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The Guardian - UK
The Guardian - UK
Business
Graeme Wearden

London Underground drivers to strike on 15 March ; 260 jobs at risk at British Steel – as it happened

British Steel Jingye United States Scunthorpe (Geopolitical Entity) Unite United Kingdom Christopher Furlong China GMB Lloyds
ASLEF members on London Underground will strike for 24 hours on Wednesday 15 March
ASLEF members on London Underground will strike for 24 hours on Wednesday 15 March
 Photograph: Westend61 GmbH/Alamy

Closing summary

Time to wrap up… here are today’s main stories:

FCA forces firms to stop making misleading British Steel pension scheme offers

Back in the steel world, the UK’s financial watchdog has instructed two firms to stop making unsolicited settlement offers to former members of the British Steel Pension Scheme (BSPS).

Those members are likely to be part of the redress scheme established by the Financial Conduct Authority (FCA), which is concerned that they are being offered unduly low offers.

The FCA says:

Today, we have formally required two firms, Abbey Lane Financial Associates Limited and Estate Capital Financial Management Limited, to stop making these offers.

Abbey Lane made offers of £100 to 82% of its clients who were BSPS members and Estate Capital made offers of £300 to 83% of its former BSPS members.

We are concerned that these offers are significantly misaligned with the average calculated redress of £45,000 for former BSPS members who received unsuitable pension transfer advice.

More details here.

Back in November, the FCA announced that more than 1,000 former members of the British Steel pension scheme who received unsuitable advice from financial advisers accused of “enriching” themselves will receive an average payout of £45,000 in compensation.

One British Steel worker leaving the Scunthorpe site told PA Media that the planned closure of its coke ovens was “a real shame”, adding:

It’s a shame guys are losing their jobs and they’re outsourcing their products, it’s a step back really.”

Another said the plant could keep going without the coke ovens but that it would “devastate this town” if it did close.

He added:

“I don’t think it will, though, not for a while.”

Wall Street has opened higher, after posting its biggest losses of 2023 yesterday.

The Dow Jones industrial average has gained 55 points, or 0.17%, to 33,185 points, with the broader S&P 500 up 0.27%.

Edward Moya of trading firm OANDA says stocks were cheered by Federal Reserve policymaker James Bullard, who stated today that markets might be over-pricing US recession risk.

Moya writes:

Bullard said his projections for rates are to reach 5.375%, which implies 75 bps more in rate increases.

Bullard is one of the more hawkish members, so if he thinks we only have a little ways to go here, the peak in rates might be properly priced in.

The disagreement between the Fed and markets on how high rates to go might be over and that could provide a tentative boost for stocks.

Aldi has become the latest supermarket chain to impose limits on purchases of salad and vegetables in the UK.

The German-owned discounter announced on Wednesday it is limiting purchases of peppers, cucumbers and tomatoes to three packs a person.

An Aldi UK spokesperson said.

“We are limiting purchases of peppers, cucumbers and tomatoes to three units per person to ensure that as many customers as possible can buy what they need,”

This follows rivals Asda and Morrisons, who are also rationing supplies of some fruit and vegetables after production was hit by disrupted harvests in southern Europe and north Africa. Supplies from British farms have also dropped, due to the rising cost of heating greenhouses to grow salad crops.

Updated

Shares in Cineworld are down almost 15% in London today after it emerged the world’s second-biggest cinema chain is yet to receive any offers to buy the whole company out of bankruptcy.

Cineworld filed for bankruptcy protection in the US last September, and is seeking interested parties to bid for the company. It owns the Regal Cinemas chain in the US and the Picturehouse brand in the UK, as well as movie theatres in central Europe, eastern Europe and Israel.

Cineworld attorney Joshua Sussberg told Texas Bankruptcy Court Judge Marvin Isgur at a hearing on Tuesday that it had reached out to 40 potential buyers – resulting in “many” offers for the rest-of-world assets and “some strategic interest in the full business”.

But, Sussberg told the court that it was yet to receive firm offers for the entire business

“We did not receive any all-cash bids, and no bid came anywhere near the $6 billion of secured indebtedness that exists on on the company’s balance sheet today.”

Ambulance staff and other health workers who are a part of Britain’s Unison trade union will take strike action on March 8, PA Media reports.

Updated

Over on Wall Street, chipmaker Intel has cut its dividend by 66%, weeks after announcing wide-ranging cost cuts, as it tries to strengthen its business.

The chip company has announced it will pay a quarterly dividend of $0.125 a share beginning in June, down from $0.365 a share during last year.

