Closing post
Time for a recap.
The International Monetary Fund has upgraded its forecasts for UK growth, saying the country will no longer fall into recession this year, but warned the government not to cut taxes as that would fuel inflation and result in high interest rates for longer.
In a message to the chancellor, Jeremy Hunt, that he should maintain his planned squeeze on public spending, the Washington-based body said tax policy should stay “aligned with monetary policy in the fight against inflation”.
Any financial surpluses should be used to pay down government debt to “rebuild fiscal buffers”, it said in its annual Article IV review of the UK’s economic outlook released on Tuesday.
During a press conference in London, IMF managing director Kristalina Georgieva hailed UK authorities for taking “decisive and responsible steps in recent months”.
The UK economy is now expected to grow by 0.4% this year, not shrink by 0.3%, meaning it should do better than Germany.
Georgieva also said it was “neither affordable nor desirable” to cut UK taxes now – the priority should be to lower inflation.
The Bank of England has admitted it made errors in its forecasting of UK inflation, and said it has some “very big” lessons to learn over how it decides monetary policy.
Policymakers faced criticism during a Treasury Committee meeting over the failure to predict a prolonged rise in inflation, driven by higher-than-expected food prices.
Bailey told MPs:
“I think there are some very big lessons in how we operate monetary policy in the face of very big shocks. Because the shocks that we have faced have been unprecedented.
“I think there are big lessons about how we operate policy in that world – in a world of very big uncertainty.”
Bailey also pointed to recent bad weather for pushing up food prices, catching the Bank’s forecasters out.
Bailey’s comments came as new data showed supermarket inflation remains over 17% this month.
Bailey told MPs he believes inflation has ‘turned the corner’; we’ll find out at 7am tomorrow if CPI did indeed fall in April, as hoped.
The housebuilder Barratt Developments has said its chair will stand down to prevent the impact of the allegations against him “from becoming disruptive to the company”.
The news came after it was announced on Friday that John Allan would step down as chair of Tesco at the supermarket’s annual meeting on 16 June.
The owner of Facebook has taken a more than $260m (£210m) loss on Giphy – selling off the gif search engine to the stock image service Shutterstock for $53m after the deal was blocked by regulators.
Private renters are almost twice as likely to be struggling with problem levels of debt than the general population, with a sharp rise in the numbers in serious financial difficulty since January, research shows.
Dozens of climate activists have disrupted Europe’s largest private jet trade fair by chaining themselves to aircraft to protest against the sector’s carbon emissions….
….while Shell’s annual shareholder meeting in London descended into chaos with more than an hour of climate protests today.
The French billionaire Patrick Drahi has increased his stake in BT to more than 24%, but reiterated that he does not intend to make a bid to take over the £15bn British telecoms group.
South West Water is being investigated by the industry regulator over whether it accurately reported leaks and figures showing how much water is used by its customers.
And National Lottery operator Camelot has signed off with its last ever set of full-year results – showing the second highest in the history of the draw, and record high returns to good causes from ticket sales…
Updated
Shell’s AGM (see earlier post) wasn’t the only event disrupted by climate protesters.
Dozens of climate activists have disrupted Europe’s largest private jet trade fair by chaining themselves to aircraft to protest against the sector’s carbon emissions, my colleague Rupert Neate reports.
The demonstrators on behalf of Greenpeace, Stay Grounded, Extinction Rebellion and Scientist Rebellion also attached themselves to the entrance gates of the event at Geneva airport in the hope of preventing prospective buyers from entering the annual show.
The activists, who were calling for a global ban on the use of private jets because of their carbon footprint, stuck tobacco-style health warning labels on some of the jets at the European Business Aviation Convention and Exhibition (EBACE) saying private jets “burn our future”, “kill our planet”, and “fuel inequality”.
