Closing summary
The chief executive of the Post Office has said that no employee is “above the law” and denied that there are “untouchables” within the organisation who will never face disciplinary action over the wrongful prosecution of hundreds of post office operators.
The public inquiry into the Horizon IT scandal had heard that Nick Read, who joined as chief executive in 2019 with a pledge to “right the wrongs of the past”, has used the phrase “untouchables” on multiple occasions.
Read had reportedly used the term to describe a group of the organisation’s investigators involved in the pursuit and wrongful prosecution of post office operators who would never face disciplinary action over the scandal.
The US government may ask a judge to force the breakup of Google’s business as it attempts to challenge the tech corporation’s monopoly over the internet search market.
The Department of Justice has filed court papers that say it is considering enforcing “structural remedies” that would prevent Google from using some of its products such as Chrome, Android and Play, which the DoJ argues give the company an advantage over rivals.
Other actions being considered include blocking Google from paying to have its search engine pre-installed on smartphones and other devices.
Google, which is owned by Alphabet, said it would challenge any case by the DoJ and that the proposals marked an “overreach” by the government that would harm consumers.
Our other main stories:
Thank you for reading. We’ll be back tomorrow. Take care – JK
Two scientists at Google DeepMind and an American biochemist have been awarded the 2024 Nobel prize in chemistry for breakthroughs in predicting and designing the structure of proteins.
Demis Hassabis, DeepMind’s British founder, and John Jumper, who led the development of the company’s AI model AlphaFold– which predicts the structure of proteins based on their chemical sequence – share half of the prize.
The other half was awarded to Prof David Baker, of the University of Washington, whose computational research has led to the creation of entirely new kinds of proteins, with applications in vaccines, nanomaterials and tiny sensors.
The winners were announced by the Royal Swedish Academy of Sciences in Stockholm, and will share the 11m Swedish kronor (£810,000) prize for computational protein design and protein structure prediction.
On Wall Street, shares have turned positive after earlier modest declines.
The Dow Jones and S&P 500 both edged 0.2% higher.
Google owner Alphabet has fallen by 1.5%, after after it emerged that the US government may ask a judge to force the breakup of Google’s business, in an attempt to challenge the tech corporation’s monopoly over the internet search market.
The tech-heavy Nasdaq nudged up by 0.1% after falling by nearly 0.3% earlier.
Ben Laidler, head of equity strategy at Bradesco BBI, told Reuters:
[This is] just a reflection of how super-sized Big Tech has become. Any uncertainty there will feaure into the rest of the market.
There is also a more positive mood in Europe. The FTSE 100 index in London is 0.4% ahead at 8,222 while the German market has risen by nearly 0.7%, and the French and Italian indices have gained around 0.3%.
Updated
Read criticises ex-Post Office chair for falling asleep in meetings
Nick Read, the chief executive of the Post Office, has criticised the former chair of the state-owned body for falling asleep in board meetings and said he had received reports that he had reduced his personal assistant to tears.
Read, who was testifying before the Post Office public inquiry, criticised Henry Staunton, the former Post Office chair who was sacked in January by the then business secretary, Kemi Badenoch.
Read said in his written witness statement to the inquiry that Karen McEwan, chief people officer at Post Office had spoken to him directly about Staunton’s behaviour “which she thought was appalling.” Read said in his witness statement:
She said that he did not treat women well and had reduced his personal assistant to tears.
Read added in his testimony that he had witnessed Staunton “be quite dismissive and rude” to Lorna Gratton, a non-executive director, at a Post Office board meeting in November 2023, “which was uncomfortable and awkward.” He also said that he got the impression that another non-executive director Amanda Burton “had felt a bit bullied and intimidated by him.”
He added that Staunton’s behaviour had been fed back to the Department of Business and Trade “and that DBT were considering what to do.” Read said in the written statement:
I explained that from my perspective I had witnessed the incident with Lorna at the board meeting and that I had also witnessed unprofessional behaviour, such as falling asleep in board and shareholder meetings (which the shareholder was aware of).
The perception, shared by me and others, was that Henry was fatigued, and was not close enough to the issues on redress and the evidence emerging from the inquiry. He would frequently report surprise at the amount of time he had to dedicate to the role, and the impression given was that he had signed up for a different job to the one he found himself in,” Read continued adding that he felt the manner of Staunton’s departure was “poorly handled and unnecessarily humiliating.”
Staunton has previously claimed he was the victim of a “smear campaign” led by Badenoch.