Intel says the move “reflects the board’s deliberate approach to capital allocation and is designed to best position the company to create long-term value”.

Since 1992, Intel says it has returned over $80bn to its stockholders, and remains committed to “maintaining a competitive dividend”.

Intel CEO Pat Gelsinger says it’s important to allocate capital prudently, as it pushes through his “IDM 2.0 strategy” – an upgrade to Intel’s integrated device manufacturing (IDM) model, which includes investing $20bn in two new chip fabrication plants in Arizona.

Updated

Network Rail says strike negotiations in ‘hiatus’ after rejection of latest offer

Elsewhere in the transport industry, Network Rail chief executive Andrew Haines said negotiations to end the industrial dispute with the Rail, Maritime and Transport union (RMT) have “hit a bit of a roadblock”.

He told reporters at a briefing at London’s Waterloo station:

“The railways are not going to be defined forever by this current action.

“We’ve seen people come back into work. We were 2,000 people away from a yes vote.

“I’ve got a lot of optimism. I’m just frustrated that we’ve taken a turn into a side street, as opposed to actually sticking on the path of getting this to resolution.

“I remain genuinely optimistic we will get a sensible outcome here. But at the moment we’ve hit a bit of a roadblock.”

Haines said Network Rail is “having to take stock” after the RMT refused to put its proposal to a vote, and was now “in a hiatus” while it considers its next steps.

Earlier this month, the RMT rejected pay offers from Network Rail and train operators, prolonging the long-running dispute on the railway, saying the proposals were “dreadful”.

Tim Shoveller, Network Rail’s chief negotiator in the dispute with the RMT, said today the union should put offer to its members:

“I think the RMT has really annoyed their members – our staff – by their refusal to put the revised offer that we made in January to a referendum.

“It’s a sham of an excuse to say that that was rejected on the basis of just going through the branch meetings.

“We can see that because our own staff are telling us that very clearly.

“They’ve been really clear that they want a chance to vote on the deal.”

Updated

There could be relief for UK households in the cost of living crisis, investment bank Citigroup believes.

Citigroup has forecast that UK inflation will plunge to 2.3% in November, down from 10.1% in January, thanks to falling energy bills.

That would put inflation close to the Bank of England’s 2% target, and allow the government claim to have achieved its target of halving inflation this year.

The new forecasts reflect the fall in wholesale energy costs. UK next-day gas now costs 127p per therm, down from as much as 405p in December.

UK domestic energy bills are currently capped by the government, at levels where the average household pays £2,500 per year. This is due to rise to £3,000 in April, but analysts then expect a fall in future quarters.

Investec predicts Ofgem’s price cap would hit £3,332 in April and then £2,165 in July, before rising slightly to £2,190 from October.

The Financial Times suggests that Citigroup’s forecasts are a fillip for Rishi Sunak, “potentially making it easier to resolve public sector strikes over pay”.

But, it would not reverse the sharp increases in prices in the shops last year, of course, which were not matched by public sector pay recommendations.

The Bankof England also expects inflation to fall this year, to 3.5% by the end of 2023, and then to just 1% in 2024.

London Underground drivers to strike on March 15

London Underground drivers are to strike on March 15 – Budget Day – in a dispute over pensions and working arrangements.

The Aslef union has announced that members will strike for 24 hours, in a dispute over changes to working arrangements and pensions.

ASLEF members in other roles on the Underground - including Test Train and Engineering train drivers and those in management grades - also voted in favour to strike, the union says, and will take action on the 15th March as well.

A passenger waits at Westminster underground station as a train arrives at the platform.
A passenger waits at Westminster underground station as a train arrives at the platform. Photograph: Steve Taylor/SOPA Images/REX/Shutterstock

Tube train drivers voted by 99% in favour of strike action, on a turnout of 77%.

Finn Brennan, ASLEF’s full-time organiser on the Underground, warns that there will be a ‘protracted dispute’ unless Transport for London works with the union.

‘The size of these “Yes” votes, and the large turnouts, show that our members are not prepared to put up any longer with the threats to their working conditions and pensions. We understand that TfL faces financial challenges, post-pandemic, but our members are simply not prepared to pay the price for the government’s failure to properly fund London’s public transport system.

‘Cuts to safety training have already been forced through and management is open that they plan to remove all current working agreements under the guise of “modernisation” and “flexibility” and to replace the agreed attendance and discipline policies. Proposals to slash pension benefits are due to be announced in the next week.

