DIRS.INFO The most relevant business & tech news

☆ New UK PM Rishi Sunak is a child of privilege, married into almost $1 billion in tech money, and takes over a country struggling to afford heating
▼ + stars: | 2022-10-25 | by ( Mia Jankowicz | Yoonji Han | ) www.businessinsider.com time to read: +8 min

Rishi Sunak will soon become the new prime minister of the UK. It's a union that made Sunak the first frontline UK politician to enter The Sunday Times' annual wealth listing. Sunak and his wife, Akshata Murthy, celebrating the British Asian Trust at the British Museum on February 2022. But despite his attempts to portray a down-to-earth image, the British public has had numerous reminders that Sunak has a very different experience with money than most people. His supporters, including British chancellor Jeremy Hunt, argue that Sunak's experience in finance and at the treasury make him the right man for the job.

☆ Rishi Sunak set to become UK PM after meeting King Charles
▼ + stars: | 2022-10-25 | by ( Jenni Reid | ) www.cnbc.com time to read: +5 min

Rishi Sunak has been named as the U.K.'s new prime minister and the country's first leader of color. Jeff J Mitchell | Getty Images News | Getty ImagesLONDON — Rishi Sunak will become the U.K.'s third prime minister of the year Tuesday following a meeting with King Charles III. Sunak was elected party leader by fellow Conservative lawmakers on Monday following the resignation of Liz Truss on Thursday. watch nowThe 42-year-old will be the youngest U.K. prime minister since 1812, and the first person of color to lead the country, which U.S. President Joe Biden said Monday was "a groundbreaking milestone." Sunak's parents are of Indian descent and in the 1960s moved from East Africa to the U.K. Sunak also has the greatest personal wealth of any of his predecessors.

☆ Reactions as Sunak becomes first British Asian PM
▼ + stars: | 2022-10-24 | by ( Reuters Editorial | ) www.reuters.com time to read: 1 min

PoliticsReactions as Sunak becomes first British Asian PMPostedFormer finance minister Rishi Sunak is set to become the UK's first prime minister of Asian descent after he was confirmed as the new leader of the ruling Conservative Party on Monday (October 24).

☆ Could Boris Johnson be next U.K. prime minister? Liz Truss replacement race is on
▼ + stars: | 2022-10-21 | by ( Https | Media-Cldnry.S-Nbcnews.Com Image Upload Newscms Patrick-Smith-Circle-Byline-Template.Jpg | Patrick Smith | ) www.nbcnews.com time to read: +9 min

Some Conservative lawmakers have suggested they may even quit the party if Johnson wins. “His manipulation of the Conservative Party, his dishonesty and boosterism were all designed to cloak the absence of any realistic policies. Sunak commanded the support of more Conservative lawmakers than Truss, but lost out in the final members’ vote. But he is viewed as responsible for Johnson’s downfall by some allies of the former prime minister, who are unlikely to cheer a Sunak premiership. Starmer, the Labour Party leader, would be the clear favorite to be prime minister if an election were held any time soon.

☆ UK business confidence withers away, surveys show
▼ + stars: | 2022-10-18 | by ( ) www.reuters.com time to read: +2 min

LONDON, Oct 19 (Reuters) - Confidence among British businesses has dropped precipitously, damaged by a toxic combination of rising costs and economic turmoil, surveys showed on Wednesday. The Federation of Small Businesses (FSB), a trade body, said its latest small business confidence index fell to -35.9 from -24.7, the worst reading outside of COVID-19 lockdowns. The surveys underline the threat of recession and scale of the task facing new finance minister Jeremy Hunt in turning Britain's economy around. "Recent political and economic turmoil hasn't helped, which is why it is vital the government focuses on stability," said FSB national chair Martin McTague. The FSB said 68% of small businesses had raised pay over the last year, with wage increases averaging 4.5%.

Hunt, appointed on Friday to fix the public finances after Truss's economic plan hammered the value of British assets, said the country needed to generate confidence and stability before it could seek to grow the economy. He said changes to planned tax cuts would raise 32 billion pounds ($36 billion) every year. While he had been expected to reverse some of the tax cuts, the change to the energy support scheme had been unexpected. Truss had announced a two-year subsidy scheme to support households and businesses through the period of surging energy prices, costing 60 billion pounds in six months. Hunt would still deliver a fuller medium-term fiscal plan as scheduled on Oct. 31, alongside forecasts from the independent Office for Budget Responsibility, the Treasury said.

