UK house price growth slows amid ‘market slowdown’ after pandemic – Business Live | Action

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8.36am BST08:36

Gas prices will rise after Ofgem raises its ceiling. Photo: Lauren Hurley/PA

Millions of homes will have to pay some of the highest energy bills of the past decade after an industry regulator gave the green light to suppliers to raise their prices by up to £153 a year.

Households across Great Britain using virtual energy tariffs to buy gas and electricity can expect a sharp increase in their bills from October this year after the regulator raised the winter energy price cap.

Ofgem said gas prices had risen to a record high in Europe “due to recovery in global demand and dwindling supplies”, which has increased the cost of home heating and raised electricity prices.

You can read the full report here:

8.32am BST08:32

A sudden decline in German industrial production A robot adjusts windshields in a fully automated process on the A-Class production line model of German automaker Mercedes-Benz at the Daimler plant in Rastatt. Photo: Kai Pfaffenbach/Reuters

Output from powerful German manufacturers fell in June, likely in part due to a global shortage of computer chips, according to official data that surprised economists.

Economists polled by Reuters had expected production to increase 0.5% in June, but it fell 1.3%, the Federal Statistics Office reported.

This decline was driven by a decline in the production of capital goods, such as machinery and vehicles, which fell by 2.9%. Production of consumer goods continued to grow, increasing by 3.4%.

A shortage of semiconductor computer chips has put the auto industry in hold around the world after the pandemic disrupted…well, everything. Car companies cut chip orders at the start of the epidemic, but did not expect a strong rebound in demand, while the rise in home computing increased the need for semiconductors from consumer electronics companies.

Andrew Kenningham, chief European economist at consultancy Capital Economics, said there were “serious problems” in German manufacturing. He said:

Automotive production was 29% lower than its pre-pandemic level, reflecting the impact of component shortages, particularly in semiconductors. This is now expected to continue through the second half of the year and will hamper the strong economic recovery.

Media reports indicate that the automakers themselves believe the component shortages are likely to continue into next year even though they expect (or hope) that the problems will be less severe. So a full recovery for Germany is still a long way off.

8.11 am BST08: 11

It’s a lot like a Friday in August in European stock markets. The FTSE 100 slipped to a nice low in early trade, dropping eight points, or 0.1%, to 7,111 points.

Here are the opening shots from key markets in Europe:

France’s CAC 40 down 0.1%; Spain IBEX FLAT EURO STOXX 600 INDEX down 0.1%; Eurozone blue chips down 0.1% German DAX 0.2%

Updated at 8.44am GMT

8.02 AM BST08: 02

UK house price growth slows to 7.6% annually – Halifax

Good morning and welcome to our live coverage of business, economics and financial markets.

UK house prices rose 7.6% in the year to July, but Halifax, the lender that reported the data, suggests this could be a sign of “market cooling” after months of inflated activity.

The average British home sold for £261,221 in July – still £18,500 more than last year. However, annual house price inflation has returned from 8.7% in “overheated” June and 9.6% in May – see Halifax’s blue graph for indications of a possible peak in growth.

Halifax data indicated that house price growth may be on a downward path. Photography: Halifax

Of course, the annual growth of 7.6% is still a staggering – far outpacing the average wage growth at any time in the past decade (except in May due to the comparison with lower wages during the first UK lockdowns).

The reasons for rising house prices (in the midst of a pandemic that shut down large parts of the economy for months) are now familiar: a combination of historically low borrowing costs, pent-up demand after a temporary market freeze, a desire for more space driven by shutdowns, and a large portion of subsidies. governmental.

The ‘cooling’ that Halifax expects in the next few months will be partly caused by another of these: a 0% stamp duty rate now applies only to the first £250,000 of the purchase price (instead of the pandemic threshold of £500,000) and will revert to standard rates starting at £125,000 as of October.

Russell Galley, MD, Halifax, said:

Recent months have been marked by historically high volumes of buyer activity, with June being the busiest month to complete a mortgage since 2008. This has been fueled by a “race for place” and a limited stamp duty respite. With the latter now entering its final stages, buyer activity should continue to subside over the coming months, and a more stable period may await for the market.

The latest industry figures show sales orders are declining and real estate agents are experiencing a drop in their available inventory. This general lack of supply should help support prices in the near term, as well as the exceptionally low cost of borrowing and continued strong customer demand.

Agenda 1:30pm GMT: US Nonfarm Payrolls (July)

Updated at 8.04am GMT

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