11.45am BST
New @EU_Commission report on #Greece sez prog fully funded to May '15. But p72 says 2.6bn in "addl fin req" for '14 http://t.co/qN6KoIN0qW
COM says #Greece spent less than budgeted on social welfare to build primary surplus. Govt will spend surplus on social programs #genius
* Greece Unemployment Seen at 24.5% in 2014, 22.5% in 2015 -- EC
11.26am BST
As market watchers feared, uncertainty over Ukraine is weighing on European stock prices. All the main indices have fallen, with Germany's DAX leading the way.
If the standoff intensifies, energy supplies could be hit either by sanctions or by incidents such as pipeline blockages or even attacks on oil or gas facilities.
Via Reuters
10.58am BST
Absolutely no market reaction at all to RBS being blocked from paying the bonuses apparently critical to its business.
RBS shares are up 0.36% - so are investors not worried about 'commercial risks' of RBS not being able to retain its 'top talent?
10.45am BST
Labour has slammed the government for getting in "a terrible muddle" over bankers' bonuses.
Here is shadow Treasury minister Cathy Jamieson on the government's response to RBS bonuses.
George Osborne is in a terrible muddle over bankers' bonuses. He is spending taxpayer's money on a legal fight in Brussels against the bonus cap and yet imposing the minimum cap at RBS.
The Government has bowed to pressure on RBS and finally admitted that bonuses of two times salary would be unacceptable at what remains a bank in government ownership. They voted against Labour's motion to impose the minimum cap at RBS in January, but have now been forced to reverse their position.
It was unfortunate that the previous government did not take the opportunity to reform bonuses when the bank was first taken into public ownership. The toxic pay culture in banking prevents banks from winning the public trust they need to thrive in the long-term.
Now the government must make sure RBS do not attempt to find ways around this cap there is little evidence to suggest that multi-million pound pay packages are necessary to recruit so-called top talent. Instead, Banks should focus on training up their existing staff and finding ways of recognising good performance other than obscene bonus payments.
10.29am BST
The surprise news that retail sales figures eked out 0.1% growth in March is seen as good news for retailers and the UK economy.
Here is a round-up of comment:
The sector continues to benefit from positive sentiment based around consumers willingness to keep spending. The arrival of warm summer weather and Mother's Day also helped retailers drive sales in March.
Non-food retailers such as furniture and DIY specialists were amongst the best performers as the consumer recovery and continued upturn in the housing market boosted sales. Clothing and footwear retailers, aided by the arrival of warm spring weather, recovered from the previous month's poor results. The effects of price cuts in the grocery sector have yet to be fully realised. Once these take hold it will be interesting to see if this growth can be sustained in the long run.
Increased confidence around the breadth and scale of the UK recovery has combined with the first rise in real wages in 5 years and a significant wealth effect on house price increases to push the UK retail sector onward in March.
Thoughts had been that consumers would take a slight pause in March from retail a breather before the late Easter spending spree but sales of clothing increased by 3.1% on the month and took the overall average into positive territory.
Even so, given that consumers have faced a prolonged squeeze on their purchasing power, the ability and willingness of many people is likely to remain limited for some time to come.
The encouraging prospect for retailers - and for overall growth prospects - is that consumers purchasing power should pick up over the coming months with inflation remaining muted and earnings growth strengthening, albeit likely relatively gradually.
10.07am BST
A political storm is brewing in France over the future of engineering giant Alstom, following reports of a takeover bid from US conglomerate General Electric.
Alstom is the symbol of our industrial power and French ingenuity. The government expresses patriotic concern and watchfulness with regard to Alstom. This high concern is focused on the serious risk of losing a major decision centre, on the desire and the necessity of reinforcing our industrial base....
This is why the government is working on other solutions and contingencies than those forseen - and without having been informed by Alstom.
Alstom's energy businesses which include building coal, gas and nuclear plants, as well as power grids accounted for more than 70% of its 20bn (£16.5bn) global revenues last year, but the unit has struggled as Europe's economic weakness led to a slump in orders. The group announced last year it would cut 1,300 jobs and put assets up for sale, including a minority stake in its transport business.