In Staunton’s own evidence to the inquiry last week he said that he was not aware until December that allegations had been made against him. Staunton said in his witness statement:
I deny those allegations completely, and felt deeply stung by them.
At the Post Office, as in my career previously, I was a champion of diversity. I find racism and misogyny utterly abhorrent.
He added that he found the allegations “deeply distressing” and he knew they “would be contested by everyone who knows me. “
Updated
Here is our story on the Post Office boss Nick Read’s appearance before the Horizon inquiry:
The chief executive of the Post Office has said that no employee is “above the law” and denied that there are “untouchables” within the organisation who will never face disciplinary action over the wrongful prosecution of hundreds of post office operators.
The public inquiry into the Horizon IT scandal had heard that Nick Read, who joined as chief executive in 2019 with a pledge to “right the wrongs of the past”, has used the phrase “untouchables” on multiple occasions
Read had reportedly used the term to describe a group of the organisation’s investigators involved in the pursuit and wrongful prosecution of post office operators who would never face disciplinary action over the scandal.
Glencore’s billionaire former head of oil trading, Alex Beard, and five other ex-employees of the Swiss-based global commodity trader will stand trial in a London court in 2027 on bribery charges.
Beard, who indicated at his first court appearance last month that he will plead not guilty, was not formally asked to enter a plea at a brief hearing at London’s Southwark Crown Court on Wednesday, Reuters reported.
The 57-year-old is charged with two counts of conspiracy to make corrupt payments to government officials and officials of state-owned oil companies in Nigeria between 2010 and 2014, and in Cameroon between 2007 and 2014.
In August, the UK’s Serious Fraud Office Beard with conspiring to make corrupt payments to benefit the commodities company’s oil operations in West Africa.
Beard, who ran Glencore’s oil division from 2007 until his retirement in 2019, will face charges alongside former Glencore executives Andrew Gibson, Paul Hopkirk, Ramon Labiaga and Martin Wakefield after a long-running investigation into allegations of bribery at the company.
Beard, who became a billionaire when Glencore listed in London in 2011, is the highest profile individual charged after the SFO’s sweeping investigation into Glencore which began in 2019 under the codename Operation Azoth.
The pound has touched a one-month low against the dollar, as markets reassess the varying interest rate paths of the US Federal Reserve and the Bank of England.
Sterling has slipped by 0.2% to $1.3075. The dollar hit a one-month high against a basket of major currencies.
Sterling has been under pressure since Bank of England governor Andrew Bailey said in an interview with the Guardian last week that the central bank could become “more aggressive” on interest rate cuts if inflation pressures continue to weaken.
Previously, the pound had been supported by expectations that the Fed would cut much more than the Bank this year. But it is now down by more than 2% since the start of the month.
Here is some analysis from last week:
The Bank of Israel kept interest rates unchanged today for the sixth time in a row, maintaining a cautious stance as Israel’s year-long war with Hamas in Gaza and fighting with Hezbollah in Lebanon has led to higher inflation and weaker economic activity.
The central bank, which is also worried about Israel’s rising investor risk premium, left its benchmark rate at 4.5%.
It cut the rate by 25 basis points in January after inflation eased and economic growth slowed amid the Gaza war, but kept policy steady in February, April, May, July and August.
Israel’s annual inflation rate rose to 3.6% in August from 3.2% in July, further above the government’s 1%-3% target range, after falling as low as 2.5% in February.
Its economy grew at an annualised rate of 0.7% in the second quarter, a sharp slowdown from the 17.2% growth in the first quarter.
UK bank CEOs gathered in Whitehall this morning for a meeting with Rachel Reeves, who was trying to sound out what kind of post-budget measures could support the City and drive forward the government’s growth agenda.
It is understood that the heads of major lenders including HSBC’s new group chief executive Georges Elhedery, NatWest Group’s Paul Thwaite and Santander UK’s Miles Regnier took part in a discussion about competitiveness and City regulation.
That included how upcoming Basel 3 rules would be implemented, as well as continued concerns around fraud, just days after new compensation rules came into force.
Ultimately, there was “nothing groundbreaking” discussed as part of the meeting, according to a source with knowledge of the meeting. And nothing, apparently, that would give bank bosses a steer on what might happen around the budget.
The annual Mansion House dinner, which is a set piece for the new chancellor and gives her a chance to address City leaders, is due to take place on 14 November.
