Good morning! Here’s what you need to know on Tuesday.
1. The value of the pound has risen above $US1.38 for the first time since the Brexit referendum, thanks to a weakening dollar and rising hopes that other European Union members will seek a relatively “soft” Brexit, the Times reported.Sterling climbed to a high of $US1.3819 yesterday afternoon, a rise of almost four cents since Thursday and a level not seen since the surprise EU referendum result caused the pound to plunge by 15 per cent.
2. The uncertainty caused by Brexit is deterring companies from investing and hampering Britain’s ability to close its productivity gap with other leading developed countries, a Bank of England policymaker has warned according to a Guardian report. Silvana Tenreyro, one of the nine members of Threadneedle Street’s monetary policy committee (MPC), which sets UK interest rates, said 75% of the decrease in growth of output per worker since the financial crisis a decade ago was due to manufacturing and financial services, but that a period of catch-up was feasible.
3. The accounting watchdog has warned that it may launch an investigation into KPMG over its audit of Carillion, the construction and services group that has collapsed into liquidation putting thousands of jobs at risk, the Times reports. The Financial Reporting Council said that it would “follow due process and will make a further statement on this matter shortly”.
4. Melrose has sketched out its strategy to turn around acquisition target GKN, the Telegraph reports, saying the FTSE 100 engineer lacks “clear focus” and “needs fundamental change,” as analysts predict it will improve its offer for the aerospace and automotive group. The turnaround specialist made an £8 billion approach for GKN last week, which was rebuffed as “entirely opportunistic and fundamentally undervaluing” the business.
5. Airbus has posted record aircraft deliveries for the year but signalled further problems for its poorly selling A380 “superjumbo,” the Telegraph reports. The company, which delivered 718 airliners to customers last year, said it would cut the rate at which builds the double-decker jet to just six a year by 2019, from a peak of 27 a few years ago.
6. The RAF scrambled two Typhoon jets to intercept Russian planes near the UK’s airspace, the Ministry of Defence (MoD) said according to Sky News. The jets were scrambled from RAF Lossiemouth in Moray, Scotland, on Monday morning.
7. Sir Richard Branson has told Virgin Trains to restock the Daily Mail, after the company announced it would stop supplying the paper on its trains because of its editorial stance on contentious issues. In a Monday blog post, Branson said: “We must not ever be seen to be censoring what our customers read.”
8. A no-deal Brexit would cost the remaining 27 EU nations €112bn (£99.5bn) in lost economic output, according to research by a UK-based thinktank cited in a Guardian report.Although the UK would still be the biggest loser from crashing out of the EU single market and customs union without a new trade deal – with a cost to the economy of £125bn by 2020 – the EU would also suffer a bigger economic hit than previously thought by the end of the decade, according to the consultancy Oxford Economics.
9. A private UK company developing a vaccine that would be the first in the world to fight all types of flu has raised £20m from investors including GV, the venture capital arm of Google parent Alphabet. Vaccitech, a spin-out founded by scientists at Oxford University’s Jenner Institute, said on Monday the cash would help fund its vaccine through a two-year clinical trial involving more than 2,000 patients, as well as expand other projects.
10. A growing majority of British people now want Theresa May to call a second Brexit referendum if she fails to secure a deal on Britain’s exit from the EU. 57% of the British public would want another vote under those circumstances, according to a new BMG poll.
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