Aurelia Butler

Here are some of the layoffs announced since the start of October:BANKS* SANTANDER: The Spanish bank said in October it would cut more than 1,400 jobs in its British business.* UNICREDIT: The Italian bank has signed an agreement with labour unions that included 1,000 voluntary redundancies and 500 new jobs, Italy’s banking union Fabi said on Oct. 17.CAR AND CAR PARTS MAKERS* BOSCH: Staff reduction schemes at the world’s biggest car parts supplier have put 8,000-10,000 jobs at risk in Germany, its deputy supervisory board chairman said on Dec. 11. One of those plans is for 3,500 job cuts in its cross-domain computer solutions division by end-2027, half of which will be in Germany.* MICHELIN: The French tyre maker will shut down two sites in Western France, affecting about 1,250 jobs, it said on Nov. 5.* SCHAEFFLER: The German machine and car parts maker, hit by weak demand from auto and industrial clients, said on Nov. 5 it planned to cut 4,700 jobs. As part of these measures, it will close two plants in Austria and Britain, it said on Nov. 27.* STELLANTIS: The Milan-listed automaker said on Nov. 26 it planned to shut its Vauxhall van factory in southern England, putting more than 1,000 jobs at risk.* VALEO: The French car parts supplier plans to cut around 1,000 jobs in Europe, including the closure of two sites in France, sources told Reuters on Nov. 27.INDUSTRIALS AND ENGINEERING* THYSSENKRUPP: The German conglomerate’s steel-making division said on Nov. 25 it planned to cut 5,000 jobs by 2030 and an additional 6,000 jobs through spin-offs or divestitures.RETAIL AND CONSUMER GOODS* AUCHAN: The French supermarket group said on Nov. 5 it planned to cut more than 2,000 jobs amid falling traffic in its stores.* HUSQVARNA: The Swedish garden equipment maker said in October it would cut around 400 jobs, hit by constrained consumer spending.OTHERS* AIRBUS: The French aerospace group said on Dec. 5 it would cut just over 2,000 jobs in its Defence and Space business, fewer than the initially announced 2,500.* EQUINOR: The Norwegian oil, gas and renewable energy producer is cutting 20% of the staff from its renewable energy division, it told Reuters on Nov. 21.* IDORSIA: The Swiss pharmaceutical company said on Nov. 27 it would shed up to 270 jobs as part of its restructuring efforts. * LUFTHANSA: The German flag carrier aims to gradually reduce jobs in administration by 20%, the Manager Magazin reported on Nov. 14.* MONDI: The British packaging maker said in October it would shut down a paper mill in Bulgaria after it was damaged by a fire, affecting around 300 positions.* NOVARTIS: The Swiss drugmaker is closing German biotech firm MorphoSys, acquired at the start of 2024, German news outlet WirtschaftsWoche reported on Dec. 19, saying 330 jobs would be affected.* SMA SOLAR: The German solar power parts supplier said on Nov. 13 it planned to cut up to 1,100 jobs worldwide.* SYENSQO: The Belgian chemicals maker said on Nov. 5 it would cut 300-350 jobs primarily in France, the U.S., Belgium and Italy.* UPM: The Finnish forestry group said on Nov. 27 it would close a plant in Kaltenkirchen, Germany, affecting 154 jobs, its latest in a string of closures this year. In October, it said it may cut up to 110 jobs in the Fibres Finland unit. * YARA: The Norwegian fertiliser maker said on Oct. 15 that planned production changes at its Tertre plant in Belgium, including the closing of its ammonia unit, could result in a dismissal of around 115 workers.Source: Regulatory filings, Reuters articles and company websites More

According to the Monetary Policy Committee (MPC), the Autumn Budget’s policy measures are expected to enhance GDP by 0.75% within a year and contribute an additional 0.5% to the Consumer Price Index (CPI) at its peak.The MPC has revised its short-term growth and CPI forecasts upward, signaling that there is no longer any spare capacity in the UK economy for the coming year. Furthermore, the MPC has indicated a preference for gradual easing if economic developments align with their expectations, setting a higher threshold for any further rate cuts in December.However, the MPC did leave a narrow possibility open for a rate reduction in December, contingent on significant negative developments in domestic prices and wages that would imply a quicker return of inflation to the target rate. The upcoming reports on growth, inflation, and the labor market will be crucial in assessing the validity of the BoE’s forecasts and could influence the MPC’s decision-making process in the lead-up to the next meeting in December.This article was generated with the support of AI and reviewed by an editor. For more information see our T&C. More

