Interest rate update
As policymakers continue to try to reconcile their concerns about the health of the UK economic recovery with their worries about inflation, UK interest rates have remained unchanged at their all-time low of 0.5% since March 2009. However, the nine members of the Bank of England’s (BoE’s) Monetary Policy Committee (MPC) voted unanimously for the[.....]
Banking reform
The UK banking sector is set to experience “fundamental and far-reaching” changes following the publication of a report from the Independent Commission on Banking (ICB), chaired by Sir John Vickers. The report recommends that UK banks should ring-fence their retail banking operations from their investment banking divisions in order to protect retail customers and taxpayers.[.....]
What is a ‘double-dip’?
Against a deteriorating economic backdrop, speculation about the likelihood of a “double-dip” recession has intensified. While a recession is generally defined as two consecutive quarters of negative growth, a double-dip recession occurs when an economy falls into recession, stages a recovery and then slips back into recession. Recessions can take a number of different forms.[.....]
Important changes to pension legislation
Britons could soon enjoy greater financial flexibility in retirement thanks to draft legislation released by the UK Treasury. Individuals are no longer forced to buy an annuity with the proceeds of their personal pension scheme at any age. Instead, they will continue to have the options to save it or move to a drawdown (unsecured[.....]
The future of pensions
Against a background of political wrangling about pension reform, a growing number of UK individuals face an uncertain – and uncomfortable – retirement. According to a survey conducted by Prudential, 35% of UK individuals who plan to retire in 2011 will have an income below the poverty line. The Joseph Roundtree Foundation estimates a single[.....]
Northern Rock – three years on
The annual “Mansion House” speeches delivered by the Chancellor of the Exchequer and the Governor of the Bank of England (BoE) often prove controversial, and 2011 was no exception as Chancellor George Osborne announced plans to sell off Northern Rock. Northern Rock was rescued by the taxpayer in 2008 following a spectacular collapse in 2007[.....]
CPI vs RPI
In June 2010, the coalition government announced that, in future, state and public service pensions would increase in line with the Consumer Price Index (CPI) rather than the Retail Prices Index (RPI). The change, announced in an Emergency Budget, aims to help the government cut the UK’s sizeable budget deficit. CPI does not include housing-related[.....]
UK House Prices
The UK housing market remains lacklustre and property prices appear unlikely to show a marked improvement in the immediate future. The Land Registry reported house prices posted a monthly increase of 0.8% during April, the first time since January 2011 the figure has been above zero and the largest growth since January 2010. This follows[.....]
Outlook for Oil
Commodity prices have been volatile in recent weeks, affected by mixed economic data and ongoing concerns about geopolitical tensions in the Middle East and North Africa. Crude oil prices plummeted in early May and, amid the instability, the price of Brent crude underwent its most severe weekly fall on record. Nevertheless, the Organisation of Petroleum[.....]
EU Insurance Ruling
The European Court of Justice (ECJ) has ruled that insurers can no longer use gender as a factor when calculating premiums. Europe’s Gender Directive outlawed gender discrimination in the UK from 2008; however, the UK was granted an opt-out when determining insurance premiums. This opt-out has now been ruled as discriminatory and against the principle[.....]
