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The Guardian - UK
The Guardian - UK
Business
Graeme Wearden

Government urged to act on wage squeeze as UK inflation rate hits 2.9% – as it happened

The skyline of the City of London.
The skyline of the City of London. Photograph: David Levene for the Guardian

That’s all for today, I think.

Here’s our latest news story on the inflation data:

Thanks for reading and commenting. GW

Our economics editor, Larry Elliott, argues that the government must respond to the pickup in inflation, and reverse some of its austerity measures.

He writes:

Had Theresa May won the landslide she was clearly expecting, the government would have been able to ride out this difficult period. Inflation is likely to go up a bit further, but the ONS’s separate figures for producer output prices, which measure the cost of goods leaving factory gates and provide a guide to inflationary pressure early in the pipeline, appear to have peaked. Moreover, weaker consumer spending will result in lower growth and this will eventually feed through into a fall in inflation.

But May is a weakened prime minister heading a minority administration and she doesn’t have time on her side. The government has recognised that voters are unhappy about falling living standards and have had enough of cuts. Deficit reduction will now play second fiddle to the need to raise real incomes, so expect a generous uplift in the minimum wage and an easing of curbs on public sector pay as signs that the age of austerity is over.

More here:

Rising prices are bad news for those who have managed to save money, particularly if they’re relying on savings income (as many pensioners are).

M&S have calculated that the gap between the interest rate on cash savings and inflation is the widest since November 2011.

That means savings, as well as wages, are shrinking in real terms.

Savings vs inflation

Ritu Vohora, Investment Director at M&G, has the details:

“At this rate, £5,000 left in an average bank account would lose £137.50, in real terms after the effects of inflation, over the next 12 months.

“All investments come with some risk, but these rock bottom net savings rates carry the very real risk of eroding wealth.”

“Now could be the right time to consider whether investing in stocks and shares could be a better way to protect against inflation, and achieve your long-term financial goals.”

CBI chief: We've got to get Brexit right after election earthquake

CBI Director General, Carolyn Fairbairn.

The head of the Confederation of British Industry has called Thursday’s general election a political earthquake, but said it’s an opportunity for a different kind of Brexit in which the voice of common sense is heard.

Carolyn Fairbairn, director general of the CBI, also warned Theresa May that for businesses across the UK, particularly in Northern Ireland, a soft border in the country was fundamental.

“Clearly it was just a political earthquake last Thursday. What we saw and realised is a lot of the consensus we thought we had we actually don’t have,” Fairbairn told the Fortune Most Powerful Women International Summit in London on Tuesday.

“My biggest message is this is a time to broaden the church, listen to and work through the biggest issues.

“We know we really care about the strength of our economy, about the regions of the UK growing. Don’t just be focused on London. The young turned out in their thousands, listen to that young voice.”

Fairbairn said the soft border in Ireland was “absolutely fundamental”, because it had helped understanding between people and the peace process. “I’m hoping from a business and practically human point of view that there is a commitment to that,” she said.

She added that there was much unhelpful language around Brexit ahead of the commencement of negotiations next week, such as “hard and soft” Brexit.

“We know we want access to the single market, jobs depend on it. We also know there is a dilemma we’re facing, there is real public concern around immigration. We’re also seeing companies with skills shortages, a 96% reduction in nurses applying [as revealed yesterday].

We need to open up that dilemma again and come up with ways to address the public concern.”

Asked why businesses were quiet during the referendum campaign, Fairbairn said they weren’t but their voice wasn’t heard enough. “We learnt through the referendum how strong this sense of feeling left out of prosperity and growth a lot of the country felt,” she continued. “We didn’t understand enough the concerns around immigration.”

What was needed now was “a reset”, she explained. “In terms of the migration issue, I think people were saying we want control back. Is that served by a single number, a cap? If not, let’s go back to problem solving.”

“I’ve got a fundamental confidence in common sense prevailing through all this,” Fairbairn said.

“I think nobody in this room would think the referendum campaigns were good. The information and understanding... I think we can get to a better place now, where there are more voices coming through. Universities, young people. The chips are falling a different way now and we can have a different outcome. The fact is the EU will be our trading partner for a long time and it’s an opportunity to protect our relationship.”

But she added: “Let’s be very clear, everybody I speak to in business accepts Brexit is happening. But what we don’t have is a consensus about how it’s happening.”

