Photo Mourners attended a funeral in Tehran on Friday for some of the victims of two attacks by terrorists aligned with the Islamic State. Credit Ebrahim Noroozi/Associated Press TEHRAN The Iranian authorities arrested 41 people Friday in connection with the twin terrorist attacks in Tehran this week the semiofficial Fars News Agency reported as evidence mounted that Iranian Kurds affiliated with the Islamic State had carried out the assault.The men who made their way through the Parliament building on Wednesday shooting assault rifles throwing grenades and searching for a way into the main hall were probably Iranian Kurds security sources say though only one has been identified. One of the two assailants at a shrine is understood to be an Iranian Kurd the security sources said.The Ministry of Intelligence identified one gunman Serias Sadeghi as an Iranian Kurd from the city of Paveh in the country s west near the Iraqi border. In 2014 the Democratic Party of Kurdistan Iran an opposition party published a report about increasing Islamic State activities in Iranian Kurdistan that singled him out as a prominent recruiter who at times held sessions in a local mosque.One website KhabarDena.Ir on Friday quoted Mamusta Molla Ghader Ghaderi a community leader from Paveh as saying that some of the attackers were from there. Continue reading the main story
MEXICO CITY - German Chancellor Angela Merkel said on Friday she was concerned about the situation in Qatar adding that all Gulf nations and also Iran and Turkey should work together to find a solution to the regional dispute. Merkel who was speaking in Mexico City alongside Mexican President Enrique Pena Nieto said it would be impossible to sort out the situation unless all regional actors were involved citing Iran Turkey and Qatar. U.S. President Donald Trump on Friday accused Qatar of being a high-level sponsor of terrorism potentially hindering the U.S. Department of State s efforts to ease heightening tensions and a blockade of the Gulf nation by Arab states and others. Arab states tightened their squeeze on Qatar by putting dozens of figures with links to the country on terrorism blacklists while its ally Turkey rushed to its side with plans to send troops. The Pentagon said the blockade was hindering U.S. ability to plan for long-term operations in the region. Al Udeid Air Base in Qatar is home to more than 11 000 U.S. and coalition forces and an important base for the fight against Islamic State. It is the U.S. Air Force s largest base in the region. U.S. Secretary of State Rex Tillerson said he expected all parties to find a resolution.
Qatar is in discussions with Iran and Turkey about securing food and water supplies to stave off possible shortages two days after its biggest suppliers the United Arab Emirates and Saudi Arabia cut trade and diplomatic ties a government official said on Wednesday. We are in talks with Turkey and Iran and other countries said an official who spoke to Reuters news agency on condition of anonymity due to the sensitivity of the subject adding that the supplies would be brought in through Qatar Airways cargo flights. The official said there were enough grain supplies in the market in Qatar to last four weeks and that the government also had large strategic food reserves in Doha. The head of Turkey s main exporting trade body told Reuters on Wednesday that Turkish exporters are ready to meet the demand for food and water in Qatar. READ MORE: Qatar-Gulf crisis - Your questions answered Saudi Arabia the https://www.3dartistonline.com/user/thoughtforquotes United Arab Emirates (UAE) Egypt and Bahrain severed relations with Qatar and closed their airspace to commercial flights on Monday charging it with financing militant groups. Qatar vehemently denies the accusations. This is the worst split between powerful Arab states in decades. The moves isolating Qatar are disrupting trade in commodities from crude oil to metals and food and deepening fears of a possible jolt to the global gas market where the Gulf state is a major player. What s behind the diplomatic breakdown in the Gulf? Food imports are affected as Saudi Arabia closed its land border with Qatar stranding thousands of trucks carrying supplies. Qatar a country heavily dependent on food imports to feed its mostly foreign population of 2.6 million has assured residents it has taken measures to ensure that normal life continues. The Ministry of Economy and Commerce released a video on Tuesday that showed supermarket shelves stocked with food and other goods after citizens and residents crowded into stores on Monday to stock up fearing shortages. Qatar s ports and airports remained open to trade with countries not taking part in the Saudi-led boycott on Wednesday a government official said. We have no problem with food supplies Qatar s foreign minister told CNN on Tuesday. We have strategic reserves in place since 2014 we don t see that life will be affected. Although Qatar is located in a volatile region of the world its huge foreign currency reserves and comparatively small population mean arranging adequate new sources of food imports in an emergency is possible. Support from Turkey Mehmet Buyukeksi the head of Turkey s main exporting trade body Turkish Exporters Assembly (TIM) told Reuters on Wednesday that Turkish exporters are ready to meet the demand for food and water in Qatar. Al Jazeera s Sinem Koseoglu reporting from Istanbul said the Turkish government and some opposition parties had expressed support for Qatar during the rift and had said its isolation was not acceptable. Since the tension between Qatar and other Gulf states has risen Turkey