Britain's trade deficit has widened to a new record of £27.9bn

By Suzanne Evans, Director, Political Insight

Britain's trade deficit has widened to a new record of £27.9bn, Yahoo Finance reports. The latest figures from the Office for National Statistics(ONS) showed that the gap between the value of exports and imports expanded at the biggest rate since 1997: UK imports were up by £14.3bn to reach £206.6bn in the second quarter, while exports increased by £12.3bn to £178.6bn. Total trade also fell 2.1% in June, riven by an 8% decline in exports, largely to outside the European Union. Removing the effect of price rises, the total trade deficit, excluding precious metals, narrowed by £2.4bn to £22.6bn in the second quarter, the figures showed. This was 4.5% of GDP. The ONS also found that overall UK imports from Russia were the lowest since records started in January 1997 because of sanctions. the total value of monthly imports stood at £33m in March, down from around £1.8bn in January and February. The import of fuels from Russia - a historically important commodity with the country - reached zero in June 2022, after the UK government said it would phase out the import of Russian oil and gas products.  
 
Labour leader Sir Keir Starmer has called for an extension of windfall taxes on oil and gas companies to fund a freeze in the energy price cap. The cap is forecast to hit £3,582 in October and £4,266 in January, the BBC says, but Labour claims its £29bn plan will mean the typical family would see savings of £1,000 by freezing the price cap at the current level of £1,971 a year. Labour also claimed this would bring inflation down by four percentage points. In May, the government announced a windfall tax on oil and gas company profits of 25%, which it expects would raise about £5bn in its first year. Starmer says he would close an "absurd loophole" by backdating the start date to January and accounting for higher oil and gas prices, which it said would raise £8bn. Labour also said it would raise £14bn from other measures such as dropping the £400 energy rebate, and abandoning pledges made by the Conservative leadership contenders - such as halting the "green levy" on fuel bills, which Liz Truss is proposing, or scrapping VAT on domestic fuel bills which Rishi Sunak has promised. Starmer also said his party would reduce energy demand and lower bills in the longer term by insulating 19 million homes over the next decade.
 
Low-income households will have to cut their spending by 24% - £1 in every £4 - in order to afford their energy bills, rent, food, transport and communication, according to think tank The Resolution Foundation (RF). A typical low-income household paying by Direct Debit would need an extra £418 to pay their energy bills over the first three months of next year than was expected back in May 2022, the RF said. In contrast, the richest tenth of households will only have to cut back 1 in £12 (8%) of their non-essential spending in order to accommodate the higher heating bills. The RF also says that 49%) of the poorest fifth of households live in homes with uninsulated walls, meaning that while the daily cost of turning the gas heating on will be £7.34 this winter for families in energy efficient homes, this figure will rise to £11.60 for those in badly insulated homes.  
 
Regulated train fares in England will rise below the rate of inflation next year to help people with the cost of living crisis, the government says. The Sunday Times reported yesterday that as well as being lower than the retail prices index (RPI) measure of inflation, the increase will again be delayed until March, as it has been since the start of the Covid pandemic. Previously, fares have been raised in January each year based on RPI from the previous July, plus 1%, RPI in June this year was 11.8%, the highest rate in more than 40 years. Regulated fares cover about 45% of fares, including season tickets on most commuter journeys, some off-peak return tickets on long distances journeys and anytime tickets around major cities. July’s inflation figures are due to be released on Wednesday.
 
A record number of jobs are being advertised, with big increases for actors, entertainers, driving instructors and dancers, according to the Recruitment and Employment Confederation (REC). 1.85 million job adverts were posted in the last week of July, with 200,000 being added every week in the past month, the trade body said. It added that vacancies for water and waste roles such as sewerage plant operatives have also increased, which could be related to the prolonged dry weather. Kate Shoesmith, deputy chief executive of the REC, said: "This new data shows the continued strength of the jobs market, despite any wider economic uncertainty."
 
UK workers are going into the office for just an average of 1½ days a week, and only 13% go in on a Friday, a survey by consultancy Advanced Workplace Associates (AWA) suggests. AWA surveyed 43 offices in the UK, representing nearly 50,000 people, in June and July, and found average attendance was just 29%, with a peak of 39% mid-week. Pre-Covid, UK workers were going into the office an average of 3.8 days a week. However, the BBC points out that the survey results are at odds with Office for National Statistics (ONS) data which found in its survey in Spring 2022 that the majority of people do not work from home. Its survey in spring 2022, suggested only 38% of working adults reported having worked from home at some point over the past seven days.
 
