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Eurozone jobless rate hits near nine-year low, German industrial output surges - business live Eurozone jobless rate hits near nine-year low, German industrial output surges - business live
(35 minutes later)
Technology site The Register has a good scoop -- apparently Britain’s City watchdog has (perhaps accidentally) banned workers across the financial services industry from using their own phones and computers for work.
It’s all to do with the new MIFID II directive; designed to prevent market abuse which came into force this week.
The Reg’s Gareth Corfield explains:
The UK’s Financial Conduct Authority has quietly transposed an EU rule without including a crucial bit of detail, thus effectively banning BYOD [bring your own device] policies in all financial services organisations across Blighty.
The UK version of the rule, which came into force on January 1, prohibits any business regulated by the FCA from letting its employees communicate with each other or the outside world “on privately owned equipment which the firm is unable to record or copy”.
However, the original version of the rule, contained in the European Union’s Market In Financial Instruments Directive (MIFID II), restricted this only to investment firms – not applying it to the entire financial sector.
The FCA regulates financial services firms ranging in size from behemoths such as Goldman Sachs right down to independent financial advisers who tell ordinary folk where best to put their savings and investments.
The body uses powers contained in the Financial Services and Markets Act 2000 (FSMA) to implement conduct and prudential rules, among these directives received from EU. It then sets out these rules in its handbook.
This is how what should have been a BYOD rule affecting only part of the market has been turned into a blanket ruling on BYOD affecting everyone – right down to self-employed advisers.
But before you chuck your phone in the bin, the FCA has since clarified that individuals can bring their own devices to work after all. However, bosses must take all reasonable steps to prevent them using them to send or receive unrecorded messages or calls.
Another headache for the IT manager.....
Financial Conduct Authority 'gold-plates' EU #MIFID II rule, bans BYOD across entire UK finance sector <- exclusive by me https://t.co/9iHT4O6UFC pic.twitter.com/kUnTnaxVCz
Germany’s government is optimistic about growth prospects in 2018:Germany’s government is optimistic about growth prospects in 2018:
Germany’s government expects the economy to grow this year at around the same rate as last year, when it expanded by 2.2%. #newsdeskGermany’s government expects the economy to grow this year at around the same rate as last year, when it expanded by 2.2%. #newsdesk
The decline in eurozone unemployment will please the European Central Bank.The decline in eurozone unemployment will please the European Central Bank.
ECB president Mario Draghi has often cited falling joblessness as a defence of his stimulus policies, which cut interest rates to record lows and pumped trillions of euros into the economy.ECB president Mario Draghi has often cited falling joblessness as a defence of his stimulus policies, which cut interest rates to record lows and pumped trillions of euros into the economy.
Dennis de Jong, managing director at UFX.com, reckons Draghi can feel vindicated, in the face of criticism from some politicians (particularly in Germany). But there could be more challenges ahead....Dennis de Jong, managing director at UFX.com, reckons Draghi can feel vindicated, in the face of criticism from some politicians (particularly in Germany). But there could be more challenges ahead....
“Lower unemployment sets the field for wage growth and ultimately higher inflation, so the euro should be in demand with traders today.“Lower unemployment sets the field for wage growth and ultimately higher inflation, so the euro should be in demand with traders today.
“Draghi has successfully navigated the eurozone through a particularly tricky period, and its economic prospects look strong. However, with further political instability brewing in both Spain and Germany, not to mention uncertainty surrounding Brexit, some continue to ask what lies beneath this millpond?”“Draghi has successfully navigated the eurozone through a particularly tricky period, and its economic prospects look strong. However, with further political instability brewing in both Spain and Germany, not to mention uncertainty surrounding Brexit, some continue to ask what lies beneath this millpond?”
This is an significant moment:This is an significant moment:
The euro area unemployment rate dropped below its long-term average in November, for the first time in 9 years. pic.twitter.com/AnDWZ1tw07The euro area unemployment rate dropped below its long-term average in November, for the first time in 9 years. pic.twitter.com/AnDWZ1tw07
Unemployment among young people across the eurozone has also fallen, but the job isn’t finished yet.Unemployment among young people across the eurozone has also fallen, but the job isn’t finished yet.
The euro-area jobless rate dropped to 18.2% in November, down from 20.5% a year ago.The euro-area jobless rate dropped to 18.2% in November, down from 20.5% a year ago.
But again, some countries are in much better shape than others:But again, some countries are in much better shape than others:
In November 2017, the lowest rates were observed in the Czech Republic (5.0%) and Germany (6.6%), while the highest were recorded in Greece (39.5% in September 2017), Spain (37.9%) and Italy (32.7%).In November 2017, the lowest rates were observed in the Czech Republic (5.0%) and Germany (6.6%), while the highest were recorded in Greece (39.5% in September 2017), Spain (37.9%) and Italy (32.7%).
