Latest news with #BarclaysPrivateBank
CNBC
5 days ago
- Business
- CNBC
Friday's jobs report likely will show hiring cooled in May. Here's what to expect
There seems little doubt now that hiring slowed considerably in May as companies and consumers braced for higher tariffs and elevated economic uncertainty. The main question is by how much. A small dip from the recent trend likely wouldn't be viewed as worrisome. But anything beyond that could set off a fresh round of fears about the labor market and broader economy, possibly pushing the Federal Reserve into a quicker-than-expected interest rate action. Economists expect that when the Bureau of Labor Statistics reports the May nonfarm payroll numbers (NFP) Friday at 8:30 a.m. ET, they will show a gain of just 125,000, down from an initial tally of 177,000 in April and the year-to-date monthly average of 144,000. That represents a slide but not a collapse, and markets will hinge on the degree of decline. "Going into the NFP print, expectations have been reset lower and a reading of around 100,000 (vs. the 125,000 expected by the consensus) could fall in the 'not-as-bad-as-feared'" camp, wrote Julien Lefargue, chief market strategist at Barclays Private Bank. "Anything below the 100,000 mark could reignite recession fears, while a stronger-than-expected print could perversely be negative for risk assets as it would likely put upward pressure on [Treasury] yields." Consequently, the report will be a balancing act between competing concerns of a slowing labor market and rising inflation. A broad range of sentiment indicators, including manufacturing and services surveys as well as gauges of small business sentiment, indicate flagging optimism toward the economy, led by worries over tariffs and the inflation they could ignite. Moreover, hard data this week from ADP showed that private payrolls essentially were flat last month, growing by just 37,000 in May, a two-year low. Jobless claims also have also recently been edging higher, with last week hitting the highest since October. Friday's payroll report, then, could be a key arbiter in determining just how much worry there is in the economy where it counts, namely the labor market, which in turn provides clues about the strength of consumers who drive nearly 70% of all U.S. economic activity. "We do think it's going to slow down. We do think that tariffs are going to start biting a little bit," said Dan North, senior economist at Allianz Trade North America. "Everybody hates the economy, but if you look at the hard data, it's not so bad." North expects it will still take several months before the sentiment surveys — "soft" data — take their toll on other economic readings, such as payrolls. In the interim, markets will be watching further developments on the trade front as President Donald Trump continues in a 90-day negotiating window that investors hope will ease some of the "Liberation Day" tariffs that are on pause. "We don't expect to see a crash this month, probably not the month after this, but certainly a weight on the economy, not just from the tariffs but also from uncertainty. It's as if tariff policy is a specter in the mist," North said. There are a variety of views on Wall Street, from Goldman Sachs, which expects a below-consensus 110,000 growth in payrolls, to Bank of America, which is looking more for a number around 150,000. From there, investors will try to figure out whether the latest numbers move the needle on Fed policy, with markets currently not expecting further interest rate cuts until September. Most policymakers of late have been focusing on tariff-induced inflation impacts, with the caveat that they are watching the jobs numbers as well. "One encouraging sign about economic activity is the resilience of the labor market," Fed Governor Adriana Kugler said Thursday in New York. "We will get the May employment report tomorrow, but the data in hand indicate that employment has continued to grow and that labor supply and demand remain in relative balance." The consensus estimate also sees the unemployment rate holding at 4.2%, while average hourly earnings are projected to show a 0.3% monthly gain and 3.7% annual increase.
