Aurelia Butler

Pubs, restaurants and other eligible hospitality and leisure businesses will be able to claim cash grants worth up to 6,000 pounds each, the U.K. Chancellor of the Exchequer said Tuesday in a pooled broadcast interview. He also unveiled extra cash for cultural institutions and to compensate companies for sick pay.The move aims to end a growing clamor from firms for more support, amid what the Confederation of British Industries has called a “lockdown by stealth” as Britons steered clear of social gatherings to avoid the virus. Until now, the Treasury had pointed to measures already in place including grants, lower sales tax and business rates relief, but companies had called for more.“The current situation is very difficult, especially for those in the hospitality industry,” Sunak said. Asked about the prospect of new restrictions, Sunak repeated Boris Johnson’s message that ministers can’t rule anything out. “We’re just dealing with an enormous amount of uncertainty at the moment.”Sunak did, however, hint that the Treasury is prepared to step in with more assistance if tighter curbs are introduced, saying he will “always respond proportionately and appropriately to the situation that we face.”Sunak said the grants are comparable in size to those in place earlier this year when businesses were required to shut. A further 30 million pounds will go into a pot to help cultural institutions such as museums and theaters.Dire WarningsThe lobby group UKHospitality said Monday that December is set to be a “disaster” for the industry, with many businesses losing 40% to 60% of their trade. It warned companies would fold without government support.The opposition Labour Party has criticized Sunak for his “radio silence” on the crisis, while the Night Time Industries Association urged him to “come out of hiding.” The chancellor was ultimately forced to cut short a work visit to California to jet back for talks with industry groups.The assistance announced Tuesday falls short of demands by business groups who also wanted to see extensions to tax breaks beyond March and relaxed repayment terms on government-backed loans. Some industry chiefs had also wanted to see a return of Sunak’s flagship furlough program, through which the government splurged 70 billion pounds, paying up to 80% of the wages for 11.7 million jobs through to its end in September this year.The new economic measures come with Johnson’s cabinet in disagreement over when and whether to bring in new curbs to stem the omicron surge. Doing so would be politically risky for the prime minister, who is also boxed in by opposition in his Conservative Party, with ministers — including Sunak — demanding further data on the severity of omicron.Restless ScientistsThe government’s Scientific Advisory Group for Emergencies, or SAGE, warned last week that “more stringent measures would need to be implemented very soon” to avoid daily Covid hospitalizations rising to at least 3,000, piling pressure on the National Health Service.Johnson on Monday held off on bringing in new restrictions, saying that while his ministers didn’t exclude doing so if needed, for now they needed more information, even as daily cases soar above 90,000.Earlier, Cabinet minister Steve Barclay suggested no steps will be taken before Christmas, telling LBC Radio: “We’re saying to people they should continue with Christmas, but in a cautious way.” He later told the BBC ministers must be “clear-eyed” about the economic consequences of any curbs.SAGE said bringing back some of the restrictions used earlier in the year — including limits on household mixing and the closing of hospitality venues — could “substantially reduce” the peak in cases. One option they suggested was going back to so-called Step 2 restrictions in Johnson’s roadmap for emerging from the last lockdown. That included pubs and restaurants only being able to serve customers outdoors, a ban on indoor mixing between households and a maximum of six people or two households being allowed to interact outdoors.Johnson has so far resisted imposing some of the measures recommended by his scientists, and he’s promised Parliament would get a chance to vote on new curbs if he did bring them in. Recalling MPs would need at least a day’s warning, and U.K. papers have reported that may come after Christmas, with new rules taking effect before January. More

BERLIN (Reuters) -German consumer morale will deteriorate further at the start of next year, a survey showed on Tuesday, as the COVID-19 pandemic and the rise of the Omicron variant push Europe’s largest economy to the brink of a recession during the winter.The Nuremberg-based GfK market research institute said its consumer sentiment index, based on a survey of about 2,000 Germans, fell to -6.8 points heading into January, against a revised -1.8 points a month earlier.The January reading was the lowest since June and compared with a Reuters forecast for a smaller drop to -2.5.The Berlin-based DIW research institute said it expects the country’s economy to shrink in the last quarter of the year.At the same time, prospects for the first quarter of 2022 look grim as industry continues to suffer from supply shortages and consumption could be further hit by restrictions, DIW said.The Ifo economic institute this month said it expected Germany’s economic output to shrink by 0.5% on the quarter over October to December and stagnate from January to March.This would bring Germany close to a technical recession, defined as two consecutive quarters of contraction.GfK economist Rolf Buerkl said the high infection rates of the fourth coronavirus wave, triggered by the Delta variant, has already resulted in restrictions for retailers and service providers this month.Germany banned unvaccinated people from entering non-essential establishments at the beginning of the month in an attempt to limit the spread of the disease.The so-called 2G rule – which restricts access to vaccinated or recovered people – has hit the Christmas business badly, Buerkl added.”The outlook for the beginning of next year is also subdued against the background of the rapid spread of the Omicron variant,” Buerkl said.The renewed restrictions have led to temporary job cuts in hospitality, tourism as well as leisure and entertainment, Ifo economist Klaus Wohlrabe said.German Chancellor Olaf Scholz and premiers of the country’s 16 states are expected to discuss further restrictions at a pandemic emergency meeting later on Tuesday.Among measures under consideration are tougher contact restrictions and an accelerated vaccine booster campaign after experts warned that the Omicron variant could bring critical infrastructure to a breaking point.The German economy is projected to rebound with a weaker than previously expected annual growth rate of 2.6% this year after its pandemic-related plunge of 4.6% in 2020. This means it will not reach its pre-crisis level before next year.For 2022, the government forecasts a growth rate of 4.1%. More