EU youth unemployment latest Greece (39.5% in September 2017), Spain (37.9%) and Italy (32.7%).EN MARCHE!EU youth unemployment latest Greece (39.5% in September 2017), Spain (37.9%) and Italy (32.7%).EN MARCHE!
The unemployment rate across the wider European Union has fallen to a nine-year low of 7.3%, down from 7.4%.The unemployment rate across the wider European Union has fallen to a nine-year low of 7.3%, down from 7.4%.
Over the last 12 months, unemployment in the EU has dropped by 2.133 million people, and by 1.561 million in the euro area.Over the last 12 months, unemployment in the EU has dropped by 2.133 million people, and by 1.561 million in the euro area.
But before anyone gets carried away, there are still 18.116 million men and women unemployed in the EU, including 14.263 million in the eurozone.But before anyone gets carried away, there are still 18.116 million men and women unemployed in the EU, including 14.263 million in the eurozone.
Newsflash: Unemployment across the eurozone has hit its lowest rate on almost nine years.Newsflash: Unemployment across the eurozone has hit its lowest rate on almost nine years.
The euro-area jobless rate fell to 8.7% in November, down from 8.8% in October. That’s the best reading since January 2009, when the global economy was crashing into recession.The euro-area jobless rate fell to 8.7% in November, down from 8.8% in October. That’s the best reading since January 2009, when the global economy was crashing into recession.
*EURO-AREA NOV. UNEMPLOYMENT RATE FALLS TO 8.7%, MATCHING EST.*EURO-AREA NOV. UNEMPLOYMENT RATE FALLS TO 8.7%, MATCHING EST.
But... there are still sharp differences between euro-area members.But... there are still sharp differences between euro-area members.
The lowest unemployment rates were recorded in the Czech Republic (2.5%), and Malta and Germany (both 3.6%).The lowest unemployment rates were recorded in the Czech Republic (2.5%), and Malta and Germany (both 3.6%).
While in Greece, more than one in five people (20.5%) are out of work, followed by Spain with a 16.7% jobless rate.While in Greece, more than one in five people (20.5%) are out of work, followed by Spain with a 16.7% jobless rate.
More to follow....More to follow....
City analysts are welcoming today’s strong German economic data, particularly the 3.4% jump in industrial production in November.City analysts are welcoming today’s strong German economic data, particularly the 3.4% jump in industrial production in November.
Jennifer McKeown of Capital Economics says German seems to be ending 2017 “with a bang”.Jennifer McKeown of Capital Economics says German seems to be ending 2017 “with a bang”.
She writes:She writes:
“November’s surge in German industrial production is a welcome confirmation that the economy approached the end of 2017 in very good health and the surveys point to further strength to come.“November’s surge in German industrial production is a welcome confirmation that the economy approached the end of 2017 in very good health and the surveys point to further strength to come.
Mark Ostwald of ADM Investor Services agrees, saying:Mark Ostwald of ADM Investor Services agrees, saying:
Better than expected German Trade and Production data affirmed what is already well known, i.e. that the German economy is in rude health.Better than expected German Trade and Production data affirmed what is already well known, i.e. that the German economy is in rude health.
It’s great to see Majestic Wine and Morrison’s bosses praising their hard-working employees this morning. But a cynic might wonder whether they’re partly motivated by a fear of losing them.It’s great to see Majestic Wine and Morrison’s bosses praising their hard-working employees this morning. But a cynic might wonder whether they’re partly motivated by a fear of losing them.
Recruitment firms say that UK companies are finding it harder and harder to find skilled staff - putting a real premium on retaining workers.Recruitment firms say that UK companies are finding it harder and harder to find skilled staff - putting a real premium on retaining workers.
Kevin Green, chief executive of the Recruitment and Employment Confederation, says it’s the worst situation in at least a decade.Kevin Green, chief executive of the Recruitment and Employment Confederation, says it’s the worst situation in at least a decade.
“We have lists where recruiters cite the jobs they are currently finding it hard to fill, in permanent jobs there used to be six or seven areas. Now there are 50 or 60. It goes on and on and on.“We have lists where recruiters cite the jobs they are currently finding it hard to fill, in permanent jobs there used to be six or seven areas. Now there are 50 or 60. It goes on and on and on.
“It is comprehensive, you would have to say the skill and talent shortages are pervasive across the economy at the moment.”“It is comprehensive, you would have to say the skill and talent shortages are pervasive across the economy at the moment.”
This tightening labour market is good news for employees, as they should be able to negotiate significant pay rise. Warm words in the Christmas trading updates won’t be enough!This tightening labour market is good news for employees, as they should be able to negotiate significant pay rise. Warm words in the Christmas trading updates won’t be enough!
