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Inflation expected to have dipped below 2% in September
Inflation across the UK should have dropped below the 2% mark last month, Deutsche Bank (ETR:DBKGn) analysts say.
Following an unchanged reading of 2.2% for the year to August, Deutsche said in a note the UK consumer price index was set to have increased by around 1.8% in September.
Core inflation, including energy and food prices, was forecast to have climbed by 3.4%, against 3.1% previously.
September will likely reflect a “cyclical low” for inflation, Deutsche analyst said, as upward momentum likely gathers pace in the months ahead.
“The recent run of energy deflation will likely come to an end shortly,” the bank said.
“Indeed, pump prices are likely to reverse course in October, while dual fuel bills will see a hefty 10% rise.
“The upcoming Autumn Budget also raises risks to short-term inflation, with alcohol and tobacco duty increases potentially in the offing.”
Inflation figures from the Office for National Statistics are due on October 16.
Government cuts NatWest stake by further 1%
The government has sold off another chunk of shares in NatWest Group PLC (LON:NWG) as a gradual wind-down of its stake in the lender continues.
Just under a per cent of the Treasury’s stake in the bank was sold, a filing showed on Wednesday, leaving the government’s holding slightly off 16%.
This follows repeated selling of its stake in NatWest by the government in recent months, which saw the public’s interest in the bank fall below 20% in July.
The government’s stake had sat at 62% in 2018, after some 84% of the bank was taken into public hands following a bail-out during the 2008 financial crisis.
Chancellor Rachel Reeves scrapped plans earlier in the year to ditch a large stake through a retail sale, noting the move would not provide value for money at the time.
Wall Street set for cautious start as third-quarter earnings season looms
Wall Street looked set for a cautious start on Wednesday after Tuesday saw stocks enjoy gains after a sell-off earlier in the week.
Futures had the Nasdaq falling 0.2% on the opening bell, while the Dow Jones and S&P 500 were seen 0.1% lower respectively.
This would follow gains across the board on Tuesday as markets recovered from Monday’s sell-off, which was prompted by a jump in Treasury yields on falling expectations for steep rate cuts by the Federal Reserve ahead.
A quiet day of scheduled news on Wednesday saw attention turn to Thursday’s inflation reading as a result, which is set to provide further clarity around the scope for future cuts.
“Federal Open Market Committee minutes that are due later today and, crucially, tomorrow’s CPI report for September, will be the most important drivers of rate cut expectations in the short term,” XTB analyst Kathleen Brooks commented.
Wednesday also looked to be a quiet period ahead of the start of third-quarter earnings season later in the week, with Delta Air Lines Inc (NYSE:DAL) reporting on Thursday, before BlackRock Inc (NYSE:BLK), JPMorgan Chase (NYSE:JPM) and Wells Fargo (NYSE:WFC) on Friday.
Train station spending worth billions a year, report finds
Train stations contribute billions of pounds to the economy annually as passengers visit the likes of coffee, gifts and haircuts ahead of journeys.
Train passengers spend £23 billion across high street stores each year, research commissioned by industry body the Rail Delivery Group (RDG) showed.
Some £9 billion is spent at independent businesses in the meantime, the report said, as train-goers spend an average of £32 in and around stations... Read more
Shares in Upper Crust owner SSP ticked up by 3.2% on Wednesday, as WH Smith PLC (LSE:LON:SMWH) climbed by 0.3%.
German exports boosted by US and UK demand
German exports unexpectedly ticked up in August on the back of strong demand from the UK and US, figures showed on Wednesday.
Federal statistics office data showed exports climbed by 1.3% over the month compared to July, against expectations for a 1% decline.
Exports to the US jumped by 5.5% during the month, the figures showed, while those to the UK increased by 5.7%.
This came as Germany’s trade surplus grew from €16.9 billion (£14.2 billion) to €22.5 billion in August, driven by a 3.4% decline in imports.
The positive figures come as Germany, Europe’s largest economy, has struggled to recover in line with other nations recently.
“The second slight increase in exports in a row is a small glimmer of hope, but no reason to sound the all-clear,” German Chamber of Commerce head Volker Treier said.
Global renewable capacity to surge through rest of decade - IEA
Renewable energy capacity is set to grow globally at almost three times the pace seen over the past six years during the rest of the decade.
Some 5,500 gigawatts of capacity is on course to be built between 2024 and 2030, the International Energy Agency said on Wednesday, with China accounting for almost 60% of all new renewables over the period.
This would see renewables able to meet almost half of global electricity demand come 2030, as solar makes up the majority of new capacity.
The new renewables would also roughly equate to the combined current power capacity of China, the European Union, India and the United States... Read more
Business confidence falls for first time this year ahead of Budget
Business confidence across the UK has dropped for the first time in a year ahead of this month’s Budget, figures showed on Wednesday.
The Institute of Chartered Accountants in England and Wales’s (ICAEW) Business Confidence Monitor fell from 16.7 to 14.4 in the third quarter.
Though this was still double the pre-pandemic average, the figure dropped for the first time in 12 months as businesses appeared to be bracing for the October 30 Autumn Budget.
ICAEW chief executive Alan Vallance noted firms were becoming “increasingly reluctant to invest” and were “troubled by the tax burden”.
Britain’s new Labour government has previously warned the Budget will be “painful,” with tax hikes expected as ministers grapple with a slated £22 billion “black hole” in public finances.
The survey showed firms still expected an uptick in domestic and export sales over the coming year, though these had weakened compared to the previous quarter.
This came after business reported export growth slowed to 2.7% from 3% previously in the third quarter, while domestic sales climbed by 3.8%, against 3.3% beforehand.
“These figures suggest a slight reality check for the UK economy,” ICAEW Economics Director Suren Thiru added.
“Weaker expected export and investment activity, alongside fears of a painful Budget, dented business confidence.”