UK leans to avoid recession; Curry’s raises earnings outlook: live business

key events

actions in curry they have jumped nearly 6% at the start of trading after he raised his earnings guidance this morning.

They reached their highest level since the beginning of April, at 59.45p.

Introduction: UK Leans To Avoid Recession; Curry’s raises earnings outlook

Good morning, and welcome to our ongoing coverage of business, financial markets, and the global economy.

Hopes that the UK will avoid recession this year are rising, after the economy has performed better than expected so far this year.

Forecasters at the EY Item Club have forecast this morning that the UK will grow by 0.2% during 2023, instead of contracting as previously forecast.

That improvement is due to falling inflation, lower-than-expected energy bills and a resilient job market, they say, with UK inflation expected to start falling sharply from its current double-digit levels.

anna anthony, UK Financial Services Managing Partner at Heycomments:

“We are still on the road to economic recovery and many businesses and consumers, particularly the most vulnerable in society, continue to face significant cost-of-living pressures.

This cannot be underestimated, and proper support has yet to be provided, but we are in a more optimistic place than we were a few months ago.

The recession that many thought was inevitable is now likely to be avoided and energy prices have fallen, boosting consumer and business confidence.

This improving economic outlook means that EY now expects higher bank lending this year and next.

Total UK bank lending to businesses and households is expected to rise by 1.2% this year, an improvement from a forecast decline of 0.1% in February, with further growth of 2.1% forecast for 2024 .

Antony says that economic conditions are expected to improve over the course of 2023 and into 2024:

“While encouraging, enthusiasm needs to be measured, at least in the short term. UK banks continue to face a challenging environment with record low credit growth rates.

However, the sector is in a strong capital position and continues to provide ongoing support to customers, businesses and the broader economy.

We learned on Friday that UK GDP grew by 0.1% in the first quarter of this year, a better result than feared a few months ago when high energy prices and mini-budget chaos hit the economy.

A chart showing UK GDP

He bank of england it also improved its forecasts last week, six months after warning that the UK was facing the longest recession in half a century. Now, however, GDP is expected to be 2.25 percentage points higher than previously forecast in the next three years.

electronics retailer curry has added to the buoyant mood this morning by raising its earnings outlook for the latest financial year.

It now expects to make adjusted pre-tax profit of £110-120m in the year ending April 29, up from a previous forecast of around £104m.

Curry’s says UK and Ireland trade has been “better than expected, especially in the last two months of the year.”

Profits have been boosted by “continued gross margin improvements” and cost efficiencies, it says.

However, comparable sales in the UK and Ireland fell 7% year-on-year and 10% over the year in the Nordic regions, where trade problems have affected the group.

curries says:

The business environment in the Nordics remains challenging, but under the new management we have made progress on margins and costs.

Also out today

Investors are closely watching Turkey, where yesterday’s elections appear headed for a runoff. If the count continues, neither President Recep Tayyip Erdoğan nor his main rival, Kemal Kılıçdaroğlu, appear to reach the 50% threshold to win the presidential race outright.

We also expect the EC to release its spring economic forecasts this morning, with new predictions for gross domestic product, inflation, employment and public finances.

The agenda

  • 10am BST: Eurozone industrial production for March

  • 10am BST: EC spring economic forecasts

  • 11am BST: Spanish Consumer Confidence for April

  • 1:30pm BST: New York Empire State Manufacturing Index for May

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