The Telegraph has the details:The Telegraph has the details:
‘Pervasive’ skill shortages across UK economy to drive up wages https://t.co/4VfX3BItFv via @telebusiness‘Pervasive’ skill shortages across UK economy to drive up wages https://t.co/4VfX3BItFv via @telebusiness
Britain’s FTSE 100 is on the brink of a new all-time high.Britain’s FTSE 100 is on the brink of a new all-time high.
The blue-chip index has gained 33 points to 7,729 points, just 4 point shy of yesterday’s intraday peak.The blue-chip index has gained 33 points to 7,729 points, just 4 point shy of yesterday’s intraday peak.
Majestic Wine is also highlighting its staff’s cheerful nature in the face of customers seeking the perfect Pinot Grigio or Pomerol for the Christmas festivities.
Britain’s largest wine retailer grew its like-for-like sales by 4.1% over the 10-week Christmas period, including a 1.3% rise at its retail outlets.
CEO Rowan Gormley says Majestic, which also owns online retailer Naked Wines, is on track to hit City forecasts:
“The team performed brilliantly.
The fact that we have been able to grow sales and maintain margins shows that our winning formula of fabulous customer service from delightful people and delicious wines at fair prices works even when times are tough.
15 months ago, Majestic Wine hit its shareholders with a profits warning, so Gormley hopefully enjoyed a better Christmas this time around.
Majestic Xmas sales +3.2% (+4.1% underlying), maintains FY expectations. Xmas = 30% of FY sales; Retail sales +1.3% like-for-like vs tough comparatives. group gross margins broadly flat
Christmas can be a stressful time for shoppers and shop-workers alike.
So it’s interesting that Morrisons reckons its staff’s cheery demeanour boosted its sales over the festive period.
It says:
Customer satisfaction again improved year-on-year − we had more tills open, shorter queues, and customers noticed our colleagues’ friendliness even at the busiest times.
The Evening Standard’s Alex Lawson doesn’t sound convinced:
Morrisons bigging up the "friendliness" of it staff in upbeat Xmas trading update. How's that measured in earnings terms: 1 smile = a repeat visit, banter = a £100 spend
Neil Wilson of ETX Capital is impressed by Morrisons’ sales growth over Christmas.
He suspects that investors who bet against Britain’s fourth-largest supermarket will soon have burned fingers, following this morning’s financial results.
“The market has not really been buying into Morrisons’ recent run of form, but yet another very impressive trading statement that has beaten expectations comfortably could turn the tide of opinion. Eight straight quarters of sales growth, yet shares were last trading c8% off the highs last February. That may change now and the shorts could face a big squeeze this morning.
Short interest is quite high so this share could pop if they throw in the towel and finally buy into David Potts and co’s strategy, which is clearly paying off.
Connor Campbell of SpreadEx says Morrisons has a “mega” Christmas:
For the 10 weeks to 7th January the smallest of the Big Four supermarkets smashed expectations, posting a 2.8% surge in like-for-like sales (excluding fuel) against the 1.7% rise forecast
Breaking down the figures further and Morrisons had plenty to smile about; its Best premium range jumped 25%, suggesting savvy branding on the supermarket’s behalf, while online sales, which include those made through Amazon Fresh, were up 10%.
These figures sent the Northern favourite nearly 4.5% higher to a 3 month peak, and set a high bar to clear for Sainsbury’s, Tesco and Marks & Spencer, all of whom report this week.
Supermarket chain Morrisons has smashed City forecasts for the crucial Christmas period, sending its shares jumping.
Morrisons grew its like-for-like sales by 2.8% over the last 10 weeks, beating expectations of 1.7% growth.
The Christmas and New Year period was particularly strong, with sales surging by 3.7%
CEO David Potts says his turnaround plan is bearing fruits:
“More and more customers found more things they wanted to buy at competitive prices at Morrisons this Christmas. The hard work and friendliness of our colleagues continues to be key in delivering our strengthening performance, and I would like to thank them for everything they do for our customers.”
Shares have jumped by 4% in early trading, as Morrison’s cements its place as a Christmas winner.
More reaction to follow....
European stock markets have opened higher, with the jump in German industrial production cheering traders.
Naeem Aslam of Think Markets says:
European markets are trading higher as investors have reacted to positive German industrial data. The number was simply astonishing, and it printed the reading of 3.4% when the market was expecting a number of 1.8%.
But Maxime Sbaihi of Bloomberg is a little more cautious:
The surge in German industry (+3.4%) over November is impressive, but remember it comes after 2 very weak months. Sector now looking at a positive Q4, in line with Q3. Should boost GDP growth for the 6th consecutive quarter. https://t.co/L5Yf4GqTEd pic.twitter.com/Ab6Yk7eccs
Germany’s factory sector has staged a “strong comeback”, says analyst Carsten Brzeski of ING.