has shown great support for Qatar - not only on a political level but on a public level as well she said. On the public level social media has been showing great support to Qatar with the hashtag Qatar is not alone she said. Pro-Qatar protests are also planned in Istanbul for Wednesday night. OPINION: The GCC will ride out the storm Koseoglu also said there were reports that legislation to deploy Turkish troops to Qatar first agreed in May could be fast-tracked through Turkey s parliament on Wednesday night. Turkey is a key ally of Qatar and is setting up a military base in the country which also hosts the largest US airbase in the Middle East Al-Udeid. Meanwhile Iranian Foreign Minister Mohammad Javad Zarif arrived in Turkey on Wednesday saying there was a need for close discussions with Turkish officials on worrying developments in the region. Zarif was scheduled to meet President Recep Tayyip Erdogan and Foreign Minister Mevlut Cavusoglu for talks on bilateral and regional issues Turkish officials said. Iran shares access with Qatar to the world s biggest natural gas field.Source: Al Jazeera and news agencies
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NEW DELHI: The key Iranian port of Chabahar where India has a key stake is not only being expanded as a gateway to Afghanistan but also being considered as an entry point to Central Asia following Hassan Rouhani s re-election as the Iranian President. Tehran is considering a plan to link the strategically-located Chabahar port with various intra-Central Asia transport corridors. Chabahar currently connects India with Afghanistan through road and plans are on by Tehran to build rail link with Delhi s support. The Rouhani government s plan to also link Chabahar with various Central Asian transport corridors will open up a second route for India s outreach to landlocked Central Asia apart from International North-South Transportation Corridor (INSTC) that also passes through Iran. The subject among other bilateral issues may come up for discussion if Rouhani meets Prime Minister Narendra Modi for a pull aside on the sidelines of the Shanghai Cooperation Organisation (SCO) Summit in Astana on Friday. No structured meeting between the Iranian President and the Indian PM is on the cards in Astana so far. India has been among the first countries to condemn terror attack in Tehran on Wednesday when Foreign Minister Sushma Swaraj telephoned her Iranian counterpart. India too has been considering to link INSTC with various intra-Central Asian connectivity corridors besides making Chabahar port another entry point for INSTC. Currently the Iranian port of Bandar Abbas is the entry point for INSTC that will link India with Russia Eurasia and Europe. On Monday Swaraj denounced misgivings regarding delay in India s role in expanding Chabahar port and asserted that work on the project has gathered momentum. Iran for centuries has been the hub for connectivity links for countries of Asia and Europe including India. Connectivity is one of the key strengths of Iran and President Rouhani is keen to boost all connectivity initiatives through the country. This is a priority sector for Iran and India s role is vital in the connectivity initiatives. Chabahar will not only be gateway to Afghanistan but the plan is to also make it a gateway to Central Asia a top official of the Iranian government told ET. The Chabahar port project was discussed during Foreign Secretary S Jaishankar s visit to Tehran last month. Tehran has offered Delhi a proposal to manage phase one of the port built by Iran even as the two sides are still negotiating terms and conditions of Delhi s role in expanding phase two of the port where the Modi government has announced to invest Rs 150 crore or 235 million. ET has learnt that Tehran has offered Delhi management rights for two years for phase one of the port and such rights could be renewed by another decade. India s allotment of 235 million for phase two of Chabahar is divided into two parts 150-million Line of Credit (LoC) from the EXIM Bank for development of the port complex and 85 million allotted later following contract between the two sides for the supply of equipment to develop two berths in the port complex. A special purpose vehicle has been created by the Indian shipping ministry for development of phase two of the port. On the Iranian side Ports and Management Organisation is the nodal authority for implementing the project. India has been given the rights to operate two berths and few terminals in this phase two of the port. India is eyeing thriving free-trade zone in Chabahar to make the port viable indicated a person familiar with the development.The pound fell dramatically against a host of other currencies on Friday as Britain headed for a hung parliament. Sterling lost as much as 2.3 per cent against the US dollar in the morning before paring back to trade 1.7 per cent down on the day at 1.2734 by the end of London trading. The FTSE 100 main stock index gained 1 per cent on Friday though strategists warned that the result would likely plunge domestic politics into deep uncertainty and raise major questions around Brexit. Brexit talks are now likely to be even more unsettling for markets and the prospect of another election raises the risk of a delay potentially leaving the UK without a negotiated exit settlement said Mark Haefele from UBS Wealth Management s chief investment office. Although we believe the pound had already priced in much of the hard Brexit risk before this vote the currency will continue to experience volatility through the governmental and Brexit talks. Read more Brexit thrown into doubt as