradually shift the economy to a more sustainable growth path. Continued measures to contain local government debt, contain shadow banking, reduce excess capacity, curb energy demand, and control pollution will reduce investment and manufacturing growth. However, targeted stimulus is expected to continue to mitigate the impact on short-term growth, should this show signs of slowing considerably below the government’s indicative target of about 7%.East Asia Pacific has thrived despite an unsteady global recovery from the financial crisis, but many risks remain for the region, both in the short and long run.To address these risks, improving fiscal policy is key. With low oil prices, countries – whether oil importers or exporters – should reform energy pricing to usher in fiscal policies that are more sustainable and equitable. Continue reading...

Analysis: Many of the party’s commitments are feasible and economically relevant but the final two pledges are there for purely political purposesLabour spent most of the 1990s rebuilding its reputation as a party of economic competence. The damage caused by being in power during Britain’s most severe postwar recession means that process has begun all over again.It is not unusual for voters to trust the Conservatives more than Labour over the running of the economy. What has been striking during this parliament has been the size of the Tory lead. So the budget responsibility lock in line one of Labour’s manifesto is an attempt to confront this weakness head on. It is the equivalent of Gordon Brown in 1997 promising to keep the top rate of income tax at 40% and to stick to Ken Clarke’s spending plans.Related: Labour election manifesto: key points Continue reading...

Shadow chancellor says party will clear the current budget deficit by the end of the next parliament as Miliband prepares to launch Labour’s manifestoEd Balls has delivered an unequivocal commitment that Labour would eliminate the current budget deficit and even deliver a surplus by 2020, in a toughening of the party’s language on public finances.

It’s easy to feel sorry for a country crippled by war and corruption – but dismissing past debts is not the way to help, say Alexander Lebedev and Vladislav InozemtsevThe road to hell is paved with good intentions, they say, and so it may be with the west’s approach to Ukraine.Related: Viktor Yanukovych is gone, but where are Ukraine's missing millions? | Oleksii KhmaraRelated: When rebels toured the palace: how does Ukraine's presidential compound measure up?Related: Viktor Yanukovych boasted of Ukraine corruption, says Mikheil Saakashvili Continue reading...

Business Trends report maintains strong growth reading, suggesting job creation will continue to rise; signs too of building industry revivalEmployers’ hiring intentions are at a “sky high” level and stronger than in the pre-recession boom, but concerns remain about the UK’s failure to grow productivity, according to a new report.

Labour to launch manifesto and challenge claim it would not tackle deficit by unveiling ‘budget responsibility lock’ and guarantee policies are fully fundedEd Miliband will move to change the terms of the general election campaign by portraying Labour as the party of fiscal responsibility when he guarantees that every policy will be fully funded and will involve no extra borrowing.In one of the boldest moves by a Labour leader since Tony Blair amended clause IV in 1994, Miliband will use the launch of the party’s manifesto to unveil a “budget responsibility lock” to guarantee the deficit will be cut in every year.This is a manifesto which shows Labour is not only the party of change but the party of responsibility tooRelated: Labour seeks to reinvent itself in public mind as party of fiscal cautionRelated: Labour pledges huge fines on tax avoiders to raise £7.5bn a year Continue reading...

Falling energy costs and a supermarket price war may force the inflation rate below zero for the first time in more than five decadesBritain could fall into deflation this week for the first time in more than half a century, the result of an escalating supermarket price war and falling energy prices.Inflation, as measured by the consumer prices index, fell to zero in February for the first time since comparable records began in 1989. Estimates from the Office for National Statistics suggested that it was the lowest reading since 1960. Continue reading...

Greece has not got the money to pay its debts and Europe’s big beasts are unwilling to offer more subsidiesA trap door is slowly opening under Athens. The Finns appeared to give it a little nudge last week with a leaked report offering a glimpse of its battle plans should the Greeks exit the euro. In Berlin, the finance minister’s obsession with paying down debts (bizarre when German infrastructure is falling apart) was on display again and gave a further clue that he will not tolerate Greece reneging on its own borrowing.While words like denouement have been used before in reference to the crisis, it looks as if we are on the last chapter of a very long book. With only days left to present a plan and not more than two weeks to come up with some serious cash to repay outstanding loans, Athens is at crunch point. Continue reading...

This week’s inflation data may see the rate dip below zero for the first time since 1960. But don’t call it ‘deflation’What do economists do to their children’s beachball after a vigorous afternoon session by the seaside? Do they deflate it? Don’t be daft. They negatively inflate it.You may not quite get the difference between the two, but don’t worry. This week might provide you with the chance to enrol in one of those crash courses in the dismal sciences that we all adore, as there’s a chance that when the latest inflation data is revealed we will discover that prices have been falling (at least according to the consumer price index measure). Continue reading...

As Labour and Tories argue over repealing legislation passed in 1799, other outdated forms of taxation need to be made clear, simple and fairGeorge Osborne, the arch-tactician, surely has at least one pre-election lollipop up his sleeve for Tuesday’s Tory manifesto launch; but so far in the general election campaign, Labour have made the running on tax.When Ed Miliband announced his party’s pledge to abolish non-domiciled tax statutes, the Conservatives – unsure whether to attack Labour for destroying a useful quirk of the UK tax system, or condemn the policy as half-hearted “tinkering around the edges” – became bogged down in arguments about how much revenue abolition would raise. Continue reading...

Dutch study finds mathematics results suffer most from dope consumption – findings sure to fuel debate over steps towards legalisationIf you want to do well in your exams, especially maths, don’t smoke dope.This is the finding of a unique study that is likely to be fiercely debated by those in favour of and those against the liberalisation of cannabis laws. Economists Olivier Marie of Maastricht University and Ulf Zölitz of IZA Bonn examined what happened in Maastricht in 2011 when the Dutch city allowed only Dutch, German and Belgian passport-holders access to the 13 coffee shops where cannabis was sold. The temporary restrictions were introduced because of fears that nationals from other countries, chiefly France and Luxembourg, were visiting the city simply to smoke drugs, which would tarnish its genteel image. Continue reading...

London’s stock market brushes off election jitters, as hopes that weaker currencies will boost corporate profits push European shares to 15-year recordLondon’s stock market brushed off electoral concerns to hit a new high as European shares also surged to a 15-year record on hopes that weaker currencies would support corporate profits.The FTSE 100 index of leading UK shares closed up 1.1% at 7,090 points and also hit a new intra-day high of 7,095.Related: Sterling hits five-year low against dollar as election fears spook investors Continue reading...