InvestmentsJan 4 2013

Morning papers: Banks regain appetite to lend

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The Government’s £80bn flagship scheme to increase bank lending is gaining traction after a patchy start, the latest barometer of British credit conditions suggests, reports The Times.

Lenders reported significant increases in the availability of mortgages and business loans in the past three months and said that they expected further rises in the current quarter, according to the Bank of England’s credit conditions survey.

Labour eyes pension grab to fund jobs

Britain’s top earners would face a £1bn tax grab on their pensions contributions to fund a compulsory job scheme for the long-term unemployed, under plans to be set out by Labour on Friday, reports the Financial Times.

Ed Balls, the shadow chancellor, is proposing in a rare new policy to target the pensions of the rich to pay for the programme that would tackle the “scarring” effect of long-term joblessness.

IMF warning over US strategy dampens global stock markets

A warning from the International Monetary Fund that the US lacks a long-term strategy for dealing with its budget problems dampened the euphoric mood on global stock markets on Thursday, reports the Guardian.

The Washington-based Fund’s view that it considered the eleventh hour deal to prevent US economy from plunging over the fiscal cliff little more than a short-term fix was followed by release of minutes from a meeting of the Federal Reserve’s policy-making committee showing members split over its programme of buying bonds to inject money into the economy.

Bank of England’s top minds raise questions over QE

The inflation risk posed by the Bank of England’s £375bn money-printing effort may be greater than thought, according to “stark” new findings from some of its leading thinkers, reports the Daily Telegraph.

The report by interest rate-setter Martin Weale and colleagues could influence whether the Bank extends its programme of quantitative easing (QE), designed to stimulate the economy.

Google cleared of search results bias after FTC investigation

Google has been forced by regulators in the US to agree to legally binding changes to the way it presents some search results and runs its search advertising following nearly two years of investigation, reports the Guardian.

But the internet search engine was exonerated of bias to push down competitors in its search results, leaving it untroubled by any government threat.

Fed split over when to halt QE3

Officials at the US Federal Reserve are split on whether to keep buying assets until the end of 2013, according to the minutes of their December meeting, reports the Financial Times.