Inflation Drops in October

The rate of Consumer Prices Index (CPI) inflation in the UK fell slightly to 5% last month, dropping from of 5.2% in September.

Falls in the price of fuel, food and air transport all contributed in driving the inflation rate lower.

Despite the drop, the rate still remains well above the Bank of England's target of 2%.

Retail Prices Index (RPI) inflation, which includes mortgage interest payments, made a similar drop from 5.6% to 5.4%.

Despite the fall, the government said it recognised that inflation remained high.

A Treasury spokesperson said, "These are difficult times for households as prices continue to be affected by conditions in the global oil and gas markets."

Food prices were driven down by heavy supermarket discounting and good harvests, according to the Office for National Statistics.

Air fares, which are historically very changeable, fell by 6% compared to the previous month.

Petrol also fell by 0.5p a litre, reflecting falls in the price of crude oil due to the weakening global economy.

Upward pressure on prices came from increases in the cost of clothing, electricity and gas.

Price rises from all the major energy suppliers have increased domestic fuel bills and are also expected to push up November's inflation figures.

The prolonged period of high inflation has made it difficult for savers to keep up with rising prices.

According to the Moneyfacts financial information service, there is no standard savings account currently available which would allow people to ensure their savings keep up with inflation, after tax is taken into account.

"Over the last year, the number of savings accounts that beat inflation for basic-rate taxpayers has dropped successively from 91 to absolutely none, which leaves savers in an impossible position," said Sylvia Waycot from Moneyfacts.

Posted at 04:07PM Nov 15, 2011 by Marc Stenton in The Economy  |  Comments[0]

Company Confidence Dropping

Business confidence has plummeted by a record amount as fears persist the economy is set to contract in the final quarter this year.

The BCM Confidence Index collapsed from +8.1 in the third quarter to -9.7, according to the latest figures.

The index is now at its lowest level since the 2009 recession, fuelling concerns the economy will shrink by some 0.2% in the final quarter.

This would mean that the growth for 2011 would end up at 0.9%, far short of the 1.7% predicted early in the year.

The index revealed confidence across all business sectors has fallen, with just energy, water and mining remaining in positive territory at +2.3.

The property sector is in the weakest position with confidence tumbling to -18.7, followed by banking, finance and insurance with -14.6.

Michael Izza, Chief Executive of ICAEW, said, "In the first nine months of the year, businesses have played their part in supporting economic growth.

"Many are proud of their success against a backdrop of a very slow and protracted recovery. Yet they are becoming increasingly worried about the immediate outlook and the risk of a double dip recession.

"They are looking to the Government which now needs to take urgent steps to restore business confidence and to show that it understands the need to rapidly change the mood that the business community clearly feels."

Turnover and profit growth expectations have now declined for two successive quarters, which has been compounded by a steep drop in capital investment growth expectations.

In total, more than 60% of UK companies are operating below capacity with the number of new employees expected to increase by just 0.9% as companies refrain from taking on new staff.

Grant Thornton CEO, Scott Barnes said, "The extent of negative sentiment in underlying business performance indicators, with confidence dropping across the UK's regions and sectors, is worrying.

"Where they can, businesses need to make the most of opportunities in growing Asian and BRIC economies to maintain demand and safeguard future growth while keeping a close eye on cost and efficiency."

Posted at 03:37PM Nov 10, 2011 by Marc Stenton in The Economy  |  Comments[0]

Personal Insolvencies Drop

Bankruptcies have hit their lowest levels since 2004 as fewer people were declared insolvent in the third quarter of this year.

But analysts warned that the figures did not give the full picture of those with severe debts.

The Insolvency Service said individual insolvencies overall in England and Wales decreased to 30,219 in the third quarter, down from 30,513 in the three months to June.

The latest figure represents a 1% drop on the previous quarter and an 11% fall on the same period last year. Of this figure, the number of bankruptcies has tailed off to 9,567, a sharp fall of almost a third (31.2%) on the same period last year.

The last time there were so few bankruptcies was in 2004, when there were 8,999 in the last three months of that year.

Meanwhile, the number of debt relief orders stands at 7,604, a 7.6% rise on the same time last year and individual voluntary arrangements (IVAs) are up 0.7% on last year, with 13,048 people entering into an IVA between July and September.

The previous personal insolvency figures had represented a rise on the first quarter of this year, when insolvencies stood at 30,145.

Before the previous quarter's figures, personal insolvencies had been falling, despite the tough economic background which has seen stagnating house prices, job uncertainty and rising living costs.

Posted at 04:44PM Nov 08, 2011 by Marc Stenton in Personal Finance  |  Comments[0]

Plymouth Come Out of Administration

Football club Plymouth Argyle can finally look forward to a better future after a takeover deal by local businessman James Brent was given the green light to finally bring the stricken club out of Administration.

The board of the Football League have agreed to transfer Plymouth's league share to Brent's Green Pilgrim Limited company and bring to an end the sorry chapter in the club's history.

But Football League chief Greg Clarke warned the deal 'required a significant leap of faith by the board' and promised to keep an eye on the Pilgrims' finances in future.

He said, "I would like to welcome James Brent to the Football League and thank him for the efforts he has made to help save Plymouth Argyle Football Club.

"It is important to place on record that his takeover proposals have required a significant leap of faith by the board, which it has agreed to take in order to preserve the future of professional football in Plymouth.

"In seasons ahead, the League will closely scrutinise the financial affairs of the club to ensure that the promises made to the board are kept.

"For many months staff have worked without pay and without any certainty that they would receive money owed to them or even have a job in future.

"Without their collective resilience there would not be a professional football club in Plymouth on Monday.

"I would also like to thank Plymouth City Council. By agreeing to purchase Home Park they have ensured that the Pilgrims can continue making an important contribution to people living in the local community.

"Finally, I would like to thank Plymouth supporters for their patience and continued support of their club. Hopefully, this will be the start of a better future for Plymouth Argyle."

Plymouth currently prop up the entire football league, sitting bottom of it’s fourth tier, two divisions lower than when their financial difficulties began.

Posted at 04:36PM Nov 02, 2011 by Marc Stenton in Sport Finance  |  Comments[0]