City AM

14/01/2025

A career that's taken him from his home in Mexico all the way to Norwich to lead Naked Wines, via Belgium, was probably not something Rodrigo Maza could have predicted when he first started out.

But the chief executive, who has only been in the job for less than a year, has not only settled into his new surroundings, but also already had an impact on turning around the ailing company which enjoyed huge success during the pandemic.

In the latest episode of City AM's Boardroom Uncovered, Maza opened up to our UK Editor Jon Robinson about why he thinks Naked Wines is a "company worth fighting for" and that he has "absolute belief in its value".

Watch the full interview here 👇
https://www.cityam.com/naked-wines-ceo-how-to-choose-the-right-bottle-of-wine/

Special thanks to Blackbaud, the sponsor of this episode of Boardroom Uncovered, and Ben Lewis-D'Anna for joining us.

14/01/2025

Tulip Siddiq has resigned her role as City minister, Downing Street has confirmed.

The Hampstead and Highgate MP has quit her role as a Treasury minister after allegations emerged about properties linked to her aunt, Sheikh Hasina, the former prime minister of Bangladesh.

She has been replaced as economic secretary to the Treasury by Emma Reynolds, who will take over Siddiq’s former brief including responsibility for “financial sanctions and countering economic crime, money laundering and illicit finance”.

Siddiq had referred herself to the independent adviser on ministerial interests, Sir Laurie Magnus, who has now told the Prime Minister he did not consider her to have breached the ministerial code.

Read the full story here 👇

Tulip Siddiq has resigned her role as City minister amid allegations about her financial links to the former Bangladeshi government.

14/01/2025

JP Morgan warned that UK policy credibility is “coming under pressure” amid continuing turmoil in the gilt market and fears about slow growth.

Gilt yields, which reflect the cost of government borrowing, have increased significantly in recent weeks.

Yields on both the 10-year and the 30-year gilts have climbed for six consecutive days, leaving the yield on the 10-year bond at a post-2008 high and the yield on the 30-year at a post-1998 high.

Gilt yields have largely moved in line with US Treasury yields, as traders have concluded that interest rates need to be higher globally in order to tame inflation.

Read the full story here 👇
https://www.cityam.com/jp-morgan-uk-policy-credibility-coming-under-pressure/

14/01/2025

Rachel Reeves has defended her trip to China amid economic turmoil in the UK as MPs argued her Budget “hasn’t worked” and insisted: “The British people deserve better.”

The Chancellor appeared in the House of Commons for the first time since last week’s bond market shock threw her public spending plans and fiscal rules into jeopardy.

She insisted her visit to Beijing and Shanghai was vital for the government’s “number one mission” to achieve economic growth, and stressed: “As the second biggest economy in the world and our fourth largest trading partner, not engaging is simply not an option.”

Reeves argued the UK “must go further and faster in our plan to kickstart economic growth” and said she and the Treasury “remain committed to those fiscal rules”, including paying for day-to-day spending through tax receipts and getting debt down as a share of the economy.

Read the full story here 👇

Rachel Reeves has defended her trip to China amid economic turmoil in the UK as MPs argued her Budget “hasn’t worked”.

14/01/2025

Opinion: Rachel Reeves’ Budget created a vicious circle whereby higher taxes increased borrowing costs, squeezing the public purse and further tempting the Chancellor into further tax rises to meet fiscal targets. There is another way, says Darwin Friend ✍️

Reeves is trapped in a vicious fiscal circle of her own making. Her high-tax budget, billed as the responsible route to prosperity, has instead triggered a cascade of economic consequences that threaten to undermine the government’s credibility and stability. By prioritising tax hikes over spending restraint, she has set off a chain reaction that risks spiralling out of control. Sooner or later, she’ll have to face the uncomfortable truth: the real problem lies on the spending side of the ledger.

When Reeves delivered her budget, she presented it as a masterclass in fiscal responsibility, designed to shore up the public finances and address the infamous £22bn “black hole”. The reality, however, has been quite the opposite. Her reliance on tax rises, targeting employers, capital gains, alcohol and inheritance to name a few, has rattled markets and pushed up borrowing costs.

The Office for Budget Responsibility (OBR) has warned that the government’s aggressive fiscal stance could further stoke inflation and interest rates, making debt servicing even more expensive than the £100bn it’s already forecast for this year. As borrowing costs rise, Reeves’ much-touted fiscal rules, including a commitment to reduce debt as a share of GDP, are now in jeopardy.

