Welcome to Your Panthera Consultancy Weekly Newsletter!
This week, we hear stories that the Base Rate has been held steady at 5.25% by the BOE and the expected change could lead us into September, not August as first predicted; London has now reclaimed the title of Europe’s biggest stock market and even hear about hot finance products like Virgin Money’s 26-month 0% interest credit card and NatWest’s reduction in rate on their mortgages. With Panthera you can rest assured to always stay informed and stay ahead.
SPECIAL ANNOUNCEMENT:
It could be your businesses last chance to benefit from the Recovery Loan Scheme, a government backed loan that can be in the form of Asset Finance, Invoice Finance or Unsecured Lending. As these loans are backed 70% by the government, lenders are providing these facilities with lowest on the market fees! This scheme ends on the 30th of June 2024 so if your business is looking for lending, don’t miss out and get in touch Today!
Email: info@pantheraconsultancy.com
Phone: 0208 132 6872
Now, to the updates:
ECONOMY
BoE Holds Rates at 5.25%
The Bank of England has kept interest rates at 5.25%, a 16-year high, with a majority of the Monetary Policy Committee agreeing that further “evidence of diminishing inflation persistence was needed before reducing the degree of monetary policy restrictiveness.” The MPC voted 7-2 in favour of freezing the base rate. Despite inflation coming down to 2%, services inflation remains sticky due to factors such as the increase in the national minimum wage and indexed household bills.
BoE Expected to Delay Rate Cut Until September
News that the rate of services inflation has remained above Bank of England forecasts has prompted traders to bet on a delay to interest rate cuts from August until September. Rob Wood, chief UK economist at Pantheon Macroeconomics, noted that sticky services inflation might shift the call for the first MPC cut to September, followed by another in November.
London Reclaims Title as Europe’s Biggest Stock Market
London has regained its position as Europe’s largest stock market, overtaking Paris. The FTSE 100 has risen 7% in the past year, with increased deals and share price boosts. Stability and the clear likelihood of a Labour victory in the upcoming election have given investors confidence.
BoE’s QE Programme Costing Britain Billions
An analyst at Columbia Threadneedle Investments has said the Bank of England is losing three times more on its quantitative easing (QE) programme than the Federal Reserve in the US. The Treasury is covering tens of billions of pounds in losses as the Bank sells bonds it issued under QE at a loss. Scaling back active QT could still reduce overall costs for the taxpayer.
REAL ESTATE
House Prices Dip by £21 in June
The average price of a home in the UK dipped by just £21 in June, following a record high in May, according to Rightmove. The typical cost of a residential property in Britain is now £375,110, slightly down from May’s record of £375,131. Despite potential caution as the election nears, the number of sales and buyer inquiries has remained steady.
BANKING
Tories and Labour Vow to Protect SME Lending
The Prudential Regulation Authority (PRA) is set to announce plans for the latest round of Basel rules, known as Basel 3.1. Both Labour and the Conservatives have committed to ensuring that small businesses can access the finance they need, addressing concerns that new regulations could severely impact lending to SMEs.
FCA Debanking Review Delayed
The Financial Conduct Authority (FCA) review into the debanking of politically-exposed persons (PEPs) has been delayed until July due to the pre-election period. The review includes an examination of the closure of Nigel Farage’s accounts by NatWest private bank Coutts.
NatWest Cuts Mortgage Rates
NatWest has become the first major mortgage lender to lower its rates after inflation fell to the Bank’s target of 2%. NatWest’s largest cuts are for remortgagers opting for a five-year fix, with a leading rate of 4.41%. Smaller lenders, such as the Co-operative Bank and Nottingham Building Society, also brought in rate cuts this week.
Virgin Money Launches 0% Balance Transfer Card with 28 Months Interest-Free
Virgin Money has launched a new credit card that offers 28 months of interest-free balance transfers, with a low fee of 3.25% on debt moved to the account. This card offers a competitive deal compared to similar offerings from other banks.
POLITICS
Labour Vows to Open 350 New Banking Hubs
Labour has pledged to open 350 new banking hubs in towns and villages across Britain over the next five years. The party aims to revitalize high streets and support financial inclusion through digital training and debt advice.
HSBC Issues Warning Over Labour’s Living Wage Proposal
Economists at HSBC have warned that Labour’s plan to introduce a “genuine living wage” could fuel inflation and job losses. They caution that this could lead to increased costs, reduced efficiency, and sustained inflation pressures, keeping the Bank Rate higher for longer.
LEISURE & HOSPITALITY
Brewers Call for Support on Tax and Business Rates
Britain’s biggest brewers and pub firms are urging the Government to ease the tax burden on the sector. Over 80 industry leaders have signed a letter highlighting the need for urgent reform of the business rates system.
MANUFACTURING
Manufacturers’ Confidence Climbs to Decade High
British manufacturers’ confidence is at its highest level in a decade, according to a survey by Make UK. Both output and orders have improved, with a 7 confidence rating on a scale of 1 to 10. The manufacturing sector is expected to outpace overall growth this year, with a growth rate of 1.2%.
OTHER
Nvidia Becomes World’s Most Valuable Company
Nvidia has overtaken Microsoft to become the world’s most valuable company, driven by rising demand for its AI-related products. Nvidia stock has surged about 180% this year, with a market capitalization of $3.335 trillion.
CLOSING THOUGHTS
As we conclude this week’s Panthera Consultancy Weekly Newsletter, we highlight the Bank of England holding interest rates at 5.25% and the slight dip in house prices. What do these developments mean for your business? Opportunities for stable financial planning and potential growth in property investments could be on the horizon.
If you’re interested in finding out how your business could benefit from these developments, get in touch with us today and see what finance options could be available to you!
Email: info@pantheraconsultancy.com
Phone: 0208 132 6872
Thank you for being a valued reader. Until next week, stay informed and stay ahead!
With my kindest regards,
Benjamin Vis
Managing Director – Head of Business Lending
Landline: 0208 132 6872
Mobile: 07933 145 994Email:Benjamin@pantheraconsultancy.com