‘We are always prepared to discuss and negotiate on changes, but our members want an unequivocal commitment from TfL that management will not continue to force through detrimental changes without agreement.

‘Unless they are prepared to work with us, and accept that changes have to come by agreement, and bring real benefits to staff, rather than just cuts and cost savings, this will be only the first day of action in a protracted dispute.’

Updated

British Steel's Scunthorpe plant in north Lincolnshire today.
British Steel's Scunthorpe plant in north Lincolnshire today. Photograph: Lindsey Parnaby/AFP/Getty Images

Speaking to PA Media outside the entrance to the British Steel plant in Scunthorpe, Unite convenor for the site Martin Foster said the move had come “too soon”.

Foster warned that the future of the plant was “a massive worry”, telling PA:

“This site seems to keep shrinking year by year, it’s a fraction of the size it used to be, and every year that goes by we seem to see the whole UK steel industry shrink that little bit more, and nobody seems to want to do anything to stop it.

“So I think it’s time that people like the Government sat up and took notice. I think the £300 million is a welcome amount of money but it just scratches the surface – it doesn’t plan for the long term.

“If we want a sustainable steel industry for the UK for the long term, we need to have a better plan than that – £300 million just buys us some time.”

Last month, it was reported that chancellor Jeremy Hunt was poised to grant a £300m funding package for struggling British Steel.

British Steel chief executive Xifeng Han says the company is undergoing the biggest transformation in its 130-year history, and that UK steelmaking ‘remains uncompetitive’ compared to rivals.

Xifeng explains:

“Jingye is committed to our long-term future but decarbonisation is a major challenge for our business and, like most companies, we’re facing significant challenges because of the economic slowdown, rising inflation and exceptionally high energy prices.

“For example, last year our energy bill rose by £120 million while we’ve also faced an increase of over £70 million in our annual carbon costs.

“We have taken action to reduce costs within our control; however, steelmaking in the UK remains uncompetitive when compared to other international steelmakers.”

“Our energy costs, carbon costs and labour costs are some of the highest across the world, which are factors that we cannot influence directly.

Updated

Unite: We'll fight to defend every steel job under threat

The Unite union has vowed to fight to defend every job under threat at British Steel’s Scunthorpe plant, through the proposed closure of its coke ovens.

Unite national officer Linda McCulloch suggests this could include strike action, saying:

“This union has not yet seen any financial justification for the closure of the coking ovens. British Steel needs to come clean and open its books in order to try to justify its decisions.

“Unite will pursue every avenue, including industrial action, to defend members’ jobs at British Steel.”

Updated

British Steel proposes closure of Scunthorpe coke ovens, with loss of up to 260 jobs

Newsflash: British Steel is proposing to close the coke ovens at its plant in Scunthorpe, with the loss of up to 260 jobs, the company has announced.

This confirms the fears voiced by unions this morning, that the company was planning to cut hundreds of jobs and shutter its coking ovens, which produce the fuel to power its blast furnaces.

The company’s owner, China’s Jingye Group, says the move is partly “to overcome global economic challenges,” and also due to rising costs (such as energy bills).

Jingye says in a statememt:

“Decisive action is required because of the unprecedented rise in operating costs, surging inflation and the need to improve environmental performance.

Updated

Community union warns of 'catastrophic' impact from steel job losses

The steelworkers union, Community, has warned that it will not accept redundencies if British Steel closes Scunthorpe’s coke ovens, as feared today.

Community’s national officer Alun Davies says the move would threaten the UK’s ability to produce steel, as it would rely on imported coke instead.

Davies say:

“British Steel’s plan to close the coke ovens could have a catastrophic impact on jobs and steel production at Scunthorpe and the UK as a whole.

“This move would see the company depending on unreliable imported coke and puts at risk our sovereign capability to produce steel in the UK for strategic infrastructure such as our rail networks.

“We will not accept redundancies and nothing is off the table when it comes to protecting our members’ jobs.

“The Government must do whatever it takes to reach a deal with British Steel that protects the loyal workforce and the future of steelmaking in this country.”

More encouragingly, German business morale has improved this month.

The Ifo institute’s business climate index has risen to 91.1 for February, up from 90.1 in January.

It adds to signs that Europe’s largest economy is recovering despite the energy crisis and high inflation.

ING economist Carsten Brzeski says that mild weather and fiscal stimulus measures helped the German economy.

He warns, though, that recession risks haven’t abated, saying:

The current assessment component dropped for the second month in a row and remains weak. It is expectations which surged and they have now improved for the fifth month in a row.