BAE Systems is set to build a new £200 million assembly hall at its Govan site on the Clyde. The facility will enable the British engineering giant to build at least two ships simultaneously under cover and in single hull format for the first time.
 
Frasers Group said it has completed the sale of some of its retail parks for £205 million, a London Stock Exchange filing has revealed. The company, which owns the Sports Direct and House of Fraser chains, said the disposal included a number of freehold and long leasehold retail parks held by its wholly-owned subsidiaries to RI UK 1 Ltd. "Frasers Group fascias will operate from leases within these properties where appropriate,” the company said, adding that it “intends to use the proceeds of sale towards the working capital of the company and its group operations."
 
18 months ago, one of Britain's largest holiday empires, Bourne Leisure, founded by the Harris family in the 1960s, was sold to American private equity firm Blackstone for more than £3bn. The sale included the three Butlin's holiday camps in Minehead, Bognor Regis and Skegness, but now Sky News says it has learned that a vehicle connected to the Harris family is close to signing a transaction to buy Butlin’s operating business back for some £300m. Last month, the UK's largest private pension fund, the Universities Superannuation Scheme (USS), confirmed a Sky News report that it was buying Butlin's underlying real estate assets for £300m. Butlin's was established by Billy Butlin in 1936 after he "felt sorry for families staying in drab guest-houses with nothing much to do" during a trip to Barry Island. In its heyday, Butlin's operated from nine sites across the UK, entertaining one million holidaymakers each year.
 
Lithia Motors, as US car dealership giant with a market value of over $7bn (£5.77bn) was the mystery bidder which made an offer last month for Pendragon, its British peer, Sky News says. NYSE listed Lithia tabled a 29p-per-share bid valuing Pendragon at about £460, however it was rejected by one of Pendragon’s five largest shareholders, Hedin Group, which itself made a 28p-per-share offer for Pendragon earlier this year. Pendragon operates more than 150 dealerships across the UK under the brands Evans Halshaw, Stratstone and CarStore. Pendragon has cut 1800 jobs since the start of the pandemic, and closed 15 stores. Both Pendragon and Lithia declined to comment on Sky’s story.
 
Saudi oil giant Aramco has broken its own record with a $48.4bn (£39.8bn) profit for the second quarter of 2022. It is a 90% year-on-year increase and marks the biggest earnings for the world's largest energy exporter since its public listing three years ago.
 
The Moscow Exchange says it is to be reopened partially to foreign investors from today, after a nearly six-month suspension to prevent money leaving the country during the Ukraine war. However, only investors from "countries that are not hostile" will be allowed to trade bonds, meaning the UK, members of the European Union, Canada and Japan – which together accounted for 90% of investments into Russia last year – will still be excluded as all have imposed sanctions on Russia. its economy. China and Turkey are likely to be among the nations now allowed to trade, as they have not imposed sanctions against Russia, the BBC says.
 
US-based meditation app Calm has axed 20% of its 400-strong workforce, becoming the latest US tech company to announce job cuts. Calm boss David Ko said the firm was "not immune" to the wider economic climate but that this was an “especially difficult” decision “for a company like ours whose mission is focused on workplace mental health and wellness." Peloton has also announced another round of job cuts, affecting 800 people, the BBC says.
 
China missed its industrial production and retail expectations for July. Figures released by the country’s National Bureau of Statistics showed that retail sales rose 2.7% from July 2021, coming in well below analyst expectations of 4.9% growth and down from 3.1% in June. Meanwhile industrial production was up 3.8% in July following a 3.9% jump in June and missing expectations for a 4.3% increase. Fixed asset investment rose 5.7% from July a year ago following 6.1% in June and versus expectations for 6.2% growth. Craig Botham, chief China+ economist at Pantheon Macroeconomics, told Sharecast News: "The slowdown in Chinese industrial production supports the narrative that stronger performances in May and June were primarily the result of a reopening rebound, and that with order backlogs now cleared, China's factories will increasingly run idle once more.

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