The Bank of England minutes revealed the bank is moving closer to a rate rise after some members of the Monetary Policy Committee dictated they stand read to vote for an earlier than expected increase, the Financial Times reports.
The bank, which has kept interest rates at the historically low rate of 0.5 per cent since 2009, would be the first leading central bank to increase rates since the European Central Bank tightened its monetary policy in the summer of 2011.
Last month, figures from the Office for National Statistics revealed the UK achieved GDP growth of 0.8 per cent in the first quarter of 2014, slightly up from the growth of 0.7 per cent seen in the last three months of 2013. Due to the strong growth, economists expect an interest rate rise in the first half of next year.
While still below the MPC’s 2 per cent ceiling, figures revealed inflation also edged up to 1.8 per cent in April.
Royal Mail warns competition hampers profits
According to the Financial Times, Royal Mail has warned increasing competition meant there was a “reasonable prospect” that its target for how much profit it makes “would never be sustainably achieved”.
It said it faced “increasing challenges” in both its letters and parcels business as it reported a 12 per cent rise in operating profits before modernisation costs to £671m in its first full-year results since privatisation.
Highest retail sales in a decade
Data has revealed that retailers enjoyed their best month for a decade in April, with sales up 6.9 per cent compared to 12 months ago, the Guardian reports.
The figures from the Office for National Statistics showed the volume of sales rose 1.3 per cent on March levels, boosted by spending during Easter in the shops and online last month.
The data provides further evidence of recovery and raising the prospects for an early interest-rate rise
Lloyds blames customers on job cuts
Lloyds Banking Group has blamed the closure of a call centre in Warrington – part of an announcement of 645 job cuts – on “customers preferring to bank online”, according to the Guardian.
The 645 job cuts take the total number of redundancies to 13,055, since chief executive António Horta-Osório took the helm of the bank in 2011.
He has earmarked 15,000 cuts as part of a three-year strategy, on top of 30,000 lost as a result of Lloyds TSB’s rescue of HBOS in 2008 to create the larger group.
About 180 jobs are going from Warrington – which will close – with 120 moving to Speke, Liverpool. In total 645 jobs are going across several areas, although 65 will be created.