A senior Bank of England policymaker has warned that financial markets are expecting too many interest rate cuts this year and that the UK central bank is unlikely to move before the US Federal Reserve.

Catherine Mann, an external member of the Bank’s rate-setting monetary policy committee (MPC), said there were risks that UK inflation could persist at higher levels than in the US or the eurozone.

City traders are pricing in three quarter-point interest rate cuts this year, with a possible first downward shift from as early as May or June. Money markets give a 20% chance of a cut in May, before the Fed or the European Central Bank.

The Co-operative Bank has unveiled plans to cut 400 jobs as part of the lender’s largest cost-cutting and restructuring programme since it was bailed out by hedge funds in 2017.

The job cuts aim to reduce the size of its 3,000-strong workforce by about 12% Redundancies will affect staff across the business, including at its 50 branches.

A spokesperson said the decision was unrelated to ongoing takeover talks with Coventry Building Society, which is considering buying the Co-operative Bank from its hedge fund owners and has been locked in talks over a potential deal since November.

Grocery price inflation in Great Britain has slowed to 4.5%, its lowest level since February 2022, but one in four households are still struggling financially, retail researchers have found.

However, the figures also suggest a change in sentiment with upmarket retailers Waitrose and Ocado the only grocers to win new shoppers in the past three months, according to the latest monthly figures from the analysts Kantar, as growth in more expensive branded groceries outstripped supermarket own-label.

Adam Neumann, the ousted co-founder of WeWork, has tabled a bid worth more than $500m (£395m) in an attempt to regain control of the long troubled shared office space rental company that he launched in 2010.

Flow, Neumann’s property company, said on Monday that it had submitted a potential bid for WeWork with a “coalition of half a dozen financing partners”. The Wall Street Journal, which first reported Neumann’s offer, said it was tabled at more than $500m.

That’s it for today, folks. Thank you for reading. We’ll be back tomorrow. Take care! – JK

Bellway, one of the UK’s biggest housebuilders, has reported a near-60% slump in full-year profits, but its sales rate has improved in recent weeks and its boss said the market was “on the road to recovery”.

The company’s profit before tax fell 58.8 to £483m in the year to 31 July, as the number of homes completed was down 2.3% to 10,945. Bellway took a near-£50m charge for safety repair works to older buildings.

However, its rate of sales to private buyers rose 21% in the six weeks since the start of February compared with a year earlier, improving to 0.67 homes reserved per site each week. Bellway’s share price rose 2% on the news.

Chief executive Jason Honeyman said the market was beginning to improve because of a combination of rising wages, falling inflation and more competitive mortgage rates. He told the Financial Times:

The housing market seems a lot brighter. It is on the road to recovery. It is happening a little quicker than we thought.

Orders for long-lasting goods manufactured in the US rose more than expected last month, suggesting while investment on equipment improved at the start of this year.

Orders for durable goods – items ranging from toasters to aircraft meant to last three years or more – rose 1.4% last month boosted by transportation equipment and machinery orders, the Commerce Department’s Census Bureau said today. Economists polled by Reuters had forecast a 1.1% rise.

However, data for January was revised lower to show orders slumping 6.9% instead of 6.2% as previously reported.

Manufacturing has been held back by higher interest rates, which have curbed demand for goods. But the outlook for the sector, which accounts for about a tenth of the US economy, is steadily improving amid expectations that the Federal Reserve will start cutting interest rates soon.

Non-defence capital goods orders excluding aircraft, a closely watched proxy for business spending plans, rose 0.7% in February after falling 0.4% in the prior month.

Kathy Jones, chief fixed income strategist at the Schwab Center for Financial Research, has this chart:

Norway’s $1.6 trillion sovereign wealth fund has warned that the UK’s Financial Conduct Authority’s plan to simplify rules around public listings – aimed at boosting numbers following a decline – could undermine investor confidence in the market.