9.43am BST
By most people's standards 0.1% growth is not a lot, but this unexpected lift in sales underscores that the UK consumer is still spending.
Here are more details from the Office for National Statistics - full release here.
9.31am BST
Breaking news: UK retail sales rose by 0.1% in March, surprising analysts who had forecast a 1.4% fall.
9.24am BST
Another warning on house prices from a former member of the Bank of England's Monetary Policy Committee.
Andrew Sentence told theBBC Radio 4 Today programme that homeowners will struggle if rates do not rise steadily.
We are getting near the point where we should be seeing a gradual rise in interest rates.
Good housing discussion on @BBCr4today. Andrew Sentance, ex-MPC, says shortage of bricks and labour reining in supply.
9.08am BST
A smidgeon of good news for President François Hollande, as the Standard & Poor's rating agency upheld its AA rating for France and forecast an upturn in growth.
S&P has pencilled in average GDP growth of 1.3% in 2014-17, against an average of 1% in 2010-13.
We anticipate that exports will pick up, supported by the steady demand in the euro area. We project that private-sector spending, in particular investment spending, may gradually replace public-sector consumption as the key economic growth driver, given the improved lending conditions for banks and the generally moderate private-sector leverage by standards in advanced economies.
although we view positively the measures introduced in 2013 to ease labor costs and which are about to be reinforced through the Responsibility Pact announced early this year, they may not be enough to fuel employment growth. We continue to see a substantial output gap and a still-high non-wage cost of employment.
8.49am BST
In a week when bankers' conducts is back in the headlines, here is a lovely letter from today's FT.
If theres one lesson Ive learnt from several years of reading these salmon-pink pages, its that the era of Dawes Tomes Mousely Grubbs Fidelity Fiduciary Bank and the like is long over. I dont exactly keep my tuppence under the mattress yet, but Iwouldntfaultothersforconsidering that a more prudent approach.
8.39am BST
State-backed Lloyds Bank will get away with its plan to side-step the bonus cap.
The government has been selling off its holdings: the taxpayer owns 24.9% of Lloyds down from the original 39% it took on at the height of the financial crisis.
While government is blocking RBS' plans it will back Lloyds' attempt to side-step the bonus cap
8.32am BST
Here is the full story on RBS pay from the Guardian's City editor Jill Treanor.
Despite the government restrictions, RBS boss Ross McEwan will take home an extra £1m a year to get round the EU bonus cap.
RBS bonus plan blocked by government
8.26am BST
The government decision on RBS is especially interesting, as the idea of the bonus cap came from the European Union. The Treasury opposed the idea and filed a complaint at the European Court of Justice, while arguing that the bonus cap would make banks more risky.
Simon Nixon at the Wall Street Journal points out the inconsistency.
Osborne was vocal critic of EU bonus cap, now refusing to allow RBS flexibility to pay 2:1 bonus ratio. Consistency?
8.21am BST
Another skirmish in the long-running battle over bankers' pay, as the government overrules RBS's plan to award their bankers a bonus twice as large as their salary.
The RBS board isn't happy, but UKFI, the body that manages the taxpayer's 81% stake, clearly left them no choice.
...all of our major competitors in the UK and Europe have indicated that they will seek approval from their shareholders to award variable remuneration up to 200% of fixed pay i.e. a 2:1 ratio.
The Board believes the best commercial solution for RBS is to have the flexibility on variable to fixed pay ratios that is now emerging as the sector norm. This would also allow RBS to maintain the maximum amount of compensation that could be subject to performance conditions including claw back for conduct issues that may emerge in future. This position was understood during consultation with institutional shareholders.
8.06am BST
Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and the business world.
Asian markets have fallen against a backdrop of escalating tensions over Ukraine, following a warning from US Secretary of State John Kerry that Washington was ready to impose further sanctions on Russia.
The tense geopolitical situation between Russia and Ukraine could see additional significant outflows of both foreign and domestic capital from the Russian economy and hence further undermine already weakening growth prospects.
Continue reading... |
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