FTSE 100 closes at 14-month high
Pound hovers around $1.30 and €1.17
Bank reforms will give customers "better deal": watchdog
Consumer groups and challenger banks say changes don't go far enough
UK trade deficit widens in June
Triptease boss Charlie Osmond speaks about finding the right formula for his hotel comparison website.
Mr Osmond, whose company shows prices for over 8,000 hotels, told Business Live on the BBC News channel that the internet enables businesses to try out different iterations.
Triptease boss Charlie Osmond on finding the right formula for his hotel comparison website
Image source, Getty ImagesThe industrial production figures, external for the April-to-June quarter may mark the fastest growth rate for 17 years, but they largely reflect a strong April.
Looking on a monthly basis, industrial production rose just 0.1% in June, fell by 0.6% in May but rose by 2.3% in April.
Samuel Tombs, chief UK economist at Pantheon Macroeconomics, says this shows that the UK economy had "little momentum" in the weeks leading up to the referendum.
"The 2.1% quarter-on-quarter rise in production in Q2 - which matches the estimate that underpinned the preliminary estimate of GDP - mainly reflected the 2.3% month-to-month jump in production in April," he says.
BBC tech correspondent Rory Cellan-Jones tweets
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Image source, PAThe pound is still below $1.30 against the dollar, currently 0.3% lower at $1.29960. However, many expect it to fall further.
In a particularly gloomy forecast, HSBC predicts it could fall to $1.20 by the end of the year and $1.10 by the end of 2017 when it also expects the pound to hit parity against the euro.
"The UK has a very large current account deficit. This structural weakness will come under immense pressure because of the forthcoming major political and economic changes. We find that sterling will need to fall further, and remain weak for a long time, in order to create significant improvements to the UK's structural position."
BBC economics correspondent Andrew Verity tweets
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The Competition and Markets Authority's (CMA) report, external into banking "must be the start, rather than the end" of the drive to improve competition in the sector, says The British Chambers of Commerce.
Quote MessageThe report fails to address the structural problems in the provision of business finance, which are holding back some of our most dynamic young firms. The CMA must also tread carefully in the sharing of data by finance providers via the Open Banking programme, to ensure that businesses retain control over who has access to their data – otherwise any trust between lenders and businesses could be destroyed.
Suren Thiru, Head of Economics and Business Finance at the British Chambers of Commerce
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Banking trade body, The British Bankers Association (BBA), has defended the fees banks charge for unauthorised overdrafts. Listen to chief executive Anthony Browne here.
Anthony Browne of the British Bankers Association on CMA banking reform
Image source, PAThe other interesting part of the industrial production figures for June is that "very few" respondents reported an impact from the uncertainty surrounding the Brexit vote, the Office for National Statistics said. , external
"Any uncertainties in the run-up to the referendum seem to have had little impact on production, with very few respondents to our surveys reporting it as an issue," ONS chief economist Joe Grice said.
The ONS gave similar findings when it reported a couple of weeks ago that economic growth sped up ahead of the EU referendum.
Image source, Getty ImagesThe gap between how much the UK exports and what it imports - known as the trade deficit - widened by £900m in June to £5.1bn, according to official figures.
It comes after imports grew faster than export activity, the Office for National Statistics said, external. Total imports of goods and services came in at £48.9bn, a record high.
UK industrial output grew at its fastest rate since 1999 in the second quarter of the year, according to official statistic, externals.
Total production output is estimated to have increased by 2.1% between April and June compared to the previous quarter, unchanged from last month's estimate.
As a result, the ONS said the figures will have no impact on its previously published GDP forecast for the second quarter.
Insurance firm Legal & General reported a rise, external in first half profits, but the shares are the biggest faller on the FTSE 100, currently down almost 5%.
Hargreaves Lansdown equity analyst Nicholas Hyett says the mix of earnings have disappointed investors.
"The LGIM [Legal & General Investment Management] business, which saw revenues decline, is capital light and generates welcome recurring income, whereas annuity revenues have become lumpier as the group increasingly relies on blockbuster bulk annuity deals," he says.
