Author: Industry News

FTSE 100 loses ground as retailers drop, with Fed decision in focus

FTSE 100 loses ground as retailers drop, with Fed decision in focus

Later, a report on the U.K. labor market will be watched for signs of wage growth, after a disappointing inflation reading hurt prospects for a Bank of England rate rise.
Retailers were among the worst performers on the London benchmark, after a downbeat view on the U.K. from home improvement chain Kingfisher PLC.
On Tuesday, the index ended 0.3% higher.
What’s driving markets The marquee event for global markets is the Fed’s policy decision, and markets have priced in expectations that it will raise its benchmark rate by a quarter-percentage point.
Investors are watching for hints the U.S. central bank may hike rates four times this year, compared with the three seen.
The decision is due at 2 p.m. Eastern Time, or 6 p.m. London time.
Investors were looking for a solid reading to help prompt the Bank of England to raise interest rates in May, after data on Tuesday showed inflation in February was lower than expected.
The Bank of England releases its policy decision on Thursday.
Read: The pound’s post-transition deal bounce might not be here to stay The pound gained after the release of the labor data.
It was expected to hold at 4.4%.

4.3%: UK unemployment falls back to near record lows

4.3%: UK unemployment falls back to near record lows

LONDON – Unemployment in the UK unexpectedly fell between November and January, according to new data released by the Office for National Statistics on Wednesday.
The headline unemployment rate, which measures the percentage of the British workforce who want a job but don’t have one, fell from 4.4% to 4.3%, reversing an increase seen in data released last month.
There were 1.45 million unemployed people in the UK over the period, according to the ONS.
Average earnings were in line with forecasts, the ONS said, with earnings increasing by 2.6% over the data period, compared to an increase of 2.5% at last month’s reading.
The UK’s Consumer Prices Index (CPI) inflation rate — the key measure of inflation — dropped to 2.7% in February.
That means that while earnings growth may be picking up, people are still not seeing wages rise quick enough to keep up with prices.
The Bank of England expects real wage growth to move into positive territory during 2018.
The bank’s monthly agents’ summary of business conditions, which polls the central bank’s operatives in the UK’s regions for a picture of what’s going on in the economy, last month showed that businesses expect wage growth to increase to 3.1% in 2018, up from 2.6% last year.
More follows …

U.K. wage growth accelerates in January

U.K. wage growth accelerates in January

LONDON–The unemployment rate in the U.K. held steady in January and wage growth ticked up, signs that the labor market remains healthy despite subdued growth in the economy.
The jobless rate in the three months through January was 4.3%, the Office for National Statistics said Wednesday, the same rate as the previous three months and lower than the 4.7% for the same period a year earlier.
The figures come as Prime Minister Theresa May hopes to this week seal an agreement with other European leaders on the terms of a transition period to bridge the gap between Britain’s formal exit from the European Union in March next year and the start of its future relationship with the bloc.
The transition, if agreed Thursday, is expected to last until the end of 2021, giving London and Brussels time to finalize the terms of their new partnership and businesses time to prepare.
Forecasters including the Bank of England expect the U.K. economy to lag its peers as long as uncertainty over the terms of its EU exit persists.
ONS data Wednesday showed the number of people in work in the U.K. rose in the three months through January, but so did the number joining the labor market to look for a job.
The fall was driven by a decline in the number of long-term sick and those registered as retired.
Britain’s fiscal year runs from April to March.
Treasury chief Philip Hammond said this month he intends to keep a tight rein on spending in the coming years in an effort to bring down public debt.
Write to Jason Douglas at

Australian wage growth is likely to pick up — but don’t start celebrating just yet

Australian wage growth is likely to pick up — but don’t start celebrating just yet