He points out that these industrial production figures have been volatile - but the trend is positive, suggesting Germany isn’t being held back by pick-up in the euro exchange rate.
Brzeski writes:
German industry has gone through a small rollercoaster ride since the start of the summer. Disappointing numbers were followed by impressive rebounds. Behind the vacation and weather driven white noise of monthly data, however, there is a clear upward trend. Up to now, 2017 industrial production has had its best year since 2011. Contrary to earlier cycles, industrial production has been a lagging, rather than a leading indicator for the German recovery.
The strengthening of the euro exchange rate since April 2017 has left the German export sector unharmed. The geographic diversity of German exports once again seems to be the key to success. Particularly, Germany’s close and distant neighbours in the East have safeguarded this year’s export revival. Germany currently exports as much to Hungary, Poland and the Czech Republic as it does to the Netherlands, Belgium and Luxembourg. Exports to China have also rebounded this year. At the same time, the US remains the single most important export destination, while exports to the UK are becoming less important.
More here:
Germany: November data confirm strong final quarter performance | Snap | ING Think - Surging industrial data suggest that the German growth party continued in the fourth quarter of 2017. https://t.co/Mtc0Y6B23V
We also have new German trade figures - and they’re also stronger than expected.
German companies grew their exports by a sparkling 4.1% in November, well ahead of forecast of a 1.2% gain.
Imports also rose too, by 2.3%, ahead of forecasts of a 0.8% rise.
The seasonally adjusted data suggests that German manufacturers and service companies benefitted from the growing global economy, and that domestic demand was also solid.
Germany’s foreign trade balance swelled to a surplus of €23.7bn in November 2017, up from €22.0bn a year earlier. It ran a surplus with its fellow EU members, and with the rest of the world.
Here’s the details:
In November 2017, Germany exported goods to the value of €67.9bn to the Member States of the European Union (up 8%), while it imported goods to the value of €62.1bn from those countries (up 9.5%)
Exports of goods to countries outside the European Union (third countries) amounted to €48.5bn in November 2017 (up 8.4%), while imports from those countries totalled €30.7bn euros (up 5.9%).
On an annual basis, German industrial output growth hit a six-year high.
Here's another #EUROBOOM chart!Germany industrial production rose 5.6% YoY in November, the biggest gain since August 2011. pic.twitter.com/VuWiZMNv58
Germany’s economy has smashed forecasts this morning, with a big jump in factory output.
German industrial production rose by 3.4% in November, new figures from statistics body Destatis show. That’s the biggest monthly rise since September 2009, suggesting Europe’s largest economy picked up pace late last year.
Factories reported a surge in demand for heavy-duty machinery, vehicles and other equipment (capital goods), with consumer products also in demand.
Destatis explains:
Within industry, the production of capital goods increased by 5.7% and the production of consumer goods by 3.6%. The production of intermediate goods showed an increase by 3.0%.
Energy production was down by 3.1% in November 2017 and the production in construction increased by 1.5%.
Oliver Rakau of Oxford Economics is impressed:
Germany industry parties on! November industrial production with largest monthly gain since September 2009 at +3.4% mom. Even accounting for weak October industry is currently key cyclical driver.
Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.
Today, we’ll find out if supermarket chain Morrisons, drinks business Majestic Wine and floorings business Topps Tiles were festive winners and losers, as they report their Christmas trading figures. Housebuilder Persimmon is also updating the City.
Updates this morning from Ferrexpo (Q4 Production), Joules, Majestic Wine, Persimmon, Robert Walters, Safestore, SIG, Stock Spirits, Topps Tiles, WM Morrison
New eurozone jobless figures are due this morning, which may show that unemployment in Europe has hit a new eight-year low of 8.7%.
Otherwise there’s not much on the economic calendar.
Stock markets remain at record levels again this morning, as the global rally in shares continues.
City investors will also be digesting yesterday’s cabinet reshuffle, which frankly looks like a mess after health secretary Jeremy Hunt dug his heels in and refused to move, and education secretary Justine Greening quit rather than take a new role.
May’s big day:-more a rebellion than a reshuffle Tomorrow’s Guardian pic.twitter.com/kNEzwJfiRJ
It wasn’t exactly an exhibition of prime ministerial authority from Theresa May, says Robin Bew of the Economist Intelligence Unit.
#UK Cabinet reshuffle doesn’t feel very impressive to me. Can’t see it changing to tone much when all the big roles remain unchanged. And there was ample reason, based on performance, to move some people. Too weakened to take them on?
The agenda:
10am: Eurozone unemployment rate for November.