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September 2020

Disclaimer :
"Any views or opinions expressed in these blogs are solely those of the author and might not represent those of Access Credit Management Limited."

UK High Streets Remain Quiet as Businesses Struggle to Get Back to Normal

The UK’s return to work following lockdown continues to be worryingly slow. However, a report by the Office for National Statistics (ONS) confirmed that the number of people travelling to work has increased slightly in recent weeks.

The Latest Numbers

The ONS stated that 57% of British working adults travelled to their workplace in the days from 26 August to the 30th of that month. This was a modest increase from the 55% that made this trip a couple of weeks earlier, and a more significant jump from the 33% reported in May.

European Central Bank Keeps Historically Low Rates

The European Central Bank (ECB) has decided to leave Eurozone interest rates at the current levels and revised its 2021 forecast upwards, leading to an immediate reaction in the markets.

What Does This Mean?

This decision to keep interest rates unchanged means that the historically low headline rate of 0% remains in place. A negative rate of -0.5% will still be charged on deposits belonging to commercial banks, in an effort to encourage them to lend more money.

Redundancies in the UK Gathering Pace

The latest figures suggest that redundancies in the UK are now at their highest level since 2009, as the crisis provoked for the coronavirus pandemic and subsequent lockdown begins to take its toll on the employment market.

A Look at the Numbers

Current data on this subject comes from the Office for National Statistics (ONS). They have confirmed that 156,000 people in the UK lost their jobs in the 3 months leading up to July this year. This was 48,000 more than were made redundant in the 3 quarters to May.

UK Taxes Could Rise by £60 Billion, According to Think-Tank

The IFS think-tank has published a report suggesting that a major income tax rise could be needed in the UK, to cover the extra public spending that the current crisis has caused. They calculate that a possible total of £60 billion needs to be generated.

What They Reported

The report pointed out that an income tax increase of 6p or 7p in every £1 earned by British workers may be needed. This would be to pay for additional public spending over the next five to six years, and to avoid new austerity measures being imposed.

BoE Chief Warns Against Pessimism

Andy Haldane, who is chief economist at the Bank of England (BoE), has pointed out the dangers of pessimism during the current crisis. This comes as it was revealed that the country´s Gross Domestic Product (GDP) fell by slightly less than predicted.

The Latest Numbers

These comments followed the Office for National Statistics (ONS) revising their estimate of the amount the British economy has shrunk by. The ONS now says that it contracted by 19.8% in the second quarter of 2020, while their initial estimate had been for a 20.4% slump.