MOSCOW (Reuters) -The Russian economy is showing signs of overheating which is stoking worryingly high inflation, President Vladimir Putin said, expressing hope for a “balanced” rate decision by the central bank when it meets on Friday.Addressing Russians in his annual phone-in, Putin generally backed the central bank’s tight monetary policy but also suggested it could have acted in more timely fashion.The regulator is expected to hike its key interest rate aggressively by 200 basis points to 23%, the highest level in over 20 years. Its successive rate rises have prompted strong criticism from businesses. “There are some issues here, namely inflation, a certain overheating of the economy, and the government and the central bank are already tasked with bringing the tempo down,” said Putin. Putin said he had had a conversation with central bank governor Elvira Nabiullina before Thursday’s phone-in, who had warned him that inflation would be 9.2%-9.3% in 2024, well above the central bank’s estimate of 8.5%. Putin said Nabiullina had not told him what the rate decision would be. “I hope that it will be balanced and meet the needs of today,” he said.Putin said that as a result of the tight monetary policy and government measures to cool the economy down, economic growth rates will come down in 2025 from this year’s 4%.”I think the (growth rate) next year should be somewhere around 2-2.5%, a sort of soft landing in order to maintain macroeconomic indicators,” Putin added.INFLATION IS A BAD THINGPutin said that the central bank could have used instruments other than the key rate earlier to cool down the economy, while the government could have worked with different sectors of the economy to boost supply. “It would have been necessary to make these timely decisions. This is an unpleasant and bad thing, in fact, the rise in prices. But I hope that in general, while maintaining macroeconomic indicators, we will cope with this too,” he said.Putin said that Western sanctions, as well as this year’s bad harvest due to extreme weather in many agricultural regions across Russia, were also to blame for high prices. Stubbornly high inflation, driven in recent months by soaring food prices, has hit Russians’ pockets. Latest inflation data showed prices for tomatoes rising by 4.1% and prices for cucumbers by 10% during one week in December.This time last year, Putin was forced to issue a rare apology over rising prices for eggs. A year on, the spiralling cost of butter has prompted thefts at some supermarkets. Households’ inflationary expectations, a key gauge for the central bank, hit this year’s highest level this month. Grigory Zakuraev, a factory worker, told Reuters that 1,000 roubles at the supermarket goes far less than it did three years ago. “Everything has gone up in price,” he said. “Of course, you feel it on the wallet, the change in prices, inflation.” More

LONDON (Reuters) -Bank of England policymakers split over whether to cut interest rates on Thursday with more officials than expected seeking to help the slowing economy with lower borrowing costs despite lingering inflation pressure.The BoE kept its benchmark Bank Rate on hold at 4.75% – as widely expected – but three of the Monetary Policy Committee’s nine members voted to cut them to 4.5%: Deputy Governor Dave Ramsden and external members Swati Dhingra and Alan Taylor.Economists polled by Reuters had expected only one MPC member to vote for a cut. Sterling fell by a third of a cent against the U.S. dollar after the decision was announced.Governor Andrew Bailey said the central bank needed to stick to its existing “gradual approach” to cutting rates.”With the heightened uncertainty in the economy we can’t commit to when or by how much we will cut rates in the coming year,” he said.Economists polled by Reuters last week forecast the BoE would cut rates four times next year. But financial markets have scaled back their expectations sharply in response to faster-than-expected wage growth and only see up to two cuts.Interest rate-sensitive British two-year government bond yields fell sharply before partially recovering to stand around 2 basis points lower than before the decision. Interest rate futures priced in less of a chance of a rate cut in the immediate future – down to a one-in-three possibility at the BoE’s next meeting in February from two-in-five earlier. Expectations for 2025 as a whole were little changed.”The MPC’s ability to ease interest rates next year will be constrained by the challenging inflation backdrop,” Yael Selfin, chief economist at KPMG UK, said.”This will put the BoE in a unique position relative to its counterparts in Europe, particularly the ECB, where a weakening growth outlook increases the urgency to cut rates,” she added.But Suren Thiru, economics director at accountancy body