eBay shares jump 6.5% in early trading after it announces that it will separate from the payments site it bought in 2002 5.09pm BST Mission chiefs representing Greeces triumvirate of creditors are back in the county for what many believe will be a stormy last review of the Greek economy - ahead of more talks over how to deal with its debt later in the year. Helena Smith reports from Athens:Finance Minister Gikas Hardouvelis kicked off what essentially is the fifth economic review of the Greek economy - and if government officials are to be believed the last by international supervisors connected to the EU, ECB and IMF - earlier today with a meeting with troika officials in his sixth floor office.Greeks officials are putting on a bold face saying: the talks took place in a good climate and went well. 3.41pm BST Perhaps everything isnt as rosy in Americas economy as expected.US consumer confidence has fallen unexpectedly this month, to a four-month low. The Confidence Boards monthly survey of morale dipped to 86.0 from 93.4 in August. A less positive assessment of the current job market, most likely due to the recent softening in growth, was the sole reason for the decline in consumers assessment of present-day conditions. All told, consumers expect economic growth to ease in the months ahead.Surprise drop in US consumer confidence: Index drops to 4-month low of 86.0 (93.4 in Aug). Consensus was 92.5 pic.twitter.com/KvNwnQL6AT 3.27pm BST Oh dear. There will be red faces at Europes statistics body, Eurostat, this afternoon, after it admitted getting some of this mornings inflation data wrong.It initially reported that one measure of core eurozone inflation (excluding energy and unprocessed food) had fallen to 0.7% from 0.9%. But after checking its sums again, eurostat has realised the correct answer was 0.8%.Eurostat Core Inflation up 0.1 to 0.8% since 10am this morning http://t.co/JfQUI2NCoR http://t.co/a6iTXmlUAX #hyperinflation #Sinnwasright 3.19pm BST From Wall Street, heres my colleague Dominic Rushe on todays eBay news: Online auction site eBay plans to spin off its PayPal business into a separate publicly traded company next year, the company announced on Tuesday.The surprise move comes after the company had rebuffed calls from billionaire hedge fund investor Carl Icahn to sell off its online payments business. 3.13pm BST eBays share price surge has taken it close to the recent high set in August but its still below the all-time closing high (i think) set in early March this year.As this chart shows, eBay shares started to fall after investor Carl Icahn stopped agitating for the company to spin off PayPal. 2.42pm BST DING DING DING goes the Wall Street opening bell, and UP UP UP go eBays shares.Shares in the company jumped by 7.3% at the start of trading. 2.34pm BST Theres an media truism that all headlines come true eventually. Technology venture capitalist Josh Kopelman could claim the same about his forecasts:Wow. My longbet prediction from 2009 came true - eBay will spin out Paypal. I was just nine months off.... http://t.co/dElLpL9df1 2.22pm BST Looking back at the eBay-Paypal split...and analysts suggest that the deal could give the payments service new life.Jason Del Rey of Re/code flags up that PayPal has lost the gloss it once enjoyed as a serious tech pioneer, before being bought by eBay in 2002.Based on conversations with people who work in the payments game, PayPal rarely ranks at the top of wish lists that top talent wants to work for, despite generating $6.6 billion in revenue last year and growing at a rate of 20 percent annually. Part of the reason for that is after 12 years as an eBay subsidiary, PayPal is no longer seen as an innovator.eBay has big challenges ahead as standalone company. Devin Wenig (@Norse5) will get his shot to put own stamp on business as CEO.Additionally, the recent U.S. initial public offering of Chinas Alibaba Group Holding Ltd.a massive, rapidly growing, multifaceted online marketplacecommenced a new stage in the transformation of commerce and payments. 2.02pm BST Heres our take on the other big story of the day, the European Unions investigation into thesweetheart tax relief which the Irish government granted to Apple for over a decade.Apple may have to repay the tens of millions of euros that it received as illegal state aid through a sweetheart tax deal with the Irish government between 1991 and 2007.The European commission (EC) on Tuesday formally opened an investigation into the deals, with the outgoing competition commissioner, Joaquín Almunia, warning that the recipient of any state aid would be liable to repay it..... (click here for more)Apple may have to repay millions from Irish government tax deal http://t.co/TK8ZxlhlEO 1.55pm BST Marketwatch flags up Carl Icahns eBay stake is now worth a chunky $138m more than last night, based on pre-market moves on Wall Street.Why he's smiling! Carl Icahn's eBay stake gains about $138 million so far. http://t.co/NnKmm4SpeA pic.twitter.com/996QmfwFqu 12.55pm BST Its a good day for Carl Icahn. Not only is eBay now following his proposal to spin off the faster growing PayPal business into a separate company, but the news has sent eBays shares sharply higher in pre-market trading.So Icahn is vindicated and his 30m shares in the company are worth substantially more. 12.41pm BST eBay shares were suspended in pre-market trading ahead of the announcement of the PayPal spin-off, but they are back now:$EBAY shares trade higher by 