Updated
The British paper and packaging firm Mondi is the top riser on the FTSE 100, after it struck a deal to buy the German, Benelux and UK packaging assets of the German family business Schumacher Packaging for €634m including debt, to expand in Western Europe.
Mondi shares are up by 4.6%.
The company lost out in a takeover battle for London-based rival DS Smith after US firm International Paper, one of the largest paper and pulp companies in the world, outbid it.
Ireland’s Smurfit Kappa bought US rival Westrock in July to create Smurfit Westrock.
Mondi’s chief executive Andrew King said:
This acquisition significantly increases our corrugated converting capacity, extends our reach across Western Europe, and offers strong downstream integration opportunities.
Wall Street futures are pointing to a lower open in half an hour, as investors await the minutes of the last Federal Reserve meeting, out tonight, and inflation data tomorrow.
Shares in Google owner Alphabet are down by 0.7% in pre-market trading, after it emerged that the US government is considering asking a judge to force the breakup of Google’s business as it attempts to challenge the tech corporation’s monopoly over the internet search market.
Stocks in the UK and the rest of Europe are slightly down (France, Italy) or slightly higher (UK, Germany).
Here is our full story on the earlier slump in Chinese stocks:
Chinese stocks have suffered their worst fall in 27 years after efforts by Beijing to stimulate the world’s second-largest economy disappointed investors.
Stock markets in Asia fell sharply after China’s top economic planning authority failed to announce further measures to improve flagging growth.
On Tuesday, the National Development and Reform Commission held a press conference in which officials were expected to reveal specific policies to supplement the stimulus measures announced last month.
However, the hoped-for policy plans were not forthcoming. Instead, the NDRC officials mostly summarised September’s announcements and commented on the general economic situation.
Updated
Top banks are pushing the UK to relax its stance on deferred bonuses and clawbacks as regulators prepare to revise their post-financial crisis rulebook, Bloomberg reports.
Discussions between financial firms and watchdogs are intensifying over the UK’s rules, which were introduced to curb “excessive-risk taking” about a decade ago and are among the strictest in the world. Senior managers have to defer part of their pay for up to seven years, and face clawbacks for a decade if issues emerge.
The topic has been a key focus for banks and their lobby groups since British regulators lifted a cap on bonuses last October, removing one of the key reforms introduced by the EU in the wake of the 2008 financial crisis and clearing the way for awards above the previous limit of two times’ bankers’ salary. Under the previous Conservative government, the regulators were given an extra duty to support the UK’s competitiveness.
Talks have ramped up in recent months and the Prudential Regulation Authority and Financial Conduct Authority will publish new proposals soon, Bloomberg said.
In August, Barclays became the first UK bank to formally lift the cap on bankers’ bonuses originally imposed by the EU, opening the door for staff to receive 10 times their salaries in payouts.
The announcement was made through an internal memo to staff, four months after shareholders at Barclays’ AGM approved the move to drop the measure.
The global economy could face losses of $14.5 trillion over five years from a potential geopolitical conflict that causes widespread disruption to global trade and supply chains, according to Lloyd’s of London.
The world’s biggest insurance market says that with more than 80% of the world’s imports and exports – around 11bn tons of goods – at sea at any given time, the closure of major trade routes due to a geopolitical conflict is one of the greatest threats to the global economy.
The economic impacts of this (hypothetical) scenario stem primarily from severe damage to infrastructure in the conflict region and the need for realignment of global trade networks due to the enforcement of sanctions and the effects of compromised shipping lines.
The impact on businesses depends on the region they are located in and its factors such as involvement in the conflict, reliance on international trade and the goods that would be delayed or lost due to the supply chain disruptions.
Europe for example, which is heavily reliant upon other major economies for supplies like semiconductors for car and electronics manufacturing, could stand to lose up to $3.4trn.
Rebekah Clement, Lloyd’s corporate affairs director, said:
Lloyd’s is supportive of public-private efforts to avoid global crises such as shortages of vital commodities and is committed to helping businesses remain resilient and prepare for the risks from widespread disruptions and financial loss from countless global risks, including geopolitical stability.
The value of insurance also extends to the compounding secondary impacts of geopolitical conflict, including downstream delays and interruptions by impacted trading partners and suppliers. Examples of insurance covers which can help businesses protect themselves against these impacts include political risk insurance and contingent business interruption, as well as dedicated war risk insurance.
Nestlé trials Quality Street paper tubs at Tesco
Taking a quick break from the inquiry.
