Income recovery slows
UK living standards rose at their slowest pace since 2012 in the past year, with the post-crisis recovery in incomes going into reverse for the poorest 30 percent of families, according to the Resolution Foundation. Typical disposable incomes after housing costs rose just 0.9 percent, held back by the pound-induced surge in inflation following the 2016 Brexit referendum, the London-based think tank estimated in a report yesterday. Poorer households were also victims of welfare cuts and saw their incomes decline by 0.3 percent. The foundation estimated the loss to poorer families at as much as ￡150 (US$200) a year as higher wages and lower taxes were not enough to offset cuts to tax credits and child benefit. Child poverty almost certainly rose last year, and the increase since 2010 has been underestimated in government data, it said.
VW poaches BMW executive
Volkswagen AG (VW) poached BMW AG’s purchasing chief Markus Duesmann, as the German auto giant bolsters its executive ranks following the surprise arrest of the Audi brand’s long-time boss. Duesmann, 49, is to join Volkswagen’s management board in an undefined role as soon as possible, the Wolfsburg-based company said yesterday in a statement. He will be a top contender to eventually replace Audi interim CEO Bram Schot, people familiar with the matter said. VolMoving to resolve uncertainty at Audi is particularly important. Former boss Rupert Stadler, who also oversaw groupwide sales activities for Volkswagen, was arrested last month over allegations that he tried to tamper with evidence in the diesel-cheating scandal.
Manufacturing PMI slides
Japan’s manufacturing sector lost steam this month as demand for exports weakened. The Nikkei Japan purchasing managers’ index (PMI) for manufacturers showed a preliminary reading of 51.6, the lowest since November 2016 and down from 53 last month. Output came in at 52.4, down from 53.6, and the index for stocks of finished goods fell. A reading above 50 indicates the sector is expanding, while one below that signals a contraction. “New business grew at a much weaker rate and was broadly flat, while export demand, despite further yen depreciation, deteriorated for a second month running,” said Joe Hayes, an economist at IHS Markit, which compiles the survey. “Slowing demand presents a worrying development given input delivery times lengthened to the sharpest extent in over seven years,” he wrote in the data release.
Nordea may challenge fine
The biggest Nordic bank is considering taking on the EU’s top markets regulator after being handed a fine for providing credit ratings without a license. Nordea Bank AB, together with four other major Nordic banks, was called out by the European Securities and Markets Authority (ESMA) for selling so-called shadow ratings to corporate clients without permission. Each firm was told to pay a fine of 495,000 euros (US$580,000) for the breach. Nordea on Monday said that it discontinued shadow ratings in 2016, “although we disagree with ESMA” on the interpretation of the rules. “As for today’s fine, Nordea has just received the information and will decide if to appeal after having analyzed the information,” the lender said in a statement.