Taiwan has cut its forecast for growth this year as weak exports continue to drag on the economy.

Gross domestic product is likely to grow 2.12% in 2023, Taiwan’s Directorate General of Budget, Accounting and Statistics said Wednesday. That’s down from 2.75% year-on-year growth predicted in November.

Taiwan, which is home to many major tech companies, has been hit by a slump in exports as high global inflation, interest rate rises and the war in Ukraine hits demand.

The statistics body says:

“Under the influence of monetary tightening by various countries to combat inflation and the stalemate in the Russia-Ukraine war, terminal consumer demand has weakened, product prices have fallen, industrial supply chain inventories have been adjusted, and global economic growth has slowed.”

New data today has shown that Taiwan’s economy shrank by 0.4% in the last quarter of 2022, putting it on the brink of a technical recession.

Lloyds bankers to share £446m bonus pot

Lloyds Banking Group staff will share their largest bonus pot in four years, despite the lender reporting flat profits as it put aside more money to protect against a potential jump in defaults amid ongoing economic uncertainty.

Lloyds, which owns Halifax and is the UK’s largest mortgage lender, said its top performing bankers would share a bonus pool worth £446m for their work in 2022 – up 11% from £399m last year and the largest sum to be distributed among employees since 2018.

The lender also revealed a £3.8m pay packet for its chief executive, Charlie Nunn. However, that is down 31% from the £5.5m he received in 2021, when he was handed a £4.2m buyout to compensate him for shares he gave up when he left HSBC to become Lloyds chief executive in August that same year.

The banking group reported flat profits of £6.9bn for the year, in line with average estimates from analysts, despite recording a near-50% jump in net interest income to £14bn, which accounts for the difference between what the bank pays out to savers and charges its loan and mortgage customers.

Here’s the full story:

Labour: British Steel job cuts reports are very worrying

Jonathan Reynolds MP, Labour’s Shadow Business Secretary, is concerned by today’s reports that British Steel will announce 300 job cuts in Scunthorpe.

Reynold says:

“Yet more worrying news for our steelworkers who desperately need a Government on their side securing the bright future our steel sector could have.

Steel is the bedrock of many communities across the UK. It is the foundation our manufacturing sector is built on, crucial to any net zero ambition and the beating heart of our sovereign capability.

That is why Labour will partner with industry to invest in the new technologies needed to keep well paid steel jobs in the UK for decades to come.”

Speaking of inflation….French food company Danone has grown its revenues at the fastest rate in more than a decade, boosted by higher prices on products from Activia yogurt to Evian water.

Danone reported that its sales rose 7.8% on a like-for-like basis in 2022. Prices were 8.7% higher over the year, while sales volumes dropped by 0.8%.

That shows how multinational companies have succeeded in hiking their prices last year, passing on costs to consumers and fuelling the highest inflation rates in decades.

In the final quarter of 2022, Danone’s prices were 11.3% higher, while sales volumes dropped 4.4%, leaving sales +7.0% on a like-for-like basis.

Danone’s CEO Antoine de Saint-Affrique says:

“While 2022 was a year of unprecedented external challenges and volatility, for Danone it has also been a year of deep transformation and solid delivery.

I am grateful to all Danoners for their resilience and their passion for customers, consumers, patients and for making our company a stronger one.

There’s no “cost-free” solution to the UK’s public sector pay disputes, a UK Government minister has said this morning.

Cabinet Office minister Johnny Mercer was asked on Times Radio whether departmental submissions for 3.5% pay rises in 2023/24 for police, teachers, nurses and other workers was likely to solve the current strikes, and argued “this is an intractable problem”.

Mercer argued that inflation-matching pay rises would push up prices further [a point disputed by some economists], saying:

“If you look at what is going on in communities like I represent in Plymouth, the biggest challenge is inflation, without a shadow of a doubt. That is driving up prices across the board.

“If you chase that inflation with public sector pay rises, as people like the governor of the Bank of England have pointed out, you are into a never-ending circle where prices just continue to rise.

“I will always advocate for people who work in my constituency to be paid more if they work in the public sector.

“But you have to do it in a balanced way. This is not a binary argument, there is no cost-free solution.”

Earlier this month BoE governor Andrew Bailey argued that the impact of inflation-matching pay increases would depend how they were funded – extra borrowing might require higher interest rates, while pay rises funded by taxation might not.

Mr Mercer added that:

“the easy option would be to cede to everyone’s demands but then inflation would continue to go up and prices would continue to go up, and life gets harder”.