She stressed that there was a lot of “really fantastic stuff” going on in businesses across the country, and urged people “not get too down on ourselves in terms of the economy”, which has huge potential. “But we’ve got to get Brexit right and make sure we have access to the single market.”

The floor of the New York Stock Exchange.
The floor of the New York Stock Exchange. Photograph: Richard Drew/AP

While Britain faces the prospect of falling real wages, squeezed households and ongoing child poverty, America’s stock market has just hit a new all-time high.

The Dow Jones industrial average jumped by around 70 points to 21,307, a new record.

Investment bank Goldman Sachs is the biggest riser (+1.5%), followed by credit card firm VISA (1.2%).

Tech firms Apple, Microsoft and Cisco have all gained around 1%, after two days of losses.

UK government bond prices have hit their lowest levels in a month since the inflation data was released.

The pound has also risen, now up 0.7 of a cent at $1.2720.

Those two facts suggests that traders see a higher chance that the Bank of England tightens monetary policy sooner, because of the risk of inflation.

However, several economists are suggesting that the BoE will be content to ‘look through’ the inflation figures.

The FTSE, meanwhile, is almost flat at 7519 points, up 0.1%.

Ashwin Kumar, Chief Economist at the Joseph Rowntree Foundation, has joined the ranks of the experts calling for the government to end its benefits freeze.

He points out that the policy becomes particularly harsh when prices start to accelerate:

“People on low incomes face challenging times. Inflation is up by the highest rate in five years, continuing a sharp rise since the Brexit vote, and employment figures out tomorrow are likely to show that wages are barely keeping up. With increases of 2 per cent in food, nearly 5 per cent in energy and 3 percent in clothing and footwear, families are facing very difficult choices.

“The benefit freeze will squeeze family budgets even further. This was a policy designed in an era of very low inflation. This is no longer the case and low-income households are suffering. As the cost of essentials rises, the new Government could help struggling families by ending the freeze on benefits.”

Given the current economic uncertainty, Brits should plan for this wage squeeze to last for some time.

Calum Bennie, savings expert at Scottish Friendly, says.

“The seemingly perpetual squeeze on UK households continues. The rise of inflation to 2.9% means no end is in sight for hard-pressed consumers who see prices rising but growth in their wages failing to keep pace. It is no surprise then that consumers are reining back on spending or in many cases are turning to credit to get by as day-to-day living gets more expensive.”

“Prices will continue to rise due to the falling pound and the higher costs of imports so the message has to be try to be prudent with spending and stash more cash. You will need more bang for your buck in the next few months and having more money in your financial armoury can only help.”

Britain’s real pay crisis is a sign that austerity has failed, argues the GMB Union.

Tim Roache, GMB general secretary, says Theresa May must take the opportunity to ditch polities such as the public sector pay freeze:

“Yet again, we are seeing the cost of living rise faster than wages. Inflation has risen to almost ten times its rate 12 months ago.

In the real world, that increase means that no matter how hard people work, increasingly they are struggling to pay their bills.

“Too often there is more month than money left after pay day.

“This is further proof, if any was needed, that austerity has failed and that it’s working people paying the price.

“If the Prime Minister is to take anything away from her election embarrassment, it should be that people are fed up.

“They’re fed up with working hard to stand still and with a system set up to benefit those who already have more than enough.

“Ending the public sector pay freeze and making sure all workers are paid a decent wage is an absolutely must, and it needs to be on the agenda for the Queen’s Speech.”

A neat summary of today’s data:

House price inflation has also risen, thanks to a pick-up in prices in London.

The average house price rose by 5.6% in the 12 months to April, to £220,000. That’s up from 4.5% in the year to March 2017.

The Office for National Statistics cautions that:

While up against March 2017, there has been a general slowdown in the annual growth rate since mid-2016.

London continues to be the region with the highest average house price at £483,000, followed by the South East (£315k) and the East of England, (£281k).

The North East still has the lowest average price (123k).

In London, prices have risen by 4.7% in the last 12 months -- up from just 1.5% a month ago.

Regional house prices

Updated

Today’s Evening Standard is splashing on the rise in inflation, and blaming it on the EU referendum.

It warns that there is now “clear blue water” between wages and inflation, adding that:

There was growing concern in the City today that the hit to consumer spending power combined with political uncertainty following the loss of Theresa May’s Commons majority will further undermine already slowing economic growth.

