Economists ❤️ inflation data
The business news that matters
Hello and welcome to the latest edition of Off to Lunch…
The Valentine's Day flowers that you buy today should be roughly 4 per cent more expensive than they were last year. At least that’s according to the latest inflation data from the Office for National Statistics.
Inflation was 4 per cent in January, the ONS has said this morning. This is the same reading as December. Economists had actually expected the consumer price index - which is the main measure of inflation - to rise to 4.2 per cent in January, according to a consensus compiled by Reuters. However, a rise in the price of energy was offset by a fall in the inflation rate for furniture, household goods, food and non-alcoholic drinks. Consumer prices fell by 0.6 per cent month-on-month, the ONS said.
As you may expect, the government has welcomed the latest figures…
Financial markets have treated the data as another sign that interest rates could be cut this year as concerns about inflation are easing. The pound dropped 0.4 per cent against the dollar on the news.
The graph below shows how inflation has come down sharply over the last year. The light-blue line is the consumer price index…
Below is a second graph which shows the key downward and upward drivers of inflation. Housing and household services - the biggest upward driver of inflation - includes gas and electricity bills…
You can find the full inflation data from the ONS here. A reminder that tomorrow morning at 7am we will find out if the UK has fallen into a recession…
Other stories that matter…
1. Shares in the book publisher Bloomsbury have risen more than 10 per cent after the company said that annual revenue and profits would be “significantly ahead of upgraded market expectations”. Financial analysts had previously forecast that Bloomsbury would post revenues of £291 million and pre-tax profits of £37 million for the year to the end of February, which was already well up on the £264 million and £15 million it posted last year. Bloomsbury said there had been “exceptional growth” in book sales to consumers, helped by the launch of Sarah J Maas’s fantasy novel House of Flame and Shadow. You can find the company’s statement here
2. The government is planning to change the rules around companies being sold to employee-owned trusts. It wants to prevent these businesses from being moved to offshore vehicles and the former owner keeping control. HMRC is concerned that the trusts are being used to avoid tax and that employees are not actually taking over the business. Story by The Times here
3. There are 1,300 incidents of violence and abuse against shop workers every day, according to a report by the British Retail Consortium. This is 50 per cent up on last year. The cost of shoplifting has also doubled to £1.8 billion, the survey says. Three in five retailers say the response from the police to crimes has been “poor” or very poor”. You can read more here
4. Office staff are using YouTube videos of random Zoom meetings to make it look like they are busier than they really are. More from Business Insider here
5. The Economist has done a fascinating piece on how the success of drug company Novo Nordisk, the maker of weight-loss drugs Ozempic and Wegovy, is changing the economy in Denmark, particularly the towns and cities where its factories and offices are based. You can read the piece - headlined “The town that Ozempic and Wegovy built” - here
Podcast…
The latest episode of our Business Leader podcast features an interview with Marc Allera, the chief executive of EE and BT’s consumer business. He explains how EE went from being an upstart mobile phone brand to a key part of BT and a business with big ambitions for the future. Plus, Allera explains what he learned from launching Sega’s Dreamcast games console and mobile phone brand Three in the early 2000s, which had mixed success.
You can listen to the episode via Substack here, Apple here or Spotify here
Business Leader event…
Richard Harpin, the owner of Business Leader’s parent company, is meeting with two small groups of CEOs this week to discuss his eight secrets to growing a billion-pound business. These are the first in a series of scale-up workshops Richard will be hosting across the country. If you’re the founder or CEO of a business with a turnover of at least £3 million and a workforce of more than fifteen, please get in touch if you’d like to attend one of the free workshops. Please email craig.wilmann@businessleader.co.uk for more details
And finally…
An amusing and unique marketing video by the ATP Tour, the men’s tennis competition, has gone viral. It shows Sir Andy Murray, Novak Djokovic and other tennis players claim that tennis is actually made-up and scripted. “Let’s face it, people are stupid. So they will buy anything,” Sir Andy says. You can watch the video below…
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Best
Graham