Bank of England poised to cut interest rates for fifth time in a year despite fears over sluggish UK economy: Live updates
Economists widely believe the Bank's monetary policy committee (MPC) will announce the base rate will be reduced by 0.25 percentage points to 4 per cent at 12pm.
It would be the fifth decrease in borrowing costs since the base rate peaked at 5.25 per cent in August last year and help further relieve pressure for some mortgage holders and home buyers.
But the move comes amid fears over the state of the UK economy with inflation reaching an 18-month high in June by climbing to 3.6 per cent, while unemployment rose to 4.7 per cent, its highest level in four years, in May.
Bank of England Governor Andrew Bailey said earlier this month that the Bank would be prepared to cut rates if the jobs market showed signs of weakening.
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The Independent
15 minutes ago
- The Independent
Students urged to ‘take stock' before accepting degree places on lower grades
Students should 'take stock' and think carefully before accepting a degree place on lower entry grades, a university sector chief has said. Hundreds of thousands of students in England, Wales and Northern Ireland will receive their A-level results on Thursday, with many finding out whether they have secured a place at their first choice university. Vivienne Stern, chief executive of Universities UK (UUK), said some universities in the country are 'really keen' this year to recruit 'as many students as they can' due to pressures facing the sector. University leaders have been warning of financial pressures due to uncertainty about the recruitment of overseas students as well as years of frozen tuition fees by domestic students. Speaking ahead of A-level results day on Thursday, Ms Stern told the PA news agency: 'We have seen some evidence of universities dropping grades in order to fill places.' She said: '(Students) should take stock of whether what they're being offered is right for them.' It has been suggested that some universities are offering incentives and relaxing offers to fill places. Ms Stern told PA: 'It's a bit of a buyer's market this admissions round.' She said: 'It's been a very competitive admissions cycle from the institutional perspective. 'We know that some universities are offering places to students with lower grades than they might have done in the past. 'From a student point of view that might be really good news. 'Although I would just say think very carefully about what's right for you.' On the day before A-level results day, a PA sample of 129 of the UK's largest higher education providers showed there were 22,518 courses with vacancies for undergraduate students living in England on the Ucas clearing site – which matches applicants to university places yet to be filled. A similar analysis last year – carried out by PA on the day before A-level results day and looking at the same range of institutions – showed there were 22,774 courses with vacancies on the clearing site. Eighteen of the 24 Russell Group universities, which represent some of the most selective UK institutions, had vacancies on courses for English residents – a total of 3,492 courses between them. A similar analysis last year, the day before A-level results day, showed 17 of the 24 Russell Group universities had vacancies on courses for English residents – a total of 3,500 courses between them. Clearing is available to students who do not meet the conditions of their offer on A-level results day, as well as those who did not receive any offers. Students who have changed their mind about what or where they wish to study, and those who have applied outside the normal application window, can also use clearing. Ms Stern advised students waiting for their grades to spend some time familiarising themselves with the Ucas system and to look at the clearing site. She said: 'There are plenty of options available and whatever's happened it's almost certainly not a disaster and it won't be the end of everything. 'So take a big deep breath and don't panic.' Last week, Jo Saxton, head of Ucas, suggested a record number of 18-year-olds are expected to wake up on A-level results day to the news that they have been successful in securing their first-choice university. Ucas figures released last month revealed that the number of offers made to prospective undergraduate students from universities and colleges has reached a record high this year. Lee Elliot Major, professor of social mobility at the University of Exeter, told PA: 'Some universities are now in survival mode — offering incentives, ramping up marketing, and relaxing offers to fill places. 'We must make every effort to ensure that students from all backgrounds are also well prepared and supported to succeed in their degrees.' Nick Hillman, director of the Higher Education Policy Institute (Hepi) think tank, said: 'It is a good year for applicants in the sense that demand is pretty flat so universities are having to fight over themselves to win new students. 'Universities do not want to have to close courses and make staff redundant but they will need to if they cannot fill their places.' Mike Nicholson, director of recruitment, admissions and participation at the University of Cambridge, said there had been a drift for students applying more to the well-known and 'more reputable universities' in recent years. The expert said that he was expecting more students to be looking in clearing for opportunities to do internships or placements as part of their degree. Mr Nicholson told PA: 'I think what we're probably seeing is students looking carefully at what the degree outcomes might be. 'We've seen a shift towards engineering degrees, mathematics degrees, associated degrees in medicine. 'They're all up significantly this year in applications.' Joanna Burton, head of policy (higher education) at the Russell Group, said: 'There is always some flexibility in offer-making decisions, and students may find they are accepted with grades slightly different to the advertised offer. 'However, our universities only admit students who show evidence they can meet the rigour of the course.' She said: 'While there appears to be some flattening out of the application rate among 18-year-olds, our universities are still seeing strong demand for courses that offer high-quality teaching and promising career prospects – and they're working hard to meet this demand.'
