VW is preparing to scrap non-essential spending as it battles with the emissions scandal * VW boss: This won’t be painless.... * Non-essential VW investment in doubt * German factories suffer in August * Ministry: Global economy is less reliable * Institute of Directors demand early EU vote 2.12pm BST GLOBAL STOCK MARKETS HAVE BEEN VOLATILE IN RECENT WEEKS, LARGELY ON CONCERNS ABOUT A SLOWDOWN IN CHINA AND THE KNOCK ON EFFECT ON COMMODITY PRICES. BUT THE RISKS FROM CHINA ARE LESS THAN MANY IMAGINE, according to Capital Economics. The research company’s Andrew Kenningham said: Although China’s growth has slowed sharply in recent years, we do not expect a “hard landing”. What’s more, even if we turn out to be wrong, some emerging economies would be hit hard by a slump in China, but the impact on advanced economies should generally be modest. GDP growth in China has already slowed from double-digit levels before 2008 to around 5% this year, according to our in-house estimates. However, it has been relatively stable over the past six months, when a slump in its equity market has triggered falls in global asset prices. Looking ahead, we think China will regain some momentum, helped by the policy support now in the pipeline. 1.58pm BST THE EUROPEAN PARLIAMENT HAS APPROVED PLANS TO SPEED UP A €35BN FUNDING PROGRAMME FOR GREECE EARMARKED IN THE EU’S 2014-2020 BUDGET. Commenting on today’s vote in favour, the EUROPEAN COMMISSION SAID: The aim is to allow Greece to make full use of EU funds and inject liquidity into the Greek economy. I welcome today’s vote in the European Parliament giving its green light to frontloading existing EU funds for investment in growth-enhancing projects in Greece.... It should be seen in a wider context of the reform process undertaken in Greece. Timely and effective implementation of reforms to modernise Greek public administration and the economy – as agreed under the new stability support programme – is crucial to regain financial stability and, consequently, ensure economic growth and job creation. 1.40pm BST AMERICA’S TRADE GAP HAS HIT A FIVE-MONTH HIGH, IN ANOTHER SIGN THAT GLOBAL ECONOMIC GROWTH MAY BE WEAKENING. US imports rose by 1.2% in August, fuelled by a 3% increased in purchases from China. US trade deficit jumps 15.6% to $48.3 billion in August as exports fall to 3-year low - @AP 1.29pm BST THE VW SCANDAL HASN’T HURT THE UK AUTO INDUSTRY YET - CAR SALES HIT AN ALL-TIME HIGH IN SEPTEMBER, ACCORDING TO NEW DATA TODAY. Petrol-powered cars saw the strongest demand; suggesting some consumers might be more wary about diesel now. Related: Car sales at September record as demand for petrol vehicles soars 12.41pm BST WORKERS AT VOLKSWAGEN HAVE BEEN WARNED TO EXPECT PAINFUL CHANGES AS THE GERMAN CARMAKER TACKLES THE EMISSIONS SCANDAL. “Technical solutions to the problems are within view. However, the business and financial consequences are not yet clear”. “Therefore we are putting all planned investments under review. What is not urgently needed will be scrapped or delayed”. 12.39pm BST Our Katie Allen confirms that Britain’s directors do not march on an empty stomach, or an environmentally friendly one.... all for free lunches but in week we tried to kill off plastic bags, is it time for sun to set on #IoDAC lunchbox? pic.twitter.com/vBKJnm8guV The annual Albert memorial picnic at the IoD convention has attracted the attention of tourists #IoDAC pic.twitter.com/dCTqd1x4wb 12.21pm BST DELEGATES AT THE INSTITUTE OF DIRECTORS’ CONFERENCE ARE TUCKING INTO THEIR LEGENDARY LUNCHBOXES -- A CHANCE TO REFUEL AFTER A MORNING DISCUSSING WEIGHTY TOPICS LIKE EUROPE AND MIGRATION. There’s an astonishing amount of packaging on display too -- here’s a photo of just one box: Genius conference chow!! Lunch boxes @TheIoD #IoDAC #eventplanning pic.twitter.com/gjf210s64k 12.04pm BST Here’s a couple of photos of Volkswagen staff arriving in Wolfsburg, where they were briefed on the emissions crisis today: 11.26am BST BREWING FIRM SABMILLER HAS TURNED DOWN AN ‘INFORMAL OFFER’ FROM RIVAL ANHEUSER-BUSCH INBEV, ACCORDING TO A BLOOMBERG NEWSFLASH. That’s sent SAB’s shares down 3%, to the bottom of the FTSE 100 (_budge up, Glencore!