Tucking into a tub of Quality Street is Christmas tradition for many British families and once they have scoffed the chocolates the handy container takes on a new life as a cake tin or Lego storage box.
But the really useful plastic tub could be looking at its last Christmas as the confectionery brand’s owner tests the reaction of Quality Street fans to a new paper container.
While the new vessel is born out of a desire by the brand’s owner, Nestlé, to cut its use of virgin plastic the public reaction is hard to predict.
In 2022 the decision to replace Quality Street’s colourful plastic wrappers with recyclable paper ones received mixed reviews. Indeed the TikTok riposte of one former Quality Street lover went viral after she called it a “travesty”, and said “who wants to eat this piece of garbage”.
However Nestlé has stuck with the paper wrappers and has now gone a step further. It has produced around 200,000 of the paper tubs which will go on sale in selected Tesco stores from next week.
But after years of shrinking tubs – mercifully this year the product has the same weight and recommended price of £5.50 – and altered line-ups Nestlé knows it has a hard sell on its hands. To this end it claims the tub, in the signature Quality Street purple, has a “luxurious design, and feel, and is embellished with gold foil”. It also has an “integrated re-close feature” which sounds like a fancy term for a lid.
Jemma Handley, senior brand manager for Quality Street, said:
We’re looking forward to seeing what Quality Street fans make of the paper tub. A lot of care and hard work has gone into the trial and we’re proud to be the first major manufacturer to trial a paper tub at Christmas.
Nick Read: 'There will be a view that not every quashed conviction will be innocent subpostmasters'
Post Office chief executive Nick Read has said some people at the organisation may have held the view that “not every quashed conviction” was an “innocent” subpostmaster.
He told the long-running Post Office Horizon IT Inquiry:
I don’t think I could say specifically that that is the case but there will be a view that not every quashed conviction will be innocent postmasters.
The majority of the organisation would agree that the action that has been taken is absolutely the right action and whether there are guilty postmasters that have been exonerated really is no longer an issue.
Updated
Nick Read: No staff in 'postmaster-facing activities' who were involved in wrongful prosecutions
The chief executive of the Post Office has said that there are no staff involved in “postmaster-facing activities” who were involved in historical investigations and wrongful prosecutions, despite the controversy about so-called “untouchables” still in the organisation’s ranks.
The public inquiry into the Horizon IT scandal has previously heard testimony that Nick Read, who joined as chief executive in 2019 with a pledge to “right the wrongs of the past”, has used the phrase “untouchables”.
This refers to a group of the organisation’s investigators and staff involved in the pursuit of post office operators who would never face disciplinary action over the Horizon IT scandal.
On Tuesday, the inquiry was shown a whistleblowing document claiming there were “at least 120 employees” at the Post Office who “to a greater or lesser degree were involved in the wrongful prosecution of SPMs [sub-postmasters]”.
“I have been very clear at no stage will we walk past allegations of wrongdoing in the organisation,” said Read, giving testimony on the first of three days at the inquiry. “Where evidence of wrongdoing is brought to my attention, or anyone else’s attention in the organisation, we will investigate and take action fully.”
Jason Beer, counsel for the inquiry, asked Read on Wednesday about whether some staff involved in the investigation and wrongful prosecution of postmasters are the same personnel involved in the compensation claim procedure under the Horizon Shortfall Scheme.
Beer said that those individuals also attend face-to-face “good faith” meetings with subpostmasters, despite their historical actions.
Read, who has submitted four witness statements totally 307 pages of written evidence to the inquiry, said:
I can’t say there have not been individuals involved in improper investigations and wrongful prosecution who were involved in the handling of compensation claims under the Horizon Shortfall Scheme.
It depends what you mean involved. I am confident there are no individuals involved in postmaster-facing activity that had roles in the past where allegations or anything of wrongdoing has been brought to my attention.
Updated
Post Office CEO Nick Read appears before Horizon inquiry
Nick Read, the outgoing chief executive of the Post Office, is appearing before the inquiry into the Horizon IT scandal.
He is due to give three days of testimony from today. Read, who was brought in to replace Paula Vennells in 2019 and “right the wrongs of the past”, announced in the summer that he was stepping back from running the company to focus on preparing and proving that “nothing like this could happen again”.
The executive, who has given himself 88 days to prepare for his appearance, has come under heavy criticism from witnesses and become embroiled in a reputational crisis of his own.