FTSE 100 drops as Rio Tinto reports profits plunge

As predicted in the introduction, European stock markets are dropping in early trading as worries about future interest rate increases weigh on shares.

Britain’s FTSE 100 has shed 66 points, or 0.85%, dropping to 7911 points – away from the record highs over 8,000 points set last week.

Mining companies are among the fallers, after natural resources giant Rio Tinto (-1.6%) reported a 38% drop in profits for last year and more than halved its dividend.

Rio was hit by weaker demand from China last year; pandemic restrictions meant less need for steel in its economy, pushing weaker iron ore.

Victoria Scholar, head of investment at interactive investor, says:

“Rio Tinto reported underlying earnings of $13.3 billion last year, below analysts’ estimates for $13.8 billion and a fall from 2021’s record high $21.4 billion. It cut its dividend by more than 50% from $10.40 per share in 2021 to $4.92 last year and cut its 2023 capital investments guidance from between $8 billion and $9 billion to $8 billion.

China’s draconian zero-tolerance to covid approach, which is finally being unwound, weighed on iron ore prices last year, negatively impacting Rio Tinto. While’s China’s economic reopening looks set to provide a tailwind to Rio this year, the risk of further restrictions from Beijing and another spike in infections remain potential hurdles. The inflationary backdrop is also adding to Rio Tinto’s cost burden with higher fuel and raw material costs as well as higher wage bills as a result of labour shortages.

Shares in Rio Tinto have rallied by more than a third since the start of November but have retreated from the January highs with earnings putting further pressure on the stock today. Other stocks in the sector like Endeavour Mining, Anglo American, Glencore and Antofagasta are also taking a hit in today’s trade.”

Bloomberg: China urges state firms to drop Big Four auditors on data risk

Chinese authorities have urged state-owned firms to phase out using the four biggest international accounting firms, Bloomberg News are reporting this morning.

The move shows China continues to be concerned about data security even after Beijing reached a landmark deal last summer to allow US audit inspections on hundreds of Chinese firms listed in New York.

Bloomberg explain:

China’s Ministry of Finance is among government entities that gave window guidance to some state-owned enterprises as recently as last month, urging them to let contracts with the Big Four auditing firms expire, according to people familiar with the matter.

While offshore subsidiaries can still use US auditors, the parent firms were urged to hire local Chinese or Hong Kong accountants when contracts come up, one of the people said, asking not to be identified discussing private information.

Sky: Government officials fly to China to win support for British Steel bailout

Sky News reported overnight that government officials will this week fly to China in an effort to convince Jingye, the owner of British Steel, to finalise plans for a state funding package

Civil servants from the Department for Business and Trade are travelling to meet executives from Jingye Group amid protracted talks about a £300m grant to the Scunthorpe-based company.

Sources told Sky the talks were expected to focus on the value of an energy subsidy package, which could take the overall value of government support for British Steel to approximately £1bn.

More here.

The timescale for the feared closure of British Steel’s coking ovens in Scunthorpe is unclear, the BBC says, as is how many compulsory redundancies it will involve.

The BBC’s Simon Jack reports:

Union officials told the BBC that the industry “is on a knife edge”.

Government sources described the decision as “disappointing” given that negotiations are still ongoing between British Steel’s Chinese owners Jingye, Tata, and the Treasury about a support package worth £300m to each company.

British Steel: We reluctantly have to consider cost-cutting

British Steel points out that Jingye has invested £330m in capital projects during its first three years of ownership.

But, a British Steel spokesman says the energy crisis has driven up the company’s costs. That, and the tough economic outlook, means it must consider cost-cutting.

The British Steel spokesman says:

“Jingye is committed to our long-term future but decarbonisation is a major challenge for our business and, like most companies, we’re facing significant challenges because of the economic slowdown, rising inflation and exceptionally high energy prices.

“For example, last year our energy bill rose by £120 million while we’ve also faced an increase of over £70 million in our annual carbon costs.

“We have taken action to reduce costs within our control; however, steelmaking in the UK remains uncompetitive when compared to other international steelmakers.

“Our energy costs, carbon costs and labour costs are some of the highest across the world, which are factors that we cannot influence directly. For the reasons outlined, we entered into talks with the UK Government in summer 2022 and are extremely grateful for its support.

“It’s important we have the correct policies and frameworks in place to back our drive to become a clean, green and sustainable company, and we’re continuing to discuss this with the Government.