11% in pre-market trade after resuming trade, and following news that they are to spin-off Paypal 12.26pm BST $EBAY to spin off PayPal as tax-free distribution in 2015. PayPal has grown 50% since 2011 vs 20% for Marketplace/Auctions 12.13pm BST Interesting news coming out of the US, with eBay announcing it has decided to spin off its PayPal business into an independent publicly traded company next year.The move seems to be a u-turn from the companys previous position but eBay president John Donahoe said:For more than a decade, eBay and PayPal have mutually benefitted from being part of one company, creating substantial shareholder value.However a thorough strategic review with our board shows that keeping eBay and PayPal together beyond 2015 clearly becomes less advantageous to each business strategically and competitively. The industry landscape is changing, and each business faces different competitive opportunities and challenges. 11.59am BST Back with the news that the UK economy grew even faster than expected in the second quarter of this year, and the reaction continues to come in.One point for discussion is what effect the stronger than forecast figures will have on the Bank of Englands deliberations about raising interest rates. David Kern, Chief Economist at the British Chambers of Commerce said: Overall these figures are positive they show an upward revision in quarterly growth in the second quarter and growth in business investment. The current level of GDP is considerably higher than its pre-recession level, which mirrors our view that earlier official estimates have understated growth in recent years. However, there are concerning features in the latest figures - the volume of exports has fallen slightly and the current account deficit has widened to above 5% of GDP, a level which in the long- term will prove to be unsustainable.While the strength of the recovery will support business confidence, these figures reinforce the need to rebalance the economy towards exports and investment. It is important that the [Bank of Englands Monetary Policy Committee] and the government make every effort to sustain the recovery. Interest rates must be kept low until there is a clear need to start increasing them, and government must do more to support exporters and improve access to finance for growing businesses.Overall, while sizeable, the adjustments to measured GDP do not significantly change the story of a deep recession followed by a protracted recovery. And since key indicators of the amount of spare capacity in the economy such as inflation, wages and unemployment are not being revised, there seems little reason for the OBR or the Bank of England to change their view on this. So the implications of the revised national accounts for economic policy should be limited.All in all, the data paint a far brighter picture of the UKs economic recovery than previously thought, but the revisions will probably do little to change the official economic outlook at the Bank of England. The Bank had already pencilled-in faster growth in the second quarter, and also uses the business surveys to back-cast GDP over recent years, so the upward revisions to the official data were already baked into the policy cake to a large degree.However, while the Banks official outlook is likely to be little changed following these revisions, its hard to see that the brighter picture will not add strength to the voices and conviction of those members of the Monetary Policy Committee who have already voted to hike interest rates.While the size of the economy has been revised up, household incomes have been revised down. It turns out the UKs living standards crisis is even worse than we thought.This is set to be the first full Parliament since the Second World War when the government leaves office with peoples pay packets worth less than when they came into power. 11.37am BST Todays downbeat eurozone data means ECB president Mario Draghi might soon have to bite the bullet and authorise fully blown quantitative easing, something that Germany for one is not keen on.That is the view of the Centre for Economics and Business Research, whose economist Danae Kyriakopoulou said:Todays news of a further fall in inflation set an urgent ground for the European Central Banks (ECB) announcement on Thursday detailing its plan to buy asset-backed securities.Cebr is cautious about whether such a programme will be enough to steer the Eurozone ship towards a sustainable recovery. Even the maximum possible of 1.4 trillion of asset purchases will be equivalent to roughly only 15% of Eurozone GDP the scale of quantitative easing in the US and the UK was higher at around 25% of GDP. 11.21am BST Time for a quick catch-up after a busy morning.Pressure is mounting on the European Central Bank to take fresh action after inflation in the euro area fell to just 0.3% this month, and core inflation weakened to 0.7%.Story of the day - Euro only coming lower pic.twitter.com/mhgHrpI6YdEven after today's revisions, the current UK recovery is slower than after the 70s, 80s or 90s recessions: pic.twitter.com/h6fzvu5VYi 10.58am BST John Hawksworth, PwCs chief economist, says todays revised British growth figures now makes the UK look more like Germany and less like France. 