CPI inflation sticks at 6.7%, but core inflation dips slightly, suggesting Bank of England may keep interest…

The higher price of oil is being blamed this morning for the fact inflation stood still at 6.7% in September. Economists had predicted that the consumer prices index (CPI) measure of inflation would drop to 6.6%, however a hike in the price of petrol and diesel offset falls in food and drink prices. Crude oil prices are up by over 20% since June and gas prices are the highest they have been since February. The price of milk, cheese and eggs all decreased, the Office for National Statistics (ONS) said, but petrol increased by 5.1p per litre. However, core inflation, which strips out food, alcohol, tobacco and energy, fell to 6.1% in on an annual basis, down from 6.2% in August, a dip that commentators have suggested may be enough for the Bank of England to keep interest rates on hold next month. ONS chief economist Grant Fitzner told BBC Radio 4's Today programme earlier that there may be "some disappointment" about the unchanged figure, but added: "If you look across Europe, many countries have seen either periods lately of no change or in some cases of actual increases in the headline rate, before they started to resume their falls." Chancellor Jeremy Hunt, echoed his comments, saying: “As we have seen across other G7 countries, inflation rarely falls in a straight line, but if we stick to our plan then we still expect it to keep falling this year.”

Prime Minister Rishi Sunak is being urged by Sir John Armitt, chairman of the National Infrastructure Commission (NIC), to shut down Britain’s gas network and commit to a total ban on gas boiler sales by 2035, as well as spend around £6bn rolling out heat pumps. Armitt wants the supply of natural gas to all buildings to stop by 2050 so the UK can hit climate targets. However, Jon Butterworth, the CEO of National Gas has hit back at the suggestion and urged the Government to keep the country’s pipelines. “I worry that there is a suggestion we decommission the gas distribution system without any alternative for millions of homes and hundreds of thousands of businesses,” he said, noting that 23m homes are dependent on gas – roughly 85% of the country’s housing stock – and that the NIC provided “no answer” for hard-to-heat homes in its report. Half a million businesses also depend on existing gas infrastructure, including industrial estates, restaurants and hotels, he said. “If you were to decommission the gas system, you can’t electrify these businesses because you need such high thermal energy. It doesn’t really answer what are they to do?” The GMB trade union, one of Britain’s largest, also slammed the proposals. GMB national secretary Andy Prendergast argued that “ripping out the gas network for 25m homes is expensive stupidity” and that the recommendation is “utterly farcical”.  The union has also criticised Labour’s proposals to ban new oil and gas licences in the North Sea.

The financial services sector is still run by an “old boys’ network” that allows sexual harassment and misogyny to go unchecked, the so-called city ‘superwoman’ Baroness Morrissey told MPs on the Treasury Committee yesterday, as it launched its Sexism in the City inquiry. Sexism is “endemic” across the industry, Helena Morrissey said, and she called for independent reviews into how firms deal with complaints of sexual harassment. She also said the Financial Conduct Authority should better use its powers to tackle the problem and penalise firms for failing to act not least, she said, as a “fear factor” deters women from reporting harassment and assault to their superiors. Morrissey, 57, has had a super-charged career in asset management while raising nine children.

Vodafone and Three have hit back at warnings from trade union Unite that their proposed merger will stifle competition, threaten national security, and raise customer bills by up to £300 a year. Yesterday, Unite opposed the merger while giving evidence to a Business and Trade Committee hearing in the House of Commons. Unite’s investigative researcher, George Stevenson, accused both firms of only “looking for a shortcut to increase their profit levels”. Stevenson also highlighted potential “security risks from Three’s Chinese-state linked owners.” It’s a terrible deal for consumers, a terrible deal for workers, and a terrible deal for national security,” he said. However, Vodafone and Three representatives argued that would boost competition and create more jobs in the industry. Nicki Lyons, Vodafone UK corporate affairs and sustainability director, said the company’s investment pledge of £11bn through the deal “will have significant benefits to consumers as well and to competition in the sector” and that the merger will help rather than hinder competition as they say it creates a third mobile network operator with the scale to compete effectively with BT/EE and Virgin Media O2. The merger is currently under investigation by the Competition and Markets Authority (CMA), Britain’s competition watchdog.

