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UK economy grew slightly in February – Yahoo Canada Finance

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A female worker checks a car on the production line at the Nissan factory in Sunderland

[Getty Images]

The UK economy grew slightly in February increasing hopes it is on its way out of recession.

The economy grew by 0.1%, official figures show, boosted by production and manufacturing in areas such as the car industry.

The Office for National Statistics (ONS) said that construction was dampened by wet weather though.

This is an early estimate, but signals how the UK, which entered recession at the end of 2023, is faring.

Liz McKeown, director of economic statistics at the ONS, said that looking across the three months to February as a whole, the economy grew for the first time since last summer.

‘Turning a corner’

Chancellor Jeremy Hunt suggested that the new figures were a “welcome sign that the economy is turning a corner”.

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“We can build on this progress if we stick to our plan,” he added.

Growing the economy was one of five key pledges that Prime Minister Rishi Sunak made last year as consumers and businesses were squeezed by higher prices and interest rates.

Labour shadow chancellor Rachel Reeves, however, argued that “Britain is worse off with low growth and high taxes”.

She added: “The Conservatives cannot fix the economy because they are the reason it is broken.”

Bar chart showing the growth of the UK economy. In February, it is estimated to have grown by 0.1%.Bar chart showing the growth of the UK economy. In February, it is estimated to have grown by 0.1%.

[BBC]

Most economists, politicians and businesses like to see gross domestic product (GDP) overall rising steadily because it usually means people are spending more, extra jobs are created, more tax is paid and workers get better pay rises.

The official statistics body also revised its previous estimate for gross domestic product (GDP) in January from 0.2% growth up to 0.3%.

In February, output from the UK’s production industry led the economy’s growth, rising by 1.1%, compared to a fall of 0.3% in January.

The construction sector saw output fall by 1.9% though as persistent rain hampered building projects.

The services sector, which includes things like hairdressing and hospitality, also grew a little with public transport and haulage having a strong month.

Yael Selfin, chief economist at KPMG UK, said that February’s overall figures offered a strong signal that the recession, which is defined as when an economy shrinks for two three-month periods in a row, may already be over.

Growth is likely to have been boosted by cuts in National Insurance and slowing price rises, meaning that businesses and households will have more confidence in their finances and therefore spending.

But she added that consumer spending is still fragile and business investment could be dented by uncertainty around a general election.

Andrew WatsonAndrew Watson

Andrew Watson says the metal manufacturing firm he works for has seen growth overall [BBC]

Andrew Watson is chief financial officer at Goodfellow, a metal manufacturer based in Cambridge which supplies research and development around the world.

He said last year the firm was hit by disruption from attacks on shipping vessels in the Red Sea and supply chains were tight after the pandemic, “but overall we saw growth”.

“You’ve got this weird mix of the economy not doing so well in terms of GDP and yet we feel like we’ve got opportunities to grow – and we just have to push forward and access those opportunities,” he said.

He suggested that growth in the UK had been “anaemic” since covid, with more opportunities presenting themselves in the United States.

Other countries’ economies have also faced energy price shocks and supply chain delays in the wake of the pandemic driving up costs, as well as the potential knock-on effects from conflict overseas, but the UK has seen growth stagnating for some time.

‘Industries still struggling’

Dr Roger Barker, director of policy at the Institute of Directors, suggested that there were few signs of a “strong” economic reboundin the UK and that some parts of the services industry like hotels and hospitality were still struggling.

Other economists pointed out the impact of previous interest rate rises by the Bank of England was still feeding through to the economy.

Currently, experts are split on when the UK’s central bank may start cutting interest rates over the summer, potentially providing some relief to mortgage-holders and borrowers.

The Bank’s Monetary Policy Committee takes into account a range of economic figures when making its decision on its base rate, although monthly figures such as February’s can be quite volatile and are “unlikely” to do much change to its thinking, said Danni Hewson, head of financial analysis at AJ Bell.

Cost of living: Tackling it togetherCost of living: Tackling it together

[BBC]

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A timeline of events in the bread price-fixing scandal

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Almost seven years since news broke of an alleged conspiracy to fix the price of packaged bread across Canada, the saga isn’t over: the Competition Bureau continues to investigate the companies that may have been involved, and two class-action lawsuits continue to work their way through the courts.

Here’s a timeline of key events in the bread price-fixing case.

Oct. 31, 2017: The Competition Bureau says it’s investigating allegations of bread price-fixing and that it was granted search warrants in the case. Several grocers confirm they are co-operating in the probe.

Dec. 19, 2017: Loblaw and George Weston say they participated in an “industry-wide price-fixing arrangement” to raise the price of packaged bread. The companies say they have been co-operating in the Competition Bureau’s investigation since March 2015, when they self-reported to the bureau upon discovering anti-competitive behaviour, and are receiving immunity from prosecution. They announce they are offering $25 gift cards to customers amid the ongoing investigation into alleged bread price-fixing.

Jan. 31, 2018: In court documents, the Competition Bureau says at least $1.50 was added to the price of a loaf of bread between about 2001 and 2016.

Dec. 20, 2019: A class-action lawsuit in a Quebec court against multiple grocers and food companies is certified against a number of companies allegedly involved in bread price-fixing, including Loblaw, George Weston, Metro, Sobeys, Walmart Canada, Canada Bread and Giant Tiger (which have all denied involvement, except for Loblaw and George Weston, which later settled with the plaintiffs).

Dec. 31, 2021: A class-action lawsuit in an Ontario court covering all Canadian residents except those in Quebec who bought packaged bread from a company named in the suit is certified against roughly the same group of companies.

