No “rational person” would want to see Greece leave the Eurozone, Nick Clegg will say today, warning that Britain will be worse off if the currency starts to break up. Markets tumbled again on Wednesday in reaction to fears that Greece’s exit was being prepared. David Cameron was in Brussels pleading with EU leaders to deal decisively with the Greek debt crisis to prevent a “disorderly” collapse of the euro. The Prime Minister warned other member states that there was a risk of the “contagion” spreading from a Greek exit, which would have dire consequences for Britain, The Telegraph writes.
British supermarkets are in for a tough few years, according to a report by Moody’s, the ratings agency, which has warned that profits at Tesco and Marks & Spencer will be under pressure as customers increasingly seek to cut back on spending money on food. “We expect that UK food retail sales will grow only in the low single-digit range through 2014 as a result of the challenging economic environment,” said Yasmina Serghini-Douvin, the author of the report. The report was published as Tesco launched its latest initiative to try to win back customers. Britain’s biggest supermarket is upgrading 300 of its ready meals, such as chicken tikka masala and rice and chicken chow mein, with 20% more meat being put in the dishes. It is part of its £1bn revamp of its supermarkets and products to put more “love” into the British part of the group, The Telegraph reports.
The Deputy Governor of the Bank of England has told pension funds they cannot count on a rise in gilt yields to close their ballooning deficits as he warned that more quantitative easing may be on the way. In a speech to the National Association of Pension Funds (NAPF), Charlie Bean also defended the Bank against claims that QE is impoverishing pensioners and crippling final salary schemes by slashing investment returns. “Not only is the adverse impact of QE on pension funds often exaggerated, but the excessive focus on QE also risks distracting attention from other factors which may present a more durable challenge,” he said, according to The Telegraph.
Leading analysts branded Facebook’s stockmarket debut a “fiasco” yesterday as investors lodged lawsuits claiming they had not been told of problems with the business before the float. Shareholders began legal action in New York and California against the social network, its chief executive Mark Zuckerberg, Morgan Stanley, the lead underwriters to the float, and other banks involved.They allege that insiders to the initial public offering (IPO) of shares did not make some investors aware of a potential fall in the company’s revenues days before the share sale, resulting in substantial losses. Two of America’s financial regulators have also said they are considering investigating issues surrounding the IPO. This could lead to Morgan Stanley being investigated for alleged securities fraud, according to The Times.
The Government of Saudi Arabia has saved a BAE Systems factory on Humberside by placing a £1.6bn order for dozens of Hawk jets to train its pilots. The deal represents a reprieve for the 248 staff and 30 apprentices who were due to be among 865 people made redundant after BAE Systems decided to shut its Brough site in the East Riding of Yorkshire in September. The deal, signed under a defence co-operation agreement between the Ministry of Defence and its Saudi counterpart, was welcomed by David Cameron, who described it as “good news for British jobs, for British investment and for British aerospace”. The Saudis will buy 55 Pilatus PC-21 aircraft, used for basic flight training, and 22 Hawk advanced jet trainer aircraft, in which trainee pilots will practise combat scenarios The Times says.
Bob Diamond, chief executive of Barclays, has launched a new ‘Citizenship Plan’ as part of a drive to restore trust and burnish his bank’s dented image – but offered no blueprint for reforming pay. The three-year plan, unveiled at the bank’s Canary Wharf headquarters, aims to support local communities, contribute to economic growth and improve integrity and service to customers. Under the plan, Barclays has made commitments to lend at least £150bn to households and to provide at least £50bn to small and medium-sized firms. The bank also plans to boost apprenticeship and work experience programmes to help young unemployed people start careers. Outside of the UK it is helping micro-entrepreneurs in Africa, according to The Daily Mail.