Strangely, the front page doesn’t mention that real wages also fell through most of their editor’s time as chancellor (2010-2016).....

Updated

Resolution: Pay squeeze will be longer and deeper than feared

There’s a danger that the political deadlock in Westminster could push inflation higher in the months ahead, warns Stephen Clarke, economic analyst at the Resolution Foundation.

And that could be particularly bad news for poorer families, if essential purchases like food and clothes keep climbing while benefits remain capped.

Clarke says:

“The latest rise in inflation adds further pressure to already shrinking pay packets. The uncertain political environment, coupled with Brexit negotiations beginning in six days’ time, is already having an impact on sterling and could create further inflationary pressures down the track.

“The latest rise in inflation will be a double blow to low-income working families, who are also seeing their tax credits fall in value as they have been frozen in cash terms. Many will wonder whether the ‘end of austerity’ announced by the Prime Minister last night could mean a softening of the ongoing benefits freeze.

“With no sign yet of pay settlements responding to rising inflation, Britain’s renewed pay squeeze looks set to be longer and deeper than many originally expected.”

Ben Lord, who manages M&G’s UK Inflation Linked Corporate Bond Fund, predicts that CPI inflation will peak at 3% later this year.

He also believes the Bank of England will resist any pressure to raise interest rates in response:

At this point, with such high uncertainty about the direction of travel into Brexit negotiations, but with very significant downside risks, it seems extremely unlikely the Bank of England will tighten policy at this point.

With so little evidence of domestic inflation pressures, and with most inflation coming from ‘transient’ and exogenous forces, governor Mark Carney will look through CPI at 3%, 4% even 5% perhaps.

In fact, if Brexit negotiations commence poorly, and if the government can’t get anything done without a workable majority and now with a viable and sizeable opposition, I would still argue that Carney’s last move at the helm may be in the looser direction.

Britain’s inflation rate has been driven higher by the slump in the pounce since June’s referendum, tweets Conservative MP George Freeman:

Freeman argued we should remain in the EU.

Hannah Maundrell, editor in chief of money.co.uk, has sent over some advice on coping with inflation:

  • check you’re on a fixed rate energy tariff (one that guarantees the price you pay per unit) and if not switch
  • make sure your savings are earning an interest rate that’s higher than the rate of inflation – otherwise they’ll lose buying power over time – you might need to think about high interest current accounts
  • shop around for food and fuel so you’re not paying any more than you need to
  • check whether you could cut your mortgage repayments by switching to a fixed rate deal if you’re on your lender’s SVR

Child poverty group: End welfare freeze now

The Child Poverty Action Group is urging the government to help struggling families cope with the ravages of inflation.

Chief executive Alison Garnham says:

“Unless there’s an urgent re-think of the current freeze on benefits, the living standards of ordinary families will slip and slide downwards with serious consequences, particularly for children. Families are saying they can’t manage. They need some leeway. Now is the time to ensure that benefits for working and non-working families once again reflect their needs and so rise with inflation.

“The failure to uprate benefits in line with inflation is the single biggest driver behind child poverty rising to 4 million and why it’s set to rise to over 5 million by the end of the new parliament.”

This chart from Sky News’s Ed Conway shows how Britain is now experiencing its second real wage squeeze since the financial crisis:

The Telegraph’s Ben Wright points out that inflation is higher than the City, or the Bank of England, expected:

Maike Currie, investment director for personal investing at Fidelity International, says inflation has hit “eye-watering” levels.

“Rising prices coupled with lacklustre earnings growth means our wages aren’t keeping up with the rising cost living. Our real income are being squeezed and we’re witnessing this impacting UK consumer spending, which fell for the first time in nearly four years in May as consumers tightened their belts. This is bad news for an economy which relies on confident consumers spending on goods and services - already we are seeing signs of a stagnating economy as confidence among companies and consumers falter. Election result paralysis will only add to the UK economy’s woes.

Readers may remember that inflation was rather higher back in the 1970s -- but the key point is that wages aren’t keeping pace.

Currie explains why inflation is a concern:

“Inflation never seems like a problem until suddenly it is and while it may be good news for borrowers, as it erodes the value of their debts, it has detrimental implications for savers, investors and retirees, chipping away at the value of future interest and dividend payments and eroding the worth of your capital pot. Once pricing pressures become entrenched, consumers’ feel the pain, businesses don’t invest and the stock market gets worried.