Yet he ultimately carried the can for an unwelcome fiscal plan that roiled bond markets, spooked investors and sparked a major backlash from governing Conservative Party lawmakers. Cutting his visit short, he flew back to London on Friday to "continue work at pace" for a medium-term fiscal plan due at the end of the month. Nor were further moves to re-embrace Treasury orthodoxy through the choice of Scholar's replacement and a decision to bring forward a medium-term fiscal plan and forecasts. In a reply to Kwarteng, Truss said she was deeply sorry to lose a long-standing friend from government. But a finance minister being ditched so quickly for his policies - especially when they were so closely aligned with the prime minister - is unprecedented in modern times.

Other media said Truss would allow corporation tax to rise in April, reversing a decision to freeze it that was part of Kwarteng's "mini-budget" announced last month. Yields for index-linked gilts also fell sharply. Bets on a peak for rates to hit 5.5% next year were no longer fully priced in. They have gathered pace as investors offered more bonds to the central bank with the scheme nearing its end. LDI funds had been hit hard by the record slump in long-dated gilt prices after Kwarteng's mini-budget.

☆ Reactions: UK's Truss fires Kwarteng, set to U-turn on tax cuts
▼ + stars: | 2022-10-14 | by ( ) www.reuters.com time to read: +5 min

LONDON, Oct 14 (Reuters) - British Prime Minister Liz Truss fired her finance minister Kwasi Kwarteng and news reports said she will scrap later on Friday parts of the economic programme of big, unfunded tax cuts that they delivered last month. Consequently, the scope for a rally in gilts (move lower in yields) and sterling would seem to be limited." BENJAMIN NABARRO, ECONOMIST, CITI"The key issue in the near term is the contradiction between monetary and fiscal policy. RACHEL REEVES, OPPOSITION LABOUR PARTY'S FINANCE CHIEF"This humiliating u-turn is necessary - but the real damage has already been done. We may well be through the worst of the volatility but I fear that the UK is nowhere near out of the woods."

☆ Factbox: What are index-linked bonds and why is the Bank of England is buying them?
▼ + stars: | 2022-10-11 | by ( ) www.reuters.com time to read: +3 min

REUTERS/Phil Noble/File PhotoLONDON, Oct 11 (Reuters) - The Bank of England said on Tuesday it would buy index-linked government debt as part of its emergency programme to try and quell turmoil in the debt market. Following is a summary of what index-linked bonds are and why the BoE is buying them. The recent surge in inflation globally has increased demand for index-linked bonds by investors, but their sensitivity to rising interest rates means many have fallen in value this year. Britain's stock of index-linked debt stood at around 558 billion pounds ($617.54 billion) on Tuesday, making up about a quarter of the government's debt portfolio, a bigger share than in many other rich economies. The BoE said it would buy up to 5 billion pounds of index-linked bonds a day, the same as its maximum for normal bonds.

☆ Fire-fighting Bank of England forced to buy inflation-linked bonds
▼ + stars: | 2022-10-11 | by ( Andy Bruce | ) www.reuters.com time to read: +3 min

Citing a "material risk" to financial stability arising from a rout in British government bonds - known as gilts - the BoE said it would buy up to 5 billion pounds ($5.51 billion) of index-linked debt per day, starting Tuesday. Rather than increase the existing commitment to buy up to 10 billion pounds of gilts each day, as announced on Monday, the purchases will run alongside existing purchases of long-dated conventional bonds, now worth up to 5 billion pounds. British inflation-linked gilts - known as linkers - suffered a massive sell-off on Monday, despite the BoE doubling the maximum size of its buy-backs of conventional long-dated gilts. "Dysfunction in this market, and the prospect of self-reinforcing 'fire sale' dynamics pose a material risk to UK financial stability." To halt freefalling prices, the BoE was forced to pledge to buy as much as 65 billion pounds ($73.63 billion) of long-dated government bonds, known as gilts.

The Dow and S&P 500 e-minis fell for the seventh time in eight sessions, while megacap growth names such as Amazon.com Inc , Apple Inc (AAPL.O), Microsoft Corp , Meta Platforms Inc and Tesla Inc (TSLA.O) lost between 1.6% and 2.7% in premarket trading. read moreIn the previous session, the S&P 500 recorded its first gain in seven sessions. The benchmark index has lost about $9.1 trillion in market value this year and was last valued at $31.2 trillion, according to Datastream. ET, Dow e-minis were down 364 points, or 1.22%, S&P 500 e-minis were down 55 points, or 1.47%, and Nasdaq 100 e-minis were down 207.75 points, or 1.8%. read moreShare of peers United Airlines Holdings (UAL.O), Southwest Airlines (LUV.N) and Delta Air Lines (DAL.N) fell between 1.6% and 2.0%.

