Welcome to Your Panthera Consultancy Weekly Newsletter!
In this week’s newsletter, we bring you exciting updates: UK inflation held steady in June, there are calls for a base rate interest cut, and wages have grown at their slowest pace in two years. The International Monetary Fund (IMF) predicts UK economic growth, while house prices continue to rise, and even in the US banks close local branches in favour of online services. Stay informed and stay ahead of your business needs with Panthera Consultancy.
By staying on top of these stories, you’re staying on top of your business. Whether it’s highlighting inflation trends or reporting on economic growth, all these factors can impact your business. If you know others who could benefit from this newsletter, share it with them and tell them to email ‘join’ to info@pantheraconsultancy.com.
Lastly, are you looking to grow your business? Don’t wait for growth to come to you, bring it to you! Panthera Consultancy supports businesses every day with their growth plans, whether it’s buying new assets, obtaining finance for new staff, or taking on new projects. Whatever your plans are, we are specialists in Asset Finance and Business Loans. We don’t just know the products; we have access to the best lenders. Get in touch today to find out what could be available to you!
Email: info@pantheraconsultancy.com
Phone: 0208 132 6872
Now onto the updates:
ECONOMY
Inflation Steady at 2% in June
UK inflation held steady in June, with the latest figures from the Office for National Statistics (ONS) showing price growth remained at the Bank of England’s target rate of 2%. Core inflation, which excludes the price of fuel and food, remained at 3.5%. Inflation in the services sector, an area closely watched by the Bank of England, remained steady at 5.7%. With inflation not coming down from May’s reading, analysts say an August interest rate cut is now less likely. Financial markets reduced their forecasts for the likelihood of an August cut from 50% to 35%.
MPC Member Calls for Interest Rate Cut
Swati Dhingra, a member of the Bank of England’s rate-setting Monetary Policy Committee, has called for the Bank to cut interest rates to ease the strain on households. Ms. Dhingra believes that demand is soft enough to prevent any resurgence in inflation, despite strong wage pressures.
Wages Grow at Slowest Pace in Two Years
Wages grew at their slowest pace in two years, according to the Office for National Statistics (ONS). Average regular earnings dropped from 6% to 5.7% in the three months to May. However, when accounting for the cost of living, real pay grew by 3.2%, the fastest pace since August 2021. The rate of UK unemployment remained unchanged at 4.4%.
Economic Outlook Upgraded After Figures Show Growth
Forecasters have upgraded expectations for the UK economy after data showed higher-than-predicted growth, with GDP up 0.4% in May compared to a flat reading in April. On a year-by-year basis, GDP is up 0.7% on June 2023. Forecasters from Deutsche Bank, Barclays, Goldman Sachs, and Capital Economics have revised their predictions, with some expecting the UK economy to grow by up to 1.2% in 2024.
FTSE 250 Hits Two-Year High
The FTSE 250 hit its highest level since April 2022, boosted by the improving outlook for the UK economy. The index reached 21,202.89 after figures released showed that the economy grew by 0.4% in May. The better-than-expected GDP figures also lifted the pound to its highest level in a year against the dollar.
REAL ESTATE
House Prices Rise 2.2% in May
Office for National Statistics data shows that average UK house prices climbed by 2.2% to £285,000 in the 12 months to May. This increase marks the third consecutive month where prices have risen, with the rate of growth being the highest since July 2022.
Rate Cut Could Boost the Market, Says Rightmove
Rightmove suggests the housing market is likely to be boosted by a potential cut to interest rates, with lower mortgage rates expected to follow when the Bank of England loosens monetary policy. Despite the general election distraction, the number of sales agreed rose by 15% year-on-year, while the number of sellers increased by 3%.
INTERNATIONAL
US Banks Close 539 Branches in H1
Banks in the US have closed 539 local branches in the first half of the year. Bank of America closed the most branches, followed by US Bank, Wells Fargo, Chase, and TD Bank. This shift comes as major banks move towards online services, with 78% of Americans preferring mobile and online banking.
BANKING
System Outage Hits House Sales and Payments Across UK and Europe
The Swift international cross-border payments system suffered an outage on Thursday, impacting the Bank of England’s CHAPS service and the European Central Bank’s settlements system. The issue, caused by an operational incident, resulted in delayed payments for some customers.
Saver Choice at 12-Year High
Analysis by Moneyfacts shows that savers have the biggest choice of deals since May 2012, with 2,014 deals currently available. The average easy-access savings account pays 3.11% interest, while notice accounts offer 4.29%.
CONSTRUCTION
House Builders Welcome Plans to Reduce Planning Restrictions
Developers have welcomed Labour’s plans to liberalise the planning regime to kickstart the building of new homes and infrastructure. Measures include mandatory housing targets and easier compulsory purchase orders, along with more resources for local councils.
Housebuilders Warn Construction Lag Threatens Labour Plan
Barratt Developments and MJ Gleeson have warned that it will take at least a year to start increasing housing supply, highlighting the challenge facing the new Labour government.
MANUFACTURING
England Sees Manufacturing Jobs Decline
While Wales, Scotland, and Northern Ireland have seen significant growth in manufacturing jobs over the past year, England has experienced a decline. The report from Make UK shows a decrease of 34,000 manufacturing jobs in English regions, except for the East of England.
OTHER
UK Home to Millions of Millionaires
The latest Global Wealth Report from UBS shows that the UK is home to more than 3 million dollar millionaires, behind only the US and China. However, UBS predicts a decline of 500,000 millionaires over the next five years due to emigration and wealth loss.
AI Start-ups Raise $2.1bn in H1
British artificial intelligence start-ups have raised $2.1bn in the first half of 2024, with forecasts predicting a record-breaking $4.4bn by year-end. The UK remains Europe’s top destination for start-up investment.
CLOSING THOUGHTS
As always, we thank you for being an avid reader of the Panthera Consultancy Newsletter and for trusting us to provide you with these essential financial updates. Beyond updates, we are here to support your business in obtaining finance and helping both businesses and individuals convert currencies cost-effectively.
If you’re looking to elevate your business to the next level or want to uncover where banks might be overcharging you on foreign exchange transactions, get in touch today. Let us help you revolutionise your financial future.
Until next week, Stay Informed & Stay Ahead.
With my kindest regards,
Benjamin Vis
Managing Director – Head of Business Lending
Panthera Consultancy – Unmatched in the Financial Kingdom