_). SABMiller diving on reports it's knocked back an informal takeover offer from ABInBev http://t.co/2TQcKrMFt4 pic.twitter.com/HOsVGt5Wnv 11.17am BST THE WORKS COUNCIL BOSS AT VOLKSWAGEN, BERND OSTERLOH, HAS TOLD STAFF THAT THE COMPANY WILL HAVE TO REVIEW ALL ITS INVESTMENTS FOLLOWING THE EMISSIONS CRISIS. He also predicted that their pay packets will suffer too. All investments at Volkswagen will be placed under review, the carmaker’s top labour representative said on Tuesday, as the embattled German group grapples with the fallout of its diesel emissions scandal. “We will need to call into question with great resolve everything that is not economical,” Bernd Osterloh, head of VW’s works council told more than 20,000 workers at a staff gathering in Wolfsburg, Germany. 10.57am BST VOLKSWAGEN HAS REVEALED THAT IT SOLD EIGHT MILLION CARS WITH DEFECTIVE EMISSIONS TESTING SOFTWARE ACROSS EUROPE. 10.51am BST Looks like Lord Lawson got the last blow in: Mandelson summing up in EU debate with Lawson at IoD: EU makes us stronger, better off and safer #IoDAC Lawson closing EU ref debate: Mandelson was wrong "time and time again" about joining euro - "he was wrong then, he is wrong now" #IoDAC 10.44am BST They’re still arguing... Mandelson to Lawson: "Nigel, go to Norway, go to Switzerland" see that in trading with EU they must enforce "every dot & comma" of Europ reg 10.42am BST BACK AT THE IOD CONFERENCE, NIGEL LAWSON AND PETER MANDELSON ARE HAVING A BRISK EXCHANGE OF VIEWS OVER BRITAIN’S MEMBERSHIP OF THE EU (LORD M IS PRO, LORD L IS CON). Katie Allen is impartial, and tweeting the key points from the Albert Hall: Lord Lawson tells IoD: there may be reasons why Britain should remain in the EU but they are not economic. #IoDAC Lawson at IoD convention says: More Europe means too often more European regulation and that EU is "project of the elites of Europe" #IoDAC Peter Mandelson tells #IoDAC convention "EU tries to do too much. It has to do less better." But ppl must ask what alternatives are for UK Mandelson on Brexit: UK would be "notionally more independent if we came out but more isolated and less influential as a result." #IoDAC 10.33am BST MINING SHARES ARE LEADING THE FALLERS IN LONDON THIS MORNING. The 1.8% drop in German factory orders in August isn’t helping the mood. Slump in commodities may last for years, banks warn http://t.co/SelpXFav29 pic.twitter.com/xoqDeN56xP 10.21am BST The Institute of Directors’ chief is also rebuking UK politicians for playing the migrants card: Simon Walker @The_IoD repeats criticism of main parties for "pandering to myths about immigration" when growing economy, NHS need migrants 9.56am BST OVER AT LONDON’S ROYAL ALBERT HALL, BUSINESS LEADERS ARE GATHERING FOR THE ANNUAL INSTITUTE OF DIRECTORS CONVENTION. The 2,000 or so delegates will be hearing first from IoD head Simon Walker. As we reported this morning, Walker will use his speech to warn prime minister David Cameron that waiting till 2017 to hold the referendum on EU membership risks turning it into a confidence vote in the government. Related: EU referendum risks being Tory confidence vote, warns IoD “By 2017 this government will have implemented spending cuts that, while necessary, will not be popular. The third year of an election cycle is a difficult time for any administration. There is a real possibility that a 2017 referendum would be a short-term judgment on the government: a chance to whack the political elite.” “In pursuing the nirvana of steadily-rising productivity, one has to bear in mind how our economy is changing, how people choose to work, and what future economic success will look like. We need to ask if too close a focus on productivity numbers