Mint
16-05-2025
- Business
- Mint
For luxury brands, there are no replacements as China and the US falter
Even though both countries have 1.4-billion strong populations, mainland China has more than 60 Louis Vuitton stores while India has only three. Designer brands' struggles in India are a reminder of just how difficult it can be to find new growth markets. That search is taking on new urgency, as the two biggest drivers of demand in the luxury goods industry, China and the U.S., are in the doldrums. Together, Chinese and American shoppers generate around half the sector's sales. But demand from Chinese consumers has been muted for four years. The country's deflating property bubble has wiped 30% off Chinese household wealth, according to Barclays Private Bank, lessening the appetite for luxury goods. U.S. luxury sales peaked in early 2022 and have tailed off since. A delicate recovery in spending seen late last year was snuffed out by the tariff war. LVMH, the world's biggest luxury-goods company by revenue, said sales in the U.S. fell 3% from a year earlier in the first quarter. Although it doesn't break out China, sales fell more than a 10th in Asia. And 2025 is shaping up to be a lost year for the luxury industry, with global sales expected to dip 2%. Brands and their shareholders got used to two decades of reliable 6% annual growth, so they are naturally eager to find the next hot market. But it will be hard for luxury companies to reduce their dependence on Chinese and American consumers, as they need such specific elements to thrive. If luxury bosses were able to build an ideal market for their products from scratch, the local economy would be growing rapidly. This creates a pool of ultrawealthy spenders. 'The ingredients [for a luxury boom] are the same every time," says Luca Solca, analyst at Bernstein. 'You have a group of top consumers getting a lot richer who are interested in separating themselves from the crowd, so they buy luxury goods." But there shouldn't be too much wealth inequality. When middle-class consumers are also getting richer, some will try to keep up with the Joneses by spending on designer goods. Top brands have a reputation for catering to the superrich, but more than 50% of global luxury sales come from hundreds of millions of middle-class shoppers who spend less than 2,000 euros a year on luxury goods, equivalent to $2,240 at current exchange rates. 'The two markets coexist in a symbiotic relationship," says Filippo Bianchi, a managing director at Boston Consulting Group. 'Spending by the wealthiest shoppers, that money is always there. But the bottom half is driven by GDP and what is happening to people's salaries." This is what made China such an amazing market for luxury goods. Between 2009 and 2019, its economy grew 8% a year on average. As China's rich got richer and its middle class swelled, both turned to Western luxury goods to signal they were moving up in the world. Back in 2000, Chinese customers generated 1% of global luxury sales, according to UBS. Today they account for around a quarter. The country also urbanized rapidly, so luxury brands were able to advertise and retail efficiently to tens of millions of city dwellers. And middle-income consumers were pressed up against the ultrarich, creating status hunger. Compare that with India, where only a third of the population lives in cities. India is the market that divides opinions the most among luxury industry analysts. It has been one of the fastest-growing economies in the world for several years, so some brands think it is only a matter of time before middle-class Indians want Chanel handbags and Cartier bracelets. But the Indian market has underperformed expectations so far. Reasons cited include a supposedly less individualistic culture and strong local clothing and jewelry brands. Today, luxury brands sell goods worth $1 billion inside India, compared with $45 billion in mainland China, says Federica Levato, a senior partner at consulting firm Bain & Company. A country's retail infrastructure can also be a deal breaker for brands. For now, luxury brands sell their goods in the lobbies of five-star hotels in India. But an area equivalent to London's Bond Street or New York's Fifth Avenue where they could open flagship stores hasn't developed yet in major cities. According to Ashok Som, co-author of 'The Road to Luxury," India's population of 1.4 billion is served by just eight luxury shopping malls. High import taxes, which add around 50% to the price of goods such as designer handbags, mean India's high-net-worth individuals do their luxury shopping abroad. Unless middle-class Indian consumers start buying luxury goods at home in big numbers, investment in high-end retail won't happen. That in turn further holds back spending. Luxury brands can try to coax more cash from local Europeans. But the region's shoppers aren't in an indulgent mood. 'The European economy has been stagnant for years versus China and the U.S.," says Bernstein's Solca. 'Consumers only buy luxury goods when they think 'I can spend a lot today because tomorrow I will be richer.'" Saudi Arabia is another market that luxury brands are watching, even though they aren't all-in yet. Half a million square meters of luxury retail space is being developed over the next decade, in a punchy bet that locals will do more luxury shopping at home rather than in London or Paris, and that there will be an influx of high-spending expats and tourists. Even if that goes according to plan, luxury sales in the Saudi market will only be the same size as Germany's, says Boston Consulting Group. With no obvious alternative to China or the U.S., brands might try to lure back middle class consumers in these markets to jump-start growth. A report from Bain shows the luxury industry has lost 50 million customers since 2022, partly because hefty price increases put their goods out of reach for aspirational customers. Today, the lowest-cost women's sneakers on Gucci's U.S. website were $790. Back in 2020, the most affordably priced pair cost $550, the Wayback Machine shows. The solution to the luxury industry's growth problem probably doesn't lie in new emerging markets. What the brands really need is a re-emergence of middle-class spending in the U.S. and China. Write to Carol Ryan at
CBS News
13-05-2025
- Business
- CBS News
Inflation rose by 2.3% in April, CPI report shows. Here's what the data means.
