The International Monetary Fund (IMF) said last Tuesday that the UK & Britain will be the best performing of the world’s largest economies in 2014. Along with the US and Germany, the UK economy is now expected to steam ahead as consumer spending rebounds, inflation remains low and unemployment continues falling. In its World Economic Outlook (WEO), published ahead of its spring conference in Washington, the IMF said the UK’s GDP growth would soar to 2.9% this year before returning to its long-term trend of 2.5% in 2015.
The US Federal Reserve released minutes of the March meeting last Wednesday, providing details of the new round of tapering. Fed Chair Janet Yellen shaved off a further $10bn off monthly bond purchases, and also surprised the markets by announcing that the first rise in US interest rates could come six months after the end of quantitative easing (QE). If the Fed keeps up the current pace of asset buying reductions, the programme will end around October.
Business secretary Vince Cable has been recalled by MPs to appear before the business select committee on April 29th regarding the Royal Mail privatisation. A report from the National Audit Office (NAO) condemned the government for undervaluing the postal service and costing taxpayers £750m in a single day. The business secretary will have to answer claims that he botched the sale and allowed City traders to make instant profits at the expense of taxpayers.
In corporate news, the troubled Co-op Bank has delayed the release of its full year financial results for a second time in order to “finalise its accounts”. Last month, the lender was forced to halt the release of its annual report as it made a fresh £400m cash call and warned losses for 2013 could hit £1.3bn. The new fundraising came just months after the Co-op Bank completed a debt-for-equity swap that saw bondholders, including several major US hedge funds, take control of the bank from the Co-op Group.
In a trading statement on Thursday morning, blue-blooded retailer Marks & Spencer (MKS) reported a 0.2% fall in Q4 like-for-like sales, although food sales rose by 0.1% over the same period. Total group sales rose by 1.9%, mainly boosted by a 4.7% hike in international sales, and 12% growth in online.