You can watch the hearing here:
My colleague Mark Sweney has looked at the key issues the judge-led inquiry is likely to ask him to explain.
Updated
German exports rise amid demand from UK, US
Some good news for the German economy, the biggest in Europe: exports unexpectedly rose in August thanks to strong demand from the UK and US.
Exports increased by 1.3% in August compared with the previous month, according to data from the federal statistics office. Economists had expected a 1% decline. Germany’s foreign trade surplus widened to €22.5bn from €16.9bn in July, boosted by a sharp drop in imports, down by 3.4%.
Volker Treier, head of foreign trade at the German Chamber of Commerce DIHK said:
The second slightly increase in exports in a row is a small glimmer of hope, but no reason to sound the all-clear.
He said manufacturers are still under pressure because of high costs for energy, tax and labour, along with too much paperwork.
Fundamental improvements are urgently needed in Germany as a business location if the German export engine is to pick up in the long term.
Exports of goods to the US were rose by 5.5% in August while shipments to the UK climbed by 5.7%.
Here is our full story on Google:
The US government may ask a judge to force the breakup of Google’s business as it attempts to challenge the tech corporation’s monopoly over the internet search market.
The Department of Justice has filed court papers that say it is considering enforcing “structural remedies” that would prevent Google from using some of its products such as Chrome, Android and Play, which the DoJ argues give the company an advantage over rivals.
Other actions being considered include blocking Google from paying to have its search engine pre-installed on smartphones and other devices.
Google, which is owned by Alphabet, said it would challenge any case by the DoJ and that the proposals marked an “overreach” by the government that would harm consumers.
Rio Tinto to buy US lithium miner Arcadium in £5.1bn deal
Rio Tinto has swooped on the US company Arcadium Lithium in a £5.1bn takeover, trying to get a foothold in the supply of lithium, a key component in electric car batteries.
It is a huge bet on the energy transition despite tough conditions in the global electric car market. Lithium is known as “white gold” due to its market value and silver colour.
The London-listed metal and mining giant’s shares fell by 2.3%, while New York-listed Arcadium shares jumped by 31% in pre-market trade.
Rio Tinto said it will pay $5.85 a share for the Pennsylvania-based lithium miner. That represents an almost 90% premium to Arcadium’s closing price of $3.08 a share on 3 October, the day before news of a potential deal emerged.
The acquisition will give the Anglo-Australian company access to lithium mines, processing facilities and deposits in Argentina, Australia, Canada and the US, as well as a client roster that includes the carmakers Tesla, BMW and General Motors.
Lithium prices have fallen because of Chinese oversupply and a slowdown in electric vehicle sales, turning miners of the metal into attractive takeover targets.
If the deal goes through, Rio Tinto will become the world’s third largest supplier of lithium, behind Albemarle and SQM.
Rio Tinto’s chief executive Jakob Stausholm said the purchase is a
significant step forward in Rio Tinto’s long-term strategy, creating a world-class lithium business alongside our leading aluminium and copper operations to supply materials needed for the energy transition.
Updated
In Europe, stock markets are mixed.
The FTSE 100 index in London has climbed by 30 points, or 0.38%, to 8,221 while Germany’s Dax and Italy’s FTSE MiB have slipped by 0.1%, and France’s CAC is up by 0.1%.
Susannah Streeter, head of money and markets at Hargreaves Lansdown, has looked at the markets:
Investors are searching for a sense of direction amid a cacophony of developments, as harsh geopolitical winds swirl and a fierce storm barrels towards Florida. Oil prices have tracked higher again, as hopes for a ceasefire between Israel and Hezbollah fade, while Hurricane Milton threatens to disrupt energy supplies, with some pipelines and delivery terminals in Tampa already shut.
Brent Crude is currently trading around $77.5 a barrel. Prices had dipped sharply yesterday, amid hopes the Hezbollah leadership would not tie negotiations for a ceasefire to what’s happening in Gaza. But given how previous deals in stopping violence in the Middle East have seemed so close, but have ultimately collapsed, it’s not surprising that confidence in agreeing even a limited break in the war is waning, prompting supply concerns to swirl again.
The FTSE 100 is set to gain back a little ground, following yesterday’s losses, but caution is in the air following another highly volatile session for indices in Asia.
The wave of enthusiasm which greeted the kitchen sink stimulus from the People’s Bank of China is ebbing away, given the lack of detail for further fiscal stimulus. Banks in China might be ready to lend, with lower rates and deposit requirements on offer, but if the demand isn’t there, it’s still set to hold back an economic rebound.