Read more here 👇
https://www.cityam.com/reeves-is-in-a-fiscal-trap-and-spending-cuts-are-the-only-way-out/

14/01/2025

A closely watched sale of UK government debt attracted robust demand today despite the ongoing turmoil in the gilt market.

The Debt Management Office (DMO) said that its £1bn sale of 30-year index-linked gilts was three times oversubscribed, indicating that interest from investors remained solid. Demand was down marginally from last year when the auction was 3.1 times oversubscribed.

The yield on the gilt – which is tied to inflation – was 2.126 per cent, hovering around its highest level in 22 years.

The auction comes amid intense pressure on gilts as investors demand higher interest rates to lend the government money.

Read the full story here 👇
https://www.cityam.com/uk-gilt-auction-oversubscribed-as-investors-buy-through-market-turmoil/

14/01/2025

Google has been placed under investigation by the Competition and Markets Authority (CMA) to assess whether its search and advertising services deliver fair results within the UK.

In a statement today, the watchdog announced the launch of its first “strategic market status designation investigation” under a new Strategic Market Status (SMS) regime, which was rolled out on 1 January this year.

The investigation will assess how Google’s services impact consumers and businesses in the UK, including publishers, search engine competitors and advertisers.

Given the dominant position of Google’s search services in the UK, which account for over 90 per cent of the nation’s search enquiries, the CMA said ensuring its services are delivering for businesses and consumers was critical.

Read the full story here 👇
https://www.cityam.com/cma-launches-probe-into-google-search-dominance-under-new-regime/

14/01/2025

Fewer firms increased their headcount in the final quarter of last year, a new survey showed, as businesses prepare for the impact of the national insurance hike.

According to a report from the British Chamber of Commerce (BCC), less than a quarter (24 per cent) of firms increased staffing numbers in the three months to December, down from 27 per cent in the third quarter of 2024.

Meanwhile, 16 per cent of respondents said they had cut back on staff and 60 per cent said their workforce had remained constant.

The survey, which garnered over 4,800 responses, was carried out between 11 November and 9 December as firms dealt with the fallout from the Budget.

Read the full story here 👇
https://www.cityam.com/fewer-firms-expanded-headcount-following-the-budget-bcc-says/

14/01/2025

Private equity fund managers are coming under mounting pressure from their investors to begin striking deals after a sluggish two years hampered by political turmoil and lofty interest rates, advisers have said.

While deal value ticked up through 2024, backers of top private equity funds are taking a “sterner” tone with fund managers after a slow period in which firms have largely held off both selling assets and putting dry powder to use, lawyers told City AM.

Dealmaking increased 36 per cent by value in the first nine months of 2024 after a slow 2023, driven by a narrowing of valuation expectations between buyers and sellers and bullish sentiment translating “more directly into deal activity”, according to EY.

However, after two years of quiet deal flow patience from private equity funds’ investors, known as limited partners (LPs), is wearing thin and firms are agitating for PE houses to begin striking deals, lawyers and bankers say.

Read the full story here 👇

Private equity fund managers are coming under pressure from investors to begin striking deals after a sluggish two years, advisers have said.

13/01/2025

Ryanair wants a “disruptive” flyer who caused a flight diversion to pay €7,000 (£5,886) for its crew and passengers’ replacement accommodation, amid a developing spat over alcohol consumption at European airports.

The low-cost giant is suing the customer after being forced to divert a Dublin-Lanzarote flight to Porto in April last year. The individual was arrested upon landing.

The lawsuit aims to deter future incidents of a similar nature. “As a direct result of this disruptive passengers behaviour, over 160 passengers and six crew were forced to divert to, and overnight in Porto Airport, and then flew onwards to Lanzarote on the following day,” the airline said in a statement on Monday.

Alongside the accommodation costs, Ryanair also wants the passenger to cover more than €7,000 for the additional landing/handling charges, replacement crew and excess fuel costs, and Portuguese legal fees.

Read the full story here 👇

Ryanair's lawsuit comes amid a developing spat over rules surrounding alcohol consumption at European airports.

13/01/2025

Consumer confidence ended 2024 on a high, but analysts have warned that it might not be able to ride out a wave of economic uncertainty this year.

