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Good morning! Here’s what you need to know on Friday.
1. The Bank of England on Thursday raised interest rates for the first time in more than 10 years, as had been widely expected by market watchers around the world. The majority of the central bank’s ratesetting Monetary Policy Committee voted to raise the UK’s base rate of interest from 0.25% to 0.5%. Rates had previously stood at 0.5% for seven years between 2009 and 2016, before being cut to 0.25% last August in the aftermath of the Brexit vote.
2. Asian share markets edged higher on Friday as investors gave a guarded reception to Republican plans for massive U.S. tax cuts, while welcoming the appointment of a centrist at the helm of the Federal Reserve, Reuters reports. MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.14%, to near its highest since late 2007. Australia’s main index firmed 0.5%, while South Korea added 0.3%.
3. A giant Singaporean sovereign wealth fund is in talks to buy a stake in OakNorth, the first of Britain’s new generation of “challenger banks” to hit a coveted $1bn valuation. Sky News has learnt that the south east Asian state’s Government Investment Corporation (GIC) is close to agreeing a deal to acquire 10% of OakNorth, the business-focused lender.
4. Europe’s largest carmaker is looking at opening a British bank to help to fund sales of its cars in the UK after Brexit, the Times reports. Talks with the Bank of England are expected to lead to Volkswagen making a formal application for a banking licence that will allow it for the first time to take savers’ money.
5. The City regulator has launched an inquiry into the London-listed technology company Telit Communications, weeks after its chief executive departed amid doubts about his true identity. Sky News has learnt that the Financial Conduct Authority (FCA) has begun making inquiries into events at Telit, which makes products enabling access to the Internet of Things (IoT).
6. Britain’s economy is weaker because of Brexit, the Bank of England said on Thursday. “Brexit-related constraints on investment and labour supply appeared to have been reinforcing the marked slowdown,” the central bank wrote in its inflation report.
7. The chief executive of Tesco said he was “surprised” and “shocked” to be told only 19 days after starting his new job that the grocer had misstated its profit forecast by nearly £250 million, the Times reports. Dave Lewis told Southwark crown court yesterday that although he was aware before taking the top job that the retailer had a tense relationship with its suppliers and a weak balance sheet, he had received no hint that its reported figures may have been misstated.
8. Oka, the luxury furniture company founded by Samantha Cameron’s mother Lady Astor, is on the verge of being put up for sale ;after receiving a number of unsolicited approaches from would-be buyers, the Telegraph reports. Advisory firm Cavendish Corporate Finance has been appointed to oversee a strategic review of the business, with one of the options for its future being a sale. Estimates put the value of the business at more than £40m.
9. Problems in Asia and a troublesome bingo contract have forced gaming and spread-betting company Playtech to issue a profit warning sending the shares plunging by a fifth, the Telegraph reports. Management said it expected annual profits to be 5pc lower than the bottom end of market expectations, prompting analysts to wipe about €20m (£17.8m) off their full-year earnings forecasts and sending Playtech shares down 218.5p to 768p.
10. The UK has retained its place in the top ten countries worldwide for ease of doing business, despite Brexit uncertainty and warnings from British business leaders. This year’s Ease of Doing Business report by the World Bank puts the UK above many of the world’s leading economies, including Germany and France, and the ease of starting a business has actually improved.