TUC: Government must act

TUC General Secretary Frances O’Grady says the government must respond to the wage squeeze by ending the 1% cap on public sector pay rises:

“The election showed that working people are struggling. And the biggest price rises in four years won’t provide any comfort.

“Working people are still £20 a week off worse, on average, than they were before the crash – and now rising prices are hammering their pay packets again.

“The new government must stop the real wage slide. Ministers must focus on delivering better-paid jobs all around the UK.

“And it’s time to lift the artificial pay restrictions in the public sector. Our hardworking nurses and teachers are long overdue a pay rise.”

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Britains’ household finance squeeze has intensified, warns Ben Brettell, senior economist at financial services group Hargreaves Lansdown:

Today’s numbers from the ONS showed inflation jumped to a fresh four-year high of 2.9%, as a fall in the price of motor fuels failed to offset higher prices for energy, food and recreational goods. Lower air fares also had a downward effect as the Easter holiday drops out of the calculation. Economists had expected the rate to remain at 2.7%.

Wage data out tomorrow is expected to confirm pay is shrinking in real terms, and a report out yesterday from Visa confirms consumers are under pressure, with spending falling 0.8% year-on-year in May.

Here’s our news story on today’s inflation report:

UK inflation jumped to a four-year high of 2.9% in May, signalling a sustained fall in living standards as prices rose faster than wages.

The consumer prices index went up from 2.7% in April and has been steadily increasing since the Brexit vote a year ago, which triggered a sharp drop in the value of the pound and pushed up the cost of goods imported from abroad. Inflation was 0.3% in May 2016, a month before the EU referendum.

At 2.9%, inflation is higher than average year-on-year wage growth of 2.1% in the three months to March, putting pressure on household budgets. It is also well above the Bank of England’s 2% target. Economists had expected inflation to stay at 2.7%.

Philip Shaw, an economist at Investec, said inflation was likely to rise further in the coming months, as the weaker pound continues to feed through to higher shop prices.

“Our view is that inflation will rise steadily to a little above 3% by the summer,” he said. “However, should sterling resume an upward trend and energy prices slip further in US dollar terms, there is a chance that inflation remains below the 3% level.”

A Treasury spokesperson has responded to the jump in inflation, saying:

‘The government is helping families with the everyday cost of living by keeping taxes low, freezing fuel duty and increasing the National Living Wage.

A typical basic rate taxpayer now pays £1,000 less income tax than in 2010 and increases in the National Living Wage mean £1,400 extra a year for a worker since its introduction.’

Here’s more detail from the Office for National Statistics about why inflation jumped to 2.9% last month:

  • The largest upward effect came from a variety of recreational and cultural goods and services with prices rising, overall, by 0.9% between April and May 2017 compared with a fall of 0.4% a year ago. Within this category the major contribution came from games, toys and hobbies, particularly computer games.
  • Food prices rose slightly between April and May this year compared with a fall a year ago. The latest rise continues the upward movement observed from late 2016 and comes from a variety of product groups, particularly sugar, jam, syrups, chocolate and confectionery where prices of cartons and boxes of chocolates rose between April and May this year.
  • Prices for clothing rose by 0.6% between April and May this year compared with a fall of 0.3% a year ago. The upward effect came principally from children’s clothing. Sales patterns may have contributed to the price movements, as the proportion of items on sale fell between April and May this year, having risen a year ago.
  • Prices for furniture and household goods rose by 1.2% between April and May this year, the largest rise between these two months since 2008. Between the same two months in 2016, prices rose by 0.4%. The main upward contributions came from lounge furniture and household textiles.
  • There was also a significant upward effect from electricity as further price increases entered the index in May. This is a part of the broader housing and household services heading within which the effect is partially offset by a downward contribution from owner occupiers’ housing costs.

Updated

There’s more inflation coming down the pipeline, warns Duncan Weldon of Resolution Group:

Inflation is now rising faster than the Bank of England expected, points out Ben Chu of the Independent.

Real wages are falling

This chart, from Reuters’ Jamie McGeever, shows the impact of higher inflation on pay packets:

The rise in inflation means that the cost of living squeeze has worsened.

Earnings figures due tomorrow are expected to show that basic pay only rose by 2.0% in the last quarter, meaning they won’t have kept pace with inflation.