Theresa May s election gamble backfires The FTSE 100 has in recent months tended to trade higher when the pound falls as a result of its high international exposure but analysts said that significant uncertainty now would likely lead to investors turning cautious on any and all UK assets. Jameel Ahmad vice president of market research at currency exchange broker FXTM said this looks like another example of traders being on the wrong side of the trade after heavily stacking their cards in favour of a landslide victory for Theresa May when pricing in the UK election . Neil Wilson an analyst at ETX Capital said the outcome had the potential to be the biggest upset in British politics since last June when the UK voted to leave the EU. Immediately after the referendum sterling sank 10 per cent against the dollar taking the currency down to its weakest level in more than three decades. With all but one seat declaring the Conservatives are the largest party with 318 seats a loss of 12 seats and eight short of the 326 required for a parliamentary majority. Labour gained 29 seats to 261 while the Scottish National Party finished on 35 seats the Lib Dems 12 Plaid Cymru on four and the Greens one. Read more Jeremy Corbyn increases his majority by 10 430 votes Tories would lose mandate to leave single market if they lose majority Labour hold onto seat where Theresa May launched campaign Commenting on the earlier exit poll which closely mirrored the actual result Samuel Tombs an economist at Pantheon said it was a thunderbolt for financial markets. Theresa May s electoral gamble has catastrophically failed said Tom Stevenson an investment director at Fidelity International. The market reaction to this unwelcome outcome is likely to hit UK shares bonds and the pound. Markets will likely remain on the back foot while the difficult job of putting together a workable government is undertaken. More about: 2017 General Election Theresa May Brexit British Pound Sterling Reuse content The prospect of a softer Brexit could support the value of the pound despite rampant fears of political instability in the wake of the Conservative party s electoral disaster according to City of London analysts. Sterling shed almost 2 per cent against the dollar to 1.2731 immediately after the bombshell exit poll was published at 10pm on Thursday night and fell as low as 1.2664 on Friday morning - putting the currency on course for its biggest drop since last October. It recovered slightly in the afternoon to trade at 1.2727 after Ms May said she would continue to govern with the support of the 10 MPs of the DUP Read more The British economy was the big winner of last night s election When we saw reports that May was going to stay on as Prime Minister at about 8am sterling dropped. This is suggestive of a perception in the market that with May having lost her majority a soft Brexit is again a possibility said Jane Foley head of FX Strategy at Rabobank International. She pointed out that the DUP has made it clear that it does not want to see trade obstructed on the Irish land border by new customs checks which would seem to rule out a cliff-edge Brexit in 2019 where the UK leaves with no customs or trade arrangements in place and simply falling back on World Trade Organisation WTO rules. Sterling hasn t weakened to the sorts of levels that many were talking about if there was a hung parliament which suggests that this perception that a soft Brexit is a bit more likely is coming into the fray she added. Supported by hope? Reuters Eikon The election result has reduced the likelihood of a hard Brexit which is economically positive for the UK and Europe agreed Mark Burgess of Columbia Threadneedle Investments. A softer approach to Brexit could see potential structural support for sterling down the line. It seems reasonable that any Brexit deal will now be subject to greater Parliamentary scrutiny and the government is more likely to seek to retain some elements of single market access. But Kevin Gardiner global investment strategist of Rothschild Wealth Management urged caution over this interpretation. Some commentators are making a soft Brexit or even a second EU membership referendum more likely but we should not take this for granted. There are two parties to the Brexit negotiation and we think it is wrong to assume any UK Government can pick its preferred outcome. Read more Pound sterling falls sharply as Tories lose majority Pound could plummet if general election delivers hung parliament Morgan Stanley slashes sterling forecast ahead of UK general election Mark Horgan the chief executive of the foreign exchange service Moneycorp stressed that sterling was already down around 15 per cent since last June s referendum. What we ve got in the price right now is the current situation. The next half point for sterling is if you do or you don t get a hard WTO Brexit. That s the next point where Sterling s going to get hit. Where we are now is a very difficult position for continuity. My view of the disaster scenario is Theresa May hangs on until October then she gets turfed out in the Conservative conference then the Conservatives lose a vote of no confidence we re back into an election in November. Forget about Brexit negotiation at that point in time because we just don t have the people to execute. Volatility is going to be higher to reflect the short and medium term uncertainties about Britain s political and economic future said Chris Iggo of AXA Investment Managers If the government sees the need to be more populist on the domestic side then this will mean more spending and more borrowing. The relaxation of fiscal austerity