Investors had been hoping for more details on an expected fiscal stimulus, hoping tax breaks would reinvigorate consumers and companies to borrow, but the vague plan put on the table yesterday by authorities disappointed. The Nikkei has climbed higher again, helped by ongoing weakness in the yen, up against the stronger dollar, which has been bolstered by expectations that the next rate cut from the Fed will be smaller than September’s big reduction.
Updated
China stocks plunge as stimulus rally fades
Stocks in China plunged, after a press briefing by Beijing’s top economic planner on Tuesday disappointed investors.
They had hoped for more stimulus measures, but officials did not announce any major new steps.
The Shenzhen Composite Index tumbled by 8.2% in its biggest fall since May 1997, while the Shanghai stock exchange lost 6.6% and the benchmark CSI 300 slid by 7.1% after the Golden Week holiday. Hong Kong’s Hang Seng was down by 1.8%.
Before the week-long holiday, Chinese stocks rallied when a raft of measures were announced by the People’s Bank of China and other authorities to revive the economy, the boldest stimulus package since the pandemic.
China’s finance ministry is due to set out its plans on fiscal stimulus in more detail at a news conference on Saturday. Finance Minister Lan Fo’an will attend the conference, whose theme is “intensifying countercyclical adjustment of fiscal policy to promote high-quality economic development”.
Investors are expecting a spending package between 4 and 10 trillion yuan (£220bn to £1.1tn).
Richard Hunter, head of markets at the trading platform interactive investor, said:
Shares in China underwent another difficult session as investor disappointment in the region persisted. The main concern was that the raft of measures announced prior to last week’s holiday – which had lit the fire under a moribund market – were not followed up with any specific actions from the authorities, or indeed further plans. The puncturing of enthusiasm fed through to commodity stocks.
The minutes of the US Federal Reserve’s last meeting will be published tonight and may attract less interest than usual, given the raft of recent comments from Fed members as the economic picture has evolved.
Hunter said:
Indeed, any comments over concerns around a deteriorating labour market will have been eclipsed by last week’s bumper non-farm payrolls report, the result of which has been the tempering of interest rate cut expectations. Of rather more interest, perhaps, will be tomorrow’s reading on inflation in the form of the Consumer Price Index, which could show that the taming of inflation is just a whisker away from the Fed’s target. In the meantime, there is now a near 90% probability of a more subdued 0.25% cut in November in terms of consensus, with a small chance of no change at all beginning to surface.
Updated
Oil prices are pushing higher again, after sliding yesterday amid talk of a potential ceasefire between Israel and Hezbollah.
Brent crude, the global benchmark, is up 0.5% at $77.55 a barrel, a 37 cent gain, while US light crude has advanced by 0.3% to $73.78 a barrel.
Prices lost more than 4% yesterday but markets are still concerned about a potential Israeli attack on Iran’s oil infrastructure. The selloff came after a rally in oil prices that began after Iran launched a barrage of missiles at Israel on 1 October, culminating in an 8% gain last week, the biggest in more than a year.
Priyanka Sachdeva, senior market analyst at the brokerage Phillip Nova in Sinagpore, said:
The everyday dilemma of ‘Middle Eastern headlines’ moving like a pendulum between ‘ceasefire talks’ and ‘further escalation in attacks’ has been distracting investors from reality.
Oil markets are twirled in sentiments of ‘buying the rumour’ and sidelining the real fundamentals that should matter.
Updated
Central bankers in New Zealand have been busy overnight, cutting their key interest rates by half a percentage point.
The Reserve Bank of New Zealand lowered the cash rate to 4.75%, from 5.25%, a move which knocked the New Zealand dollar (known, rather sweetly, as the ‘kiwi’ in FX circles).
The kiwi dollar tumbled 0.9% to $0.6084, the lowest since 19 August.
New Zealand 2Y interest rate swaps down ~4bps on the RBNZ decision. Another 50 on Nov 27 remains the red-hot favourite. Kiwi Q3 CPI is released Wednesday week $NZD https://t.co/HIk3bAqT7I pic.twitter.com/BVvFMt58YV
— David Scutt (@Scutty) October 9, 2024
Antonio Ernesto Di Giacomo, senior market analyst at XS.com, says:
The main objective of this decision is to keep inflation within the target range of 1-3% and stabilize the economy, which has shown signs of weakening in recent months.
