{"id":8371,"date":"2022-10-05T12:10:44","date_gmt":"2022-10-05T11:10:44","guid":{"rendered":"https:\/\/new.contentdeployment.co.uk\/tomd\/2022\/10\/05\/news-in-review-75\/"},"modified":"2022-10-05T14:05:08","modified_gmt":"2022-10-05T13:05:08","slug":"news-in-review-75","status":"publish","type":"post","link":"https:\/\/new.contentdeployment.co.uk\/tomd\/2022\/10\/05\/news-in-review-75\/","title":{"rendered":"News in Review"},"content":{"rendered":"
\n

\u201cWe live in\nrapidly moving times\u201d<\/em><\/strong><\/p>\n<\/div>\n\n

\n

The Prime Minister and Chancellor met with the<\/strong> <\/strong>Office for Budget Responsibility<\/strong> (OBR) on Friday morning to discuss the ramifications of their Growth\nPlan.<\/strong> In a move widely seen as an attempt to reassure\nfinancial markets following a challenging week, the Bank of England stepped in\nwith a \u00a3<\/strong>65m intervention to carry out a temporary\npurchase of long-dated UK government bonds.<\/strong><\/strong><\/p>\n<\/div>\n\n

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The government and OBR agreed to work closely together, with the OBR confirming it will deliver the first draft of its economic and\nfiscal forecasts on 7 October. The Chancellor has commissioned the\nOBR to publish an updated forecast alongside his Medium-Term Fiscal Plan, which\nis expected to take place on 23 November.<\/p>\n<\/div>\n\n

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Speaking on Thursday, Huw Pill, member of the Monetary Policy Committee\n(MPC) and Bank of England Chief Economist, delivered a speech about recent\ndevelopments in the economy and markets. Speaking about current events, he\ndeduced, \u201c<\/em>We live\nin rapidly moving times. As events unfold, assessments need to be updated. But,\nat present, on the basis of the fiscal easing announced last week, the\nmacroeconomic policy environment looks set to rebalance.\u201d<\/em> On the impact of market developments he summarised, \u201cIt\nis hard to avoid the conclusion that the fiscal easing announced last week will\nprompt a significant and necessary monetary policy response in November.\u201d<\/em> The\nMPC is next scheduled to meet on 3 November.<\/p>\n<\/div>\n\n

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U-turn\n\u2013 Chancellor tax reversal<\/strong><\/p>\n<\/div>\n\n

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As part of the Growth Plan, the Chancellor\nhad pledged to abolish the 45p additional rate of tax, from April 2023, which\nis paid by people who earn more than \u00a3150,000 a year. On Monday, after widespread opposition\nto the move, including from several senior Conservative MPs, the government\nannounced a U-turn to this policy, with Chancellor Kwasi Kwarteng saying, “it\nis clear that the abolition of the 45p tax rate has become a distraction.”<\/em><\/p>\n<\/div>\n\n

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Economic growth confirmed in Q2<\/strong><\/strong><\/p>\n<\/div>\n\n

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On Friday, positive data released by the Office\nfor National Statistics (ONS) showed that UK economic output increased by 0.2%\nin the second quarter of the year, revised up from a previous reading of -0.1%,\nsuggesting the UK is not currently in recession \u2013 defined as two\nconsecutive three-month periods of GDP contraction. In September, the Bank of\nEngland had cautioned that the UK could already be in recession, so the\nofficial data was welcomed. ONS Chief\nEconomist Grant Fitzner said the revised figures also show that “while\nhousehold savings fell back in the most recent quarter, households saved more\nthan we previously estimated during and after the pandemic.”<\/em><\/p>\n<\/div>\n\n

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Mortgages withdrawn<\/strong><\/p>\n<\/div>\n\n

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It has been reported that since the Chancellor\u2019s \u2018mini-Budget\u2019\non 23 September, over 40% ofavailable mortgages have been\nwithdrawn from the market, amid concerns that the BoE would call for a large\nemergency rate rise and expectations that Bank Rate could reach 6% by summer\n2023. Lenders started suspending products last week as it became increasingly\nchallenging to price them amid the uncertainty of financial markets. Lenders are having to deal with fast moving funding conditions and\nhave withdrawn or repriced products altogether or streamlined down their\nmortgage range. <\/p>\n<\/div>\n\n

\n

Energy\nprice cap in action<\/strong><\/p>\n<\/div>\n\n

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From 1 October, the government\u2019s Energy\nPrice Guarantee now applies, limiting the price households pay per unit of gas\nand electricity. The average unit price for dual fuel\ncustomers paying by direct debit is limited to 34.0p per kilowatt hour (kWh)\nfor electricity and 10.3p per kWh for gas.<\/p>\n<\/div>\n\n

\n

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

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Sterling\nmanaged a rebound, edging back up to the levels seen before the Chancellor\nunveiled his Growth Plan. London stocks appear to have reacted positively to\nthe 45p tax rate U-turn, with the FTSE 100 ending Tuesday\u2019s session up\n2.57% at 7,086.46, and the FTSE 250 ahead 3.11% at 17,822.15.<\/p>\n<\/div>\n\n

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Coining\nit in\u2026<\/strong><\/p>\n<\/div>\n\n

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The Royal Mint\nhas unveiled the official coin effigy of King Charles III. Special \u00a35 and 50p coins\ncommemorating Elizabeth II were released on Monday, with the 50p set to\nenter general circulation from December. Currency featuring the late Queen will\nremain legal tender.<\/p>\n<\/div>\n\n

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

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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>\n\n

\n

All\ndetails are correct at time of writing (5 October 2022)<\/strong><\/p>\n<\/div>","protected":false},"excerpt":{"rendered":"

\u201cWe live in rapidly moving times\u201d The Prime Minister and Chancellor met with the Office for Budget Responsibility (OBR) on Friday morning to discuss the ramifications of their Growth Plan. In a move widely seen as an attempt to reassure financial markets following a challenging week, the Bank of England stepped in with a \u00a365m […]<\/p>\n","protected":false},"author":12,"featured_media":8373,"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\/8371"}],"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=8371"}],"version-history":[{"count":1,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/posts\/8371\/revisions"}],"predecessor-version":[{"id":8372,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/posts\/8371\/revisions\/8372"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/media\/8373"}],"wp:attachment":[{"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/media?parent=8371"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/categories?post=8371"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/tags?post=8371"},{"taxonomy":"hd_content_source","embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/hd_content_source?post=8371"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}