Photograph: Carlos Barría/Reuters
Average London salary 68% higher than Burnley equivalent, says thinktank
The average London worker could quit their job in August and still be paid what an average worker in Burnley would make in a year, according to a report highlighting Britain’s stark regional pay divide.
Calling on the government to close regional pay divisions and increase economic growth, the Centre for Cities said the average annual wage for an employee in London was almost £20,000 higher than in the lowest-paid places in the UK.
With an average wage 24% higher than the national average, workers in London typically are paid 68% more in a year than their peers in Burnley. The average wage in the east Lancashire town, of £29,508, would take a worker on the capital’s average, of £49,455, just eight months to earn.
Publishing its annual Cities Outlook report, the thinktank said the pay divide primarily resulted from some cities having more “cutting edge” private sector jobs and businesses than others. Places with the highest pay, including London and Cambridge, have more than twice as many cutting-edge companies and three times as many jobs in leading sectors – such as biotech and AI – as the country’s lowest-paying towns, such as Burnley, Huddersfield and Middlesbrough.
UK housing market ‘starts new year with a bang’, says Rightmove
A record number of new sellers have come on to the UK housing market since Boxing Day, while the average price and the number of sales agreed also increased, pointing to a busier 2025, according to a report.
The average price of a property coming to market rose by 1.7%, or £5,992, this month to £366,189, the biggest jump in prices at the start of the year since 2020, the property website Rightmove said in its monthly report. While prices usually bounce back in the new year after a seasonal fall in December, before Christmas, the rise was pronounced this month.
Buyers are understood to be more comfortable bidding for homes in response to falling interest rates, which could fall more steeply this year after official figures showed inflation fell in November by more than expected to 2.5%.
Values were still almost £9,000 below May 2024’s all-time record, though, reflecting affordability constraints among some buyers.
The number of new properties coming to market was 11% higher than a year earlier while the number of buyers contacting agents about properties for sale since Boxing Day is 9% ahead of last year, and the number of sales being agreed over the same period is up by 11%.
The UK chancellor, Rachel Reeves, will travel to the World Economic Forum’s annual meeting in Davos this week in the hope of convincing some of the world’s largest companies to invest, with allies saying she will use spending cuts rather than further tax increases to meet her own fiscal rules.
At the same time, the Treasury is considering a push to cut the benefits bill, in a move that is causing nervousness among Labour MPs.
Wealth of world’s billionaires grew by $2tn in 2024, report finds
As Davos gets underway, Oxfam has released its annual inequality report.
It shows that the wealth of the world’s billionaires grew by $2tn (£1.64tn) in 2024, three times faster than in 2023, amounting to $5.7bn a day.
The charity said the world is now on track to have five trillionaires within a decade, a change from last year’s forecast of one trillionaire within 10 years.
At the same time, the number of people living under the World Bank poverty line of $6.85 a day has barely changed since 1990, and is close to 3.6 billion – equivalent to 44% of the world’s population today, the charity said. One in 10 women live in extreme poverty (below $2.15 a day), which means 24.3 million more women than men endure extreme poverty.
The report, titled Takers Not Makers, comes as many of the world’s political leaders, corporate executives and the super-rich travel to the Swiss ski resort of Davos for the annual World Economic Forum meeting from Monday.
Oxfam’s examination of billionaire assets also coincides with Donald Trump’s inauguration as US president. Trump is expected to include several billionaires in his team of close advisers, including the Tesla and SpaceX chief executive, Elon Musk, and to offer large-scale tax breaks to the wealthiest US citizens.
Separately, the links between the founders of the US’s most prestigious investment bank and enslavement have come under scrutiny after a campaign by historians in Liverpool.
Brown Brothers Harriman (BBH) is Wall Street’s oldest private investment bank, known for the role alumni have played in shaping US politics and the global economic order, with former partners including Prescott Bush, patriarch of the Bush political dynasty.
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FTSE 100 hovers near record
European stock markets are heading higher again, after the FTSE 100 in London hit a record high on Friday.
The UK bluechip index has climbed by 26 points, or 0.3%, to 8,531.90, just shy of Friday’s intra-day peak of 8,533.43 points, amid growing confidence that the Bank of England will cut interest rates further this year. The “Footsie” ended last week at a fresh closing high of 8505.22 points.
Following a surprise drop in inflation and subdued economic growth data last week, markets now see an 81% chance of a rate cut at the next meeting on 6 February, and have pencilled in a further one or two reductions this year.
Germany’s Dax edged by 0.1% higher while France’s CAC gained 0.37%, and the Italian borsa slipped by 0.36%.
In bond markets, the yield (or interest rate) on the 10-year gilt has edged up by nearly 2 basis points to 4.682%, but has fallen back sharply since hitting the highest levels since 2008 above 4.8% on 8 January.
Crude oil prices have fallen slightly since the ceasefire in Gaza took hold yesterday. Brent crude and US light crude are both trading 0.3% lower, at $80.55 and $77.64 a barrel respectively.