Updated

Inflation: the key charts

This charts hows how the Consumer Price Index has jumped to its highest level since June 2013 (the yellow line).

UK inflation

This shows how the cost of living has risen over the last year:

UK inflation

Updated

Why inflation rose again

  • Food, energy and recreational costs all helped to push inflation up in May.

  • The Office for National Statistics say:

    • Rising prices for recreational and cultural goods and services (particularly games, toys and hobbies) was the main contributor to the increase in the rate.
    • There were smaller upward contributions from increased electricity and food prices.
    • These upward contributions were partially offset by falls in motor fuel prices, and air and sea fares, the latter two influenced by the timing of Easter in April this year.

    UK inflation jumps to 2.9%

    Breaking! Britain’s inflation rate has jumped to 2.9% in May - a new four-year high.

    More to follow....

    The pound has now crept back over $1.27, a gain of half a cent today.

    Economist Rupert Seggins has tweeted some handy charts on inflation, ahead of May’s consumer prices index report (due in around 10 minutes).

    This shows how inflation has risen sharply in recent months:

    This shows how it can take up to two years for a change in the value of the pound to fully feed into the economy:

    This shows how global food prices have stopped rising recently:

    And this show how the price of oil, in pound, surged after the Brexit vote:

    Updated

    Merlin Entertainment, which runs many of Britain’s largest theme parks and tourists attractions, has warned that demand has fallen since the terror attacks in London and Manchester.

    Shares in Merlin have fallen by 3%, to the bottom of the FTSE 100 leaderboard, after it told that City that fewer domestic tourists have been making day trips to its sites - whihc include Alton Towers, the Sea Life centres, and Legoland.

    Nick Varney, Merlin’s chief executive, struck a suitably upbeat and uncowed tone, saying:

    “The impact of recent terror attacks on our London attractions is unclear at this stage.”

    “What is clear, however, is that London has bounced back before and will do again. I have every confidence in the longer term resilience and growth trajectory of the market. London is very much open for business, welcoming visitors from the UK and from around the world to this exciting and vibrant city.”

    More here:

    European stock markets have risen in early trading, with the FTSE 100 gaining around 0.25%.

    june13europe1
    june13europe1 Photograph: Thomson Reuters

    The pound is also pushing back towards $1.27 ahead of today’s inflation data.

    Connor Campbell of SpreadEX believes the City is welcoming the prospect of a softer Brexit (assuming Michael Barnier finally gets some company at the negotiating table):

    The pound has woken in a better mood than it did yesterday, lifting 0.2% against the dollar and 0.3% against the euro. The FTSE also looked a bit chirpier, rising 0.3% to sit at 7530.

    art of that positivity will stem from this morning’s Reuters poll stating that the risk of a ‘hard’ Brexit has fallen following Theresa May’s failure to secure a Tory majority; that’s not the same as the PM now chasing a ‘soft’ exit from the EU, but it’s still good news for sterling.

    Cabinet minister Michael Gove, who campaigned to leave the EU last year, has dropped a hint that Britain is inching away from a hard Brexit.

    Barnier: Hurry up Britain!

    Michel Barnier

    City traders should also take note that Michel Barnier, the EU’s chief Brexit negotiator, is running out of patience.

    Barnier has told the Financial Times that Britain risks crashing out of the EU in March 2019 without a deal on future relations if it “wastes” more time.

    Barnier pointed out that no progress has been made since Britain triggered Article 50 in March, saying:

    “Next week, it will be three months after the sending of the Article 50 letter.

    “We haven’t negotiated, we haven’t progressed. Thus we must begin this negotiation. We are ready as soon as the UK itself is ready.”

    In a sign of exasperation, Barnier even pointed out that he can’t negotiate with himself!

    Here’s some reaction from our Brussels correspondent, Jennifer Rankin:

    Updated

    Analysts at Royal Bank of Canada agree that last week’s election shock has changed the Brexit landscape.

    But they’re not sure, though, that Britain can maintain in the Single Market:

    Calls for a so-called ‘soft’ Brexit need to be weighed against the reality that both Labour and the Conservatives had manifesto commitments to take the UK out of the Single Market.

    In any case, it looks as though the existence of a minority government with less authority in the House of Commons is set to fuel expectations that the UK’s Brexit strategy could be modified in some way.

    During the campaign, Theresa May repeatedly said that “no deal was better than a bad deal”. But there are signs that this position is, well, softening.

