Hot whisky
Diageo talks
Drinks giant Diageo has once more got around the table with Indian drinks entrepreneur Vijay Mallya for discussions over taking a stake in India's biggest spirits business, United Spirits, the maker of brands such as Black Dog and Bagpiper whisky. The two companies have held abortive talks before but Mr Mallya, United's biggest shareholder, may be more amenable to talks now given that he is reported to be trying to raise funds for his Kingfisher airline. Under Mr Mallya, United Spirits has become the largest spirits company in India by volume, selling more than 120m cases a year.
Extra costly
Softs surge
The price of olive oil has surged by more than 60 per cent in the past three months due to drought in Spain which has hampered yields there. It represents a standout riser among the general trend for food price rises in recent weeks, which some analysts are forecasting will continue and even accelerate during 2013 as the effects of this year's drought conditions in many parts of the northern hemisphere begin to work through the system. We could see further shocks to the supply chain to come also, as the potentially disruptive El Nino weather pattern takes hold again this autumn.
See: Deals drive agricultural opportunity
Eurogloom
S&P hit
Standard & Poor's has dealt a blow to the eurozone by downgrading growth prospects in the economic bloc for the next two years. S&P does not expect Europe to return to growth until 2014 at the earliest, with countries such as Spain among the hardest hit - it forecasts Spain's economy will contract by 1.4 per cent this year. Such declines will offset what S&P thinks will be "modest" growth in countries such as the UK and France. Meanwhile, International Monetary Fund head Christine Lagarde has warned that economic recovery will be painful and urged policymakers to sustain their recent activity, saying: "We need decision makers to be real action takers."
Bank of Vince
Business Bank fast-tracked
The government's proposed Business Bank, which has been a pet campaign of business secretary Vince Cable, is to be fast-tracked into existence, according to chief secretary to the Treasury Danny Alexander, who described it as an "urgent growth requirement". The bank will be seed-funded with £1bn by the government but then leveraged up to £10bn once in existence. It is envisaged that it will ease the flow of lending to small businesses which are struggling to persuade the banks to unleash credit to them.
Regulation nation
Libor withdrawal
UK banks have withdrawn from their role in the setting of Libor rates in the wake of the rate-fixing scandal that claimed the scalp of Barclays' chief executive Bob Diamond earlier this year. The British Bankers' Association formally withdrew from the Libor process last week at the request of regulators ahead of the announcement of a new system for setting Libor rates, which is expected to feature a much more active role for the UK's financial regulators.
Housing hope
Lending rises
The UK housing market could be set for a boost through the remaining months of the year as banks ramp up lending. A Bank of England report said that banks "significantly" increased their mortgage lending in the three months to September and will do so again in the final quarter. Much of the increase is believed to be aimed at lower deposit holders and first-time buyers, although figures for mortgage approvals contradicted this as approvals fell by 13 per cent in August.
See the Chronic Investor blog for our view on the government's New Buy scheme