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Here’s our full story on Trump’s meme cryptocurrency going head to head with a coin backed by his wife.
The incoming US first lady, Melania Trump, has followed Donald Trump’s lead by launching a multibillion-dollar cryptocurrency meme coin – briefly tanking the price of her husband’s coin in the process.
The price of the incoming president’s token, $Trump, had more than tripled in price to more than $70 (£57), giving it a total value of over $14bn shortly after its launch on Friday. However, the launch of his wife’s coin, $Melania, pared back those gains.
Trump, who will be inaugurated on Monday, posted on social media as his token launched: “It’s time to celebrate everything we stand for: WINNING! Join my very special Trump Community. GET YOUR $TRUMP NOW.”. According to the meme coin’s website, a Trump-owned company, CIC Digital LLC, will own 80% of the coin’s supply.
The token quickly broke into the top 20 of all cryptocurrencies. Such was the extent of the digital stampede, blockchain analysts said, it sucked liquidity from the rest of the market, causing other coins to fall in value, as traders sold their existing holdings to buy in to Trump’s.
The inauguration ceremony has been moved inside to the rotunda at the US Capitol building because of bitterly cold weather.
You can read more about Trump’s inauguration day on our politics live blog here:
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China's vice president meets Musk and other business leaders in Washington
China’s vice president has expressed hope of stable relations as Trump returns to the White House, keen to avoid a repeat of the damaging trade war that drove a wedge between the two countries during his first term.
Chinese vice president Han Zheng, in meetings with Tesla chief executive Elon Musk and other US business leaders in Washington ahead of Trump’s inauguration, said he hoped US companies would “take root” in China and help to stabilise bilateral relations, the official Xinhua news agency and Reuters reported.
The last time Trump was president (from 2017 to 2021), he imposed tariffs on more than $300bn of Chinese imports. In recent months, he said he would add tariffs of at least 10%, a move that would hurt China at a time when its economy is struggling to gather steam.
However, in a seemingly conciliatory gesture the US president-elect invited Chinese president Xi Jinping to attend his inauguration on Monday. Xi sent Han in his place, a sign of goodwill given that China was only represented by its ambassador at the previous two US presidential inaugurations.
At their meeting on Sunday, Han told Musk – appointed by Trump to lead a department aimed at creating a more efficient US government – that he “welcomed Tesla and other US companies” to share in the benefits of China’s development and contribute to relations between the two countries.
The vice president’s meeting with US businesses was chaired by FedEx CEO Rajesh Subramaniam on the US side, and included the heads of eight US firms from a range of industries including technology, banking and logistics, Reuters reported, citing an American executive in the room, who said the meeting over-ran its allotted time and was very cordial.
Michael Hart, president of the American Chamber of Commerce in China, told Reuters in Beijing that Han
is seen as someone, because of his time in Shanghai, who understands the concerns of the foreign business community, he understands the economy.
Xi and Trump were upbeat after speaking by phone on Friday, with Trump calling it “a very good one” and Xi saying he and Trump both hoped for a positive start to US-China relations.
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China's response to TikTok restoring services in the US
TikTok is restoring services in the US after Donald Trump pledged over the weekend to give the video app a reprieve on its US ban.
When asked about this, China’s foreign ministry told a regular news briefing that it believed companies should “decide independently” about their operations and deals, Reuters reported.
Ministry spokesperson Mao Ning said:
TikTok has operated in the US for many years and is deeply loved by American users. We hope that the US can earnestly listen to the voice of reason and provide an open, fair, just and non-discriminatory business environment for firms operating there.
Trump wrote on Truth Social that after taking office on Monday he would sign an executive order allowing the Chinese-owned video app additional time to find a buyer before facing a total shutdown, and proposing that the US or an American firm take a 50% ownership stake.
Chris Turner, ING’s global head of markets, has looked at potential US tariffs.
The big day has finally arrived. Financial markets are on tenterhooks to see what executive orders newly elected US President Donald Trump will enact on his first day. There’s a lot of focus on immigration controls and declaring a national energy emergency to allow more US oil and gas production. Currency markets are most interested in what he has to say about tariffs and what kind of pain the Oval Office plans to inflict on major trade partners. At last week’s nomination hearings, incoming Treasury Secretary Scott Bessent said that tariffs would be needed to address unfair trade practices, support government revenue, and to be used as a negotiating tool.
In terms of what is currently priced for tariffs by financial markets, we find the online prediction websites quite useful, such as Polymarket and Kalshi. Polymarket is running a book on which countries will receive US tariffs in Trump’s first week. China is priced at 56%, Mexico at 54%, Canada at 45% and the European Union at just 7%. There is also the case – using Scott Bessent’s remarks about tariffs as negotiating tools – that the new administration goes in on tariffs hard at the outset. That is why after a near 10% rally from late September, the dollar today is less than one percent off its recent high.
Of course, there will be the risk of a correction in the dollar should it look like Trump will be more selective on tariffs after all – but that should probably come at a later stage.
