{"id":7513,"date":"2022-08-11T10:58:20","date_gmt":"2022-08-11T09:58:20","guid":{"rendered":"https:\/\/new.contentdeployment.co.uk\/tomd\/2022\/08\/11\/news-in-review-67\/"},"modified":"2022-08-15T12:31:53","modified_gmt":"2022-08-15T11:31:53","slug":"news-in-review-67","status":"publish","type":"post","link":"https:\/\/new.contentdeployment.co.uk\/tomd\/2022\/08\/11\/news-in-review-67\/","title":{"rendered":"News in Review"},"content":{"rendered":"
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\u201cIt\u2019s our\njob to get inflation back down to 2%, so we have raised interest rates\u201d<\/em><\/strong><\/em><\/strong><\/p>\n<\/div>\n\n

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After five successive smaller\nrises, last week saw the Bank of England\u2019s Monetary Policy Committee (MPC) up\nthe ante and increase Bank Rate by 0.5 percentage points, the biggest rate hike\nsince the MPC was established in 1997.<\/p>\n<\/div>\n\n

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At 1.75%, Bank Rate is now higher\nthan at any point since December 2008. The 0.5% rise will translate into an\nextra monthly cost for homeowners on a tracker or variable rate mortgage, while\nthose with credit cards, bank loans and car loans will also see higher charges\non their debt. In announcing the rise, the Bank of England (BoE) acknowledged\nthe hardships people are facing but reaffirmed its objective, \u201cIt\u2019s our job\nto make sure that inflation returns to our 2% target, and that is what we will\ndo\u201d.<\/em><\/p>\n<\/div>\n\n

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Global trend<\/strong><\/p>\n<\/div>\n\n

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Like other central banks around\nthe world, the BoE is raising rates in response to soaring inflation. When\nannouncing the rate rise, the MPC warned that inflation could hit 13% next\nyear, partly due to the rising energy price cap. The UK\u2019s inflationary pressures\nare also part of a global trend, prompted largely by Russia\u2019s restriction of\ngas supplies to Europe. Since May, wholesale gas prices have almost doubled,\nwhile uncertainty still abounds over the possibility of future Russian curbs.<\/p>\n<\/div>\n\n

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Oil production<\/strong><\/p>\n<\/div>\n\n

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One\ngroup with the power to ease some of the price pains is the Organization of the\nPetroleum Exporting Countries (OPEC). Following pressure applied by US\nPresident Joe Biden and other Western leaders, the world’s biggest oil\nproducers agreed to a slight increase in production at a meeting of OPEC+ last\nWednesday. The larger grouping of OPEC and its allies, which include Russia,\npledged to increase supply by 100,000 barrels a day, equivalent to around 0.1% of\nglobal demand, starting from September. OPEC expects global oil demand to rise\nin 2023 but at a slower pace than in 2022.<\/p>\n<\/div>\n\n

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Energy price cap change<\/strong><\/p>\n<\/div>\n\n

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Ahead of the latest rise to the\nUK\u2019s energy price cap in October, regulator Ofgem announced new plans that will\nsee household energy costs change every three months. Currently, the price cap\nupdates every six months; moving to quarterly changes should allow price rises\nand falls to be passed onto customers more quickly. Ofgem claims this will\nreduce price shocks, while Greg Hands, the Minister for Energy, noted that, “If\nenergy prices were to start to fall people would see those benefits more\nquickly.”<\/em><\/p>\n<\/div>\n\n

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On\nTuesday, however, consultancy Cornwall Insight made an upward revision to its\nforecast for January 2023 in response to the plans. It now expects energy bills\nto hit \u00a34,266 a year for a typical household by the start of next year.<\/p>\n<\/div>\n\n

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Car sales down \u2026<\/strong><\/p>\n<\/div>\n\n

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Last Thursday, the Society of\nMotor Manufacturers and Traders (SMMT) announced that sales of new cars in the\nUK fell by nearly 9% in July, leading the body to downgrade its outlook for the\nfull year.<\/p>\n<\/div>\n\n

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As global supply chain issues continue\nto frustrate order fulfilment, the revised forecast of 1.6 million new car\nregistrations would represent a 2.8% year-on-year decline. The SMMT also\npointed to COVID lockdowns in key manufacturing and logistics centres in China,\nas well as disruption from the war in Ukraine, to explain the falling sales. In\nthe face of all these difficulties, the body noted that the industry was facing\nits \u2018most challenging year for three decades\u2019.<\/em><\/p>\n<\/div>\n\n

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\u2026 but retail sales heat up <\/strong><\/p>\n<\/div>\n\n

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According to the British Retail Consortium, retail sales in the UK\nincreased by 1.6% on a like-for-like basis in July 2022 from a year ago, rising\nfor the first time in five months. Demand for items such as electric fans, summer\nclothing and picnic food during the record hot weather helped retailers rebound\nlast month. <\/p>\n<\/div>\n\n

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

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London stocks were mixed at close on Tuesday with investors awaiting\nthe latest key US inflation data which is due for release on Wednesday. The FTSE\n100 ended the session up 0.08% at 7,488.15, while the FTSE\n250 was down 1.02% at 19,912.40. Wall Street stocks closed weaker on\nTuesday \u2013 the Dow Jones finished down 0.18% at 32,774.41 and the Nasdaq\nComposite lost 1.19% to end the session at 12,493.93.<\/p>\n<\/div>\n\n

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

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Financial advice is\nkey, so please do not hesitate to get in contact with any questions or concerns\nyou may have.<\/p>\n<\/div>\n\n

\n

The value of investments can go down as well as up and you may not get\nback the full amount you invested. The past is not a guide to future\nperformance and past performance may not necessarily be repeated.<\/strong><\/strong><\/p>\n<\/div>\n\n

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All details are correct at time of\nwriting (10 August 2022)<\/em><\/strong><\/p>\n<\/div>","protected":false},"excerpt":{"rendered":"

\u201cIt\u2019s our job to get inflation back down to 2%, so we have raised interest rates\u201d After five successive smaller rises, last week saw the Bank of England\u2019s Monetary Policy Committee (MPC) up the ante and increase Bank Rate by 0.5 percentage points, the biggest rate hike since the MPC was established in 1997. At […]<\/p>\n","protected":false},"author":12,"featured_media":167045,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[32],"tags":[],"hd_content_source":[116],"_links":{"self":[{"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/posts\/7513"}],"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=7513"}],"version-history":[{"count":1,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/posts\/7513\/revisions"}],"predecessor-version":[{"id":7515,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/posts\/7513\/revisions\/7515"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/"}],"wp:attachment":[{"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/media?parent=7513"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/categories?post=7513"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/tags?post=7513"},{"taxonomy":"hd_content_source","embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/hd_content_source?post=7513"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}