Archive for the ‘business’ Category

Car price war and falling air fares cool UK inflation

Rise in interest rates unlikely, with CPI down to 2% in May from 2.1% in April

A fall in transport costs and cheaper clothing brought to an end the recent rise in inflation that threatened to push the Bank of England to increase interest rates.

Energy costs, which spiked in April, and a price war in the car industry following a slump in sales over the past year also helped to bring down the consumer prices index (CPI) from 2.1% in April to 2% in May. Transport costs fell by 3.8% overall between April and May this year, led by falling air fares.

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Will Facebook’s Libra currency shake up financial services?

Facebook’s first big foray into the financial world raised an immediate question: how deeply will its new digital currency shake up traditional financial services? Facebook’s vision promises a world where banks and other payment providers are disintermediated by Libra, which would allow instant, near-free international money transfers. If its currency is widely adopted by Facebook’s 2.4 billion users, it could hold considerable sway, even affecting the role of central banks. With the ink barely dry on Facebook’s proposals, bankers, regulators, payments executives, investors and industry experts all said they were busy evaluating the impact, but suggested that there would be many hurdles in Libra’s path. Regulation came up most often. Harsh Sinha, chief technology officer of forex payments firm TransferWise, described the lengthy regulatory processes that his firm had to go through to set up a network to move money around the world, including getting approval in every single ...

Swiss export pigs’ feet for the Chinese

The Swiss have just been given a licence to export pigs' trotters to China to feed a growing hunger for the delicacy. A new middle class of Chinese are buying increasing quantities of meat, but the country cannot match supply with demand, hence the Swiss intervention. Pigs' trotters are considered more nutritious than other types of pork, and are more expensive to buy. Eating them is thought to ward off wrinkles.  An export licence has just been awarded to five Swiss firms that work together in a chain - two Swiss abattoirs, two meat processing companies and Swiss Nutrivalor, a company that recently opened a CHF20 million ($20 million) factory to clean and trim trotters before shipping them off to China. The factory in Oensingen in northern Switzerland can process 20 tons per day.  Strict hygiene rules It took these companies a year and a half to fulfil the strict hygiene requirements imposed by the Chinese authorities, who insisted that pork and beef products be separated ...

Swiss role in Facebook cryptocurrency project revealed

Social media giant Facebook has released details of its cryptocurrency global payments project, including the role to be played by its Geneva-based foundation, the Libra Association. The non-profit entity was set up in Switzerland last month because the country “has a history of global neutrality and openness to blockchain technology, and the association strives to be a neutral, international institution, hence the choice to be registered there,” read a statement. Switzerland, the self-styled “Crypto Nation”, is home to a growing number of blockchain companies and non-profit foundations related to cryptocurrencies. Developing Libra The role of the Libra Association is to mint and control supply of the new cryptocurrency called Libra. It will manage the reserve of government-issued currencies designed to keep the price of Libra stable, develop the Libra Blockchain on which it runs and play an important role in validating transactions among users on the digital payments network. ...

A third of young Swiss experience financial hardship

Around 30% of young adults in Switzerland have faced financial difficulties, according to data from the Young Adult Survey Switzerland (YASS).  The survey, which questions some 70,000 19-year-olds around the country every four years, aims to gain an “empiric and interdisciplinary insight” into the “educational biographies, living conditions and social and political orientations” of young Swiss adults.  The main findings comparing the results of surveys in 2010/11 and 2014/15 were published by the Swiss Federal Surveys of Adolescents on Tuesday.  Financial problems  Around 30% of young adults in Switzerland have faced financial difficulties at least once in their lives. The share is significantly lower in German-speaking Switzerland than in French-speaking Switzerland. In addition, young Swiss who do not continue their education after it is no longer obligatory are more likely to face financial problems than those with a vocational or all-round education. Financial difficulties ...

Hammond ‘aware of risks’ over trading with China but presses on

The chancellor says the UK’s open trading economy needs inward investment

Britain is aware of the risks facing sensitive areas of the economy from greater levels of Chinese investment, Philip Hammond has said, as London forges closer economic ties with Beijing despite US concerns.

Speaking after a joint economic summit between Britain and China in London that is set to open up deals for companies in the two countries worth more than £500m, the chancellor said he welcomed the closer cooperation.

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Airline shares under pressure after surprise Lufthansa profit warning – business live

German carrier warns on “aggressive” growth in low-cost competition

Wednesday could well mark the start of a new period in the global economy: a decade after the financial crisis hit, the Federal Reserve could be about to cut interest rates again.

The Fed, led by Jerome Powell, has to balance a US economy that economists believe is still relatively healthy with the risks to growth posed particularly by White House trade policy towards China.

On Wednesday, we expect the Fed to signal precautionary rate cuts are in the offing. Markets favour a 25bp rate cut in July with three additional rate cuts over the next twelve months.

The passing of the dividend will mean that income funds will be running for cover, not least due to the overhang from the Woodford saga. However, providing assets are not sold off too cheaply, it could be an interesting speculative buy if this is indeed the last of the final downgrades.

Venerable auction house Sotheby’s has been bought by telecoms billionaire Patrick Drahi, in a deal that values the company at $3.7bn (£2.9bn).

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