10.56am BST Ben Brettell, senior economist at Hargreaves Lansdown, says todays data show eurozone inflation continues to fall perilously close to zero:While it was widely forecast, todays drop in consumer price inflation to just 0.3% - a five year low - heaps further pressure on Mario Draghi to engage in QE. I believe he will succumb to this pressure eventually, though perhaps not as soon as Thursdays policy announcement. Stiff opposition from Germany will need to be overcome, and that will take time. Last week Draghi hinted at the prospect of QE, saying we stand ready to use additional unconventional instruments.The market certainly believes todays figure has brought QE closer the euro fell sharply on the news (by almost a cent against the US dollar). The euro is now 9% lower against the dollar than its May peak, and this should aid the euro zones struggling exporters.The ECB has in the past taken comfort in the fact that while inflation may be falling, inflation expectations are positive. However, inflation expectations are also declining amongst both consumers and producers, and it is worth noting that inflation expectations remained positive in Japan prior to its lost decade. 10.46am BST Credit Agricole economist Frederik Ducrozet reckons that core eurozone inflation (down from 0.9% to 0.7%), could be revised higher in Eurostats final data. Unless Frances prices have fallen really sharply....To be sure, either French core inflation dropped by a large amount, or Eurozone core inflation will be revised higher.@fwred Well, there's not a single retailer without some kind of sales currently. For the record, promotions are extending well into October 10.39am BST Looking back at the new UK growth data....Andrew Goodwin, Senior UK Economist at Oxford Economics, flags up that Americas economy has still powered ahead: UK growth performance looks less bad, but we still lag way behind the US #gdp pic.twitter.com/P2z2RrzNdf 10.27am BST The euro has fallen sharply following the news that eurozone inflation sagged to just 0.3% this month.It shed three quarters of a cent against the US dollar, to 1.2608, a new two-year low.Market reaction: EURUSD drooooping on flash CPI release. From 1.27 this morning to 1.2613 now. #ECB smiling, or not. pic.twitter.com/cQzgm87B45 10.26am BST Crucially, core inflation in the eurozone (stripping out volatile food, alcohol and energy prices) has fallen too, to just 0.7% from 0.9% in August.EU Core Prices slip to 0.7% from 0.9% in September #euro 10.17am BST The eurozone has slipped closer to deflation this month, which will renew fears that Europe risks suffering Japanification unless policymakers manage to stimulate the economy. Inflation across the single currency region has fallen to a fresh five-year low of 0.3% this month, Eurostat has reported. Thats down from 0.4% in August. 10.10am BST Europes young people continue to suffer badly from the crisis.In August 2014, the youth unemployment rate across the European Union was 21.6%, down from 23.5% a year ago. In the eurozone, the youth unemployment rate is 23.3%, down from 23.9% in August 2013.Italy's youth unemployment rate hit a record 44.2% in August pic.twitter.com/dPh8MO1rOmJobless rate among Italy's youth (aged 15-24) is 11.9%. 15% are employed. 44.2% unemployed (rate). 73.2% inactive. pic.twitter.com/YY3igeAUIC 10.07am BST Back to the eurozone, the unemployment rate across the single currency region was steady at 11.5%, Eurostat has just reported.Thats no better than in July, and not far from the record high of 12% set last year.The largest decreases were registered in Hungary (10.2% to 7.8% between July 2013 and July 2014), Portugal (16.1% to 14.0%), Spain (26.1% to 24.4%) and Croatia (18.2% to 16.5%), and the highest increases were registered in Finland (8.1% to 8.6%) and France (10.2% to 10.5%). 9.59am BST And heres how the ONS sums up the situation:The latest figures for Q2 2014 show the UK recovery continuing. With GDP in real terms growing by 0.9% compared with the previous quarter, and by 3.2% between Q2 2013 and Q2 2014, the strongest quarter on same quarter a year ago growth since before the economic downturn. 9.58am BST You can see the ONSs full report on the UK economy here. 9.58am BST More reaction is coming in. Heres Newsnights Duncan Weldon:Big GDP revisions. UK recovery still looks weak compared to previous recoveries but much better relative to the rest of the world. 9.53am BST As this chart shows, the great recession of 2009 was still the biggest plunge in output in decades, even after todays data revisions. 9.49am BST Sky Newss economics editor Ed Conway flags up that Britains recovery now looks less dire than its international rivals. UKs newly-revised economic growth profile suddenly looks a lot more respectable compared to the rest of the world pic.twitter.com/LZz6GmCE32Heres the old official estimate of UK GDP (blue) and the newly revised numbers published today (red) pic.twitter.com/j98eRW3lkB 9.47am BST Britains GDP is now 2.7% higher than the pre-economic downturn peak of Q1 2008, the ONS now reckons.These changes are being made to bring the UK into line with international standards. 9.43am BST Perhaps the biggest news this morning is that Britains Great Recession was not quite as deep as previously thought.The ONS now believes that the UK recovered all the output lost after 2008 in the third quarter of last year, rather than in this spring as initially thought.*U.K. 2008/2009 PEAK-TROUGH GDP DROP WAS 6% VS 7.2% PREVIOUSLY 9.39am BST The ONS has also revised down its estimate for growth in the first three months of 2014, from +0.8% to +0.7%. 