Connect with us

Economic

Study shows annual mortgage bills rise by £5,100 for five million households in the UK

Avatar

Published

on

More than 5 million households in Britain are set to see their annual mortgage payments increase by an average of £5,100 by the end of 2024, following rising inflation and a ‘mini’ budget.

More than a million households with variable mortgage rates are facing higher repayment rates after the finance minister’s financial statement last month.

However, the number is set to rise to 1.7 million by the end of this year, as people receiving fixed bids move on to new deals, according to research by Resolution and published Saturday.

By the end of 2024, 5.1 million households – about a fifth of the total – will be paying more for a mortgage than today.

The think tank found that affected households would typically pay an additional £5,100 a year by the end of 2024, which adds up to £26 billion in additional mortgage payments.

Advertisement
Column chart of the estimated number of households facing an increase in mortgage payments, compared to the third quarter of 2022, Great Britain showing that the number of households with high mortgage payments is increasing

While a large part of the expected increase in mortgage payments is the result of the rise in Bank of England Policy rate, £1,200 due to changes in interest rate expectations after the “mini” budget, according to the study.

The rise in interest rates “will lead to a new crisis in living standards for foreclosed families across Britain,” said Lindsey Judge, director of research at Resolution Foundation and author of the report.

Affected households in London will see the biggest increase – average payments are set to rise by £8,000 over the same period, more than double the level of the £3,400 increase seen by Welsh mortgage lenders.

However, the impact in the capital will be more concentrated as only 19 percent of households have a mortgage, the lowest of any region and well below 29 percent in the Southeast.

Although higher-income households will experience the largest increases in mortgage costs in cash on average, it is lower-income households that experience the largest rise as a share of income.

The think tank has estimated that the typical household with a mortgage will spend about 5 percent more of their income on housing costs by the end of 2024. However, the figure rises to 10 percent for those on the lowest salaries.

Advertisement

With inflation at a 40-year high, the Bank of England raised its policy rate from a historic low of 0.1 per cent last year to 2.25 per cent.

Meanwhile, markets are pricing in a 75 or 100 basis point increase at the Bank of England’s next policy meeting in November, and the rate is expected to rise to more than 5 per cent by early next year.

Line chart of bank rate and average mortgage rates, UK showing mortgage payments rising ahead of expected interest rate increases

Interest rate policy expectations for next year jumped by nearly two percentage points in response to the unfunded tax cuts announced by the government on September 23.

Even after the government U-turn on corporate tax cut On Friday, interest rate policy expectations for 2023 remained above 5 percent and well above the mid-September forecast.

The Think and Mortgage Foundation projected that mortgage rates would rise to between 6 and 7 percent for those who rely on fixed rates, reaching more than 8 percent for those who use floating rates.

Analysis showed that one in three Conservative voters has a mortgage. For Labor voters and those in “red wall” constituencies in the North and Midlands, which the Conservatives won in the last general election, the share has risen to two in five.

Advertisement

Source link

Continue Reading
Advertisement
Click to comment

Leave a Reply

Your email address will not be published.

Economic

US Equity Funds Record Largest Weekly Outflow In About 1-1/2 Years By Reuters

Avatar

Published

on

© Reuters. FILE PHOTO: One hundred US dollar banknotes are seen in this illustration taken in Seoul on February 7, 2011. REUTERS/Lee Jae-won/File Photo

(Reuters) – US equity funds posted massive outflows in the week ending Dec. 7 as investors worried about the Federal Reserve’s interest rate hike, as data showed a rebound in employment and a recovery in the services sector.

According to data from Refinitiv Lipper, US equity funds recorded withdrawals of $26.66 billion, the largest weekly outflow since April 2021.

Graph: Money Flows: US Stocks, Bonds, Money Market Funds, https://fingfx.thomsonreuters.com/gfx/mkt/znpnbbezgpl/Fund%20flows%20US%20equities%20bonds%20and%20money%20market%20funds.jpg Reports Show Upbeat US service industry activity and higher-than-expected additions to non-farm payrolls in November raised bets that the Federal Reserve will remain more hawkish than expected.

Investors were also worried because the largest U.S. banks including Goldman Sachs (NYSE: ), JP Morgan, and Bank of America (NYSE: 100) have warned of a recession as inflation threatens consumer demand.

Advertisement



US equity growth funds saw $9.91 billion in withdrawals, while value funds saw a net sell-off of $2.03 billion, as selling continued for the third straight week in every sector.

Graph: Fund Flows: US Growth and Value Funds, https://fingfx.thomsonreuters.com/gfx/mkt/jnvwyyewnvw/Fund%20flows%20US%20growth%20and%20value%20funds.jpg Sector fund data showed technology, financials and fund losses Estimated consumers are $1.27 billion, $761 million, and $527 million, respectively, in outflows.

Graph: Fund Flows: US Equity Sector Funds, https://fingfx.thomsonreuters.com/gfx/mkt/gdvzqqywlpw/Fund%20flows%20US%20equity%20sector%20funds.jpg Meanwhile, US bond funds received a net 992 million dollars in inflows after seeing weekly outflows for four weeks.