☆ Sterling slippery, stocks stalling as BoE boost fades
▼ + stars: | 2022-09-29 | by ( Tom Westbrook | ) www.reuters.com time to read: +4 min

S&P 500 futures fell 0.2%. European futures rose 0.6% and FTSE futures lifted 0.3%. The U.S. dollar index had its worst session in 2-1/2 years on Wednesday, recoiling from record highs. The Australian dollar fell 0.8% to $0.6470. Brent crude futures fell 0.8% to $88.62 a barrel.

☆ Stocks bounce but sterling slippery after BoE buys bonds
▼ + stars: | 2022-09-29 | by ( Tom Westbrook | ) www.reuters.com time to read: +3 min

The Bank of England said it will buy as much as £5 billion ($5.4 billion) a day of long-dated government bonds until Oct. 14. For one, this re-stimulation will lift, not quell UK inflation, and that's bad for bonds and sterling." The mood gave pause to the U.S. dollar's march higher and the dollar index had its worst session in 2-1/2 years as the greenback recoiled from lofty heights. The dollar index was up 0.1% to 113.12, within striking distance of Wednesday's 20-year high of 114.78. ($1 = 0.9252 pounds)Register now for FREE unlimited access to Reuters.com RegisterEditing by Shri NavaratnamOur Standards: The Thomson Reuters Trust Principles.

A source at the Treasury said Kwarteng had no plans to resign or reverse any policies. DO THINGS DIFFERENTLYBritain's first Black Chancellor, Kwarteng is the son of Ghanaian immigrants. In Kwarteng, Truss picked a key ideological ally with whom she co-wrote a book that spells out a low tax, small state, deregulated vision of Britain. One other aspect that raised investor ire was Kwarteng's decision to release a fiscal plan without the accompanying scrutiny of the independent Office for Budget Responsibility. Kwarteng will set out a medium term fiscal plan alongside OBR forecasts on the scale of government borrowing on Nov. 23.

☆ Morning Bid: U-turn sparks huge turn
▼ + stars: | 2022-09-28 | by ( ) www.reuters.com time to read: +2 min

Take Britain, where a government budget on Friday sparked a run on the pound and gilts, accelerated the downdraft across world markets, before prompting an astonishing policy U-turn from the Bank of England on Wednesday. This unleashed a wave of buying across British assets - the 30-year gilt yield sank a record 100 basis points and sterling rose 1.5% - and triggered a pent-up recovery across world markets. The relief was palpable: world stocks and the S&P 500 snapped six-day losing streaks, with the S&P 500 jumping around 2%. Its tinkering at the edges seems to have failed, so will it soon have to take more forceful action to support the yuan? They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias.

"There will be impacts, there’s correlations ... some market volatility, and then how it weighs in the global growth picture," said Paul Malloy, head of municipals at Vanguard. The wild swings in the pound have ricocheted across currency markets, where volatility was already climbing. According to the widely watched Deutsche Bank Currency Volatility Index , volatility across currencies on Wednesday hit its highest level since the March 2020 COVID-19- induced market meltdown, jumping more than 20% from levels last week. Closely followed indicators of financial stress remain contained. U.S. stock market volatility as measured by the "fear index," the VIX (.VIX), has also climbed in recent days but remains below its 2022 highs.

The BoE said it would temporarily buy long-dated bonds - linked most closely to workers' pensions and home loans - in light of a surge in 30-year UK bond yields above 5%, their highest since 2002. Register now for FREE unlimited access to Reuters.com RegisterEuropean government bonds got a lift from the surge in gilts. "The surge in bond yields threatens the housing market and broader economy. Wall Street opened higher, with the S&P 500 Index (.SPX) up about 1% after it fell to a two year low on Tuesday. Scott Wren, Senior Global Market Strategist at Wells Fargo Investment Institute, said markets may already be pricing in future pain.

The BoE said it would temporarily buy long-dated bonds - linked most closely to workers' pensions and home loans - in light of a surge in 30-year UK bond yields above 5%, their highest since 2002. The pound briefly fell by as much as 1% after the BoE's announcement, while UK stocks cut losses, which in turn helped the broader European equity market avoid deeper falls. "The surge in bond yields threatens the housing market and broader economy. The IMF and the U.S. Treasury waded in yesterday in fear of global contagion from gilts to other markets," he said. European government bonds got a lift from the surge in the value of UK gilts.

☆ Stocks pull off 2020 lows, Bank of England steps in to calm UK bond market
▼ + stars: | 2022-09-28 | by ( Amanda Cooper | Harry Robertson | ) www.reuters.com time to read: +5 min

A general view of the Bank of England (BoE) building, the BoE confirmed to raise interest rates to 1.75%, in London, Britain, August 4, 2022. The BoE said it would temporarily buy long-dated bonds - linked most closely to workers' pensions and home loans - in light of a surge in 30-year bond yields above 5%, their highest since 2002. "The surge in bond yields threatens the housing market and broader economy. The MSCI All-World index was last down 0.5%, having pulled off a session trough that marked its lowest since November 2020. "The Bank of England is restoring some calm to the markets.