ICAEW, said there were signs the BoE could move more quickly.”The split vote decision and the dovish tone of the minutes suggest that a February interest rate cut remains very much in play, if not yet a done deal,” he said.SLOWER RATE CUTSThe BoE has already been less willing to cut rates than either the U.S. Federal Reserve or the European Central Bank, reducing rates by just half a percentage point this year.Official figures on Wednesday showed British consumer price inflation rose to 2.6% in November – the highest in the Group of Seven rich economies by a small margin, and slightly higher than the BoE itself had forecast last month.”Headline inflation is expected to continue to rise slightly in the near term,” the BoE said.However, the central bank also cut its growth forecast for the final quarter of this year to zero from a 0.3% forecast just six weeks ago.Britain’s economy contracted in September and October – the first back-to-back monthly falls in output since 2020 – according to official data last week and business sentiment has tumbled since finance minister Rachel Reeves announced a 25 billion pound tax hike for employers in her Oct. 30 budget.MPC members who backed keeping rates on hold said it remained “particularly uncertain” whether these higher costs would be passed on to consumers through higher prices or lead to job losses and slower pay growth.”Recent developments added to the argument for a gradual approach to the withdrawal of policy restrictiveness, while eschewing any commitment to changing policy at a specific meeting,” they said.The three MPC members who voted to cut rates said a “very restrictive” policy stance risked pushing inflation too far below its 2% target in the medium term and creating an unduly large amount of spare capacity in the economy. More

LONDON (Reuters) – The Bank of England wrapped up a big year of central bank rate cuts by keeping rates steady on Thursday, a day after the Federal Reserve eased policy but suggested it would be more cautious in 2025. Seven of the world’s 10 major, developed-market central banks cut rates this year, with only Australia and Norway still on hold. Japan, the outlier, is in hiking mode. 1/ SWITZERLAND The Swiss National Bank, which has been at the forefront of monetary easing, cut rates by an unexpectedly large 50 basis points (bps) to 0.5% last week, the lowest since November 2022 and the bank’s biggest reduction in almost a decade. Swiss annual inflation was most recently reported at just 0.7% and the SNB, which is alert to the safe-haven Swiss franc strengthening beyond levels domestic exporters can bear, said it could reduce borrowing costs again next year. 2/ CANADA The Bank of Canada also cut rates by 50 bps to 3.25% last week, marking the first time since the COVID-19 outbreak that it has implemented consecutive half-point cuts. It indicated further easing would be gradual after annual inflation accelerated to 2%, but with Canada’s weak economy threatened by U.S. President-elect Donald Trump’s proposed tariffs, markets placed 50% odds on a 25-bps cut next month. 3/ SWEDENSweden’s Riksbank cut rates by a quarter-point to 2.5% on Thursday, in line with expectations, but signalled it can slow its easing pace in early 2025 after 150 bps of cuts so far this year. The central bank said it favours a more tentative approach – noting that monetary policy affects the economy with a lag. 4/ NEW ZEALAND New Zealand’s economy sank into recession in the third quarter, Thursday data showed, a dire result that cements the case for more aggressive rate cuts.The Reserve Bank of New Zealand next meets in February and its governor says there is scope for a 50-bps cut.It has lowered its cash rate by 125 bps to 4.25% so far this cycle and markets are pricing around another 100 bps of cuts by the middle of next year. 5/ EURO ZONEThe ECB is firmly in easing mode, cutting its deposit rate by 25 bps to 3% last week in its fourth such move this year and keeping the door open to further reductions. It also signalled that further cuts are possible by removing a reference to keeping rates “sufficiently restrictive”, economic jargon for a level of borrowing costs that curbs economic growth.Markets price in roughly 110 bps worth of further tightening by end-2025.6/ UNITED STATES The Federal Reserve cut rates on Wednesday, as expected, but Chair Jerome Powell said more reductions in borrowing costs now hinge on further progress in lowering stubbornly high inflation. That jolted markets, sending stocks down sharply and bond yields higher as investors dialled back expectations of rate cuts for 2025. 