The RBA is banking on stronger wage growth to help lift inflation and economic growth in the years ahead.
Most leading labour market indicators all point to stronger wage pressures as labour market conditions strengthen.
While few see any meaningful lift in wages arriving any time soon, there are signs that the labour market is slowly tightening.
The unemployment rate, at 5.5%, is edging lower while broader measures of labour market underutilisation such as underemployment, measuring the proportion of Australians who have a job but who would like to work more hours, is also starting to decline, albeit from elevated levels.
It suggests that Australia’s record-breaking pace of job creation seen in 2017 is helping to tighten labour market conditions.
And this next chart also suggests that labour market conditions are tightening.
And as labour market conditions gradually tighten, there are signs emerging that average advertised salaries are also starting to increase.
“The Reserve Bank’s central scenario is that, over time, this will become a more general story.” While Lowe appears confident that ongoing strong demand for workers will help to lift wage pressures more broadly in the period ahead, markets will get to gauge the other side of the equation — labour supply — when the ABS releases Australia’s jobs report for February.
Even with the gradual reduction in labour market underutilisation seen in recent years, current levels of annual wage growth remain well below what they were during similar levels of underutilisation in the past.
Should that trend continue, it suggests that any lift in wage pressures from lower levels of labour market slack is likely to be subdued.

Workers comp provider acquires insurer

Workers comp provider acquires insurer

To expand its geographic reach, privately held Service Insurance Holdings Inc., parent of Texas-based Service Lloyds Insurance Co., is acquiring Oklahoma City-based American Healthcare Indemnity Co., the Austin-based company announced Tuesday.
The new entity will be rebranded as Service American Indemnity Co., according to a press release.
The acquisition will allow Service American Indemnity Co. to write workers compensation insurance in up to 48 states.
The new entity will also identify and introduce new programs that will create significant opportunities for growth and profitability, according to the release.
Specifics on the acquisition were not available.
“The launch of Service American Indemnity Co., integrated with Service Lloyds, represents one of the first steps in our strategy to execute measured, organic growth into targeted areas over the next few years,” said J. Kelly Gray, CEO of Service Insurance Holdings Inc., in a press statement.
“It will allow us to continue our tradition of unparalleled service in the workers compensation market as well as be responsive to the growing needs of customers and stakeholders.” The acquisition will result in a planned pooling and reinsurance agreement under Service Insurance Holdings, whose business will remain headquartered in Austin.

Fed Watching Basketball-style: Point-Spreads or Teamwork?

Fed Watching Basketball-style: Point-Spreads or Teamwork?

Financial traders are as focused on the FOMC rate hike probability as basketball gamblers are on in-game win probabilities.
Likewise, investors want to know how Fed Coach Powell and his team will make decisions in 2018.
The Fed calls this average “inflation.” But, today’s price changes are not like 1970s monetary-caused inflation.
Government policy can change prices — regulatory policy (tariffs, banking, health care, or zoning), taxes, and subsidies.
Question #2 Why do FOMC members wonder about the mystery of “missing inflation?” Investors read data showing the average price for durables has been falling since 1995 – global costs have been falling for decades.
But, health care price increases have been moderating since 1996, with rises and falls.
Question #3 What power does the FOMC have to raise prices that are lower because of improved technology, a change in regulation, or lower taxes?
Question #4 Why does the FOMC target the average price of all products when durables are fastest growing, and people buy more when prices fall?
Question #5 Does the reality of lower prices for real people change policy?
Question #6 What is the Fed’s primary guide for the Federal Funds rate?

HURT TO HOPE: Teens of addicted parents feel inclusion, reclaim voices through group

HURT TO HOPE: Teens of addicted parents feel inclusion, reclaim voices through group

John Kasich who mentioned them during his final State of the State address this month.
Maybe for the first time in some of their lives, the girls feel powerful. “I hope no other kids have to deal with what we have to, that they have people to talk to,” said Faith Butler, 15.
A lot of these kids are dealing with adult situations as kids,” Gillott said.
He had known Rodgers and some of her peers because he’d been arresting their parents for years but hadn’t really thought of what the impact was on them.
Crabtree also spoke to the high school students to let them know, “I didn’t care about their parents anymore.
The teens began supporting each other.
The YMCA began piloting Hurt to Hope Jan. 15 and while they haven’t received any funding from the state yet, there is funding available now through the Ohio Department of Job and Family Services and the Ohio Department of Mental Health and Addiction Services, said Kim Conley, Pike County YMCA director.
On a state level, the teens also have been cited as the impetus for the OhioCorps bill introduced last month.
The bill aims to create a mentoring programs between college students and teens impacted by poverty and the opiate epidemic.