☆ Moody's warns UK unfunded tax cuts are 'credit negative'
▼ + stars: | 2022-09-28 | by ( ) www.reuters.com time to read: +1 min

SYDNEY, Sept 28 (Reuters) - Global ratings agency Moody's has warned the British government that plans for unfunded tax cuts could lead to larger budget deficits and higher interest rates, threatening the country's credibility with investors. In a blunt release the agency said large unfunded tax cuts were "credit negative", leading to structurally higher deficits amid rising borrowing costs, a weaker growth outlook and acute public spending pressure. "A sustained confidence shock arising from market concerns over the credibility of the government's fiscal strategy that resulted in structurally higher funding costs could more permanently weaken the UK's debt affordability," Moody's said. The pound tumbled to an all-time low of $1.0327 on Monday while bond yields surged as investors demanded a higher risk premia for holding British assets. Register now for FREE unlimited access to Reuters.com RegisterReporting by Wayne Cole Editing by Shri NavaratnamOur Standards: The Thomson Reuters Trust Principles.

☆ Sterling drops against dollar as Bank of England intervenes in bond market
▼ + stars: | 2022-09-28 | by ( Harry Robertson | ) www.reuters.com time to read: +3 min

It was on track for its biggest monthly fall against the dollar since the financial crisis in autumn 2008, having shed almost 9% in October alone. The Bank said it had seen "dysfunction" in the market for long-dated gilts and that it would buy as many as necessary to rectify the situation. Ratings agency Moody's also weighed in on Tuesday, saying the unfunded tax cuts were "credit negative" and likely to weigh on growth. "This move from the Bank of England won't stem moves against the UK debt and currency markets on their own," said Mike Owens, global sales trader at Saxo Markets. "While this is welcome, the fact that it needed to be done in the first place shows that the UK markets are in a perilous position," said Paul Dales, chief UK economist at Capital Economics.

☆ Runaway dollar pauses for breath as bears stalk stocks
▼ + stars: | 2022-09-27 | by ( Xie Yu | ) www.reuters.com time to read: +3 min

Pound and U.S. dollar banknotes are seen in this illustration taken January 6, 2020. REUTERS/Dado Ruvic/IllustrationHONG KONG, Sept 27 (Reuters) - Asian markets attempted to stabilise on Tuesday after a wild few days of stumbling stocks, crumbling bonds, a plunging pound and soaring dollar, with the dollar easing a bit and stocks flat. S&P 500 futures rose 0.7%, and MSCI's broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) fell 0.1%. After two weeks of mostly steady losses on the U.S. stock market, the Dow Jones Industrial Average (.DJI) confirmed on Monday that it was in a bear market, tracing its start to declines in early January. The dollar index on Tuesday eased 0.1% to 113.8, after earlier touching 114.58, its strongest against a basket of peer currencies since May 2002.

An employee is seen walking over a mosaic of pound sterling symbols set in the floor of the front hall of the Bank of England in London, in this March 25, 2008 file photograph. Yet the rapid rise in yields investors now receive for owning UK bonds hasn't helped sterling much. Pound slumps and UK borrowing costs surgePredicting the short-term direction of currencies is notoriously hard. Against the euro the pound is only at two-year lows, although it is down 3% since Friday. "People will look at the UK and think that that's not a market that is stable," said Payne at Janus Henderson.

☆ New UK finance minister Kwarteng seeks end to 'cycle of stagnation'
▼ + stars: | 2022-09-23 | by ( David Milliken | ) www.reuters.com time to read: +4 min

Paul Johnson, director of the Institute for Fiscal Studies (IFS) think tank, said Truss and Kwarteng's tax cuts could be the largest since 1988, and risked putting Britain's public debt on an unsustainable path. The IFS, together with U.S. bank Citi, estimate household energy subsidies will cost about 120 billion pounds over two years, while six months of business energy subsidies will cost 40 billion pounds. read moreThese are a one-off, and the bigger concern for the IFS is around 30 billion pounds of permanent tax cuts - starting with 14 billion pounds in reduced payroll taxes, confirmed on Thursday, and 15 billion pounds of cuts to corporation tax. For Kwarteng, tax cuts and deregulation are a way to end what he calls "a cycle of stagnation" that led to tax rates being on course for their highest level since the 1940s. "We will liberalise planning rules in specified agreed sites, releasing land and accelerating development," Kwarteng is expected to say.

Search resuls for: "British AS"

25 mentions found