First post
Retail element confirmed
The government this week confirmed that the forthcoming float of the Royal Mail will contain a retail element, although the percentage has not yet been revealed. In confirming that stockbrokers and share dealing services will be able to sell shares to the public as well as the institutional investors, business minister Michael Fallon fired the starting gun on what is likely to be a significant PR campaign to persuade retail punters to take part.
New media consumes old
Bezos buys Post
One of America's most venerable media institutions, The Washington Post, has been bought in a surprise $250m (£162m) cash deal by Jeff Bezos, the entrepreneur who made his billions after founding online marketplace Amazon. The Washington Post, whose most famous hour was the Watergate scandal, has faced several years of declining revenues as it has struggled in the face of online competition, and the owning Graham family felt now was the time to sell out. Mr Bezos is in good company, with Liverpool Football Club owner John Henry buying the Boston Globe last week.
Boom over?
Australian rates cut
The Reserve Bank of Australia this week cut its interest rate to 2.5 per cent, the lowest rate since the Bank was created in 1959. The headline interest rate has now been almost halved during the past two years as the heat has started to come out of the previously booming Australian economy. Indeed, signs are growing that Australia's long resource-fuelled boom may be coming to an end, even if it is temporary, as demand from its near neighbours in Asia has abated in recent months. The Australian dollar has weakened significantly and the Bank is seeking to encourage a rebalancing of the economy.
UK healing?
Data delight
There is an increasing sense of optimism surrounding the UK economy as a number of indicators have turned upwards. Most significantly this week, the dominant services sector's Purchasing Managers' Index recorded a score of 60.2, smashing analysts' expectations in posting the highest score since the pre-credit crunch days in 2006. This was backed up by the strongest rises in house prices for three years, according to two leading estate agents, improving retail sales and a return to growth for the manufacturing sector. Elsewhere there were signs in Europe that the eurozone economy may also be preparing to haul itself out of recession before the end of this year.
■ See Approaching 'escape velocity'?
Asset resolution
Payback time
UK Asset Resolution, the government organisation set up to manage its investments in the toxic assets of Bradford & Bingley and Northern Rock, has paid back another chunk of its dues to the government in the form of a £1.3bn payment following an improved half-year performance. Profits rose by 10 per cent to £529m as bad loans improved and no extra payment protection insurance liabilities were incurred, although there was an extra £47m of provisions for compensation for paperwork mistakes on more than 100,000 unsecured loans. Progress continues to be made on rationalising the mortgage portfolios inherited, with more than £2bn of mortgages redeemed during the first half.
Rajan rescue
Indian hope
The Reserve Bank of India has appointed former economic advisor to the IMF Raghuram Rajan as its head from the first week of September as it bids to turn around the fortunes of the ailing emerging market giant. With the rupee sliding in value, inflation remaining stubbornly high, growth slowing and foreign investment on the wane, India's woes are mounting and Rajan will be under pressure to act to turn things around. Mr Rajan stated that "there is no magic wand to make the problems disappear".