9.35am BST BREAKING NEWS: The UK economy grew even faster than expected in the second quarter of this year.The Office for National Statistics has just revised up its estimate for GDP growth in the April-June quarter to +0.9%, from 0.8% previously. 9.29am BST Nearly time for the updated UK GDP data...Remember at 9:30am the UK Blue Book will tell us how much the level of UK GDP has been revised higher under ESA 10 rules #GBP 9.29am BST Back in the UK, pre-tax profits at payday firm Wonga have slumped by 53%.And net profits have halved, as Wonga is hit by rising operating costs and a new tougher environment.Wongas loan book rose by 8 per cent to £1.3bn at the end of 2013, while its default rate nudged down from 7.4 per cent in 2012 to 7 per cent last year.However, operating costs - including investments in debt collection and fines - climbed by 56 per cent to £133.7m, even as revenues only inched up to £314.7m, crimping profits severely. 9.22am BST Heres AFPs take on the rise in German (seasonally adjusted) unemployment this month:Unemployment in Germany stagnated in September, as clouds continue to build over Europes biggest economy, official data showed on Tuesday.The unemployment rate stood at 6.7% in seasonally adjusted terms in September, unchanged from August. 9.19am BST Italys youth unemployment total has hit a fresh record high, according to data just released by ISTAT.ISTAT reported that Italys youth jobless rate (covering 16-24 year olds) jumped to 44.2 in August, from 43.2 in July.Italy headline unemployment at 12.3% - down 3 tenths - but youth unemployment hits a record high at 44.2% 9.02am BST Here we go, the first slice of eurozone jobless data, from Germany.And the headline news is that the number of people out of work in Germany jumped by 13,000 in September, to 2.918m. Economists had expected a 2,000 drop.German September seasonally adjusted jobless total up slightly (+13k) to 2.918 million. Jobless rate unmoved at 6.7%. 8.55am BST 8.55am BST The regional house price data from Nationwide is quite fascinating, although also depressing if youre trying to get on the housing ladder. 8.43am BST Back on the surprise 0.2% drop in UK house prices in September (details start here).This Nationwide chart, which compares average prices over the last quarter compared to the previous three months, suggests a clear slowdown over the summer:Momentum in UK housing market is slowing fast, according to Nationwide pic.twitter.com/SfD5flMn6Z 8.35am BST While UK retailers worry about the weather, their counterparts in Germany can cheer a strong summers trading. Retail sales jumped 2.5% in August compared with July; a post-World Cup boost, perhaps?Did all Germans buy the new national soccer shirt with four stars? German retail sales up by 2.5% MoM in August. 8.32am BST Retail analyst Nick Bubb says Nexts warning that the warm weather could hit its profits could spook investors:Next are probably being unnecessarily cautious, ahead of investor meetings this week, but the market is unlikely to take any chances.... 8.23am BST High street retailer Next has sent a shiver through the retail sector this morning, warning that the recent warm weather has hit demand for clothes.Cooler weather in August resulted in several very strong weeks. However, warmer weather in the more important month of September has had the reverse effect. The overall effect is that Quarter Three sales to date are up 6%, which is lower than our previous forecast of +10%.Next Q3 sales up 6%, 4 percentage points below forecast. Will lower FY guidance if it stays warm. Rescue Lord Wolfson. Buy a jumper.OMG, Next warns that because of "the recent spell of unseasonably warm weather" sales are is only running +6% in Q3 to date, below budget 8.03am BST Royal Bank of Scotland has given its investors some good news this morning, reporting that its bad loan impairments are much less than expected.RBS, still majority owned by the UK taxpayer, reported a continued improvement in economic conditions and asset prices in our key markets, including Ireland. 8.01am BST One last chart, showing how houses are much less affordable than 20 years ago; the situation was even worse before the financial crisis struck, though: 7.53am BST Nationwide also warned that the UK housing markets prospects remain unclear, after this months 0.2% drop in prices.Price growth may soften further in the final quarter of the year, given the high base for comparison from Q4 2013. However, the outlook remains uncertain. There have been tentative signs from surveyors and estate agents that buyer demand may be starting to moderate, but the low level of interest rates and strong labour market suggest that underlying demand is likely to remain robust. 7.43am BST House prices down 0.2% in September, according to Nationwide, annual rate drops from 11% to 9.4%. First monthly fall since spring 2013. 7.42am BST Nationwide, the building society, has reported that UK house prices have fallen for the first time in 17 months, in the latest sign that the market is cooling.It reports that average house prices fell by 0.2% month-on-month in September, which drags back the annual growth to 9.4%; an eight-month low.Annual house price growth in London slowed somewhat, from 25.8% in Q2 to 21% in Q3. Nevertheless, at £401,072, average prices in the capital reached a record high, 31% above their 2007 peak. 7.40am BST Good morning, and welcome to our rolling coverage of the financial markets, the world economy, business and the eurozone. Continue reading...
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