should lead to the steepening of the gilt curve. Ten year gilt yields which move inversely to prices - yesterday spiked early yesterday as high as 1.064 per cent but fell back to 1.035 in the afternoon. Mr Horgan of Moneycorp said that his company had seen a three-fold increase in trading volumes relative to a normal day. But he added that Moneycorp s clients - mainly small firms seeking to hedge their foreign exchange exposure - had learned the lesson from last June s Brexit vote which sent the currency down a record 10 per cent in one day. Everybody s been less caught out there s been a huge increase in hedging since Brexit. If you ve got a business making 10 per cent net profit and 10 per cent disappears in a currency movement you re focused on not letting that happen again. More about: pound sterling Brexit Theresa May General Election 2017 Moneycorp Reuse content Changing money for your holiday today? If you do it at the airport 1 will get you less than 1. As the pound plummets in the wake of the General Election results currency exchange rates at airport bureaux de change have fallen below parity with the euro. The Independent has been sent photos of this morning s rates at the Gatwick South Terminal Moneycorp branch selling euros at an exchange rate of 0.9848. Rates have plummeted against most currencies this morning (The Independent) This means that 100 changed at the airport today is worth a pitiful 98.48. To get 100 you ll be charged 101.54. At 5 a coffee and croissant on Ryanair on the way out will now cost you 5.07. And a McDonald s coffee in Switzerland is now nudging 4. Rates at Moneycorp Stansted were even wore this morning with 1 worth just 0.96. This means spending 100 to get 100 - and that s before the 4.99 commission charge for transactions between 15 and 300. The pound has plummeted against the euro this morning (Katherine Wheatley) Rates against the US dollar are equally ignominious - 100 will net travellers just 110.24 at Moneycorp s Gatwick prices and a shocking 107.62 at Stansted. Rates with other currencies are also dire not least because many other currencies including those of the UAE China and much of Latin America are linked to the dollar. Read more Brexit tourism: Pound slump fuels surge in foreign spending At Moneycorp s Gatwick rates today 100 will get you 136.62 Canadian dollars 362 UAE dirham or 1566 Argentine pesos (last week while The Independent s travel team was in Argentina the going rate was around 2000 pesos for 100). Of course airport currency rates are notoriously low. The Post Office is offering online rates of 1.08 for euros against sterling today rising to 1.10 for amounts above 1000. It has the US dollar at 1.2172 against the pound. This isn t the first time sterling has slipped below parity with the euro at airport rates. In January The Independent noted an even worse rate at Moneycorp Gatwick of 97.4 euro cents for every pound. Today s rates mean a regular cappuccino at McDonalds in Switzerland will set you back 3.95 (at current rates against the Swiss franc) while a Big Mac is 5.24. More about: Travel money Exchange rates Pound Euro Dollar Reuse content Crash bang wallop. Yes as soon as the first exit poll was in and pointing to a possible hung Parliament the markets started having a tizzy. We re doomed I tell you doomed! What s happened to the strong and stable government we were told was a cert? Theresa May s hubris and a desultory campaign was what happened. Letting a lead of what was it 20 25 points has quickly evaporated. Quite an achievement. Barely had the poll surfaced and the panicky predictions were flying in. UBS was first out of the stalls: this does not bode well for the Brexit negotiations they said. As if they were going to go well with Theresa May getting a comfy majority. Chaps have you not seen the people around her who would in theory end up running the negotiation? Time to take a chill pill. For a start it s going to be a long night and the poll might be wrong. Someone might have to eat their hat. Perhaps not Paddy Ashdown and certainly not the boss of YouGov. Its polls might have come closest. Someone though. However here s the thing. Compared to Brexit the market reaction to http://all4webs.com/thoughtforquotes/home.htm?20097=356 the poll was a barely perceptible wobble rather than anything serious. Exit poll predicts hung parliament The pound fell by 2.5 cents against the dollar on its release about a cent against the euro and it then started inching back up (it s only a poll after all). The Brexit vote? That knocked 10 cents from the value of sterling. So context. FTSE 100 futures rose a bit because that s what happens when the pound falls. Then they started drifting off (Jeremy Corbyn in No 10? Nooooo!) However the business community more generally might be less disturbed about this than the initial wobble might suggest. The biggest economic risk facing Britain is after all not Jeremy Corbyn but a chaotic hard Brexit. Most strategists were (until the poll) predicting just that. Conservative ministers keep saying no deal is better than a bad deal when in fact no deal is the worst possible option. Moreover people are starting to believe that the swivel-eyed EU-haters dominating the party s thought processes right now mean it about flouncing off into the North Sea. If that happens exporters to Britain s biggest overseas trading partners will overnight start facing WTO tariffs. They could be every bit as damaging and destructive to the UK economy as Labour s plan to hike corporation tax (which anyway might not happen). Would it be the worst thing in the world if nothing got done for a while and a shaky coalition said