Closing summary
Our main stories today:
The anticipated post-election bounceback in the UK economy failed to materialise as activity flatlined in July for a second month, according to the latest official data.
The Office for National Statistics (ONS) said the pre-election stalling of activity in June was followed by another month in which gross domestic product remained unchanged.
Although the economy grew by 0.5% in the three months to July, the weak performance of the economy during Labour’s first weeks in power came as a shock to the City, which had been expecting growth of 0.2% on the month.
The economy grew by 0.7% in the first three months of 2024, followed by a 0.6% expansion in the second quarter, but the latest ONS figures suggest the recovery from the mild recession in late 2023 has petered out.
Price growth continued to soften in the US last month, as the Federal Reserve prepares to cut interest rates for the first time since the start of the pandemic at next week’s meeting.
As inflation continues to fade, the consumer price index rose at an annual rate of 2.5% in August – down from 2.9% in July, and below the 2.6% expected by economists. However, the core rate of inflation, which strips out volatile food and energy costs, remained at 3.2%.
The British steel industry has suffered a blow after confirmation that 2,500 jobs will go at the Port Talbot steelworks despite a £500m taxpayer-backed deal for the south Wales plant.
The business secretary, Jonathan Reynolds, has agreed a deal in which the government will provide £500m towards the construction of a new greener electric arc furnace at the site, with the plant’s Indian owners, Tata Steel, paying £750m.
However, while the deal secures the long-term future of steel production at the south Wales site, the government was unable to secure guarantees that would save the 2,500 jobs at Port Talbot that Tata was likely to cut over the coming months.
Thank you for reading. We’ll be back tomorrow. Take care! – JK
Manchester United posts loss for fifth year running
Manchester United’s new chief executive has said that the football club is working towards improving performance on and off the pitch, after posting a financial loss for the fifth year running following a poor 2023-24 season.
United have embarked on a number of changes since British billionaire Jim Ratcliffe acquired a 25% stake in the club and over the summer managed to secure new players, many of whom are under 25 years of age.
Omar Berrada, who was appointed CEO in July after moving from Manchester City’s parent company, City Football Group, said:
We are working towards greater financial sustainability and making changes to our operations to make them more efficient, to ensure we are directing our resources to enhancing on-pitch performance.
Our clear objective is to return the club to the top of European football.
United’s net loss ballooned to £113.2m in the year to 30 June, from £28.7m the previous year. This is only the second time since the New York listing in 2012 that the club’s annual net loss exceeded £100m. Shares were 5% lower in US premarket trading.
United finished eighth in the Premier League last season, their lowest position since the league’s inception. This season hasn’t started any better, with two losses in the first three games.
Earlier this month, Berrada said manager Erik ten Hag had the full backing of the club.
For the coming year, the club expects an adjusted core profit between £145m and £160m, and revenues between £650m and £670m. It reported adjusted core profit of £147.7m on record revenues of £661.8m in the latest year.
It said the estimate reflects the impact of recent restructuring initiatives, including plans for 250 job cuts.
Since Manchester United was acquired in 2005 the Club has made cumulative pre-tax losses of £483m and paid net interest costs on loans of £969 million. pic.twitter.com/XRDfaKarbP
— Kieran Maguire (@KieranMaguire) September 11, 2024