Taxable US bond funds made net purchases of $886 million after three consecutive weeks of selling, although municipal bond funds experienced small outflows of $53 million.

US investors bought $318 million in high-yield bond funds and $1.06 billion in government bond funds in their biggest weekly net purchases since November 16. However, domestic public taxable fixed income funds recorded $794 million worth of outflows.

Advertisement



Graph: Fund Flows: US Bond Funds, https://fingfx.thomsonreuters.com/gfx/mkt/zgpobbmrovd/Fund%20flows%20US%20bond%20funds.jpg Meanwhile, US money market funds took in $36.19 billion of inflows, the largest amount for a week since November 2.

Source link

Continue Reading

Economic

FirstFT: The FTC is flexing its muscles on the Microsoft-Activision deal

Avatar

Published

on

good morning. This article is an in situ version of our website FirstFT the news. Subscribe to our site AsiaAnd the Europe/Africa or The Americas A release to send straight to your inbox every weekday morning

The US Federal Trade Commission will file a lawsuit to block Microsoft $75 billion acquisition of video game maker Activision Blizzard Because of concerns that the deal could hurt competitors to the Xbox consoles and cloud gaming business.

Deal, which was announced in JanuaryIt will be Microsoft’s largest acquisition ever and will make it the third largest game company by revenue, after China’s Tencent and Japan’s Sony.

But the Federal Trade Commission said yesterday that the deal would harm competition in the gaming sector, highlighting the fact that Activision is one of the few video game developers that produces and publishes the best video games for many devices such as PCs, consoles and mobile phones.

Microsoft moved to head off a regulatory backlash this week By signing a contract for 10 years To bring Call of dutythe blockbuster that brought in $30 billion in lifetime sales for Activision, has moved to Nintendo platforms instead of turning it into an Xbox exclusive.

Advertisement

The measure is one of the biggest tests yet for Lena Khan, the chair of the Federal Trade Commission appointed by President Joe Biden, who has He vowed to crack down on Big Tech’s market power.

Microsoft CEO Satya Nadella hoped the deal would give the US software company a head start in the race to build the next version of the Internet and saw no reason for competition concerns when He spoke to the Financial Times in February.

“Even after this acquisition, we’ll be in third place with kind of a lower teen share[of the video games market]. . . “We’re going to be a bit of a player in a place that’s going to be very fragmented,” he said.

1. Pro-left appointed as Brazilian Finance Minister Luis Inacio Lula da Silva Fernando is expected to name HaddadThree well-informed sources reported that a loyalist from the left-wing Labor Party as Finance Minister today. The decision is likely to disappoint financial markets and reignite investor fears that the Lula administration, which takes office on January 1, will pursue a looser fiscal policy.

2. The US House of Representatives passes a defense bill worth $858 billion in financing weapons for Taiwan passed by the US House of Representatives A comprehensive defense spending bill of $858 billion That provides $10 billion in funding to provide arms to Taiwan as the country comes under increasing pressure from China. It is the first time that the US government has funded weapons for Taiwan.

Advertisement

3. The United Kingdom, Japan and Italy agree to jointly build advanced combat aircraft The three countries will joint construction One of the most advanced combat aircraft in the world by 2035, to expand its defense capabilities to counter the growing threats from China and Russia. They will share development costs estimated at tens of billions of dollars.

A mock-up of the Tempest jet at the 2018 Farnborough Airshow
The UK and Italy’s Tempest fighter program will be integrated with Japan’s FX project © Peter Nicholls / Reuters

4. Airlines are feeling the pressure as charter groups raise rents Airlines return to profitability, but one cloud looms: Sharp increases in rental costs. More than half of the world’s commercial aircraft are owned or operated by leasing companies, and their fees are rising, which is another consequence of rising interest rates.

5. The Faustian agreement between Joe Biden and Russia to secure the release of Brittney Greener Brittney Griner’s release was greeted with joy from the basketball star’s family and supporters. But the exchange with Viktor Bout, a notorious arms dealer, drew criticism and raised questions about how America’s adversaries would deal with them. It may benefit from the arrest of its own citizens in the future.

How good is it to keep up with the news this week? Take our test.

Coming days

Economic data The US Department of Labor will update the Producer Price Index. The producer price index is expected to have risen 0.2 percent in November from the previous month, but the annual pace of wholesale inflation is expected to have eased to 7.2 percent, from 8 percent in October. The University of Michigan preliminary reading on consumer confidence is expected to have risen to 56.9 in December from 56.8 last month.

UK to launch financial services reforms Chancellor Jeremy Hunt would Unveil changeswhich include raising the ceiling on bankers’ bonuses and removing the requirement to separate risky investment banks from retail operations, in a speech in Edinburgh later in the day.

Advertisement

Putin in Kyrgyzstan Russian President Vladimir Putin has arrived in Bishkek, the capital of Kyrgyzstan, to participate in the Eurasian Economic Union summit. The leaders are expected to discuss the establishment of a joint gas market and the establishment of an intergovernmental council in the field of energy. According to the Russian news agency TASS.

world Cup The quarter-final matches kick off in Qatar today, with Croatia playing Brazil in the first match, followed by the Netherlands and Argentina. Tomorrow, the surprising Moroccan team will meet Portugal at the start of the match, and England will meet France at a later time.