The Consumer Price Index in April rose 2.3% on an annual basis, signaling that price hikes remain above the Federal Reserve's goal of bringing down inflation to a 2% rate. By the numbers The CPI was forecast to rise 2.4% last month, according to economists polled by financial data firm FactSet. The CPI, a basket of goods and services typically bought by consumers, tracks the change in those prices over time. What experts say Economists are looking for early signs that Mr. Trump's tariffs are trickling through to American households. Because tariffs are import taxes paid by U.S. companies, which largely pass on the added costs to shoppers, they are at some point expected to boost consumer prices. Earlier this month, Federal Reserve Chair Jerome Powell said the central bank is taking a wait-and-see approach on Mr. Trump's tariffs, which he said could boost inflation and blunt economic growth. But so far, the tariff impact hasn't shown up in economic data, which typically is backward-looking because it reflects activity from the previous month. Mr. Trump has also announced tariffs, such as his April 2 "Liberation Day" levies, and then backed off from them. On April 9, he hit the pause button with a 90-day delay, scaling back the tariffs to a 10% rate. And on Monday, the Trump administration and China agreed to a temporary but significant easing of tariffs imposed over the last couple months, scaling back the import duties on Chinese-made goods from 145% to 30%. Meanwhile, some consumers and businesses rushed to order goods ahead of the tariffs' imposition, aiming to skirt the new import duties by front-loading their purchases. Because of this, the impact of the tariffs might not show up in economic data for another few months, economists say. "[I]n reality, the data for April is likely to be largely unaffected by President Trump's announcements on Liberation Day," said Julien Lafargue, chief market strategist at Barclays Private Bank, in an email. "This is because exemptions were granted for goods that had left exporting countries before 2 April, and because consumers and businesses rushed to front-run tariffs in February and March." He added, "As such, both the Fed and global investors will still need to be a bit more patient before they can properly assess the impact of the trade uncertainty on consumer prices."
Business Times
12-05-2025
- Business
- Business Times
In return to Singapore, Barclays Private Bank sets sights on ultra rich and family offices
[SINGAPORE] Barclays' private bank, which made a return to Singapore in 2021, is building up the business with renewed vigour. In that push, the group has been stepping up its recruitment in Singapore, said Evonne Tan, head of Barclays Private Bank, Singapore. Among the most prominent hires, besides Tan, are David Ratcliffe as chief operating officer and Ken Sze as head of investments, Asia. The number of relationship managers in Singapore is now believed to exceed 10. Tan told The Business Times recently that Barclays plans to continue hiring, despite many clients being in 'standstill' mode as they try to assess the impact of US President Donald Trump's tariffs. She said this could provide Barclays' relationship managers with the opportunity to hold their clients' hands through uncertainty. In February 2024, it designated private banking as one of its five key pillars. Last July, Barclays, one of UK's largest lenders, said it aims to quadruple its private-banking assets in Asia by the end of 2028. The bank, which had £212.4 billion (S$365.6 billion) in private-banking assets and liabilities as at Mar 31, 2025, doesn't provide regional breakdowns. Barclays sold its private-banking business in the city-state and Hong Kong to Bank of Singapore in November 2016. With about US$18.3 billion in assets under management as at end-2015, the business was sold for US$227.5 million. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Barclays' private-banking business was previously known as its Wealth and Investment Management unit, and had been identified as non-core by the group's then-chief executive officer Jes Staley. When it made a U-turn to restart its Singapore private bank five years later, some of its clients were sceptical. 'You've left you leave again next year?' was a question that some of them had, said Tan. But observers sat up when the bank hired Tan in July 2021, when the city-state and most of the world were still in the grips of the Covid-19 pandemic. Tan had joined from UBS, where she led the team overseeing the wealth of ultra-high-net-worth individuals. Her experience proved useful when Barclays pivoted its Singapore private bank to focus on the wealth segment with at least £5 million or equivalent in local currency to invest. The lender also widened its clientele to include family offices in Singapore. The number of family offices rose 42.9 per cent from 2023 to exceed 2,000 in 2024. Building up Singapore Barclays' private-banking business in Singapore currently uses London as its booking centre, but it is in the process of setting up a booking centre here. A booking centre is a dedicated office handling the clients' specific needs, such as managing their assets, executing transactions and providing wealth management services. Clients' accounts will be registered there, which could affect where they are taxed, depending on their citizenship. A booking centre requires staff, and systems and structures to facilitate these processes. 