Carine Smith Ihenacho, chief governance and compliance officer of Norges Bank Investment Management, and Elisa Cencig, the fund’s head of policy engagement, wrote in a letter to the regulator last Friday:

We are concerned that the FCA’s efforts to boost listings by lowering corporate governance requirements will undermine the UK’s reputation as a market with robust investor protection, and might ultimately not be successful in driving companies’ IPO locations.

The UK’s finance regulator outlined plans in December to replace the standard and premium listings rules with one set of “streamlined eligibility and ongoing requirements,” after first announcing proposals in May.

They are intended to kickstart interest in London’s stock markets, where the number of flotations fell by 49% last year from 2022, according to the consultancy EY. It was the quietest year on record since 2010 when EY first started collating the data. The 23 issuers in 2023 raised £953.7m in total, down 40% from the £1.6bn raised in 2022.

Companies are attracted to a market by the possibility of getting a higher valuation, Ihenacho and Cencig said in the letter. They argued that it is unlikely that corporate governance requirements are a “key factor”, while reducing them will drive up costs for investors.

As a global investor, we are concerned about reforms to weaken investor protection driven by the aim to attract primary listings. As acknowledged by the FCA, there are many factors driving a company’s decision to list in a given market, including valuation and research coverage, the presence of a large pool of investors with deep expertise in certain sectors, and liquidity.

We are unconvinced that corporate governance requirements are the key factor in determining where a company lists. Consideration of the likelihood of achieving a higher valuation likely plays a relatively larger role. Furthermore, the proposals will affect costs for investors, by requiring more stringent monitoring and due diligence, and hinder stewardship efforts.

In particular, we note that a more permissive approach to unequal voting rights runs counter to the FCA’s intention to encourage investor stewardship and the higher expectations on institutional investors to protect minority interests.

Regarding dual class shares, we continue to believe that “one share, one vote” is the best regime to secure the fair treatment of all shareholders.

The FCA should reconsider before removing key investor protections such as a mandatory time-based sunset clause for dual class share structures and shareholder votes on related party transactions and significant transactions, they said.

The fund also raised concerns about scrapping eligibility requirements for companies, while backing its decision to maintain the current regime for controlling shareholders and an overall approach to annual disclosures and reporting requirements for UK governance, climate, and diversity.

The US and the rest of world face a “retirement crisis” as national safety nets buckle under the strain of ageing populations, with medical breakthroughs like the new weight loss drugs set to extend people’s lives further, BlackRock boss Larry Fink has warned.

In his annual letter to shareholders, Fink called for greater use of capital markets to help people save for retirement. BlackRock is the world’s largest money manager with $10 trillion in assets, more than half of which are for retirement.

Comparing the retirement crisis to the 2008/9 financial crisis, he said:

Maybe once a decade, the US faces a problem so big and urgent that government and corporate leaders stop business as usual. They step out of their silos and sit around the same table to find a solution.

Fink said the Social Security programme in the US (the idea originates from pre-World War I Germany) and the other “old-age insurance” programmes of the 20th century worked well when demographics were different. More than half the people who worked and paid into the system in the US never lived to retire and be paid from the system.

Today, these demographics have completely unravelled, and this unravelling is obviously a wonderful thing. We should want more people to live more years. But we can’t overlook the massive impact on the country’s retirement system.

Obesity, for example, can take more than 10 years off someone’s life expectancy, which is why some researchers think that new pharmaceuticals like Ozempic and Wegovy can be life-extending drugs, not just weight-loss drugs. In fact, a recent study shows that semaglutide, the generic name for Ozempic, can give people with cardiovascular disease an extra two years of life where they don’t suffer a major condition like a heart attack.

These drugs are breakthroughs. But they underscore a frustrating irony: As a society, we focus a tremendous amount of energy on helping people live longer lives. But not even a fraction of that effort is spent helping people afford those extra years.

Investing in financial markets is key, he argued:

People are living longer lives. They’ll need more money. The capital markets can provide it — so long as governments and companies help people invest.