you know what we ll stay in the European Economic Area for a bit and see how it goes? A bit more tax but stable-ish free-ish trade? That might not be such a bad idea. Business would not love the instability it never does but once business leaders start thinking about it it might be the least worst option. Which was what the election was all about for a lot of people anyway. More about: Brexit Jeremy Corbyn Theresa May General Election 2017 Reuse content 5.06pm BST 17:06 Pound falls shares rise after UK election The pound initially fell 2.5% against the dollar after the shock election result but had recovered some ground by the time London markets closed. It was still down 1.6% at 1.2740 but was off its eight week lows against the US currency. Even so the decline gave some support to the FTSE 100 and its overseas earners while news that Theresa May was forming a government - even if with the help of the DUP - provided some support for shares and the pound. European and US markets shrugged off the UK result with the Dow Jones Industrial Average hitting a new peak as investors preferred to concentrate on the latest twists in the Donald Trump saga.Jasper Lawler senior market analyst at London Capital Group said: Although the pound fell the FTSE 100 as well as other global indices opened higher on election result day. Traditional havens like gold and the Japanese yen dropped as global markets shook off the result as a UK-only affair. The closing scores in Europe showed: The FTSE 100 finished up 77.35 points or 1.04% at 7527.33 Germany s Dax rose 0.8% to 12 815.72 France s Cac closed up 0.67% at 5299.71 Italy s FTSE MIB was 0.38% better at 21 122.42 Spain s Ibex ended up 0.23% at 10 978.3 In Greece the Athens market added 0.39% to 782.10 ahead of next week s key eurogroup meeting On Wall Street the Dow Jones Industrial Average is up more than 100 points or 0.5%. On that note it s time to close for the day. Thanks for all your comments and we ll be back on Monday. But don t forget our politics blog is still going with all the latest developments in the wake of the election result: Election 2017: May postpones reshuffle and will reflect on why Tories lost seats live Read more Updated at 5.09pm BST Facebook Twitter Google plus Share Share this post Facebook Twitter Google plus close 3.29pm BST 15:29 The ratings agency also warns another election could be on the horizon (!): Prime Minister Theresa May will seek to form a government with support from Northern Ireland s Democratic Unionist Party known as the DUP after her governing Conservative Party fell short of a parliamentary majority. While this would avoid a prolonged period of coalition talks the terms of the agreement are unclear and another election in the near term is possible. Facebook Twitter Google plus Share Share this post Facebook Twitter Google plus close 3.27pm BST 15:27 Fitch added: The election increases the possibility of looser fiscal policy. The Conservative manifesto aims to balance the UK budget by the middle of the next decade later than previously planned although detailed tax and spending proposals were broadly consistent with March s budget. But Labour s stronger-than-expected performance after campaigning for higher public spending and investment funded by higher corporation tax and other tax increases suggests that austerity fatigue is a meaningful factor in UK politics. Meanwhile a minority or Conservative-led coalition government may have to compromise on the pace of fiscal consolidation or specific policy measures to maintain parliamentary support (the reversal of proposals to increase social contributions for the self-employed in March s budget highlighted a degree of inflexibility in fiscal policy making). The possibility of a second Scottish independence referendum has receded after the Scottish National Party lost 21 MPs compared with the previous election in 2015 although it remains the largest party in Scotland. We will continue to assess the UK s sovereign creditworthiness with reference to the resilience of its economic growth prospects and its public finances as the domestic political situation develops and Brexit talks begin. We affirmed the UK s sovereign rating at AA /Negative on 5 May. The next scheduled review is on 27 October. Facebook Twitter Google plus Share Share this post Facebook Twitter Google plus close 3.25pm BST 15:25 Fitch says election result adds to Brexit uncertainty Fitch has now chimed in on the election result and says unsurprisingly it will cause uncertainty: The UK general election result creates uncertainty over the policy platform political cohesion and longevity of the next UK government Fitch Ratings says. This will have implications for Brexit and potentially fiscal policy. The political economic and institutional uncertainty stemming from the June 2016 Brexit referendum and the upcoming UK-EU negotiations is reflected in the Negative Outlook on the UK s AA sovereign rating. Updated at 3.34pm BST Facebook Twitter Google plus Share Share this post Facebook Twitter Google plus close 3.16pm BST 15:16 If the UK s Brexit negotiating stance remains unchanged despite the election result that would a negative according to Deutsche Bank. Analysts Oliver Harvey and Mark Wall said: We see the initial move lower in the pound on the election result as justified. The election has resulted in a weaker rather than a stronger UK government which will make negotiations with the EU27 more difficult. The medium-term outlook will depend on the tone of the Prime Minister s stance on Brexit and fiscal policy over the next few hours and days. A course towards softer Brexit and even a second referendum