'UK faces new £20bn budget black hole –as it happened' diff viewer (4/5)

This article is from the source 'guardian' and was first published or seen on October 30, 2017 11:48 (UTC). It last changed over 40 days ago and won't be checked again for changes.

You can find the current article at its original source at https://www.theguardian.com/business/live/2017/oct/30/uk-budget-deficit-consumer-spending-spain-economy-gdp-business-live

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Version 4	Version 5
UK faces new £20bn budget black hole – business live	UK faces new £20bn budget black hole – business live
2017-10-30 14:10:06 UTC	2017-10-30 14:45:07 UTC (35 minutes later)
	2.23pm GMT
	14:23
	Wall Street falls back but Spain regains ground
	US markets have eased back from their record breaking run last week, which was partly fuelled by a surge in technology shares after forecast-beating results from the likes of Amazon and Microsoft.
	As well as some profit taking, investors are playing it cautiously ahead of the latest US Federal Reserve meeting this week - which is not expected to alter interest rates but could point to a rise in December - and crucially, Donald Trump’s decision as to who he will pick for the next Fed chair.
	On top of that, traders are also trying to weigh up the latest developments in the enquiry into possible Russian interference in the US election.
	So the Dow Jones Industrial Average is currently down 37 points or 0.16%, while the S&P 500 and Nasdaq Composite both opened a few points lower.
	Over in Europe, and the Spanish market has jumped 2.4%, recovering all of Friday’s losses and more despite the continuing dispute over Catalonian independence. Some concerns were eased a little after a weekend poll suggested secessionists may lose their majority in elections scheduled for December. David Madden, market analyst at CMC Markets UK, said:
	The Spanish government has dissolved the parliament in Catalonia, and has announced a snap election in December. According to the opinion poll that was published in El Mundo, the Catalan separatists might lose their majority in the region.
	On top of that, came some positive Spanish GDP figures as we reported earlier.
	So all in all, the MSCI world equity index hit yet another new peak, up 0.2%.
	Updated
	at 2.26pm GMT
1.47pm GMT	1.47pm GMT
13:47	13:47
Brace yourself for some spooky charts....	Brace yourself for some spooky charts....
The IFS’s warning that Britain’s fiscal position is worse than forecast has cast some autumnal gloom over the economy.	The IFS’s warning that Britain’s fiscal position is worse than forecast has cast some autumnal gloom over the economy.
And with Halloween looming, Anthony Doyle, fixed interest investment director at M&G, has send over some more spooky charts to give us the shivers.	And with Halloween looming, Anthony Doyle, fixed interest investment director at M&G, has send over some more spooky charts to give us the shivers.
This one shows how the G20 advanced economies now owe $135 trillion US dollars, or 260% of their annual economic outlook.	This one shows how the G20 advanced economies now owe $135 trillion US dollars, or 260% of their annual economic outlook.
As Doyle says:	As Doyle says:
Governments, corporates, and households have never lived beyond their means by so much.	Governments, corporates, and households have never lived beyond their means by so much.
This chart shows how the European Central Bank’s huge asset purchase scheme has driven down the interest rate on eurozone government debt. So, what happens when the ECB stops buying?....	This chart shows how the European Central Bank’s huge asset purchase scheme has driven down the interest rate on eurozone government debt. So, what happens when the ECB stops buying?....
With interest rates so low, and central banks so active in the market, investors have been forced to buy riskier assets in search of a decent return.	With interest rates so low, and central banks so active in the market, investors have been forced to buy riskier assets in search of a decent return.
So if the markets turn south and investors “head for the exits”, there could be “substantial price declines” if everyone tries to sell these assets at the same time.	So if the markets turn south and investors “head for the exits”, there could be “substantial price declines” if everyone tries to sell these assets at the same time.
After decades of weakened unions, workers now face poor wage growth and limited job protection.	After decades of weakened unions, workers now face poor wage growth and limited job protection.
Indeed, the situation is so bad that central bankers are now calling for wage increases.	Indeed, the situation is so bad that central bankers are now calling for wage increases.
Doyle says:	Doyle says:
For the first time, central bankers like Mario Draghi and Haruhiko Kuroda have been calling on unions to increase wage demands, with Draghi stating wages are the “primary driver of inflation”.....	For the first time, central bankers like Mario Draghi and Haruhiko Kuroda have been calling on unions to increase wage demands, with Draghi stating wages are the “primary driver of inflation”.....
Unless workers can start demanding higher rates of pay, it is likely they will continue to suffer real-wage declines. This has been the case in the UK, with unit labour costs and inflation growing by 16% and 25% respectively since 2008.”	Unless workers can start demanding higher rates of pay, it is likely they will continue to suffer real-wage declines. This has been the case in the UK, with unit labour costs and inflation growing by 16% and 25% respectively since 2008.”
And finally, a chart showing why ‘hard Brexit’ could be scarier than the costumed children who’ll be knocking on our doors tomorrow night:	And finally, a chart showing why ‘hard Brexit’ could be scarier than the costumed children who’ll be knocking on our doors tomorrow night:
Doyle explains:	Doyle explains:
“In March 2019, unless some form of deal is agreed, the UK will have to negotiate trade deals with the majority of its current trading partners. This would be a major challenge as complex trade agreements are not easy to negotiate and often take years to agree to.	“In March 2019, unless some form of deal is agreed, the UK will have to negotiate trade deals with the majority of its current trading partners. This would be a major challenge as complex trade agreements are not easy to negotiate and often take years to agree to.
If the UK finds itself outside the European Union Single market and the EU Customs Union, tariff and non-tariff trade barriers (like quotas, embargoes, and levies) are likely to be implemented between the UK and its main European trading partners. Some sectors and companies may face much more restricted access to the European market, and that will prove to be a significant headwind to UK economic growth in the short-term.”	If the UK finds itself outside the European Union Single market and the EU Customs Union, tariff and non-tariff trade barriers (like quotas, embargoes, and levies) are likely to be implemented between the UK and its main European trading partners. Some sectors and companies may face much more restricted access to the European market, and that will prove to be a significant headwind to UK economic growth in the short-term.”
1.16pm GMT	1.16pm GMT
13:16	13:16
Just in: The cost of living in Germany rose by less than expected this month.	Just in: The cost of living in Germany rose by less than expected this month.
Germany’s harmonised consumer prices index rose by 1.5% per year in October, a smaller rise than expected.	Germany’s harmonised consumer prices index rose by 1.5% per year in October, a smaller rise than expected.
The European Central Bank will see this as vindication for its strategy of keeping interest rates at record lows (even though it’s very unpopular with German savers).	The European Central Bank will see this as vindication for its strategy of keeping interest rates at record lows (even though it’s very unpopular with German savers).