In previous letters, Fink addressed other urgent issues such as the climate crisis. Two years ago, he said pushing climate policies was about profits, not being “woke”.

In the 2024 letter, he described the energy transition and the need to invest in infrastructure as today’s second big challenge.

Decarbonisation and energy security are the two macroeconomic trends driving the demand for more energy infrastructure. Sometimes they’re competing trends. Other times, they’re complementary, like when the same advanced battery that decarbonizes your grid can also reduce your dependence on foreign power.

In fact, in my nearly 50 years in finance, I’ve never seen more demand for energy infrastructure.

The container vessel The Dali that collided with a bridge in Baltimore was chartered by the Danish shipping company Maersk, it said.

The ship carried Maersk customers’ cargo but none of the company’s crew or personnel were onboard, it added.

The shipping company said:

We are horrified by what has happened in Baltimore, and our thoughts are with all of those affected.

We are closely following the investigations conducted by authorities and Synergy, and we will do our utmost to keep our customers informed.

The Maersk share price fell more than 3% earlier and is now down 2%.

The vessel was set to depart Baltimore early today and arrive at Colombo on 22 April, Reuters reported, citing a schedule on Maersk’s website.

The vessel is owned by Singapore’s Grace Ocean Private Limited, and managed by Synergy Marine Group.

Revolution Bars said it could put itself up for sale, and is talking to investors about raising cash.

Its share price plummeted 48% today after the statement, and press reports that it could shut about 20 bars, equivalent to a quarter of its outlets, with the loss of hundreds of jobs.

The company did not comment on the mooted closures, but said:

Following a period of external challenges which have impacted the company’s business and trading performance, the board is actively exploring all the strategic options available to it to improve the future prospects of the group.

These include a restructuring plan for certain parts of the group, a sale of all or part of the group and any other avenue to maximise returns for stakeholders. The company also confirms it is currently engaged with key shareholders and other investors including Luke Johnson in respect of a fundraising.

Sky News reported that the London-listed company, which owns Peach Pubs and the Revolución de Cuba chain, is drawing up plans to close 20 of its worst-peforming bars, and has sounded out investors about a potential fundraising of £10m. This is more than the company’s market value of £3.45m.

One of its investors is Johnson, the entrepreneur and former chairman of Pizza Express, Patisserie Valerie, the Royal Society of Arts and Channel 4. He currently chairs and part-owns Gail’s bakery. He is a former owner of The Ivy, Le Caprice and J Sheekey restaurants.

The pizza chain Papa Johns is to shut 43 restaurants across Britain, nearly a tenth of its UK sites.

The company has not confirmed how many staff will be affected by the closures – “underperforming locations that are no longer financially viable”. It expects to begin shutting the restaurants by mid-May following a consultation with staff.

All the restaurants that face closure are in England, from Harrogate in North Yorkshire to St Helens in Merseyside, Billericay in Essex and Eastbourne on the south coast.

Chris Phylactou, managing director at Papa Johns UK, said:

Our goal is to work with impacted team members and attempt to find redeployment opportunities where available. We understand the impact this will have on our team members and are committed to supporting them during this time.

Papa Johns said it plans to increase investment in research and technology, including making better use of customer data.

It will also look at new types of sites beyond traditional restaurants, such as expanding into holiday parks, and expects “to announce other large retail partners in the coming months”.

Phylactou added:

While this is a difficult decision, closing these underperforming locations will give us the opportunity to invest back into the right locations with the right partners for long-term growth.

We are focused on driving shared profitable growth across our UK restaurants, by continuing to make improvements to our business to ensure that we are well positioned for the future. We have been encouraged by the results so far from these initiatives.

Financial markets are getting ahead of themselves and pricing in too many interest rate cuts from the Bank of England, according to a policymaker.