June 21, 2023: Bakery giant Canada Bread Co. is fined $50 million after pleading guilty to four counts of price-fixing under the Competition Act as part of the Competition Bureau’s ongoing investigation.

Oct. 25 2023: Canada Bread files a statement of defence in the Ontario class action denying participating in the alleged conspiracy and saying any anti-competitive behaviour it participated in was at the direction and to the benefit of its then-majority owner Maple Leaf Foods, which is not a defendant in the case (neither is its current owner Grupo Bimbo). Maple Leaf calls Canada Bread’s accusations “baseless.”

Dec. 20, 2023: Metro files new documents in the Ontario class action accusing Loblaw and its parent company George Weston of conspiring to implicate it in the alleged scheme, denying involvement. Sobeys has made a similar claim. The two companies deny the allegations.

July 25, 2024: Loblaw and George Weston say they agreed to pay a combined $500 million to settle both the Ontario and Quebec class-action lawsuits. Loblaw’s share of the settlement includes a $96-million credit for the gift cards it gave out years earlier.

Sept. 12, 2024: Canada Bread files new documents in Ontario court as part of the class action, claiming Maple Leaf used it as a “shield” to avoid liability in the alleged scheme. Maple Leaf was a majority shareholder of Canada Bread until 2014, and the company claims it’s liable for any price-fixing activity. Maple Leaf refutes the claims.

This report by The Canadian Press was first published Sept. 19, 2024.

Companies in this story: (TSX:L, TSX:MFI, TSX:MRU, TSX:EMP.A, TSX:WN)

The Canadian Press. All rights reserved.

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S&P/TSX composite up more than 250 points, U.S. stock markets also higher

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TORONTO – Canada’s main stock index was up more than 250 points in late-morning trading, led by strength in the base metal and technology sectors, while U.S. stock markets also charged higher.

The S&P/TSX composite index was up 254.62 points at 23,847.22.

In New York, the Dow Jones industrial average was up 432.77 points at 41,935.87. The S&P 500 index was up 96.38 points at 5,714.64, while the Nasdaq composite was up 486.12 points at 18,059.42.

The Canadian dollar traded for 73.68 cents US compared with 73.58 cents US on Thursday.

The November crude oil contract was up 89 cents at US$70.77 per barrel and the October natural gas contract was down a penny at US2.27 per mmBTU.

The December gold contract was up US$9.40 at US$2,608.00 an ounce and the December copper contract was up four cents at US$4.33 a pound.

This report by The Canadian Press was first published Sept. 19, 2024.

Companies in this story: (TSX:GSPTSE, TSX:CADUSD)

The Canadian Press. All rights reserved.

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Construction wraps on indoor supervised site for people who inhale drugs in Vancouver

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VANCOUVER – Supervised injection sites are saving the lives of drug users everyday, but the same support is not being offered to people who inhale illicit drugs, the head of the BC Centre for Excellence in HIV/AIDS says.

Dr. Julio Montaner said the construction of Vancouver’s first indoor supervised site for people who inhale drugs comes as the percentage of people who die from smoking drugs continues to climb.

The location in the Downtown Eastside at the Hope to Health Research and Innovation Centre was unveiled Wednesday after construction was complete, and Montaner said people could start using the specialized rooms in a matter of weeks after final approvals from the city and federal government.

“If we don’t create mechanisms for these individuals to be able to use safely and engage with the medical system, and generate points of entry into the medical system, we will never be able to solve the problem,” he said.

“Now, I’m not here to tell you that we will fix it tomorrow, but denying it or ignoring it, or throw it under the bus, or under the carpet is no way to fix it, so we need to take proactive action.”

Nearly two-thirds of overdose deaths in British Columbia in 2023 came after smoking illicit drugs, yet only 40 per cent of supervised consumption sites in the province offer a safe place to smoke, often outdoors, in a tent.

The centre has been running a supervised injection site for years which sees more than a thousand people monthly and last month resuscitated five people who were overdosing.

The new facilities offer indoor, individual, negative-pressure rooms that allow fresh air to circulate and can clear out smoke in 30 to 60 seconds while users are monitored by trained nurses.

Advocates calling for more supervised inhalation sites have previously said the rules for setting up sites are overly complicated at a time when the province is facing an overdose crisis.

More than 15,000 people have died of overdoses since the public health emergency was declared in B.C. in April 2016.

Kate Salters, a senior researcher at the centre, said they worked with mechanical and chemical engineers to make sure the site is up to code and abidies by the highest standard of occupational health and safety.

“This is just another tool in our tool box to make sure that we’re offering life-saving services to those who are using drugs,” she said.

Montaner acknowledged the process to get the site up and running took “an inordinate amount of time,” but said the centre worked hard to follow all regulations.

“We feel that doing this right, with appropriate scientific background, in a medically supervised environment, etc, etc, allows us to derive the data that ultimately will be sufficiently convincing for not just our leaders, but also the leaders across the country and across the world, to embrace the strategies that we are trying to develop.” he said.

Montaner said building the facility was possible thanks to a single $4-million donation from a longtime supporter.

Construction finished with less than a week before the launch of the next provincial election campaign and within a year of the next federal election.

Montaner said he is concerned about “some of the things that have been said publicly by some of the political leaders in the province and in the country.”

“We want to bring awareness to the people that this is a serious undertaking. This is a very massive investment, and we need to protect it for the benefit of people who are unfortunately drug dependent.” he said.

This report by The Canadian Press was first published Sept. 18, 2024.

The Canadian Press. All rights reserved.

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