{"id":5034,"date":"2022-03-16T11:52:31","date_gmt":"2022-03-16T11:52:31","guid":{"rendered":"https:\/\/new.contentdeployment.co.uk\/tomd\/2022\/03\/16\/news-in-review-47\/"},"modified":"2022-07-05T14:09:48","modified_gmt":"2022-07-05T13:09:48","slug":"news-in-review-47","status":"publish","type":"post","link":"https:\/\/new.contentdeployment.co.uk\/tomd\/2022\/03\/16\/news-in-review-47\/","title":{"rendered":"News in Review"},"content":{"rendered":"
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\u201cAt the Spring\nStatement, Rishi Sunak has to make a huge judgment call\u201d<\/em><\/strong><\/em><\/strong><\/p>\n<\/div>\n\n

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With a week to go until the next\nfiscal event in the government\u2019s calendar \u2013 the Spring Forecast Statement on 23\nMarch – new research from the Institute for Fiscal Studies (IFS) has\nhighlighted its belief that the Chancellor has some big decisions to make in\nthe face of soaring living costs and new economic challenges presented by the\nwar in Ukraine. <\/strong><\/strong><\/p>\n<\/div>\n\n

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Interestingly, a Spring Statement is\nusually regarded as a lesser fiscal event than a Budget; providing a set of new\neconomic forecasts and updates, rather than the government\u2019s planned spending\nand revenue gathering proposals which appear in the Budget. However, on this\noccasion, with inflation continuing its ascent, wages unable to keep pace, and the\ncosts of energy, fuel and other commodities being driven even higher due to the\ninvasion of Ukraine, the IFS is speculating whether the government will consider\nextra protection for households struggling to keep up with their bills,\npotentially making this a crucial event for many households.<\/p>\n<\/div>\n\n

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The\nIFS analysis emphasises \u2018the far-reaching economic challenges associated\nwith this shifting outlook. Households and public services will be squeezed by\nhigher inflation, the economy rocked by heightened uncertainty, and the public\nfinances buffeted by the fallout from Ukraine.\u2019 <\/em>Paul Johnson IFS Director added, “At\nthe Spring Statement, Rishi Sunak has to make a huge judgment call. Will he do\nmore to protect households from the effects of energy prices, which have risen\neven further in the last two weeks? If he doesn’t, then many on moderate\nincomes will face the biggest hit to their living standards since at least the financial crisis. If he does, then there will be\nanother big hit to the public finances.”<\/em><\/p>\n<\/div>\n\n

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\u201cSignificant economic uncertainty\u201d<\/em><\/strong><\/em><\/strong><\/p>\n<\/div>\n\n

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Although the UK economy rebounded\nstrongly in January, analysts\u2019 expectations indicate more subdued growth moving\nthrough 2022 as the cost-of-living crisis intensifies. Suren Thiru, Head of\nEconomics at the British Chambers of Commerce (BCC) believes the Ukraine\ninvasion \u201chas increased the risk of a recession in the UK\u201d<\/em> by\nexacerbating the inflationary squeeze and \u201cderailing the supply of critical\ncommodities to many sectors of the economy.”<\/em> Chancellor Rishi Sunak said that Russia’s invasion “is creating\nsignificant economic uncertainty.”<\/em> He added that the government\u2019s \u201cunprecedented\nsupport”<\/em> provided during the pandemic \u201chas put our economy in a\nstrong position to deal with current cost of living challenges.\u201d<\/em><\/strong><\/p>\n<\/div>\n\n

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Further e<\/strong>mergency funding<\/strong><\/strong><\/p>\n<\/div>\n\n

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In addition to funding provided by the World Bank, the International\nMonetary Fund (IMF) last week approved $1.4bn of emergency funding for Ukraine, to meet the country’s urgent\nspending needs and help alleviate the devastating economic impact of the war. Kristalina Georgieva, Managing\nDirector of the IMF said, “The Russian military invasion of Ukraine has been responsible\nfor a massive humanitarian and economic crisis\u2026 The tragic loss of life, huge\nrefugee flows, and immense destruction of infrastructure and productive\ncapacity is causing severe human suffering and will lead to a deep recession\nthis year. Financing needs are large, urgent, and could rise significantly as\nthe war continues.”<\/em><\/p>\n<\/div>\n\n

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G7 Leaders showed support for the people of Ukraine and condemnation of Putin\u2019s war by issuing a joint statement, \u2018We are united in our determination to hold President Putin and his regime accountable for this unjustified and unprovoked war that has already isolated Russia in the world. The world should join together in calling on President Putin and his regime to immediately stop its ongoing assault against Ukraine and withdraw its military forces. We stand in solidarity with those who are bravely opposing the invasion of Ukraine.\u2019<\/em><\/p>\n<\/div>\n\n

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Markets<\/strong><\/strong><\/p>\n<\/div>\n\n

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At the end of last week, many\nEuropean markets responded positively on tentative hopes that discussions\nbetween Ukraine and Russia were progressing, however US indices were more\nsubdued, following the release of February\u2019s inflation figure which reached a 40-year\nhigh of 7.9%.<\/p>\n<\/div>\n\n

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London\nstocks dropped into the red on Tuesday as Office for National Statistics (ONS)\ndata revealed that real wages in the UK, taking inflation into account, had\ndropped by 1% in the three months to January, the biggest fall since 2014. <\/p>\n<\/div>\n\n

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Here to help<\/strong><\/p>\n<\/div>\n\n

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It is essential\nthat investors focus on longer-term timescales instead of focusing too intently\non short-term volatility. Rest assured we will continue to monitor events\nclosely. Financial\nadvice is key, so please do not hesitate to get in contact with any questions\nor concerns you may have.<\/p>\n<\/div>\n\n

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The value of investments can go down as well\nas up and you may not get back the full amount you invested. The past is not a\nguide to future performance and past performance may not necessarily be\nrepeated.<\/strong><\/strong><\/p>\n<\/div>","protected":false},"excerpt":{"rendered":"

\u201cAt the Spring Statement, Rishi Sunak has to make a huge judgment call\u201d With a week to go until the next fiscal event in the government\u2019s calendar \u2013 the Spring Forecast Statement on 23 March – new research from the Institute for Fiscal Studies (IFS) has highlighted its belief that the Chancellor has some big […]<\/p>\n","protected":false},"author":12,"featured_media":5079,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[32,112],"tags":[],"hd_content_source":[116],"_links":{"self":[{"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/posts\/5034"}],"collection":[{"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/users\/12"}],"replies":[{"embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/comments?post=5034"}],"version-history":[{"count":2,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/posts\/5034\/revisions"}],"predecessor-version":[{"id":5084,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/posts\/5034\/revisions\/5084"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/media\/5079"}],"wp:attachment":[{"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/media?parent=5034"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/categories?post=5034"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/tags?post=5034"},{"taxonomy":"hd_content_source","embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/hd_content_source?post=5034"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}