Good morning.
A food and drink extravaganza over the platinum jubilee weekend failed to boost retail sales as consumer spending remained subdued amid rising inflation.
Retail sales fell by 0.1% in June, according to the ONS. That was ahead of May’s 0.8% drop and better than feared, but still pointed to a worrisome picture of the economy.
Food sales jumped 3.1% thanks to the royal celebrations. But that masked a 4.3 percent drop in fuel sales as pump prices jumped to record highs while other sectors also saw declines.
Meanwhile, GfK’s latest consumer confidence survey remains at a 48-year low as rising food and fuel prices leave consumers feeling “deeply depressed”.
5 things to start your day with
1) Why the end of the ECB’s disastrous experiment with negative interest rates won’t save Europe Lagarde’s major rate reversal does little to quell fears of a protracted crisis
2) Tata threatens to close Port Talbot steelworks. The company is asking for a £1.5 billion lifeline of taxpayer subsidy to keep the site open
3) Report failed SFO Unaoil bribery probe lets boss off the hook Embattled director Lisa Osofsky vows to stay put and implement recommendations
4) Top Tory donors attack Rishi Sunak’s ‘ridiculous’ tax plans. Sir Rocco Forte’s call for tax cuts has been echoed by business leaders and economists
5) Why Thatcher’s tax cuts are so hard to replicate Experience around the world shows that tax cuts help stimulate growth
What happened in one night
Asian stock markets were on track for their best week in months and the dollar held off recent record highs after the European Central Bank raised interest rates for the first time in more than a decade and bets on the size of U.S. rate hikes eased.
Japan’s Nikkei rose 0.2% this morning and was on course for a seventh straight day of gains. This is likely to be the index’s best week since March.
MSCI’s broadest index of Asia-Pacific shares outside Japan was down 0.03 percent, but the index was still set for its best week in about two months.
Hong Kong’s Hang Seng index rose 0.1 percent.
It’s due today
- Economy: Services PMI (UK, US, EU), Manufacturing PMI (UK, US, EU), Composite PMI (UK, US, EU), Retail Sales (UK)
- Corporate: Beasley (interim); JTC (Trade Update)
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