This indicates that monetary authorities are willing to take additional measures, if necessary, to support growth.
Google: DOJ’s radical and sweeping proposals risk hurting consumers, businesses, and developers
Google has criticised the DoJ’s proposal, calling them “radical” and arguing they “go far beyond the specific legal issues in this case.”
In a corporate blog post, Lee-Anne Mulholland, Google’s vice president for Regulatory Affairs, claims that the US government is pursuing “a sweeping agenda that will impact numerous industries and products”, rather than simply focusing on the issue of search contracts.
Mulholland argues that:
Forcing Google to share your search queries, clicks, and results with competitors risks your privacy and security.
Hampering Google’s AI tools risks holding back American innovation at a critical moment.
Splitting off Chrome or Android would break them — and many other things
Changes to the online advertising market would make online ads less valuable for publishers and merchants, and less useful for consumers.
Unreasonable restrictions on how Google promotes our search engine would create friction for consumers and harm businesses.
You can read the argument here.
Boeing withdraws 30% pay rise offer to striking workers
Also in the US overnight, attempts to end the Boeing workers strike have hit a roadblock – with the company withdrawing its pay rise offer.
Boeing and the union held their latest round of negotiations with federal mediators on Monday and Tuesday, but talks collapsed and the sides were left locked in acrimonious stalemate showing no signs of being resolved anytime soon, a person briefed on the talks said.
Nearly four weeks after the walkout began, no further negotiations were planned between Boeing and union representatives.
Both sides blamed the other for the deadlock.
“Unfortunately, the union did not seriously consider our proposals,” Boeing Commercial Airplanes head Stephanie Pope said in a note to the employees, calling the union’s demands “non-negotiable“.
Pope added:
“Further negotiations do not make sense at this point and our offer has been withdrawn.”
But, the International Association of Machinists and Aerospace Workers union said in a statement that Boeing was “hell-bent on standing on the non-negotiated offer” proposed last month.
The union said:
“They refused to propose any wage increases, vacation/sick leave accrual, progression, ratification bonus, or the 401k Match/SCRC Contribution. They also would not reinstate the defined benefit pension.”
US considers breakup of Google in landmark search case
Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.
Google is facing the threat of being broken up, as the US government weighs up how to tackle its monopoly in online search.
In a court document filed overnight, the US Department of Justice suggests it could seek ‘structural remedies’ such as forced product sales – to prevent Google using its Chrome browser, Android operating system and Play app store to unfairly dominate the search market. Other, less radical, options are also under consideration, though.
Introducing their case, the DoJ say:
Google’s anticompetitive conduct resulted in interlocking and pernicious harms that present unprecedented complexities in a highly evolving set of markets.
These markets are indispensable to the lives of all Americans, whether as individuals or as business owners, and the importance of effectively unfettering these markets and restoring competition cannot be overstated.
The DoJ’s “proposed remedy framework” comes a month after a US judge ruled that Google had violated antitrust law and created an illegal monopoly. The case centred on Google’s use of exclusive agreements with device makers like Apple and Samsung, in which it paid billions of dollars to make sure that its product was the default search engine on their phones and tablets.
The DoJ argues that the courts must address Google’s unlawful conduct is undoing its effects on search distribution, so rivals can compete for customers fairly.
The court filing says:
Fully remedying these harms requires not only ending Google’s control of distribution today, but also ensuring Google cannot control the distribution of tomorrow.
At this stage, the plaintiffs are only “considering” behavioral and structural remedies – legal-speak for breaking the tech giant up.
Other options include potentially restricting Google from using contracts and “monopoly profits” to control distribution channels and search-related products. Or, Google could be forced to share users’ search data with rivals.
The plaintiffs also want the remedies to be forward-looking; they could include restricting Google from using search results to train new generative artificial intelligence models and products.
They say:
Google’s ability to leverage its monopoly power to feed artificial intelligence features is an emerging barrier to competition and risks further entrenching Google’s dominance.
The Justice Department is expected to file a more detailed proposal with the court by 20 November, Reuters reports, while Google will have a chance to propose its own remedies by 20 December…..
The agenda
7am BST: German trade data for August
10am BST: Post Office chief executive, Nick Read, to give evidence at the Horizon IT inquiry
Noon BST: US weekly mortgage approval data
2pm BST: Bank of Israel’s interest rate decision
3.30pm BST: EIA oil stocks data
Updated
