via Reuters

By William Schomberg

LONDON (Reuters) – British firms called on Tuesday for another 7.6 billion pounds ($10.3 billion) of emergency government help, saying they cannot wait until finance minister Rishi Sunak’s March budget to learn if they will get more pandemic support.

With Britain back under lockdown and companies adjusting to life after Brexit, firms are taking big decisions about jobs and investment and need to know if their financial lifelines will be extended, the Confederation of British Industry said.

“We just have to finish the job. Now would be a very odd time to end that support,” CBI Director-General Tony Danker said in a statement.

Sunak has extended his support measures several times already and has said his response to the pandemic will cost 280 billion pounds during the current financial year, saddling Britain with a peacetime record budget deficit.

But he is facing calls on many fronts to spend yet more including from lawmakers, some from his Conservative Party, who want an emergency welfare benefit increase to be prolonged.

The CBI said Sunak should extend until June his broad job retention scheme, which is scheduled to expire in April, and then follow it up with targeted support for jobs in sectors facing a slow recovery such as aviation.

He should give firms more time to pay back value-added tax which was deferred last year, grant a similar deferral for early 2021 and extend a business rates tax exemption for companies forced to close by the lockdown as well as their suppliers.

“The rule of thumb must be that business support remains in parallel to restrictions and that those measures do not come to a sudden stop,” Danker said.

The CBI said its longer-term priority was an overhaul of the business rates system that it said was outdated and discouraging investment in low-carbon energy.

Danker said it was too soon to start raising Britain’s corporation tax rate, one of the lowest among rich economies after a Times report that Sunak was drawing up plans to increase it to start fixing the public finances.

“It would be wrong to raise business taxes when we don’t have a recovery,” Danker said.

($1 = 0.7380 pounds)

(Writing by William Schomberg; Editing by Alexander Smith)

via Reuters

 

By Kaori Kaneko

TOKYO (Reuters) – The Bank of Japan will likely focus on measures to make its purchases of risky assets, such as exchange-traded funds (ETF), more flexible as the economy comes under growing strain from a spike in COVID-19 infections, a Reuters poll found.

Analysts polled also revised down their economic projection for the fiscal year ending in March on expectations a recent resurgence of coronavirus infections would dent growth.

Economic activity could stall in the world’s third-largest economy from pandemic curbs and the BOJ may have to look at more effective ways to achieve its 2% inflation target as renewed infections force it to maintain its massive stimulus longer, analysts said.

The central bank said last month it would undergo an examination of its yield curve control and quantitative easing policies to seek ways to make them more “effective and sustainable”. Its findings will be released in March while new GDP estimates will be issued at its Jan. 20-21 policy meeting.

“The BOJ may be thinking of correcting distortions caused by its policy that could become an obstacle for maintaining its current framework through Governor (Haruhiko) Kuroda’s term that ends in early 2023,” said Izuru Kato, chief economist at Totan Research.

Asked what steps the BOJ would take when the central bank unveils its findings in March, 31 economists said the central bank would “make its ETF, J-REIT buying more flexible,” the poll conducted between Jan. 7-18 showed.

Eight analysts said the BOJ would revise its three-tiered deposit rate system that applies negative interest rates only to marginal excess bank reserves and two said the central bank would change the 10-year bond yield target to other durations.

The question allowed multiple answers.

The central bank will discuss ways to scale back a controversial programme that buys massive amounts of exchange traded funds without stoking market fears of a full-fledged retreat from ultra-loose policy, sources have told Reuters.

 

RENEWED STATE OF EMERGENCY

Japan expanded a state of emergency it declared for the Tokyo area earlier this month to seven more prefectures last Wednesday amid a steady rise in COVID-19 cases.

Many analysts expect the latest measures to inflict less damage to the economy than the stricter and broader curbs imposed in April and May last year.

In the poll, taken before the government’s decision to expand the state of emergency beyond the Tokyo area, analysts expected the economy to contract 2.4% in January-March. The poll had predicted a 2.1% expansion in December.

For the current fiscal year ending in March, the economy was forecast to shrink 5.5%, the poll found, slightly weaker than a 5.3% contraction projected last month.

The economy was expected to expand 3.3% in the fiscal year beginning in April, starting with 4.1% growth in the April-June quarter, the poll showed.

“Restrictions under the renewed emergency status are relatively moderate, so it could take a long time for infection numbers to fall,” said Hiroshi Namioka, strategist and fund manager at T&D Asset Management. “Downward pressure on prices could strengthen.”

Core consumer prices, which exclude volatile fresh food prices, will slip 0.5% this fiscal year before rising 0.2% next fiscal year, the poll found.

Economists were split on which direction the BOJ will move when it next changes policy.

Twenty-one of 39 analysts forecast the BOJ would scale down stimulus, while 18 said it would ramp up monetary support.

Sources have told Reuters the BOJ was likely to slightly revise up next fiscal year’s economic forecast and hold off on expanding stimulus at its Jan. 20-21 policy meeting.

 

(For other stories from the Reuters global economic poll:)

 

 

(Polling by Shaloo Shrivastava, Editing by Leika Kihara and Jacqueline Wong)

 

-Survey of 1007 SMEs in the UK by Spitfire Network Services Ltd reveals pain points for employees working from home-

-27% experience frequent or occasional connectivity disruptions despite working remotely since March-

-Only 4% of employees working from home have a dedicated Internet connection for work-related purposes-

Spitfire Network Services Ltd, a provider of telecoms and IP engineering solutions to UK businesses, today revealed data that showed more than a quarter of employees experience regular issues with connectivity whilst working from home. The ‘Voice Quality Matters’ survey found that 27% of employees faced connectivity challenges such as drop-outs or lags during the course of their working day, causing frequent disruption and impacting on productivity. With the majority of voice (video) communications hosted via the Internet, the importance of ensuring your voice can be heard has never mattered more.

The survey revealed that only 4% of employees working from home had their own dedicated internet connection for work purposes. Instead, employees are relying on their home broadband for connectivity. When asked, 57% of employees revealed that they had between 3-10 devices connected to their home broadband at any one time.

Employees were also asked about the time of the day that most of the issues occurred, 4pm-6pm was revealed to be the problem hours. With kids returning from school and using personal devices, the strain on the network resulted in connectivity problems arising.

Dominic Norton, Sales Director, Spitfire Network Services Ltd, commented on the findings: “We were unsurprised to discover that more than one in four employees are facing connectivity challenges whilst they work from home. When you consider that remote working can no longer be classed as the supposed ‘new normal’ with this shift happening over 9-months ago, it shows that businesses have been slow to act. Connectivity is critical for employees to mirror the experience of the office from home – critical for delivering a service to customers and ensuring their workforce is as productive as possible. My message to businesses would be to act now and really consider the damage that may be being caused to both productivity and reputation.”

In total, 1007 respondents were surveyed throughout November 2020 as part of the Voice Quality Matters survey conducted by Spitfire Network Services Ltd.

For more information about Spitfire Network Services Ltd, visit www.spitfire.co.uk.

To find out how we can support your customers to ensure they stay connected, please contact [email protected].