British Steel insists that it is “committed to working together”, so that Britain can make home-made steel for generations to come, adding:

“Unfortunately, like many other businesses we are reluctantly having to consider cost-cutting in light of the global recession and increased costs. We have discussed this in preliminary talks with the trade unions in which we shared the challenges we face.

“We look forward to working closely with them to ensure a long-term, safe and sustainable future for the company, thousands of employees and many more in people in our supply chain.”

The Unite union is also concerned that British Steel will announce job cuts today.

Unite general secretary Sharon Graham says:

“British Steel workers are faced with the toxic combination of a greedy employer that is reneging on investment promises and a shambolic UK Government that has no serious plan for the industry.

“Unite’s members in British Steel are clear that they will fight this and they will have the full support of their union.”

Unions warn British Steel jobs at risk amid coking ovens closure fears

Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.

Unions fear British Steel is set to announce the closure of coking ovens at one of its plants today, with the loss of hundreds of jobs.

Union officials were told earlier this month that British Steel, owned by China’s Jingye, was considering closing coke ovens at its site in Scunthorpe.

An aerial view of the British Steel works in Scunthorpe.
An aerial view of the British Steel works in Scunthorpe. Photograph: Christopher Furlong/Getty Images

An announcement could be made on Wednesday, unions believe.

Charlotte Brumpton-Childs, GMB national officer, said it would be “devastating news“ for the people of Scunthorpe and all British Steel workers across the UK.

She explains (via PA Media):

“With grim predictability, the Government’s investment is a sticking plaster that does nothing to help the long-term structural issues affecting our steel industry.

“Now steel workers, their families and communities will once again be asked to pay the price.

“GMB urges British Steel and the UK Government to continue talks.

“Ministers need to decide if they want the UK to have a future in steel or whether they want it to wither and die like so much of our proud manufacturing heritage.”

Coking ovens turn coal into coke, which burns at the higher temperature needed for the steel production process.

British Steel, which was bought in 2020 by Jingye, has been in talks with the government over a possible £300m support package for several months, as is its Indian-owned rival Tata Steel.

At the start of February, the Unite union warned that 1,2000 jobs were at risk at British Steel’s Scunthorpe steelworks.

Jingye and Tata Steel (which owns Port Talbot near Swansea, in Wales) are seeking support to upgrade their steel blast furnaces to electric arc furnaces with much lower carbon emissions.

Also coming up today

UK supermarket shoppers could be facing weeks of shortages of fruit and vegetables.

Yesterday, Asda introduced a limit on tomatoes, peppers, cucumbers, lettuce, salad bags, broccoli, cauliflower and raspberries, and today Morrisons will restrict customers to two per item on packs of tomatoes, cucumbers, lettuce and peppers from Wednesday.

UK prime minister Rishi Sunak is exploring a 5% rise for public-sector workers, the Financial Times reports, to end an escalating wave of strikes.

This possible breakthrough comes after yesterday’s public finances gave the Treasury was given an unexpected £30bn windfall.

Ministers and nurses’ leaders are due to hold “intensive talks” on Wednesday in an unexpected move that has raised hopes that they will thrash out a deal to end the long-running pay dispute. The Royal College of Nursing has suspended next week’s planned strike.

But yesterday, Jeremy Hunt insisted the government is unable afford a bigger pay increase for nurses and other public sector workers at next month’s budget, despite official figures showing an unexpected boost for the exchequer in January.

Lloyds Banking Group has reported a flat annual pre-tax profit for last year. Lloyds made £6.9bn last year, as a jump in income driven by higher interest rates was offset by mounting bad loan provisions.

Lloyds CEO Charlie Nunn says the results are ‘resilient’, and told the Today Programme that the bank expects a mild UK recession in 2023, with a recovery in 2024.

European stock markets are set to open lower, after Wall Street posted its biggest loss of 2023 so far.

The Dow Jones industrial average shed 2% on Tuesday, as a strong survey of US purchasing managers fuelled concerns that America’s central bank will keep interest rates higher for longer than hoped.

The US Federal Reserve will release the minutes of its last meeting tonight, which will give insight into whether policymakers expected to ‘pivot’ away from higher borrowing costs anytime soon.

The agenda

  • 7am GMT: German inflation rate for January

  • 9am GMT: Italian inflation rate for January

  • 9am GMT: Ifo index of German business confidence

  • 9.30am GMT: House of Commons Science and Technology Committee to question Google, Microsoft and BT on AI regulation

  • 1.55pm GMT: US Redbook Index of retail sales growth

  • 7pm GMT: US Federal Reserve to publish minutes of this month’s meeeting

Updated

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