The Guardian
15 minutes ago
- The Guardian
The UK's bank ringfencing doesn't need large-scale reform
One reason to worry about the chancellor's plan for deregulation in the financial services sector is the dramatic language in which she pitched it. Rachel Reeves's metaphor in her Mansion House speech last month about regulation in too many areas acting as 'a boot on the neck of business' felt wildly over the top when you remember why tougher financial rules were needed in the banking sector in the first place. It was because the light-touch regulatory era caused the whole economy to be clobbered in the collapses of 2008-09. In the event, it took until 2019 to fully implement the centrepiece of the clean-up operation – bank ringfencing, which requires UK banks of a certain size to separate their retail and investment banking activities. Now, six years later – no time at all in the grand scheme – the Treasury, lobbied by most of the big banks, is contemplating 'meaningful' changes to ringfencing in the interests of economic growth. It feels far too soon to try anything radical. The definition of 'meaningful' is vague, it should be said. Outright abolition of ringfencing is off the table, thankfully, and some of the possibilities floated by the Treasury could be viewed as innocuous. Letting banks share back-office resources across the ringfence? Yes, that could be regarded as mere housekeeping. Allowing ringfenced banks to provide more products to UK businesses? Possibly, if we're talking about low-octane services. But the details do matter. The danger is that, if you create too many holes in the fence, you end up defeating the purpose of the construct. There are at least three reasons why Reeves should drop the inflammatory language and err on the side of caution. First, remember the primary goal: to ensure the state never has to bail out banks again – at least not the riskier trading activities. The plea from reformists is that other measures, such as stiffer capital requirements and 'living wills' to organise an orderly wind-down, do the same job. Yet ringfencing is surely genuinely different because it is a structural measure – the core UK deposit-taking operations have to sit inside their own legal entity. Maximum protection for the deposit-taking core still feels a sound principle given what happened in 2008-09, and how the whole of the wretched Royal Bank of Scotland was dragged down. Second, ringfencing may lower funding costs for banks. The perception of greater resilience should, in theory, attract a funding bonus. Put another way, regulators – with their eye on the overall stability of the system – might demand even higher capital buffers if ringfencing were to be meaningfully weakened. Would-be abolitionists grumble about the costs of trapped capital. Fair enough, but they probably wouldn't like bigger capital buffers either. Sign up to Business Today Get set for the working day – we'll point you to all the business news and analysis you need every morning after newsletter promotion Third, if the chancellor's aim is more growth, why make it easier for UK banks to chase higher returns outside the UK? She should listen to the commonsense point made by Andrew Bailey, the governor of the Bank of England: 'Removing the ringfence would most likely have a negative effect on UK lending, both in terms of cost and quantities.' If ringfencing has meant cheaper mortgages, it would be a political risk for a chancellor to mess with the formula. None of which is to pretend that ringfencing has been a free lunch. Friction and expense clearly exist – the big banks spent a small fortune setting up the structures and have to carry extra overheads. Competition may also have suffered as big ringfenced banks have concentrated on UK mortgage lending and smaller banks have been forced towards riskier lending. Visions of a post-crisis world full of dynamic 'challenger' banks never materialised. But that is just to say that trade-offs exist. For the UK – a country that simply cannot afford another crisis like 2008's – financial stability should still be the priority. A few minor fiddles might be an improvement because no design is perfect. But major reform is not needed.
BBC News
15 minutes ago
- BBC News
Claire's Accessories on brink of collapse putting 2,150 jobs at risk
Claire's Accessories is on the brink of collapse after the fashion retailer said it will appoint administrators in the UK and Ireland, putting 2,150 jobs at risk. The company has 278 stores in the UK and 28 in Ireland but has been struggling with falling sales and fierce the shops will continue trading while administrators at Interpath, once appointed, will "assess options for the company". Interpath chief executive Will Wright, said options include "exploring the possibility of a sale which would secure a future for this well-loved brand". Claire's in the US filed for bankruptcy in the US earlier this firm operates under two brand names, Claire's and Icing, and is owned by a group of firms, including investment giant Elliott Management.