The Society of Motor Manufacturers and Traders (SMMT) has crunched the numbers on what the cost will be of the new post-Brexit “rules of origin” tariffs which are due to come in on electric vehicles (EVs) in January. The new tariffs will add 10% to the cost of any electric car which fails to source nearly half of its value from inside the UK or the European Union (EU), and the SMMT has concluded each sale will cost Brits an extra £3,400, while there will be a combined cost of £4.3bn to the industry between 2024 and 2026. Mike Hawes, SMMT’s CEO said: “our manufacturers have shown incredible resilience amid multiple challenges in recent years, but unnecessary, unworkable and ill-timed rules of origin will only serve to set back the recovery and disincentivise the very vehicles we want to sell. Not only would consumers be out of pocket, but the industrial competitiveness of the UK and continental industries would be undermined. A three-year delay is a simple, common-sense solution which must be agreed urgently.” Vauxhall owner Stellantis, Jaguar Land Rover and Ford have all criticised the new tariff. Stellantis has warned it may have to close factories in the UK without changes to the Brexit deal, while Ford has described the levy as a “pointless cost.”

Meanwhile, Tesla has cut the price of its entry-level Model 3 EV car in Britain, beginning to sell it yesterday for £39,990, £3,000 cheaper than the previous cheapest version.

City AM reports that Credit Insurance, which protects retail suppliers from retailers collapsing in between expecting an order and payment, has been pulled from some of the country’s biggest names in the past few months. Allianz Trade, formerly Euler Hermes, reduced its cover on Boohoo by an average of 50%, the newspaper says, placing “further pressure on the fast fashion favourite after it struggled with sales amid the cost of living crisis”. The same firm also pulled cover from Asos suppliers in June, citing a challenging economic climate and the company’s poor financial performance.  Meanwhile, online retailer Very Group also saw cover pulled over concerns with its finances. Group fashion and sports retail sales at Very declined by 9.4% year-on-year, with the company blaming a “heavily promotional environment for fashion” for the fall. City AM also understands that Manchester business eComplete, an e-commerce start-up, had its credit insurance pulled just as it started to implement a restructuring in recent weeks as it seeks to avoid administration. Russ Mould, investment director at AJ Bell, said the relationship between creditors and retailers is a “very delicate balancing act”. “I guess it’s the supply chain looking to protect itself and insurers looking to protect themselves,” he said, adding that in his experience, insurers do not pull cover “unless they feel there is a good reason for doing so”.

Lloyds Banking Group is to transfer The Telegraph to a newly established holding company as it prepares for an auction and a potential legal battle with former owners the Barclay family, The Daily Telegraph reports. Telegraph Media Group Holdings Limited was registered on Companies House on Monday as a subsidiary of Telegraph Media Group Limited, which publishes The Daily Telegraph and The Sunday Telegraph, and all their digital properties, and is a precursor to a “hive down” whereby Telegraph Media Group Limited and dormant companies associated with it will eventually be dissolved. The move is also intended to ring-fence The Telegraph from any potential court wrangling with the Barclay family that might overshadow the imminent auction of the titles. It is understood that the process will have no impact on staff pay, benefits or conditions. A source said: “This is an administrative change as part of the sale readiness process.” The Barclay family owned The Telegraph from 2004 until this summer, when a long-running dispute over debts of more than £1bn prompted Lloyds to appoint receivers and take ownership. The Barclay family has made a series of offers to pay off some of the debt they secured against The Telegraph in hope of regaining control, but Lloyds is pressing ahead with plans for a competitive auction run by Goldman Sachs. Other interested buyers include Sir Paul Marshall, the co-owner of GB News, who has formed a consortium with fellow hedge fund billionaire Ken Griffin, a major donor to the US Republican party; Daniel Kretinsky, the Czech billionaire gas dealer and West Ham United investor; Sir William Lewis, a former editor of The Telegraph; German newspaper giant Axel Springer; and Lord Rothermere’s Daily Mail and General Trust, the publisher of The Daily Mail.

Morgan Stanley is locked in a secret London court battle as part of an attempt to seize an oil firm in southern Russia on behalf of a group of lenders, City A.M. has learned.  The Wall Street Bank is looking to take a majority stake in Cypriot-registered Russian drilling firm, Southern Oil Company (UNK), after UNK’s parent firm, Astrakhan Oil Corporation (AOC), which is also registered in Cyprus, fell behind on payments to the bank for a $73m loan when the rouble crashed following Russia’s invasion of Crimea in 2014. A hearing at the London Court of International Arbitration is set to take place today, City AM says. If Morgan Stanley is successful, AOC would be forced to hand over control of UNK’s 40 oil wells in the southern Astrakhan region of Russia, wiping out UNK equity holders. Attempts to take control of the oil firm stretch back to 2017, but the bank’s attempts have been rejected by the Russian courts.