Investing.com — President Joe Biden will speak on the deteriorating situation with regard to Covid-19 in the U.S. as new infections hit a record high. European power and gas prices surge another 10% as Russia keeps its gas deliveries to a minimum. Stocks are set to open higher after upbeat earnings from Micron (NASDAQ:MU) and, to a lesser extent, Nike (NYSE:NKE). The Democratic Party is punting a vote on its key spending bill to next year, and the American Petroleum Institute releases weekly inventory data. Here’s what’s moving markets on Tuesday, 21st December. 1. U.S. Covid-19 cases jump as Omicron becomes dominant strainOmicron is already the dominant strain of the Covid-19 virus in the U.S. and spreading fast, according to new estimates from the Centers for Disease Control. The CDC estimated that it accounted for over 70% of new cases in the week through Saturday, up from only 11% the previous week.Overall infection rates have nearly doubled in that time, hitting an all-time peak of 298,000 on Monday, according to New York Times data. While there is no corresponding rise in hospital admissions to be observed, the rapid spread is already having an effect on the retail and hospitality sectors, as well as forcing a broader increase in absenteeism due to self-isolation.President Joe Biden will speak on pandemic issue later but is not expected to announce any new restrictions on mobility. The Biden administration said it will distribute 500 million free at-home testing kits to help stem the tide. 2. European power prices at new records as Russian gas dries upEurope’s energy crisis took a fresh turn for the worse as incremental Russian gas supplies through a key pipeline dried upWholesale prices for spot power in Germany hit 425 euros ($480) a megawatt-hour, while benchmark natural gas prices in the Netherlands touched the equivalent of $50 per million Btu – around 12 times the corresponding price in the U.S. Low renewables output is also forcing utilities to burn more gas to generate power, draining storage that is already far below the usual levels for this time of year.The stand-off between Russia and the EU and U.S. over Ukraine continues to overshadow events, with an estimated 175,000 Russian troops massed on the Ukrainian border.3. Stocks set to open higher after Nike, Micron earnings cheerStocks are set to bounce from their harsh sell-off at the start of the week, as strong earnings from chipmaker Micron encouraged a slightly more bullish reassessment of the current situation.By 6:30 AM ET (1130 GMT), Dow Jones futures were up 335 points, or 1.0%, while S&P 500 futures were up by a similar amount and Nasdaq 100 futures were up by 1.1%.Micron reported bumper earnings thanks to sustained high demand from data centers and the auto sector. Its report was more upbeat than that of Nike, which warned that the rebound in sales growth and margins would start to weaken in the current quarter, against a backdrop of its Vietnamese suppliers still only working at 80% of capacity. General Mills (NYSE:GIS) reports earnings before the open.4. Dems punt BBB to next yearThere will be no vote on the Build Back Better bill until the new year, according to Senate Majority Leader Chuck Schumer.Schumer said in a letter to other Democratic lawmakers that the gap between the demands of West Virginia Senator Joe Manchin and the rest of the caucus was too large to bridge before the end of the year.Manchin had objected in particular to the expansion of child tax credits foreseen in the bill, according to various reports, and has argued that the funding for the proposed programs wasn’t solid enough to avoid big increases in the budget deficit in future.5. Oil rebounds as risk appetite returns; API data eyedCrude oil prices also rebounded as a degree of risk appetite returned to markets, supported by the sight of power stations in Europe starting up their fuel oil-burning units for the first time in years.By 6:40 AM ET (1140 GMT), U.S. crude futures were up 1.8% at $69.81 a barrel, while Brent futures were up 1.5% at $72.60 a barrel.The American Petroleum Institute releases its weekly inventory data at 4:30 PM ET as usual. Analysts expect the government’s data, due on Wednesday, to show a drop of 2.6 million barrels in crude stockpiles from the previous week. More

TOKYO (Reuters) -Japanese Prime Minister Fumio Kishida on Tuesday called on shareholders to recognise the importance of raising wages, making a clear push to address one of the chronic ailments of the world’s no.3 economy: low pay.Kishida also told a news conference that he would compile a policy package on Dec. 27 to allow small firms to pass on the cost wage hikes, adding it was important to take every possible step to encourage companies to raise wages.After years of deflation, Japanese companies are wary of hiking prices for fear of losing customers and market share. Instead, they have typically turned to belt-tightening to keep costs down, leaving them with razor-thin margins and employees with flat pay.Kishida, who has called for a “new capitalism”, has made low wages one of his biggest points and called for a redistribution of wealth.”Paying an appropriate salary provides the foundation of creation of sustainable corporate value. We need to make large shareholders of a company understand this point,” Kishida said. Kishida was speaking a day after parliament approved the first extra budget of the 2021 fiscal year, with record spending of $317 billion.The 36 trillion yen ($317 billion) budget earmarks funds for tackling COVID-19, including to secure vaccines and drugs, while it also features cash payouts for families with children and funds for the promotion of tourism. He said Japan’s COVID-19 border controls, some of the strictest in the world, would remain in place for the time being.Kishida also said he would make arrangements so that Pfizer (NYSE:PFE)’s coronavirus oral drugs would be available early next year. More