Local update
Booster vaccinations have begun for the over 80’s and vulnerable high risk islanders this week. Currently there are 229 Covid cases in Jersey, with 2 people in hospital.
From Monday onwards, over-70s will be able to book their appointments for the booster. The programme will be expanded each week throughout October to include the over-50s, and those between 16 to 49 who are considered vulnerable or at risk.
Mixed markets
The blue-chip FTSE 100 index fell 1%, with oil and mining stocks, financials and retailers among the worst performers. The FTSE 250 dropped 0.9% and was set to record its worst week since October last year, hit by declines in travel and leisure stocks.
European markets are mixed. The DAX is higher by 0.06%, while the CAC 40 is leading the FTSE 100 lower. They are down 0.43% and 0.07% respectively.
As of this morning, in the US, the S&P 500 remained unchanged. NASDAQ fell 0.2% while the Dow Jones Industrial Average rose 0.3%.
Asian markets finished mixed as of the most recent closing prices. The Shanghai Composite gained 1.14%, while the Nikkei 225 led the Hang Seng lower. They fell 2.07% and 0.27% respectively.
UK economy growing quicker than expected
The UK economy has grown faster in the second quarter, than previously anticipated. This is mostly due to a stronger performance from the healthcare sector and the arts than initial estimates had captured. According to the Office for National Statistics, UK gross domestic product increased by 5.5% in the second quarter, after being revised up from the first estimate of a 4.8%increase.
Therefore, the economy is now 3.3% below its level in the fourth quarter of 2019, prior to the start of the pandemic, which is up from the previous estimate of 4.4% below. The revision “raises the risk that the Bank of England will hike interest rates sooner than our forecast of May 2022,” said Ruth Gregory, senior UK economist at Capital Economics.
“The upward revision to GDP in the second quarter brings the UK economy’s performance in line with other G7 economies,” said Samuel Tombs, chief UK economist at Pantheon Macroeconomics.
It was initially believed that the corona collapse was the UK’s biggest annual contraction in over 300 years, however the revised figures show that GDP shrank by just under 9.7% in 2020, slightly less than the fall recorded in 1921. Which means last year was the worst contraction for only 99 years.
More economic woes
Unions have warned that doing away with the furlough scheme, is going to contribute to further economic calamity.
The wage-subsidy has been supporting over a million jobs, but once it ends next week, coupled with the £20 a week cut in universal credit will leave workers in dire straits as we move into winter soon.
Frances O’Grady, the TUC general secretary, said: “Ministers should rethink the end of furlough. Many workers in hard hit industries are still furloughed and need support for longer. Otherwise, we may see a rise in unemployment.”
The UK is still short of approximately 100,000 truckers after tens of thousands returned to the European Union during the Brexit turmoil. In addition, 40,000 truck driver tests were cancelled during the COVID-19 lockdowns. With increased wages due to the shortage, truckers themselves have warned Boris Johnson that this will have a knock-on effect on food prices and gifts as we approach Christmas.
No supply shortages for Jersey
On the home front, according to the Chief Minister, John Le Fondre, Islanders shouldn’t face gas price increases to deal with the current global price instability.
Talks between the senator and Jersey Gas have provided reassurance over further price hikes, after the increase of 13.2% announced last week. We have been advised that the measures Jersey Gas has brought in are sufficient to bridge the global price instability, without any further increases.
It has also been stressed that the supply problems taking place in the UK do not apply in Jersey. The Island’s storage facilities are currently full of petrol, diesel and heating oil from a recent delivery.