Later Election, Pound Flying High: Your Saturday UK Briefing

(Bloomberg) — Hello from London, where the budget is behind us and an election is looking further away.

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After the will-he-or-won’t-he confusion over tax cuts in Jeremy Hunt’s statement on Wednesday, government officials now expect another fiscal event later this year. Lower inflation and interest rate cuts could provide the chancellor of the exchequer with more headroom for some pre-election sweeteners.

One indicator that could help the government now, though, is the pound. Sterling reaching a seven-month high of $1.2894 on Friday.

That won’t be much comfort to the British billionaire who sold his Belgravia mansion at a loss of about 30%, the latest example of weak demand forcing steep discounts in the capital’s property market.

An idea that the chancellor floated, to create a “UK ISA” for domestic investment, has at least one problem — British companies, according to John Authers. Much better returns are found putting money overseas, he wrote for Bloomberg Opinion.

Germany’s Mittelstand, the family-owned firms that make up the backbone of Europe’s largest economy, are similarly squeezed. More owners are looking to sell as companies get weighed down by red tape and investment demands, Eyk Henning and Jan-Henrik Förster report.

The focus was firmly on central banks this week, and the Bank of England is seen following the ECB in holding interest rates steady when it meets on March 21. The central bank is trying to retain staff, too, and is offering an inflation-matching pay rise of 4% plus a 1% salary top-up for 2024/25.

Finally, lawmakers are calling on banks and hedge funds to stop using nondisclosure agreements in workplace sexual harassment disputes because they risk silencing victims while protecting perpetrators.

Here’s some more weekend reading:

Ciao, mamma? Italy’s low birth rate is affecting everything from the economy to popular culture.
Paris Olympics will be a showcase of wooden architecture.
The cost-of-living crisis in Nigeria is turning deadly.
Apparently, the world has too much wine.

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