The BOE will likely have to choose between persistent inflation or a mortgage crisis

The BOE will likely have to choose between persistent inflation or a mortgage crisis

0705 GMT – The Bank of England is expected to accelerate its cycle of interest rate hikes as financial markets have lost faith in the UK’s macroeconomic policy regime, said Pantheon Macroeconomics’ UK chief economist, Samuel Tombs, in a footnote. Raising interest rates to nearly 6% – the level markets are currently pricing in – would crush inflation but lead to a sharp rise in mortgage defaults, he says. A slower rise would weigh on the pound and boost imported inflation, allowing it to stay above target for longer, according to Tombs. This option is the one the BOE is likely to see as the lesser of two evils, although a recession is inevitable as many households and businesses will immediately cut back on spending knowing that higher interest rates and further hikes in prices are ongoing, Tombs said. ([email protected])

 
Companies News: 

SSE PLC sees its adjusted earnings per share increase in the first half; back guidance

SSE PLC said on Tuesday it expects adjusted earnings per share to rise for the first half of the financial year and backed its full-year guidance.

United Utilities reports lower first-half revenue amid inflation and higher power prices

United Utilities Group PLC said Tuesday that revenue for the first half and full year ending March 31 is expected to be lower on the year amid an inflationary environment and higher electricity prices.

UK regulator to consider acquisition of stake in National Grid by consortium

Britain’s competition regulator said on Tuesday it was examining whether the acquisition of a 60% stake in National Grid PLC by Macquarie Infrastructure and Real Assets (Europe) Ltd. and British Columbia Investment Management Corp. could reduce competition.

Weir Group Supports 2022 Views and Targets Operating Margin Growth

Weir Group PLC said on Tuesday it was taking initiatives to boost operating margins beyond 2023 and backed its full-year guidance.

Saga Swung at 1H Pretax Loss; Lowers earnings forecast for the full year

Saga PLC said on Tuesday it turned to a pre-tax loss in the first half despite higher earnings on one-time asset write-downs, and lowered expectations for the full year.

SSP to announce around £2.17bn in sales for financial year 2022 as passenger numbers recover

SSP Group PLC said on Tuesday it expects to report sales of around 2.17 billion pounds ($2.32 billion) for the financial year 2022 as passenger numbers continue to recover, and it remains confident in the continued resilience of its business model.

Biffa accepts £1.3bn offer from ECP, lower than previously reported

Biffa PLC announced on Tuesday that it has agreed to a 1.3 billion pound ($1.39 billion) takeover by Bears Bidco Ltd., a new company formed and controlled by ECP V, LLC, slightly below the price listed on June 7.

Card factory swings to 1H pretax profit as customer spending normalizes

Card Factory PLC on Tuesday reported a change in pre-tax profit in the first half of fiscal 2023, driven by a return to normal in customer spending after the lifting of coronavirus measures.

Domino’s Pizza Group appoints Elias Diaz Sese as interim CEO

Domino’s Pizza Group PLC announced on Tuesday that it has appointed Elias Diaz Sese as interim chief executive, succeeding Dominic Paul, who is leaving to join FTSE 100-listed hotel and restaurant company Whitbread PLC.

Close Brothers’ FY2022 net income fell due to rising costs; Increase the dividend

Close Brothers Group PLC said on Tuesday that profit for the 2022 financial year fell due to higher expenses, but increased its dividend payout.

AG Barr warns of economic challenges ahead despite strong first-half performance

AG Barr PLC said on Tuesday it expects the current economic environment to hurt consumer buying behavior as it reported an increase in pre-tax profit for the first half of fiscal 2023 thanks to an increase in revenues from all its main brands.

The first real estate funds under management fell at the start of the 2023 financial year

First Property Group PLC said on Tuesday that its total funds under management had declined in the 2023 financial year to date following the sale of several properties.

Mortgage advisory office’s first-half pre-tax profit fell amid tough macro environment

Mortgage Advice Bureau (Holdings) PLC said on Tuesday that first-half pretax profit fell in an increasingly difficult macroeconomic environment.

S&U 1H Rose Pretax Earnings; Increase the dividend

S&U PLC said on Tuesday that pre-tax profit for the first half of fiscal 2023 rose on the back of higher revenue and declared a dividend payout.

 
Market Talk: 

SSE PLC 1H update lacked energy but long-term outlook was better

07:01 GMT – SSE PLC’s update ahead of its first-half results looks mildly negative in the near term, given weak renewable energy production and slight delays to the Keadby 2 project, according to RBC Capital Markets. However, the energy company’s full-year forecast of at least 120 pence of adjusted earnings per share has been maintained and that should be the priority for longer-term investors, RBC analysts said in a research note. . “Clearly, despite the hedging, there remains significant uncertainty in the outlook given the volatility in commodities, wintry weather conditions and potential policy interventions in wholesale markets,” the Canadian bank said, while adding that she sees increasing value in the title. RBC maintains its sector performance rating and its price target of 1,825 pence on the share. Shares closed Monday at 1,671.0 pence. ([email protected])

 

Contact: London NewsPlus; [email protected]

(END) Dow Jones Newswire

September 27, 2022 03:37 ET (07:37 GMT)

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