Dr Catherine Mann, one of the nine members of Threadneedle Street’s monetary policy committee (MPC), voted to keep interest rates unchanged at 5.25% at the last meeting, having previously voted for rate hikes. It was the first time since September 2021 that no one on the MPC voted for a rate rise. Eight members backed no change, and one member, Swati Dhingra, voted for a cut of 0.25 percentage points.

She had long argued for further rises, along with fellow rate setter Jonathan Haskel, and traders have interpreted the shift as a signal that there could be interest rate cuts soon.

Markets are pricing in three quarter-point reductions by the end of the year, and are expecting the first cut by June.

Mann told Bloomberg TV:

I think they are pricing in too many cuts, that would be my personal view. In some sense, I don’t have to cut because the market already is, in terms of the implications of the market curve and mortgage rates, for example.

Those are the rates that are faced by borrowers. Bank Rate is not the rates that borrowers face.

She said it’s hard to argue that the Bank of England will cut sooner than the US Federal Reserve or the European Central Bank. She noted that wage dynamics in the UK are stronger than in the US and eurozone.

Last week, the Bank’s governor Andrew Bailey said interest rate cuts will be “in play” at forthcoming policy meetings as inflation has slowed sharply over the past year.

In a signal that Threadneedle Street is preparing the ground for a cut in borrowing costs within months, Andrew Bailey told the Financial Times: “All our meetings are in play. We take a fresh decision every time.”

The Co-operative Bank is cutting 400 jobs in its largest restructuring programme since its 2017 hedge fund rescue deal.

It said it had over the last three years pursued a strategy to “simplify and transform the business”, including investing more than £100m in a revamp of its IT system, which is nearing completion.

In the next phase of its turnaround plan, the bank has carried out a review to identify opportunities to simplify processes, reduce its cost base and make efficiency improvements. It has kicked off a consultation on an operating model restructure today, which will result in the net reduction of 400 roles across the bank, 12% of its workforce.

The decision has not been made lightly, and the bank will continue to work closely with our trade union and to support impacted colleagues.

A spokesman for the Co-operative Bank added:

This is a decision made by the Bank. The changes we have announced today are completely separate from the previously announced discussions with Coventry Building Society.

Coventry Building Society is in exclusive talks to potentially buy the Co-operative Bank from its hedge fund owners, in a move that would return the ethical bank to member ownership and create a high street challenger with almost 5 million customers.

It signals the most serious sign yet that the Co-op Bank’s hedge fund owners could exit the bank, after spending £700m on rescuing it in 2017.

The deal would more than double the size of Coventry’s 2-million-strong membership, by adding Co-operative’s 2.7 million retail customers and 94,000 business clients to its roster. It would also add a further 50 branches to its existing network of 64, and create a combined mortgage portfolio worth £69bn. Coventry’s mortgage book is valued at £49bn, while Co-operative’s is £19.7bn.

A takeover would also bring the Co-operative back to its mutual roots, as Coventry is owned by its members.

Grocery price inflation in Great Britain has slowed to 4.5%, its lowest level since February 2022, but one in four households are still struggling financially, retail researchers have found.

The upmarket retailers Waitrose and Ocado were the only grocers to win new shoppers in the past three months, according to the latest monthly figures from the analysts Kantar, as growth in more expensive branded groceries outstripped supermarket own label.

Waitrose’s pace of growth, at 3.9%, was faster than at the discounter Aldi – which has been the target of price-match campaigns by Tesco, Sainsbury’s, Asda and Lidl – for the first time since 2021. Only Asda, the Co-op and Iceland trailed behind Aldi’s 3.1% rise in sales, with even struggling Morrisons ahead on 3.6%.

Fraser McKevitt, the head of retail and consumer insight at Kantar, said:

Grocery inflation has come down significantly since hitting an eye-watering peak of 17% in March 2023. However, despite this continued slowdown, many British households are still feeling the squeeze. Twenty-three per cent identified themselves as struggling financially in our data – the same proportion as reported in November last year.