    My colleagues Anushka Asthana and Jessica Elgot reported last night that:

    Senior insiders say one of the ideas actively being considered to win backing across parliament was “not to major” on the controversial “no deal is better than a bad deal” position taken by May before the election.

    Also under consideration is whether to exclude overseas students from the immigration numbers and even possibly to abandon the target to reduce immigration to the “tens of thousands”. Although nothing has been agreed, any softening of the position on immigration could maximise the chance of a closer economic relationship with the EU.

    Poll: Hard Brexit risk has fallen

    As the dust settles from last week’s general election, economists are coming to the conclusion that Britain is less likely to exit the EU with a ‘hard Brexit’.

    That’s according to a new poll of City experts from Reuters, who say:

    The chances of Britain ending up outside the single market when Brexit talks are concluded have receded somewhat after last week’s election, although the pound might weaken further against other currencies, a Reuters poll of economists found.

    Around two-thirds of the economists polled this week, 33 out of 49, said the chance of a hard Brexit had receded somewhat.

    Three said it had receded significantly, while eight said there was no change.

    Five said it had increased somewhat and none said increased significantly.

    “The prime minister may have to change her stance and approach to Brexit following the election outcome,” said Nikesh Sawjani at Lloyds Banking Group.

    More here: Likelihood of hard Brexit recedes after UK election - Reuters poll of economists

    The agenda: UK inflation could stick at four-year high

    Good morning, and welcome to our rolling coverage of the financial markets, the world economy, the eurozone and business.

    We’re about to find out how much damage the weak pound did to UK household budgets.

    New inflation data, due at 9.30am, is expected to show that prices rose by 2.7% year-on-year in May.

    That would match the four-year high struck in April, and mean that prices in the shops are rising faster than wages [which only rose by 2.1% in the year to March].

    Michael Hewson of CMC Markets says the figures come at a crucial time for the economy:

    We get to look under the bonnet of the UK economy this week, at a time when there is rising evidence that the UK consumer having enjoyed a post Brexit shopping spree is now scaling back as inflation starts to eat away at average earnings.

    Having started this year at 1.8% CPI inflation hit 2.7% in April and looks set to stay at this level in the latest May numbers which are due out later this morning. Core prices have also jumped sharply since the beginning of the year from 1.6% to 2.4% in April, though we are expected to see a slight moderation in the May numbers to 2.3%.

    There could be a silver lining given recent falls in oil prices, which might suggest that we’ve seen a short term plateau for prices which could see prices start to fall back. Input prices in the last few months have shown some signs of falling back, and in both the US and the EU inflation has shown some signs of falling back which would be good news for hard pressed consumers, when wages are currently lagging behind.

    We also get a new report on Britain’s housing market, which may show that prices rose at a slower rate in April.

    So it will be a busy morning for City traders, who’ll have one eye on the economic data, and the other one on political developments after Britain’s general election.

    The pound has clawed back a little ground this morning, after hitting eight-month lows against the euro yesterday. It’s currently trading around €1.132, up 0.2%.

    Today, prime minister Theresa May is meeting DUP leader Arlene Foster to discuss a possible deal to prop up a minority Conservative administration.

    Last night, the PM apologised to her backbenchers for leading the party into such a mess. Senior colleagues have been making supportive noises, but May still looks weak and vulnerable - even if her premiership isn’t over quite yet.

    Also coming up today..

    Brussels is expected to announce new proposals for how euro-denominated securities are cleared. That’s important for London, which currently dominates this market but could lose this lucrative (and important) business after Brexit.

    City AM has the details:

    The City is bracing itself for the European Commission’s proposed changes to the European Market Infrastructure Regulation (Emir), due out on Tuesday morning.

    Brussels sources told City A.M. the proposals will include a mechanism giving the EU power to force relocation of euro clearing activity, which is currently dominated by London.

    A source familiar with the plans told City A.M.: “The commission is not going for the nuclear option.”

    The “nuclear option” would have seen the commission require all clearing of euro-denominated derivatives to take place within the EU...

    European stock markets are expected to rise this morning, with the FTSE 100 index called up 33 points.

    Here’s the agenda:

    • 9.30am BST: UK inflation report for May
    • 9.30am BST: UK house price index for April
    • 10am BST: German ZEW investor confidence report

    Updated

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