7/ BRITAIN The Bank of England kept its main interest rate unchanged at 4.75% on Thursday but policymakers became more divided about whether rate cuts were needed to tackle a slowing economy.The more dovish tone sparked a rally in UK government bond prices, pushing yields down. Still, markets price in less than a 50% chance of a 25-bps rate cut when the BoE next meets in February.8/ NORWAY Norway’s central bank held its policy rate steady at a 16-year high of 4.5% on Thursday.Looking forward, the Norges Bank believes that while restrictive policy is still needed, the time to begin easing is approaching and it expects to start lowering borrowing costs in March next year. 9/ AUSTRALIA The Reserve Bank of Australia held rates steady at a 12-year high of 4.35% last week but softened its tone on inflation, raising the market-implied probability of a quarter-point cut in February to more than 50%. The RBA, which has not changed borrowing costs for more than a year, has taken note of a surprise economic growth slowdown as high rates deterred households from spending despite a recent round of tax cuts. 10/ JAPAN The Bank of Japan, the only G10 central bank in a hiking cycle, kept interest rates unchanged on Thursday, as expected, but markets seized on remarks from governor Kazuo Ueda suggesting the BOJ preferred to wait for Spring wage data before moving again. Investors had seen a January rate increase as likely, and their reassessment of this sent the yen and bond yields tumbling. More

WASHINGTON (Reuters) – The U.S. Congress has two days to avert a partial government shutdown after Republican President-elect Donald Trump rejected a bipartisan deal late on Wednesday and demanded lawmakers also raise the nation’s debt ceiling before he takes office next month.Trump pressured his fellow Republicans in Congress to reject a stopgap bill to keep the government funded past the deadline of midnight on Friday. Absent congressional action, the U.S. government will begin a partial shutdown on Saturday that would disrupt everything from air travel to law enforcement in the days leading up to the Dec. 25 Christmas holiday. The bipartisan deal reached on Tuesday would have extended funding through March 14.Trump warned that Republicans who vote for the current legislative package could have trouble getting re-elected because they will face primary challenges inside their own party.”Any Republican that would be so stupid as to do this should, and will, be Primaried,” Trump wrote on his Truth Social platform.If it were to materialize, it would be the first government shutdown since one that extended through December 2018 into 2019, during Trump’s first four-year White House term.Trump is now calling on Congress to pass legislation that would tie up loose ends before he takes office next month by raising the government’s borrowing authority – a politically difficult task – and extending government funding. He also said lawmakers should strip out elements of the deal backed by Democrats, whose support would be necessary for passage.Trump’s comments came after his ally Elon Musk, who has been tasked by Trump to prune the federal budget, pressured Congress to reject the bill and said those who back it should be voted out of office.TALKS CONTINUED LATE INTO THE NIGHTAfter a meeting with Vice President-elect JD Vance and other top Republican leaders late on Wednesday, Republican House of Representatives Speaker Mike Johnson said there was a “productive conversation,” without giving details.”I’m not going to say anything else about it tonight because we are in the middle of these negotiations,” Johnson said.When asked if raising the debt ceiling will be part of an agreement being worked on, House Republican leader Steve Scalise said lawmakers were “not there yet.” House Appropriations Committee Chair Tom Cole, who was also at the meeting, was asked if he was confident there would not be a government shutdown. He replied: “I’m not confident of anything.”NEXT STEPS REMAIN UNCLEARThe next steps for Congress were unclear. Bipartisan agreement will be needed to pass any spending bill through the House, where Republicans currently have a 219-211 majority, and the Senate, where Democrats currently hold a narrow majority. The White House of Democratic President Joe Biden, who remains in power until Trump takes office on Jan. 20, said on Wednesday that “Republicans need to stop playing politics” and that a government shutdown will be damaging.The current bill would fund government agencies at current levels and provide $100 billion for disaster relief and $10 billion in farm aid. It also includes a wide range of unrelated provisions, such as a pay raise for lawmakers and a crackdown on hidden hotel fees.Trump said Congress should limit the bill to temporary spending and disaster relief and also raise the national debt ceiling now before it comes to a head next year.The stopgap measure is needed because Congress has failed to pass regular spending legislation for the fiscal year that began on Oct. 1. It does not cover benefit programs like Social Security, which continue automatically.The U.S. government has spent more money than it has taken in for over 20 years, as Democrats have expanded health programs and Republicans have cut taxes.Steadily mounting debt – currently $36 trillion – will force lawmakers to raise the debt ceiling at some point, either now or when borrowing authority runs out next year. Failure to act could have potentially severe economic consequences. More