has potentially been opened albeit is highly path-dependent. But if the UK government sticks with existing Brexit plans in a much weaker domestic political position significant sterling and/or economic weakness would again be required to shift the UK away from a crash Brexit. On that front we view the Prime Minister s just-delivered speech on the steps of Number 10 as extremely negative. As well as confirming that Brexit negotiations will begin on schedule in 10 days time the speech made no concessions to the Conservatives weak showing last night or the clear electoral rejection of hard-Brexit plans. Facebook Twitter Google plus Share Share this post Facebook Twitter Google plus close 3.10pm BST 15:10 Just a reminder. The latest political developments after the shock UK election result are in our live blog here: Election 2017: May says Tories will work with DUP to proceed with Brexit - live Read more Facebook Twitter Google plus Share Share this post Facebook Twitter Google plus close 3.05pm BST 15:05 Wall Street opens higher The shock UK election result has had little effect on US markets which have been more concerned about the latest revelations surrounding Donald Trump notably Thursday s testimony from ex-FBI boss James Comey. The Dow Jones Industrial Average is currently up around 60 points while the S&P 500 and Nasdaq Composite both opened up around 0.13%. Facebook Twitter Google plus Share Share this post Facebook Twitter Google plus close 2.14pm BST 14:14 UK government bonds could fall back if the new administration decides to boost the domestic economy. Chris Iggo at Axa Investment Managers said: Britain hasn t been doing elections (referendums) very well recently. Last year s vote on European Union (EU) membership and the General Election of 2017 have not resulted in the desired outcome for the two people that called the vote... More importantly Britain faces huge uncertainty about its place in the world together with significant internal divisions. Going forward one strategy might be to make sure people feel better about the domestic economy at least in case things don t go well with Brexit. That may mean less austerity. From the UK bond market point of view interest rates are not likely to move but gilt yields could rise if the new government thinks allowing some fiscal slippage is an acceptable price to pay for staying in power. Gilts could underperform US Treasuries and Bunds as a result and break-even inflation rates could move back to their highs of earlier this year. Facebook Twitter Google plus Share Share this post Facebook Twitter Google plus close 1.58pm BST 13:58 More on UK GDP and Capital Economics has looked at how it has been affected by political uncertainty: Capital Economics (@CapEconUK) Political uncertainty could weigh on GDP growth. But the economy shrugged off uncertainty related to 2010 Hung Parliament and Brexit vote. pic.twitter.com/iz5x231Urd June 9 2017 Facebook Twitter Google plus Share Share this post Facebook Twitter Google plus close 1.54pm BST 13:54 UK economic growth subdued - NIESR The UK economy was seeing subdued growth ahead of the election according to think tank NIESR. Its latest estimate of GDP showed output growing by 0.2% in the three months to the end of May the same as during the three months ending in April. This is below its long term trend of 0.6% it said. NIER s James Warren said: The subdued performance of the economy in the three months to May was driven by weakness in the production sector offset by a mild rebound in services. The current political backdrop may lead to greater uncertainty and a drag on growth prospects in particular business investment which contracted in 2016. In the light of the election result NIESR director Jagjit Chadha added: The subdued performance in the economy throws the political turmoil of a hung Parliament into sharp relief. People are looking for answers to low levels of economic growth limited improvements in productivity and falling real wages. That none of the parties wholly addressed our long run problems or how we ought to address exit from the European Union is the reason there was no clear winner. NIESR s most recent economic forecast published in May suggested GDP growth of 1.7% in 2017 and 1.9% in 2018. Facebook Twitter Google plus Share Share this post Facebook Twitter Google plus close 1.40pm BST 13:40 Richard Watts manager of Old Mutual s UK Mid Cap Fund isn t convinced by Theresa May s pledge to carry on as prime minister. He argues that a hung parliament election make a softer Brexit or even no Brexit at all more likely: Rather than strengthening her position she has been significantly weakened perhaps fatally. It is not clear that she can hold on to her position of prime minister although she has announced that she intends to do so. In 10 days time talks are set to start with the EU over the terms of the UKs withdrawal from the EU. In our view the election result has called in to question the government s mandate for a hard Brexit. It also appears that the DUP favours a soft Brexit and may make this the price of doing a deal with the Conservatives. What this means for Brexit is unclear but it makes a soft Brexit or no Brexit more likely in our view. This may not be a bad thing for the UK economy. However the timing of talks could be delayed as Theresa May seeks to form a government which adds another level of complexity to the negotiations. Watts also thinks that Jeremy Corbyn could have dealt a massive blow to austerity even though he didn t actually win the election: With a continuation of a Conservative-led government we do not expect any major policy changes. If anything