EconomyNato chiefs meet as war in Ukraine enters a...

Nato chiefs meet as war in Ukraine enters a second month


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Hello and welcome to the working week.

First the bad news. I’m afraid that this week’s diary is filled with more grim landmarks. Having just passed the second anniversary of Covid-19 being declared a global pandemic at the beginning of March, this Thursday will mark a month since Russian troops invaded Ukraine.

Nato heads of state — including US president Joe Biden — will gather that day for an extraordinary meeting to discuss next steps in relation to the conflict. It will coincide with a pre-planned European Council meeting of EU member state leaders to discuss the energy crisis and Covid as well as the Ukrainian war.

The UK is facing the sharpest drop in living standards since the 1950s — and possibly two lost decades for the economy. Chancellor Rishi Sunak has the unenviable task on Wednesday of charting a way through this when he presents his Spring Statement to the Westminster parliament. Will he introduce a windfall tax on energy companies? With better than expected public finances, the UK’s treasurer in chief has some wriggle room to offset the financial pain heading towards British households, but it will still be a challenging balancing act to ease the rising cost of living for many. In the last 20 years, a string of economic shocks — from the financial crisis to the pandemic — have exposed structural weaknesses in the UK economy so MBA-graduate Sunak needs fresh ideas to transform the country, and fast.

The lights will be going out in cities across the planet on Saturday, but not because of the energy crisis — we hope. It is Earth Hour, the annual show of international kinship on climate change, reminding us that we can do more to tackle global warming by using less power.

So what about the good news this week? The US National Park Service has estimated cherry blossoms will reach peak bloom in Washington in the coming days. The Oscars are also back in person with an awards ceremony in Hollywood on Sunday. And also on that day, in the UK and the EU, the clocks go forward by an hour for daylight saving time, ushering in longer evenings for those of us in the northern hemisphere to get out in the open. It could be just what we need to lift the spirits in these dark times.

Economic data

The spending statement will coincide with economic data on the state of the UK economy — inflation, house prices and the Office for Budget Responsibility’s medium term outlook for the economy. Forecasts into the distant future — that is, more than a couple of years — could be taken with a large dose of salt, but observers will be keen to see what current shocks have done to growth forecasts overall.

If you are after international comparisons, there is the publication of numerous purchasing managers’ index (PMI) reports on Thursday. If you want yet more UK data, on Friday we will get an update on consumer confidence and retail sales.

Companies

Expect some strong numbers from the British retailers that are reporting earnings this week. Home improvement chain operator Kingfisher — which reports full-year earnings on Tuesday — raised its guidance in December, highlighting that concerns about an end to DIY with the lifting of lockdown restrictions had not come to pass. It was also a good Christmas season for clothing chain Next, which reports its numbers on Thursday, having also raised its guidance in December. The question is whether the sales boom can last given the hit to consumer confidence from rising fuel costs and the war in Ukraine.

It will be a nervous week for British restaurateurs, however. The industry is in a parlous state — insolvencies rose 20 per cent during the last quarter of 2021, according to accountancy firm UHY Hacker Young. If that was not enough to contend with, the UK government’s ban on commercial evictions ends on Friday, the same day that the Commercial Rent (Coronavirus) Bill comes into force. While rent arrears from the protected period — which for England means 20 March 2020 to 21 June 2021 — landlords will no longer be barred from taking action on unpaid rent on other occasions. It means that restaurants could be forced to pay rent for the periods in which they were unable to open, putting many into a precarious position.

Key economic and company reports

Here is a more complete list of what to expect in terms of company reports and economic data this week.

Monday

  • Germany, February producer price index (PPI) figures for industrial products

  • UK, Rightmove monthly house price data

  • Results: Nike Q3, Salzgitter FY

Tuesday

  • Canada, monthly industrial product and raw materials price indices

  • UK, CBI monthly industrial trends survey plus public sector net borrowing data

  • Results: Adobe Q1, Iliad FY, Kingfisher FY

Wednesday

  • Argentina, Q4 GDP figures

  • EU, flash monthly consumer confidence data

  • South Africa, February consumer price index (CPI) data

  • UK, Spring Statement by chancellor Rishi Sunak, plus February PPI and CPI data, Office for National Statistics house price index and the Office for Budget Responsibility’s economic and fiscal outlook

  • Results: General Mills Q3

Thursday

  • Eurozone, France, Germany, Japan, UK, US: IHS Markit composite purchasing managers’ index (PMI) data

  • EU, European Central Bank’s general council meets in Frankfurt

  • Japan, minutes published of Bank of Japan’s monthly monetary policy meeting

  • South Africa, South African Reserve Bank’s monetary policy committee meeting

  • UK, CBI monthly distributive trades survey showing retail industry trends

  • Results: Next FY

Friday

  • Germany, Ifo Institute monthly business confidence index

  • UK, Gfk consumer confidence figures plus ONS February retail sales data

  • US, February pending home sales

  • Governor of the Bank of England, Andrew Bailey, speaks at an online forum hosted by the CBI

  • Results: Smiths Group FY

World events

Finally, here is a rundown of other events and milestones this week.

Monday

  • EU, foreign affairs council meets in Brussels with discussions including the Ukrainian crisis

  • UK, a service of thanksgiving for British wartime singer Vera Lynn to be held at London’s Westminster Abbey

Tuesday

  • Jordan, gubernatorial and municipal elections

  • World Water Day, organised by the UN Environment Programme to raise awareness of water access and management

Wednesday

  • UK, WikiLeaks founder Julian Assange to marry his fiancé, the lawyer Stella Moris, in Belmarsh prison

  • US, Saturday Night Live’s Pete Davidson becomes the latest celebrity to take a ride to the edge of space on Blue Origin’s New Shepard

Thursday

  • Belgium, final Covid-19 restrictions lifted plus Brussels hosts summit of EU leaders and an extraordinary meeting of Nato heads of state

  • Ukraine, one calendar month since Russia launched its attack

  • US, Covid death toll set to pass 1mn mark, according to a Reuters tally

Friday

  • Feast of the Annunciation in the Roman Catholic Church

  • Greek National Day, celebrating the country’s 1921 declaration of independence

  • UK, ban on commercial evictions — introduced during the pandemic — ends

Saturday

  • France, Eiffel Tower to switch off its lights as part of Earth Hour, calling for increased action to protect the planet from climate change

  • Germany, elections in western state of Saarland

  • Malta, general election

  • United Arab Emirates, the world’s richest day in horseracing, the Dubai World Cup, will be run at the Meydan Racecourse

Sunday

  • Daylight Saving Time begins in the EU and the UK

  • China, indirect election of Hong Kong’s chief executive by a 1,500-member Election Committee, criticised for being weighted towards pro-Beijing interests

  • UK, Mothering Sunday

  • US, the 94th Academy Awards (the Oscars) ceremony returns to the Dolby Theater in Hollywood, Los Angeles

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