  • Read more: Simon Cooper, who grew up in the Netherlands, explains how the Dutch do it They abandon tradition under their coach Louis van Gaal in a bid to win the World Cup.

What else do we read?

Light needs to illuminate the black hole on dollar swaps An ordinary person might assume the dollar swap market It is a transparent angle of financing, given that the US currency underpins much of the global industry and these contracts are used by most of the major corporations and investment groups. Not so, writes Gillian Tate, as a recent report from the Bank for International Settlements shows.

Has inflation peaked? Central banks in the developed world have cautiously raised interest rates to curb demand and crush inflation this year, but, says the Financial Times editorial board, Now is not the time to hold back or cut back borrowing costs.

‘Hell. Hell: The War of Attrition on Bakhmut With Russia desperate for victory, wave after wave of infantry began Thrown in the city of Bakhmut on the front line In the Donetsk province, only to be cut down by the Ukrainian defenders. “They are just meat for Putin, and Bakhmut is a meat grinder,” said Kostyantyn, an exhausted Ukrainian machine gunner.

Advertisement
Maps show that there was relatively little movement on the front line around Bakhmut

Why the price of oil has fallen despite new restrictions on Russian supply This week saw a pivotal moment in global geopolitics, as the European embargo and G7 cap on Russian crude oil prices came into effect. Within hours, supply disruptions set in as the piling up oil tankers queued up in the Bosphorus Strait. All of this would normally lead to a sharp rise in oil prices. However, yesterday they reached a new low of 2022. What is going on? Our energy editors explain.

It’s time to hunt down the dragons of the Asia Corporation I learned the hard way during years of managing Japanese equity portfolios, writes the Financial Times’ new investment columnist Stuart Kirk, the country’s corporate bosses were obsessed with market share, quality, innovation, culture and hard work. But did they sleep at night dreaming of my equity returns, Stewart asks, no they did not. That’s changing, he says, but local conditions are still very important.

the television

There are explosive royal TV shows out there, writes lead writer Henry Mance. But so far the new Netflix series Harry and Megan Not them. He argues that the Sussexes are both an ambitious couple and a cautionary tale about ambition.

The Duke and Duchess of Sussex
Harry & Meghan is produced by the couple’s company Archewell © Courtesy Prince Harry and Meghan, the Duke and Duchess of Sussex

Thank you for reading and remember that you can Add FirstFT to myFT. You can also choose to receive a FirstFT push notification every morning on the app. Send your recommendations and feedback to firstft@ft.com

Climate chart: an explanation – Learn about the most important weather data for the week. Participation over here

Long story short – The biggest and best-read stories in one smart email. Participation over here


Source link

Advertisement
Continue Reading

Economic

What is the ChatGPT policy?

Avatar

Published

on

Rob Lonnie She claims to be a “left-liberal”. David Rosado I applied the political compass test He concluded that ChatGPT is a mixture of left and liberal leanings, eg: “anti-death penalty, pro-abortion, skeptical of free markets, corporations exploiting developing countries, more taxes for the rich, government subsidies, pro-benefits for those who refuse to work, Pro-immigration, sexual liberation, morality without religion, etc.”

Produce this image from the test results:

Rosado also ran several other political tests with largely similar results. However, I would like to stress a few different points. Most of all, I see ChatGPT as “pro-Western” in its perspective, while giving different visions of what this means. I also see ChatGPT as a “discord minimization”, for business reasons but also simply to want to get on with substantive work with a minimum of external fuss. I wouldn’t have built it myself So differently, and note that the bias may lie in the training data rather than any biases of the creators.

Advertisement



Marc Andreessen has received a number of tweets suggesting that AI engines will host the “mother of battles” over content, censorship, bias, etc. – outside of the current battles on social media.

I agree.

I saw someone ask ChatGPT if Israel is an apartheid state (I can’t reproduce the answer because chat is now broken for me – unfortunately! But try for yourself.). Basically, ChatGPT answered no, that only South Africa was an apartheid country. Not many people will be unhappy with this answer, including many supporters of Israel (Israel’s moral defense, on the one hand, was not weighty enough for many tastes). Many Palestinians will object, for obvious reasons. And what about all those Rhodesians who suffered under their apartheid regime? Are they simply to be forgotten?

Advertisement



When it comes to politics, the AI ​​engine simply cannot win, or even win a draw. However, there is no simple way to keep them out of politics either. By the way, if you get frustrated with ChatGPT wrapping your question, rephrase it in terms of asking them to write a dialogue or speech on a topic, in someone else’s voice or style. Often it will go further in this way.

The world has yet to realize how powerful ChatGPT is, and thus Open AI can still live in a kind of relative peace. I’m sorry to say that it won’t last long.

the post What is the ChatGPT policy? Debuted marginal revolution.

Source link

Advertisement



Continue Reading
Advertisement

Trending