we may see a fiscal easing. It s obvious that Jeremy Corbyn s anti-austerity policies have resonated very strongly with parts of the electorate. In time this could be good for UK domestic cyclical stocks. Facebook Twitter Google plus Share Share this post Facebook Twitter Google plus close 1.08pm BST 13:08 Theresa May to form next government Over in Downing Street Theresa May has just returned from her audience with the Queen - and announced that she is forming a new minority government. It will be a government that can provide certainty and lead Britain forward at this critical moment she says -- not acknowledging the uncertainty created by yesterday s election. Over the next five years we will build a country in which no-one and no community are left behind she insists. Whart the country needs more than ever is certainty and having secured the largest number of votes and the greatest number of seats only the Conservative and Unionist party can provide it May continues. She confirms that she will work with the DUP and pledge to deliver a successful Brexit deal that works for everyone. Now let s get to work she concludes before marching back into Downing Street. It s almost as if that pesky election didn t happen. Rowena Mason (@rowenamason) No acknowledgement there from May that she has gone backwards - astoundingly defiant like she thinks no one will notice what happened June 9 2017 Michael Deacon (@MichaelPDeacon) Is it possible that Theresa May hasn t actually heard the election result June 9 2017 Katie Martin (@katie_martin_fx) I must have missed the bit where she said she was listening to concerns and she was sorry about Tory losses. June 9 2017 Katie Allen (@KatieAllenGdn) I would tweet a reaction to May s speech but our stable leader with her strong mandate as told us to get back to work June 9 2017 Facebook Twitter Google plus Share Share this post Facebook Twitter Google plus close 12.57pm BST 12:57 Today s hung parliament shock is reminiscent of a similar political https://www.smore.com/bfvn0-thought-for-the-day-quote crisis over forty years ago. Our economics editor Larry Elliott explains: When it closed for business on election day the City of London was in confident mood. Theresa May was Margaret Thatcher. Jeremy Corbyn was Michael Foot. Labour s manifesto was if not the longest suicide note in history the second longest. Opinion polls were pointing to a Tory majority of about 100 which is what Thatcher got in her second general election victory. By 10pm when the results of the exit poll were released it dawned on the City that this was not a rerun of 1983 but of 1974. May was not Thatcher she was Ted Heath a prime minister lacking the human touch who had called an election when there was no need to do so. With a hung parliament pointing to the possibility of a second general election within months another echo of 1974 the markets responded in predictable fashion by dumping the pound. Here s Larry s full analysis: UK economy now in the fog of election uncertainty | Larry Elliott Read more Updated at 3.52pm BST Facebook Twitter Google plus Share Share this post Facebook Twitter Google plus close 12.45pm BST 12:45 Here are some predictions from another heavyweight global investor Allianz Global Investors: The UK election result may augur a more pragmatic approach to Brexit and increase the likelihood of a soft Brexit perhaps even retaining access to the single market. Our high-conviction view is that the Bank of England will put rate rises on hold for the next 2-3 years or longer. The election reinforces such a view. Speculation about another election puts downward pressure on sterling but economic data is likely to be the key driver. A weak government or coalition probably means that fewer contentious manifesto pledges can be enacted although there may still be action on utilities. Facebook Twitter Google plus Share Share this post Facebook Twitter Google plus close 12.19pm BST 12:19 Lunchtime summary: Sterling pounded by hung parliament shock The general election results (with Kensington still to declare) Photograph: Sky News Time for a quick recap. The pound has suffered heavy losses in volatile trading as the impact of Britain s inconclusive general election ripples through the City. Sterling tumbled over three cents against the US dollar this morning to an eight-week low of just 1.265 putting it on track for its worst daily loss since the EU referendum. It also slumped to a seven-month low against the euro at just 1.13 as investors warned that Theresa May could be forced to resign after failing to secure a majority. But the pound is now clawing its way back after May seemingly secured a deal with the Northern Irish DUP for a confidence and supply arrangement that can keep her in Downing Street. General election 2017: May strikes deal with DUP to form UK government - live Read more Theresa May is heading to Buckingham Palace right now to ask the Queen for permission to form a new government. Sterling is currently trading at 1.275 down two cents or 1.5% since the exit polls struck after a wild morning. The pound vs the US dollar Photograph: Thomson Reuters Connor Campbell of City firm SpreadEx says the DUP deal has calmed the City a little: The pound gradually pulled back from the brink this morning though the currency still finds itself in a very bad way following the shock general election result. As expected Theresa May appears to have made an agreement with the DUP whose 10 seats in Northern Ireland would allow the Tories to just about manage a parliamentary majority. While the pound is obviously pleased that May is set to visit the Queen at midday to seek permission