It’s been a difficult week for the UK economy this week. Figures released yesterday showed that the economy had contracted in the last month and that over Q1, growth was only 0.8% vs an expected 1%.
It has led to further speculation that the UK could be headed towards a recession later in the year and comes off the back of the BoE’s deputy governor telling Bloomberg that we should expect further rises in Interest Rates.
Over the course of the day today, Sterling hit a two year low against the Dollar with no end in sight. It is believed by many that the rate could drop below the 1.20 mark in the near future.
Against the Euro, Sterling took a slight dip mid-week, but ended the week back where it started.
Putting the Pound aside, the Euro has continued to decline against the US Dollar. It could end this week at the lowest point since 2002! Much of this can be put down to the war in Ukraine and the constant threats to the European energy markets from Russia. We could see parity in these currencies very soon.
Back to the UK and pressure is growing on the Government to introduce a Windfall Tax on energy companies. Just today figures were released showing Diesel had hit a record high wiping out the effect of the Fuel Duty Cut. Both the PM and Chancellor are said to be warming to the idea after a raft of energy companies announced huge profits. Just recently for example, the parent company of British Gas announced that it would be seeing between £739m and £1.4bn profits this year.
To round the week off with some positive news, an amateur baker has won a competition to create a new pudding to celebrate the Queen’s Platinum Jubilee. The lemon Swiss roll and amaretti trifle will now officially become ‘The Platinum Pudding’ and join Coronation Chicken as part of the UK’s culinary history.