ORLANDO, Florida (Reuters) -The end of the Federal Reserve’s interest rate-cutting cycle is suddenly in sight, and a complete U-turn with rate hikes next year can no longer be ruled out.    The Fed lowered the fed funds rate by 25 basis points on Wednesday to a target range of 4.25%-4.50%, as expected. But if ever there was a “hawkish cut”, this was it.     The market reaction was swift and powerful: the dollar soared to a two-year high, stocks slumped, and Treasury yields surged. Markets can overshoot on days like these, but there was plenty here to back up the moves, whether investors were looking at the Fed’s statement, its revised projections or Chair Jerome Powell’s press conference.    First, the decision to cut wasn’t unanimous, as Cleveland Fed President Beth Hammack dissented. And Powell called the 25 bps cut a “closer call” than recent decisions. He also said that monetary policy is now “significantly less restrictive” and “significantly closer to neutral”.    Additionally, policymakers significantly raised their median 2025 inflation outlook to 2.5% from 2.1%, upped their view of the long run neutral rate of interest again to a six-year high of 3.0%, and halved the number of projected rate cuts next year to two.    While the Fed’s new projections are still pointing to 50 bps of easing next year and 100 bps by the end of 2026, the rates markets are having none of it. They’re now pricing in only 35 bps of cuts next year and that’s pretty much it. No more.    In short, the market is essentially calling the Fed’s bluff.     That’s largely because of the head-scratching logic behind the Fed’s 2025 outlook: policymakers expect inflation to be much higher than they had previously thought, yet they’re still planning to cut rates. It’s a difficult circle to square, as Powell discovered in his press conference.    The stance might be more defensible – and less jarring for markets – if growth and employment were also cratering. But they’re not. The Fed’s projections for both barely changed, with economic activity and the labor market expected to remain strong into 2026.NEVER RULE ANYTHING IN OR OUT    Only one year after Powell’s dovish pivot, markets may now be considering the possibility of a turn the other way.     Torsten Slok, chief economist at Apollo Global Management (NYSE:APO), was one of the first on the Street to float the idea that interest rates may actually rise next year. Wednesday’s developments have only reinforced his view that the economy is strong and thus rates will need to stay higher for longer.     “I believe there is now a 40% probability that the Fed will hike in 2025,” Slok said after the meeting.    It’s not an outlandish call, considering interest rate markets are anticipating that the Fed will begin an extended pause at its next meeting that will last well into 2025. The next quarter point rate cut is not fully priced in until September.    Of course, a lot can happen in nine months, especially given that President-elect Donald Trump is returning to the White House in January. If his proposed trade policies and tariffs are deployed, inflation could heat up, complicating the Fed’s job even more.    Economist Phil Suttle reckons this could force the Fed’s hand.     “My view remains that the next move from the Fed will be a hike in July, after a tariff-driven rise in inflation in the second quarter,” he wrote on Wednesday.    True, financial markets are not explicitly pricing in a U-turn from the Fed, and Powell on Wednesday dismissed the prospect as an unlikely outcome.     But the dollar is up 8% since the Fed’s first rate cut in September, and Treasury yields have risen 80 basis points. That suggests some segments of the financial universe are already anticipating tighter policy.     As Powell also said on Wednesday when asked about a possible rate hike next year: “You don’t rule things completely in or out in this world.”     Given how lousy the market has been at predicting Fed policy over the last few years, keeping an open mind is probably a very good idea.    (The opinions expressed here are those of the author, a columnist for Reuters.)(By Jamie McGeever; Editing by Michael Perry) More