Thursday could also be an important day for markets this week, when Trump is due to have a digital dialogue with leaders at the World Economic Forum in Davos.
Victoria Hasler, head of fund research at Hargreaves Lansdown, has looked at what Trump’s second presidency could mean for markets:
A new year, a new president. The lead up to Trump’s presidency has been noisy and, at times, divisive. Markets hate uncertainty though, and the simple fact of having the new president settled in the White House may prove to be a good thing for markets. Over the next few weeks and months, we (and the rest of the world) will be watching closely, listening to the speeches and analysing the policies. No doubt some will have a more positive impact on markets than others – expect some fireworks and associated volatility as we navigate the next four years.
This notwithstanding, there are good reasons to believe that the impact on the US stock market could be positive, and particularly so for smaller companies. Because trade tariffs, Trump’s most talked-about policy, favour domestic businesses over international conglomerates, and smaller companies are usually more domestically focused. During campaigning, and since the election, we heard a lot about tariffs. We expect the reality to be a little more muted than the campaign chat, but nonetheless at least some new tariffs are likely, particularly when it comes to Chinese trade.
At the same time, we have the supportive backdrop of monetary policy easing. While we don’t expect interest rates to fall as quickly as originally anticipated, they are almost certainly on a downward trajectory. Historically, small companies have tended to perform well relative to their larger counterparts in a falling interest rate environment, which further strengthens the outlook for smaller companies. Add to that the potential for lower personal and corporation taxes in the US and the tailwinds are building for US smaller companies.
Looking a little further afield, Trump’s occupancy of the White House could cause some jitters in global equity markets. We have yet to see how his foreign policy will play out, but it could cause tension with certain countries, including China, and tariffs could impact growth in markets which rely on exporting goods to the US. Markets aren’t keen on geopolitical uncertainty, and if tensions escalate, we expect to see increased volatility.
Introduction: Bitcoin hits new record high, dollar dips ahead of Trump inauguration
Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.
Bitcoin, the world’s best-known cryptocurrency, has hit a fresh record high ahead of Donald Trump’s inauguration in Washington DC later today, while the dollar dipped.
The president-elect has promised a crypto-friendly administration, pledging to make the US the “crypto capital of the planet” and to create a “strategic national bitcoin reserve” during his election campaign.
Trump has launched his own crypto currency – which briefly tanked over the weekend when his wife Melania also launched a multi-billion dollar cryptocurrency meme coin.
Meanwhile, bitcoin has risen by 4% and hit a new record high of $109,071 during Asian trading. It reversed earlier losses when it dropped to nearly $100,000 when the Melania Trump-backed cryptocurrency launched.
The dollar, which has strengthened against other currencies in recent months, dipped by 0.3% against a basket of major currencies today. The pound and the euro both rose by 0.4% against the greenback.
Asian stocks have pushed higher, with Japan’s Nikkei gaining 1.17% and Hong Kong’s Hang Seng up 1.8%. In China, the Shanghai Composite edged up by 0.08% while the Shenzhen exchange rose by almost 1%.
Ipek Ozkardeskaya, senior analyst at Swissquote Bank, said:
A good part of Trump trade has already happened – the small and mid-caps rallied, energy and financials outperformed and cryptocurrencies touched the sky. Therefore, the first week under Trump may not bring a lot of surprises... (but it may as well!) The WSJ writes that Donald Trump has already prepared 100 – yes 100 – executive orders to take swift action after today’s inauguration, including an order to make crypto a policy priority and giving insiders of the crypto market a good voice within his administration.
Trump launched a cryptocurrency of his own on the Solana blockchain and the coin gained up to 600% in three days reaching a $15bn capitalization before easing – a little bit – also sending Solana to a fresh record high.
But beyond that optimism, Trump policies are expected to be a double-edged sword. His pro-growth policies and deregulation are expected to benefit to the US economy but his tariff policies will certainly lead inflation higher and soften the Fed doves’ hands for easing policy. In addition, exploding debt levels will likely further push the borrowing costs higher.
Trump has promised to mark day one of his presidency with a barrage of executive orders targeting illegal immigration, transgender rights and other rightwing priorities.
ING analyst Chris Turner said:
Today, all eyes are on Donald Trump’s inauguration as the 47th president of the United States. Financial markets are bracing for a flurry of executive orders ranging from immigration to energy and possibly trade. On tariffs, betting markets are marginally priced in favour of tariff action against China and Mexico this week. After four months of being bought on the rumour, the dollar is now exposed to some selling on the fact – but there should be plenty of dollar buyers on dips.
The latter referred to the practice of buying a weaker asset and selling it once it has reached a new high.
US markets are shut today for the Martin Luther King public holiday, and the US economic calendar is quiet this week.
The world’s political and business leaders are heading to the Swiss ski resort of Davos for the annual meeting of the World Economic Forum, which starts today.
The Agenda
5pm GMT: US Inauguration of Donald Trump in Washington D.C.
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