Serco has won a Department for Work and Pensions (DWP) £350m five-year contract to deliver functional health assessments to determine disability benefits and support in the south-west of England.

The Savoy and The Dorchester are warning a lack of workers is leaving them unable to meet growing demand from wealthy tourists travelling to the capital to stay in their luxury hotels. The Telegraph has seen newly filed accounts for The Savoy which cite “ongoing hiring challenges” as limiting the hotel’s ability “to service the strong resurgence in demand”. These concerns were echoed by The Dorchester, which said in its latest financial report that the labour market continued “to be a challenging one to operate in”. However, revenues at the Dorchester Hotel Limited, which owns The Dorchester and its sister hotel 45 Park Lane, jumped by more than 50% to £61.3m last year. Turnover at The Savoy also rose from £23.4m to £52.9m. Both posted pre-tax losses of £18.5m and £12m respectively. Recent figures from the ONS show the hospitality sector has almost 120,000 unfilled roles, more than any other industry, while another survey by trade association UK Hospitality found around 61% of its members were experiencing staff shortages. Kate Nicholls, CEO at UK Hospitality, said: “For hoteliers in particular, shortages have been felt most acutely in critical roles such as chefs, housekeepers and receptionists.”

Revolution Bars has swung to a full-year loss, blaming “the cost-of-living crisis which followed the period affected by trading restrictions under the pandemic". In its preliminary results for the year to 1^st July, the company said it swung to a statutory pre-tax loss of £22.2m from a profit of £2.1m the year before. Total revenue rose by £11.8m to £152.6m. However, like-for-like revenues declined by 8.7%. The company - which owns Peach Pubs, Revolution, Revolucion de Cuba, Founders & Co and Playhouse - said its Revolution brand was hit particularly hard by reduced footfall "as a result of the well-publicised challenges faced by our young guest base". "On a macroeconomic basis, late-night hospitality, in particular, is facing very challenging times,” it added, also citing “the working from home trend, especially on Fridays, historically our second largest night” as affecting sales.

Britain’s largest wealth manager, St James’s Place, has finally agreed to scrap early withdrawal charges on all new investment bond and pension business from the second half of 2025 for new customers, following pressure from the Financial Conduct Authority (FCA); lawyers seeking redress for clients; and numerous fairly negative media reports. The FTSE 100 firm will also cap its initial advice fees, ongoing advice fees and fund charges. However existing clients will see the early withdrawal charge still apply until it tapers off, meaning clients could still be paying exit fees as late as 2030, five years after they have been scrapped. St James’ said the overhaul was expected to cost the business between £140m and £160m by the time it was introduced. The furore has wiped more than 18% off St James’ share price this week. The FCA introduced a new Consumer Duty this summer which includes a rule that firms should not impose “unreasonable” exit fees. Currently, St James’ clients who want to stop receiving advice from the company face an early withdrawal fee as high as 6% for new clients. Some £47bn, or 30%, of the firm’s assets under management were subject to such exit penalties as of June this year, according to reports, which also detail complaints from clients who say they have gone years without seeing their adviser yet were still paying ongoing fees. The Telegraph has been told by lawyers AMK Legal that it has recovered £3.43m for St James’ clients so far this year, in many cases because of a lack of review meetings between adviser and client. Lee Goggin, of the platform Findawealthmanager.com, told the newspaper: “It’s about time. Too many clients have had to endure an opaque charging structure that was pricey and not good value.”

And finally… Goldman Sachs CEO David Solomon has decided to stop DJ-ing notable gigs after his high-profile hobby drew unwanted scrutiny from the US bank’s board of directors, according to the Financial Times. He has not appeared at a major event since Lollapalooza in Chicago last July, one of the largest music festivals in the world. Solomon’s hobby began more than a decade ago, and became highly visible, with his original DJ persona DJ-D Sol being referenced in the American television series Billions in 2020. “This is not news,” Goldman spokesman Tony Fratto told the FT. “David hasn’t publicly DJed an event in well over a year, which we have confirmed multiple times in the past. Music was not a distraction from David’s work. The media attention became a distraction.”