'We have the commitment from the group to invest in the local infrastructure,' said Tan. 'Our clients are looking to book assets and park assets here, and they want to invest in Asia. So we need to build up Singapore.' Currently, Barclays' only booking centre in Asia-Pacific is in India. The booking centre will be operational here by next year. 'Clients are expecting us to come back in a big way.' Tectonic plates shifting Tan's team is also focused on helping clients navigate the current investment climate. 'Are there going to be new strategic alliances in the world? We don't really know, but we just know that tectonic plates are shifting. We may not have the answers now, but we may need to do some rebalancing and restructuring for the long term.' For instance, the bank could suggest to clients with over-leveraged positions to take up more defensive assets such as gold. Given that family offices typically have long investment horizons and deep pockets, many are emulating the approach of institutional investors by venturing into private markets, Tan said. 'It's not uncommon to see them allocating 25, 30 per cent (of their assets) to private markets, or even more.' While private-market assets are usually less liquid and transparent than public-listed securities, they are expected to generate higher long-term returns. As family offices grow across regions, Barclays is targeting those with a more global profile, particularly large families seeking to invest globally, where the lender can also tap its investment banking team. Within Asia, Barclays is focusing on helping family offices manage their wealth transfers, and legacy planning. Given the relative youth of family offices and large entrepreneurial businesses in Asia compared to Europe, Barclays can lean on its experience managing intergenerational wealth transfers in Europe, to help clients in this part of the world, said Tan.
The Independent
06-03-2025
- Business
- The Independent
Trump, tariffs and potential defense spending surge overshadow European Central Bank meeting
The impact of a potential trade war with the United States and massive increases in European defense spending and government borrowing loom over a policy meeting Thursday at the European Central Bank, which is expected to cut interest rates by a quarter percentage point. Analysts are widely expecting a cut in the bank's benchmark deposit rate to 2.50%, a step to lower borrowing costs for consumers and businesses in an economy that's struggling to get out of first gear. The bank's monetary policy statement and post-meeting news conference by President Christine Lagarde will be scrutinized for hints about how far the bank will cut rates amid concerns about weak growth. The bank has already reduced the benchmark rate by 1.25 percentage points since June. Meanwhile new concerns that would massively reshuffle the economic picture are likely to intrude: the potential impact of new tariffs on European imports from U.S. President Trump, which could slow growth, and plans for massive new defense spending and borrowing, which could mean more growth but also more inflation. Those two forces could push the ECB in opposite directions: a hit to growth would call for lower rates, while more persistent inflation would argue for keeping rates higher in coming months. Growth estimates for Germany, the eurozone's largest economy, shot up overnight and long-term interest rates rose following an agreement by the two parties that will form the country's next government to loosen constitutional limits on borrowing and exempt defense spending. That is a major turnaround in German budget policy and opens the way for a trillion or more in new borrowing and spending over the next decade. Also in the mix are concerns that Trump will impose new tariffs on European goods, hurting growth in an export-dependent economy. The 20 countries that use the euro currency and for which the ECB determines interest rate policy stagnated in the last three months of the year, showing zero growth. Consumers burned by an earlier outbreak of inflation remain cautious, while businesses have been unsettled by concerns about what Trump may do. 'Christine Lagarde will most certainly be asked about how the ECB intends to respond to these moves and the support that the central bank may provide to the bloc,' said Julien Lafargue, chief market strategist at Barclays Private Bank. He predicted the ECB would stay flexible and decide based on incoming data: "Indeed, the possible push, in terms of GDP growth, from higher government spending may be offset by the pull coming from US tariffs and the net effect is unclear.' Economists at Deutsche Bank predict the ECB will cut rates to 1.5% by the end of the year: 'Our assumption is the negatives of a trade war dominate the positives of defence spending in 2025.'