Confidence was at its highest since April 2021 in December, according to Yougov’s and CBRE’s monthly consumer confidence survey. Business activity, optimism about the future, and perceptions of house prices all showed improvements.

But forecasting lead Sam Miley warned of economic clouds on the horizon and said that consumers’ ability to “ride out” economic uncertainty will be “key” to the economy’s performance this year.

Read the full story here 👇

UK consumer confidence about the future of their household finances rose in December, but a shaky start to 2025 has some analysts worried.

13/01/2025

Keir Starmer has thrown the weight of Whitehall behind AI in a bid to boost growth and position the UK as a world leader in the sector.

On Monday morning, Keir Starmer revealed the UK’s ‘AI Opportunities Action Plan’, a transformative strategy to establish the UK as a global leader in AI.

He said: “The AI industry needs a Government that is on their side, one that won’t slip back and let opportunities slip through its fingers."

Read the full story here 👇
https://www.cityam.com/uk-to-go-all-in-on-ai-as-starmer-throws-weight-of-whitehall-behind-technology/

13/01/2025

Brexit, Donald Trump’s tariffs and changing relations with China will hamper British trade growth in the next decade, a new report suggests.

UK trade will only grow by 0.7 per cent annually between 2023 and 2033, according to new projections from Boston Consulting Group (BCG), down from a previous estimate of 0.9 per cent.

This would see trade growth fall behind domestic GDP growth, which BCG expects to average 1.6 per cent in the decade to 2033, meaning trade is a less significant part of economic activity. Global trade, in contrast, is projected to grow at 2.6 per cent every year over the same period.

Brexit will be a major impediment to UK trade growth, the report suggests, although the UK’s trading woes extend around the world.

Read the full story here 👇

Brexit, Donald Trump's tariffs and changing relations with China will hamper British trade growth in the next decade, a new report warns.

13/01/2025

Sir Keir Starmer has declined to confirm that Rachel Reeves will be Chancellor at the next general election.

The Prime Minister was asked about Reeves’ role following a speech in London on artificial intelligence (AI) and insisted he was “completely confident” in her.

However, he declined to guarantee she would still be in post at the time of the next election when directly asked.

It comes amid a widely criticised trip by the Chancellor to China which coincided with turmoil in the bond market sending UK borrowing costs soaring, putting the government’s fiscal rules and public spending plans in jeopardy.

Read the full story here 👇
https://www.cityam.com/starmer-declines-to-confirm-reeves-will-be-chancellor-at-next-election/

13/01/2025

Rachel Reeves has created a “hole in the confidence and trust of business” by using the private sector to fill a £22bn hole in the government’s finances, the chair of the UK’s top business body has said.

Rupert Soames, chair of the Confederation of British Industry, said the Chancellor had “bruised” British companies after rolling out some £40bn worth of tax hikes at her Budget in October.

“The Chancellor told us at the time of the budget that there was an unexpected hole of about £22bn in the Government finances, and business was going to have to fill it. In filling in one hole, it’s created another, and that hole is a hole in the confidence and trust that business has in the Government,” Soames told BBC Radio 4’s Today programme.

Read the full story here 👇

Rachel Reeves has created a “hole in the confidence and trust of business”,, the chair of the UK’s top business body has said.

13/01/2025

Investors will be paying close attention to the UK economy again this week ahead of a series of crunch data releases.

The latest inflation figures, covering December, will be published on Wednesday before GDP figures for November will be released on Thursday.

City economists expect inflation to remain unchanged at 2.6 per cent, while the economy is projected to return to growth having suffered two months of contraction.

But the data releases come at a time when the economy is facing particular scrutiny from international investors following last week’s sell-off in UK government debt.

Continue reading 👇

The latest inflation figures, covering December, will be published on Wednesday before GDP figures for November will be released on Thursday.

13/01/2025

Finance chiefs at UK businesses are focused on cutting costs in the wake of the Budget, with investment and hiring set to suffer as a result.

Over half (52 per cent) of CFOs surveyed by Deloitte said cost reduction was a strong priority for their business in the wake of the Chancellor’s tax raid.

The survey showed that hiring intentions in the final quarter of last year fell at the fastest pace since early 2020, while a net 58 per cent of firms expect to cut discretionary spending.

In addition, less than one in five CFOs (18 per cent) said it was a good time to take additional risk onto their balance sheet, the weakest risk appetite in over a year.

Continue reading 👇
https://bit.ly/4fSfa4h