Closing summary
Time for a recap
The pound has slipped back from its highest level against the US dollar since last summer.
Sterling hit a 10-month high of $1.2546 against the dollar early this morning, for the first time since June 2022. It was lifted by data this week showing US inflationary pressures easing and a rise in jobless claims.
But the dollar has picked up some strength this afternoon, after Federal Reserve policymaker Christopher Weller said US central bankers “haven’t made much progress” in fighting inflation, meaning rates must be raised higher.
The latest economic data from the US paints a mixed picture. Industrial production rose by 0.4% last month, but retail sales dropped 1%…. and consumer confidence has risen.
The boss of JP Morgan, Jamie Dimon, has said “storm clouds” threatening the banking sector have grown since last month’s short-lived crisis but the lender is prepared for further turmoil to come after first-quarter profits rose by 52%.
Dimon said:
“The storm clouds that we have been monitoring for the past year remain on the horizon, and the banking industry turmoil adds to these risks.”
Global demand for oil this year is on track to rise to a record 101.9m barrels per day as China leads an economic surge among developing nations, the world’s leading energy body has forecast.
The FTSE 100 is ending the week strongly, up 42 points or 0.55% at 7885, led by banking stocks.
Shares in veterinary medicine maker Dechra Pharmacy have jumped 34% after it confirmed it was in talks over a possible £4.6bn takeover offer.
But fashion brand Superdry has warned that it no longer expects to make a profit this year and may have to raise new funds as a damp spring and the cost of living crisis hit sales.
Lord Simon Wolfson’s pay slumped almost 40% last year to £2.5m as the boss of Next collected smaller bonuses after missing some targets on earnings per share and returns to shareholders.
Leaders of the biggest rail workers union are considering an “updated” offer from train companies aimed at resolving the long-running dispute over jobs, pay and conditions.
The IMF is calling on Western countries to put together a debt relief and aid package to match that of the landmark Gleneagles summit deal in 2005, to fight a severe funding squeeze affecting struggling African countries.
British shoppers are switching from fresh to frozen food as they try to keep down spending amid the cost of living crisis, retail data suggests.
Aldi and Lidl have announced they will cut milk prices to 90p per pint, with Morrisons expected to follow on Monday.
Boeing has revealed that deliveries of its bestselling 737 Max plane will be delayed, in the latest blow to the US manufacturer in its long recovery from a crisis started by the troubled model.
US consumer confidence rises
US consumer confidence has crept up this month, according to the latest data from the University of Michigan.
The Index of Consumer Sentiment rose to 63.5 points for April, up from March’s 62.0, with people more optimistic about current economic conditions and economic prospects.
The University of Michigan’s consumer sentiment comes in higher than expected at 63.5 for the month of April. pic.twitter.com/i9HJ5s9HBF
— Yahoo Finance (@YahooFinance) April 14, 2023
However, Americans are anticipating higher price rises. Year-ahead inflation expectations rose from 3.6% in March to 4.6% in April.
Yes, so about #inflation coming down. Michigan 1-year ahead #inflation expectation just rose the most since 2021, back at 4.6% This is the one that #Powell looks at, right? https://t.co/DJaYjYr5KV pic.twitter.com/udHQ3hXN3m
— jeroen blokland (@jsblokland) April 14, 2023
Surveys of Consumers director Joanne Hsu explains:
Consumer sentiment was essentially unchanged this month, inching up less than two index points from March. Sentiment is now about 3% below a year ago but 27% above the all-time low from last June.
Rising sentiment for lower-income consumers was offset by declines among those with higher incomes. While consumers have noted the easing of inflation among durable goods and cars, they still expect high inflation to persist, at least in the short run. On net, consumers did not perceive material changes in the economic environment in April.