Lidl remains the fastest-growing high street grocer, with sales up 8.8% helped by a 24% rise in sales of baked goods and a 11% jump in fruit, vegetables and salads.

Across Britain, £605m more was spent on promotional deals this month than in March last year, while nearly a third of baskets across Tesco, Sainsbury’s and Asda collectively contained at least one product price-matched to a discounter.

The Kremlin-controlled energy giant Gazprom has bought the 27.5% stake formerly owned by Shell in the Russian liquefield natural gas producer Sakhalin Energy for around $1bn.

The Russian government said late on Monday that the 27.5% stake in Sakhalin Energy is due to be sold to a company called Sakhalin Project for 94.8bn roubles. Sakhalin Project is fully owned by Gazprom, Reuters reported, citing company filings.

Gazprom owns 50% of Sakhalin Energy, which is based in the southern tip of Russia’s Pacific island of Sakhalin. Other shareholders are the Japanese companies Mitsubishi and Mitsubishi.

Following Moscow’s invasion of Ukraine two years ago, Shell pulled out of the LNG project, and took a $1.6bn impairment charge.

Adam Neumann, the former chief executive and co-founder of WeWork, has made an offer to buy the bankrupt co-working company for more than $500m, the Wall Street Journal reported.

He said last month he was working on a bid – five years after he was ousted from the business following a failed stock market listing.

It’s not clear how Neumann is funding the bid. Last month, Neumann’s lawyers sent a letter to WeWork’s advisers saying he was teaming up with Dan Loeb’s Third Point hedge fund and other investors in exploring a bid for the company. But Third Point is not part of Neumann’s $500m-plus bid, the Journal said.

We reported last month that lawyers representing Neumann’s new venture, Flow Global, wrote to WeWork advisers revealing he had been trying to meet with the company for months to negotiate a deal to buy back the company or provide it with debt financing.

But WeWork advisers appeared hesitant to go to the negotiating table with the company’s former CEO. Neumann’s lawyers said WeWork had had a “lack of engagement” with him and had not given him the information he needs to make an offer to purchase the company or finance its debt. The company has more than $4bn in debt, according to the New York Times.

Over here, the online fashion retailer Asos said sales fell 18% in the six months to 3 March. It said this was in line with previous guidance, and expects sales to decline by between 5% and 15% in the full year.

The company has been reducing the amount of stock it holds in an attempt to improve profitability, and reported a near £300m annual loss in November. Asos has embarked on a turnaround plan, and said today:

Good progress on implementing the Back to Fashion strategy, including action to clear aged stock and transition to the new operating model by FY25. Ahead on plan to improve stock efficiency and reduce inventory to £600m by year end.

The US faces a market shock similar to the one seen in the UK after Liz Truss’s disastrous mini-budget, unless the US government reins in the country’s ballooning federal debt, according to the head of Congress’s independent fiscal watchdog.

Phillip Swagel, director of the Congressional Budget Office, told the Financial Times that rising US debt is on an “unprecedented” trajectory and could risk a Truss-style crisis that sent borrowing costs soaring and caused a run on the pound in the autumn of 2022. Truss quit after just 45 days as UK prime minister markets took fright at her package of unfunded tax cuts.

Japan would not rule out any measures to prop up the sliding yen, its finance minister said, in the latest warning to currency speculators.

A week after the country’s historic shift away from years of negative interest rates, Shunichi Suzuki said that excess currency volatility was bad for the economy. He told journalists after a cabinet meeting:

Rapid currency moves are undesirable.

It is important for currencies to move stably, reflecting economic fundamentals.

The yen’s sell-off intensified after the Bank of Japan decided to end eight years of negative interest rates, ushering in a new era in a nation that has become used to cheap money.

A weaker yen benefits Japan’s exporters but also raises the costs of imports, can drive up inflation and squeeze households’ incomes.

The Agenda

• 12.30pm GMT: US Durable goods orders for February (forecast: 1.1% monthly gain)

• 2pm GMT: US Conference Board Consumer confidence for March