to form a government therefore likely avoiding another election in a few weeks times the unstable nature of such a government and what that means for the Prime Minister s ability to negotiate with the EU has only seen sterling erase the top layer of its losses. Several major City firms have also voiced their concerns: Legal & General suspects that Theresa May could face a rebellion from angry colleagues UBS has predicted greater volatility for UK assets such as the pound JP Morgan has predicted that Britain won t be ready to hold Brexit talks in mid-June Citi has warned that May could be forced to step down Many UK companies have suffered losses on the stock market today; shares in housebuilders and banks have fallen due to concerns that the UK economy will struggle. Royal Bank of Scotland are the biggest faller on the FTSE 100 down 3.2% followed by building firms Barratt Developments and Taylor Wimpey. Retailers such as M&S and Next have also dropped on fears that a weaker pound will drive up inflation hurting consumer spending. Utility firms has risen though as the threat of being nationalised by Jeremy Corbyn seems to have faded. After jumping in early trading the FTSE 100 has dipped back -- currently up 34 points or 0.5% at 7484 points. Multinational companies who will benefit from cheaper pound are rallying such as drinks firm Diageo and fashion chain Burberry. The FTSE 250 which is a better gauge of the UK economy has shed 100 points or 0.5% to 19639. Business leaders are extremely unimpressed by the situation; the British Chambers of Commerce says it s essential that the UK has a functioning government while the CBI urged Westminster to get its house in order. Credit rating agencies are also watching the situation closely; S&P has warned that Britain s credit rating could be cut. Updated at 12.33pm BST Facebook Twitter Google plus Share Share this post Facebook Twitter Google plus close 12.14pm BST 12:14 Legal & General Investment Management one of the City s biggest investors is concerned that the governance of Britain hangs in the balance . Hetal Mehta LGIM s senior European economist says: Theresa May could face a rebellion as some in her party might blame her for losing both a sizeable lead in the opinion polls and valuable Brexit negotiation time. This could mean that her position might become much weaker possibly to the extent that she will have to stand down thereby triggering a leadership contest. As we saw after the EU referendum last year the Conservatives can pull together relatively quickly to elect a leader but the risk is that the process is long and drawn out over the summer. If the Conservatives become preoccupied with internal party politics the chances of forming a minority government quickly may be lower although an arrangement with the DUP is emerging as a likely outcome. However the situation is extremely fluid and it is worth remembering that back in 2010 the coalition between the Conservatives and Liberal Democrats took six days to form and that was when that partnership was amongst the likely outcomes. As such the uncertainty and political wrangling is unlikely to lift quickly. Facebook Twitter Google plus Share Share this post Facebook Twitter Google plus close 11.43am BST 11:43 UK retailer Sports Direct has told the City that it won t suffer from the drop in the pound as it s fully hedged . In a statement it says: Following the outcome of yesterday s general election and in view of the associated market volatility in particular to sterling / dollar exchange rates Sports Direct International plc is pleased to confirm that its sterling / dollar exchange rate is fully hedged for FY18 at 1.31. Last October Sports Direct (which pays for some of its imports in dollars) issued a profits warning after a currency hedge backfired when the pound suffered a flash crash . That cost the firm 15m -- at a time when it was trying to improve its image following the exposure of poor working practices at its Derbyshire warehouse. Facebook Twitter Google plus Share Share this post Facebook Twitter Google plus close An analysis of billions of online searches conducted in the UK over the past year indicates that when it comes to finance people are most concerned about exchange rates. Research carried out by Yahoo and published on Thursday reveals the most frequently searched for terms in the 12 months to the end of April. Exchange rates topped the list followed by The Budget house prices student finance and mortgage rates . Read more Pound sterling near two-week high as UK voters take to the polls The pound has fallen more than 10 per cent against the dollar since the UK last June voted to leave the EU. That pushed inflation up to 2.7 http://thoughtforthedayquotes.com.yolasite.com/ per cent in April the highest since September 2013 and consumers seem to be starting to feel the pinch of higher prices. See how much you could save on international money transfers with HiFX: sign up and make a transfer Data from YouGov and the Centre for Economics and Business Research (CEBR) published at the end of May showed that consumer confidence had fallen to its lowest level since July last year largely as a result of concerns around people s household financial situation. Yahoo said that consumers want clarity on how the Government intends to support that situation which was why The Budget was the second most searched-for term. Other search terms that made it into the top ten included car tax universal credit pension changes new 1 coin and Lloyds share price . More about: UK Yahoo Centre for Economics and Business Research Reuse content
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