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Sep 20 • 6 tweets • 2 min read
This is Josh Farrant, front of house manager of Ye Olde Fleece in Kendal, Cumbria.

The pub's energy costs are set to rise SIXFOLD from next month... Image
...this is Kate Phillips who manages Kendal's Lakeland Climbing Centre.

Her business' gas bills are heading up FOURFOLD from next month... Image
...This is Scott and Mel Walmsley who run Lakes Sandwiches in Kendal.

Their firm's energy bills have ALREADY risen sevenfold... Image
....Two weeks ago the Government promised an energy price freeze for firms like this that would provide "equivalent support" as that going to households.

Now business are asking:

What are the details of that support?

When will it arrive?

Will it really be "equivalent"..
...Tonight on #Newsnight we explore whether the government is really set to deliver for UK firms when it comes to energy price support.

1030pm on BBC2📺
Update from colleagues at @SkyNews :

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More from @BenChu_

Ben Chu Profile picture
Sep 20
I'm hearing, as per Bloomberg report, that the government energy price freeze plan, which we will likely get details on tomorrow AM, will work by capping the gas/electricity prices chargable to firms at a certain £/KWH rate...
bloomberg.com/news/articles/…
...& will likely be backdated so firms get support for higher costs incurred since the Spring, not just the six months from October...
...the latter will be welcomed by firms on variable rates which have already been hit hard by price increases this year.

But some big caveats/question marks being highlighted...
Read 6 tweets
Ben Chu Profile picture
Aug 31
UK sovereign bond yield curve still "inverted" this morning (data from Refinitiv).

2 year Gilt yields (3.021%) trading higher than 10 year yields (2.805%)...
...normally 10 year yields are higher.

Inversion often seen as a recession signal from bond market.

Signals (arguably) investors expect Bank of England rate hikes in immediate term, but much weaker economy further out which will require lower rates i.e recession...
...though inverted yield curve has been a more reliable recession predictor in the US than in the UK.

Some more background here..

independent.co.uk/news/business/…
Read 4 tweets
Ben Chu Profile picture
Aug 15
How would Labour "fully fund" its £30bn six month energy bill support package for households?

A brief thread.

The party's costing document today lays out the following...
...Lots of focus on the £7bn lower debt interest component - as @PJTheEconomist has pointed out, this is only a *temporary* saving if bills are allowed to rise after 6 months and headline inflation & debt interest springs back after that...
...& if the plan rolls on LONGER than 6 months (and looking at the current wholesale gas futures curve it's hard to see it being less needed by the poorest families in April 2023) then the total cost will likely be well north of £30bn...
Read 8 tweets
Ben Chu Profile picture
Aug 8
Just how much more severe is the financial hit now facing UK households due to rising energy bills? 📈

And how big is the financial hole in household budgets the government is being urged to fill? 💰

A thread...🧵1/
Start with May, when the government brought in its latest financial support package.

Here's @resfoundation modelling showing the projected hit by household vingtile from rising bills over 2022-23 (blue).

And the total financial support coming from government (red)... 2/
Notice that for those in the bottom quarter the financial supoort was more or less matching the expected increase increase in energy bills, which is why the May package was widely praised for being (belatedly) progressive...3/
Read 13 tweets
Ben Chu Profile picture
Jun 1
Is UK inflation so high at the moment because the Bank of England printed too much money during the pandemic?

💵💵💵📈

A thread 🧵 ...
2/Now, the Government and the Bank of England argue our 9% y/y inflation rate is primarily due to spiking energy import prices and disruption to global supply chains.

But some are offering a DIFFERENT explanation...
3/Some monetarist economists and even the former Bank of England Governor, Mervyn King, have suggested it’s actually in large part because the Bank of England engaged in Quantitative Easing (large scale buying of government bonds, a.k.a money printing)...
reuters.com/world/uk/ex-ba…
Read 23 tweets
Ben Chu Profile picture
Feb 28
Have the West's financial sanctions undermined "Fortress Russia" by preventing the country from tapping its $630bn financial war chest?

Lots of debate on that in recent days.

Interestingly, the country's own central bank admitted as much today...: cbr.ru/eng/press/even… Image
..."The new sanctions imposed by foreign states have entailed a considerable increase in the ruble exchange rate and limited the opportunities for Russia to use its gold and foreign currency reserves" says Bank of Russia Governor Elvira Nabiullina... Image
...Assuming dollars, euros and yen making up Russisa's $630bn foreign exchange reserves are now blocked due to Western sanctions, the best hope for Putin probably lies in being able to draw on monetary gold and Chinese yuan... Image
Read 9 tweets

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