UK private sector is contracting as firms give ‘thumbs down’ to the budget, hitting pound – as it happened

Time for a recap.Evidence is growing that the UK economy is weakening, while the eurozone is also lurching deeper into trouble … as the US pushes ahead.UK business activity shrank for the first time in over a year this month, according to the latest poll of purchasing managers, in a sign that corporate confidence has been hit by last month’s budget.Chris Williamson, chief business economist at S&P Global Market Intelligence, says:Business optimism has slumped sharply since the General Election, dropping further in November to hit the lowest since late 2022.Companies are giving a clear ‘thumbs down’ to the policies announced in the Budget, especially the planned increase in employers’ National Insurance contributions

Spain fines budget airlines including Ryanair total of €179m

Spain has fined five budget airlines, including Ryanair, a total of €179m (£150m) for charging passengers for hand luggage and seat reservations, prompting the Irish carrier to say banning the practices would “destroy” the ability to offer cheap tickets.Spain’s Consumer Rights Ministry announced the sanctions on Friday, with Ryanair given the biggest fine, of €108m, and easyJet a penalty of €29m.Vueling, the low-cost operation of the British Airways owner IAG, has been fined €39m, and Norwegian Airlines and Volotea have been fined €1.6m and €1.2m

Budget blamed for first contraction in private sector for a year

Labour’s first budget in 14 years has been given the “thumbs down” by private sector businesses as it was blamed for the end to a 12-month run of expansion and a fall in retail sales.Many businesses said the first fall in business activity in November since the same month last year was a result of tax rises announced by the chancellor, Rachel Reeves, while official figures showed retail sales had dropped in October, the first month of the “golden quarter” for retailers that includes the Christmas rush.Manufacturers registered “a solid decline” in new work, and the rate of contraction accelerated to the fastest since February, according to a closely watched survey by S&P Global Market Intelligence.Chris Williamson, the firm’s chief business economist, said the contraction in November was only marginal but reflected deeper concern about the prospects for the year ahead.The S&P Global Flash purchasing managers’ index (PMI) fell from 51

Bitcoin rises after SEC chair says he is to step down when Trump is inaugurated

Cryptocurrencies have risen sharply after one of the industry’s biggest critics, Gary Gensler, said he would stand down as the head of the US financial regulator when president-elect Donald Trump was inaugurated in January.In a post on X, Gensler confirmed he would resign from the US Securities and Exchange Commission (SEC) on 20 January.Trump had previously said he intended to fire Gensler on “day one” of his presidency after the chair of the SEC took legal action against cryptocurrency trading and platforms.“I thank President Biden for entrusting me with this incredible responsibility,” Gensler wrote in the post on X.Gensler was appointed chair of the SEC in 2021 and immediately called on Congress to give him more powers to regulate the “wild west” crypto-sector, saying that it was “rife with fraud, scams and abuse”

The fierce reaction to Australia’s new Future Fund mandate reflects how much has changed since 2006 | John Quiggin

The announcement by the treasurer, Jim Chalmers, that Australia’s Future Fund would be directed to invest in areas of national priority, rather than pursuing a purely commercial investment strategy, has drawn a strong reaction from Peter Costello and John Howard who established the fund in 2006. The ferocity of this reaction is a reminder of how much the world has changed since that time.The fund was established at the high point of neoliberalism, initially using the proceeds of the privatisation of Telstra. The worship of financial markets, and the disdain for public ownership of any kind was at its peak. The guiding principle was the “efficient markets hypothesis” which, in its strongest form, states that the asset prices prevailing in financial markets are the best guide to the returns available to any investment, public or private

Defence firm Thales faces bribery and corruption investigation

The Serious Fraud Office (SFO) is investigating suspected bribery and corruption at Thales Group, a multinational aerospace and defence electronics contractor.The company, which is headquartered in Paris and has a UK subsidiary employing more than 7,000 staff, is known in defence circles for its varied businesses, which include making missiles and launchers, supplying sonar systems for the Royal Navy’s nuclear submarines and designing the Queen Elizabeth-class aircraft carriers.Investigators from the SFO and its French equivalent, Parquet National Financier (PNF), have informed the company of their joint investigation, with each agency concentrating on their respective jurisdictions.The economic crime agencies cooperated on an investigation into Airbus, which resulted in Europe’s largest aerospace multinational paying a record £3bn in penalties in 2020, after admitting it had paid huge bribes on an “endemic” basis to land contracts in 20 countries.Nick Ephgrave, the SFO director, said: “Working collaboratively with our international partners is a crucial factor in the fight against international corruption and with this case I hope to reinforce the SFO and PNF’s longstanding relationship, built on mutual cooperation and shared success