Why the stock market may find an ally in the Fed

Why the stock market may find an ally in the Fed

The Fed funds futures market is currently pricing in three rate increases in 2018, the same as the Fed policy makers are projecting, but investors worry that the FOMC, which is viewed as decidedly more hawkish than last year’s lineup, may signal a fourth hike is in the offing via their so-called dot-plot forecast.
The stock market’s preference for three rather than four rates hikes was made apparent in the sharp February selloff that tipped the S&P 500 SPX, +0.16% and Dow Jones Industrial Average DJIA, +0.50% into correction territory—a drop of 10% from a recent peak.
“The dots are likely to shift around, but we are skeptical that we will see four hikes penciled in for 2018.
Read: Powell will use press conference to counterbalance hawkish undertone of Fed’s forecasts “Instead, what we are likely to see is a coalescing around three hikes this year.
After all, there are six officials currently below three hikes for 2018,” he said.
And Dutta argued that there is still considerable slack in the labor market.
“While some at the Fed appear to be enamored with the idea that the labor market is beyond full employment, the latest figures don’t really support this view,” he said.
“The continued rise in prime-age participation rates suggest that more workers can be drawn into the labor force provided the recovery continues,” Dutta said.
Since the Federal Reserve has a dual mandate of full employment and inflation, allowing more workers join the workforce may prompt officials to rethink what an optimal unemployment rate is.
“If the Fed reiterates a balanced set of risks and doesn’t shift the median up to four hikes this year, it will likely take some of the air out of the hawkish Fed trade,” Dutta said.

Italy’s election: How the economy is performing

Italy’s election: How the economy is performing

Italy’s economy has started to expand once again, but is still one of the worst performers of the countries in the eurozone.
Italy vote: Who’s who and why it matters The parties are battling to prove they can take Italy’s economy, industry and job market back to pre-crisis levels.
The road to full recovery has been much harder than many expected.
Slow growth Economic growth – in terms of GDP per head – has been picking up since 2014.
The “Made in Italy” brand has been rejuvenated thanks to an increase in exports and international interest.
Part-time jobs In 2014, Matteo Renzi’s Democratic Party started its job reforms, which have been credited with creating almost one million jobs.
However, the latest Italian Institute of Statistics (ISTAT) figures show that nearly 60% of them are part-time roles.
Unemployment The level of part-time work means much lower job security compared with other European countries.
Increasing poverty Although Italy presents itself as one of the top three European economies, high rates of unemployment have caused a steep rise in poverty.
Battle against taxes The top rate of income tax in Italy is one of the highest in Europe, well above the 39% average for top rates across the 28-members of the Union.

The 23 cities with the best quality of life in the world

The 23 cities with the best quality of life in the world

Every year Mercer, one of the world’s largest HR consultancy firms, releases its Quality of Living Index, which looks at which cities provide the best quality of life.
The ranking is one of the most comprehensive of its kind and is carried out annually to help multinational companies and other employers to compensate employees fairly when placing them on international assignments, according to Mercer.
London and New York do not make it anywhere near the top of the list.
Looking at 450 cities across the world, Mercer takes into account the following metrics to judge which cities made the list for the best quality of life: Political and social environment (political stability, crime, law enforcement) Economic environment (currency-exchange regulations, banking services) Socio-cultural environment (media availability and censorship, limitations on personal freedom) Medical and health considerations (medical supplies and services, infectious diseases, sewage, waste disposal, air pollution) Schools and education (standards and availability of international schools) Public services and transportation (electricity, water, public transportation, traffic congestion) Recreation (restaurants, theatres, cinemas, sports and leisure) Consumer goods (availability of food/daily consumption items, cars) Housing (rental housing, household appliances, furniture, maintenance services) Natural environment (climate, record of natural disasters) Here are the top 21 cities on the planet, according to Mercer.
Lianna Brinded contributed to an earlier version of this post.
Reuters/Chris Wattie Markus Schreiber/AP PomInOz / Shutterstock Kristoffer Trolle/Flickr