Chancellor told to change course
Britain’s most respected economic think tank today warned that the Government was likely to miss the borrowing targets set by the Chancellor, George Osborne, because the economy was not growing as quickly as he had expected. The NIESR urged Mr Osborne to reconsider his current plans for tax rises and spending cuts. MORE
Spain and Italy in new euro crisis
Hopes that the July deal for a second bailout of Greece would calm the eurozone crisis look set to be dashed after a day of rising tensions. Both Spain and Italy saw their borrowing costs soar close to the levels that have triggered bailouts of several other eurozone nations, with politicians scheduling emergency meetings. MORE
US gets AAA boost after debt deal
President Obama’s attempts to sell the US debt-ceiling deal to the American people were boosted yesterday by Fitch. The credit-ratings agency, the first to pass judgement on the deal, said it thought the US would be able to retain its crucial AAA credit rating. The gloss was taken off the news by poor economic news, however.
South Korea adds to gold reserves
South Korea has bought gold for the first time in more than a decade, the country’s central bank said yesterday, reflecting the diminishing clout of the US dollar and growing concern about inflation across the world economy. The Bank of Korea said it had spent $1.24bn buying 25 tons of the yellow metal in the past two months.
Carpetright has to cut prices
Carpetright, the UK’s biggest floor-coverings retailer, gave a warning yesterday that it expects trading conditions to remain tough as it reported a 0.2 per cent decline in like-for-like sales. The retailer said it did not expect any improvement in the near term and said it had cut prices to secure sales.
Xstrata doubles dividend payout
Miner Xstrata more than doubled its interim dividend yesterday and pointed to a stronger second half, as ongoing tightness in the copper market helps the group to recover from a flood-hit start to 2011. The miner lifted its interim dividend to $0.13 on the back of a 30 per cent rise in headline profits.
BMW motors thanks to China
BMW’s profits more than doubled in the second quarter on the back of soaring demand from China. The car manufacturer, which also owns Mini, reported a 115 per cent jump in net profit to €1.8bn (£1.6bn), as record car sales pushed revenues up by 17 per cent to €17.9bn. Sales in China jumped by 52 per cent.
Quake sends Toyota into red
Toyota fell to its first quarterly loss in two years in the three months to June after the Japanese earthquake disrupted operations. The disaster drove the car manufacturer to a 108bn yen (£860m) loss, against a 211.7bn yen profit in the same period last year, though the slump was not as steep as feared.
Meggitt boosted by aerospace
The recovery in the commercial aerospace market helped the aircraft parts supplier Meggitt post better than expected profits yesterday. The company said underlying pre-tax profits had climbed to £146.2m in the first six months of the year, surpassing the stock market’s hopes of a total of £135m.
Weir firing on all cylinders
Pumps and valves maker Weir posted a 24 per cent jump in first-half pre-tax profit, helped by the booming mining and oil industries, and said its full-year results would be better than hoped. “We now expect profits for the full year to be ahead of our previous expectations,” said Weir boss Keith Cochrane.