without considering wider factors could pose a long-term risk to the economy and prosperity.” Here we go then – attendees seated and ready. Let’s get this convention started! #IoDAC pic.twitter.com/mVaGPfIL0o 9.52am BST BACK IN THE UK, HOUSE PRICES DIPPED BY 0.9% LAST MONTH, ACCORDING TO MORTGAGE LENDER HALIFAX. But that’s little relief to those hoping to get a house (or buy a bigger one. Prices are up around 8.9% year-on-year. On a quarter-on-quarter basis, they’ve been gaining since the start of 2013. In September last year the average UK home was worth £187k according to Halifax. This September it was £203k. pic.twitter.com/8RkYjJ1u72 9.31am BST INTERESTING.... JONATHAN PORTES, ONE OF THE UK’S BETTER KNOWN ECONOMISTS, HAS LEFT HIS POST AS DIRECTOR OF THE NATIONAL INSTITUTE OF ECONOMIC AND SOCIAL RESEARCH THINKTANK. So farewell, then, Jonathan Portes: he has left NIESR ‘by mutual consent’. @steerpike has details: http://t.co/hRq8H8khgJ 8.49am BST OVER IN WOLFSBURG, THOUSANDS OF VOLKSWAGEN EMPLOYEES ARE MEETING AT COMPANY HQ TO HEAR FROM THEIR NEW CEO. 8.31am BST EUROPEAN STOCK MARKETS ARE BEING DRAGGED DOWN BY THE NEWS THAT GERMAN FACTORY ORDERS SLID IN AUGUST. The main indices are all in the red in early trading, with Germany’s DAX shedding almost 0.5%. A huge miss in German factory orders (complete with a downward revision for last month’s figure) seems to have taken the edge off of the Eurozone, following a Eurogroup meeting yesterday that hinted at more trouble for the currency union going forwards. European Commissioner Pierre Moscovici warned that Spain will miss its headline targets in 2015 and 2016, providing yet another bearish note from the country that already includes a 21 month low manufacturing figure, a 9 month low services PMI, a separatist victory in Catalonia AND an impending general election in September. 8.13am BST HERE’S ASSOCIATED PRESS’S EARLY TAKE ON THE DECLINE IN GERMAN FACTORY ORDERS: German factory orders dropped for the second consecutive month in August, led by a drop in demand from countries outside the eurozone and lower demand at home. The Economy Ministry said Tuesday that orders were down 1.8% in seasonally adjusted terms compared with the previous month. That followed a 2.2% drop in July. 8.08am BST THIS CHART CONFIRMS THAT GERMAN INDUSTRIAL ORDERS HAVE TAILED OFF IN THE LAST COUPLE OF MONTHS, AFTER A DECENT START TO THE YEAR. 7.46am BST GERMAN FACTORY ORDERS FELL UNEXPECTEDLY IN AUGUST, FUELLING FEARS THAT EUROPE’S LARGEST ECONOMY IS BEING HIT BY SLOWING GLOBAL GROWTH. Industrial orders slid by 1.8%, according to the economy ministry, dashing expectations of a 0.5% rise. Ugly German factory orders...August slump -1.8% & July fall revised down further. Shows exposure to weak China. Eurozone a bright spot In July foreign German factory orders slumped 6.1%...not quite so bad in August, but domestic demand worsening amid holidays 7.33am BST GOOD MORNING, AND WELCOME TO OUR ROLLING COVERAGE OF THE WORLD ECONOMY, THE FINANCIAL MARKETS, THE EUROZONE AND BUSINESS. There’s a relaxed mood in the markets this morning, as investors become increasingly convinced that central banks won’t be able to tighten monetary policy anytime soon. Modest continued rally expected at European opening - FTSe +27, DAX +45, CAC +22 (courtesy of IG) The weaker than expected US jobs report significantly reduces the chance of a rate hike this year from the Federal Reserve. Europe and China could also be on the verge of adding stimulus with deflation and low growth possibly enough motivation for the respective central banks to intervene before the end of 2015. #Japan's Nikkei ends up 1% at 18186.10 on the prospect that the BoJ may need to ease again. http://t.co/zmeGKcNyoO pic.twitter.com/CvF2WUEByg It’s #IoDAC day!! Looking forward to seeing everyone later today at the @RoyalAlbertHall! pic.twitter.com/Qk5LiJ0Fai Continue reading...
 |
| READ THE ORIGINAL POST AT www.theguardian.com |