The company also said Brexit had triggered "greater market volatility which we expect to continue for some time".
Legal and General, external, which earlier reported a 23% rise in pre-tax profit to £826m for the first half of the year, said it expects its opportunities to remain "largely unchanged" despite slowing global activity.
Speaking on Today, chief executive Nigel Wilson said people needed to stop grumbling about the economy.
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Image source, Getty ImagesOnline fashion retailer Boohoo.com says profits will be higher than expected after strong sales of its spring and summer lines.
Boohoo says it expects sales growth, external will now be between 28% and 33% in the six months to the end of August, up from its earlier forecast of 25% to 30%.
Shares in Boohoo are up 5% on the news. They have more than doubled so far this year to 78.57p, valuing the business at £883m.
Today Programme
BBC Radio 4
Sarah Pennells, founder of SavvyWomen, a money website for women, says the banking report puts too much emphasis on consumers acting.
"It shouldn't be up to us to fix a failing market," she says.
She says people are naturally wary of switching bank accounts because if it goes wrong it causes real problems for people.
"One of the biggest barriers for switching is for people who use an overdraft, and it's just over half, and they don't know if they'll get that if they switch bank account," she says.
The pound is trading near a one-month low ahead of trade data for June due at 9.30am. It's currently down 0.4% at $1.29910.
The fall has been linked to an op-ed in The Times by the Bank of England's Ian McCafferty. He suggested that more quantitative easing would be needed if the UK's economic decline worsens.
"The pound’s been sold on speculation that the Bank of England is ready to launch more monetary easing in the coming months should the data turn sour. At present it’s hard to see much good news to prevent the Bank from building on its expanded QE programme over the autumn," says Neil Wilson, markets analyst at ETX Capital.
Today Programme
BBC Radio 4
The bank report puts the onus on consumers to get a better deal and as a result is unlikely to make much difference to the current state of banking, according to Diane Coyle, professor of economics at Manchester University.
She says so called "open banking" - which allows consumers to compare costs for particular services - is unlikely to prove effective because it requires consumers to give all their financial information to third party providers. She believes that is something people will be reluctant to do.
Professor Coyle also says the report fails to "tackle the biggest problem in the market": the cost advantages of the big banks.
"They've got the 'too big to fail guarantee' from the government, lots of deposits which they don't have to pay much interest on so a cheap source of money. There is nothing in the report to tackle these issues."
As a result, she believes that prospects for newcomers to the sector - called challenger banks - are looking "less shiny" than a few months ago.
The FTSE 100 has risen by 12 points in the first few minutes of trading to 6,821, with payment processing group Worldpay leading the way.
Worldpay this morning posted a big jump, external in pre-tax profit to £168.6m in the first half of the year and beat analyst expectations.
Insurance firm Legal and General is the biggest loser in early trading, despite posting a 23% rise, external in first-half profit to £826m.
The FTSE 250 is up 53 points to 17,611 points.
Image source, PAAway from this morning's bank report, supermarket Morrisons and online grocery firm Ocado have announced changes to their longstanding tie-up.
Morrisons.com will be rolled out across more of the UK by enabling it to pick produce from its own stores, and through taking a major stake in Ocado's new delivery centre in Erith, south London.
Under the deal, external, Morrisons will no longer have to share its online profits with Ocado once the "store picking" is up and running.
At that point Ocado will also be able to partner with other grocery retailers, apart from major competitors Tesco, Asda, Sainsbury's, Aldi and Lidl.
Image source, TSBThe Competition and Markets Authority (CMA), external's report has missed "a golden opportunity", according to TSB chief executive Paul Pester.
He says it has failed to make strong recommendations to help make the industry more transparent to consumers.
Quote Message“Banking must be the only industry that doesn’t tell its customers how much they are paying for their services. Consumers need to be equipped with the necessary tools in order to make informed choices about the best products and services for their needs. This is why we will continue to champion transparency over the true cost of banking through the creation of a Monthly Bill. The CMA’s report is only the first rung on the ladder and, while disappointing, it should not constrain the Government in its ambition to achieve a truly competitive banking market.
Paul Pester, TSB chief executive
