Key eventsRiksbank cuts policy rate to 3.75%, flags two more rate cuts this yearSweden’s Riksbank has cut its policy rate to 3.75% from 4%, as expected.The central bank said it expects to reduce rates two more times in the second half of this year. Its statement said:
Inflation is approaching the target while economic activity is weak. The Riksbank can therefore ease monetary policy. The executive board has decided to cut the policy rate by 0.25 percentage points to 3.75%. If the outlook for inflation still holds, the policy rate is expected to be cut two more times during the second half of the year.
You can read the statement in full here.Governor Erik Thedéen and Åsa Olli Segendorf, head of the monetary policy department, will explain the decision and the outlook at a press conference at 11am local time (10am BST). The minutes of the meeting will be published on 15 May.ShareMilo Bussell, associate analyst for consumer and media at Edison Group, said:
Moving forward, it will be interesting to see how consumer demand evolves in the coming year. Management noted improving momentum in sales… Having opened its new US distribution centre to target a key market and completed its automation project in Sheffield, the company believes it is well-positioned having invested for sustainable and profitable growth.
With greater cost savings and lower capital expenditure having completed these two projects, management is confident in achieving its medium-term Ebitda margin target of 6%-8% and expects to be free cash flow positive in 2024/25.
ShareBoohoo cuts over 1,000 jobs after 13% sales slumpBoohoo has cut more than 1,000 jobs and dived into debt after losses soared and sales slumped 13% amid heavy competition from Chinese online seller Shein and the revival of the high street after the pandemic lockdowns.The online fashion specialist, which owns Debenhams, Warehouse, Dorothy Perkins and Pretty Little Thing, said it had built up net debts of £95m in the year to the end of February from nearly £6m of net cash a year before after losses widened 76% to £160m.John Lyttle, the chief executive of Boohoo blamed “difficult market conditions, caused by high levels of inflation and weakened consumer demand,” for the group’s problems and said it planned to make savings of £125m in the year ahead after putting more automation into its Sheffield warehouse, closing one in Daventry and opening a new warehouse in the US.The latest accounts show that Boohoo, which was founded in Manchester in 2006, has already cut more than 1,000 jobs in the year as it faced an 11% drop in the number of active customers using its site each of whom spent less and visited less often.Boohoo’s share price fell 4.6% and is less than a tenth of its value three years ago when it was riding high on a shift to online shopping during the pandemic when high streets were affected by government lockdowns.The poor performance meant the company did not hand 16m shares to shareholders of Pretty Little Thing who are led by Umar Kamani, son of the Boohoo co-founder and chairman Mahmud Kamani.Guy Lawson-Johns, equity analyst at Hargreaves Lansdown, said:
Boohoo’s full-year results were a painful read for investors. Revenue declined at high double-digit rates across all regions, including an 18% in the US, which is seen as the group’s pathway to major growth.
For now, it remains a struggling company with a tarnished reputation, reflected in the group’s valuation, which has come down significantly over the last few years.
Executing its back-to-growth strategy hasn’t been easy. And, as part of the drive for profitability, Boohoo has heavily invested in expanding capacity abroad where there’s greater room for growth. International markets, especially the US, hold the key to the group’s future growth, but extensive investment has so far yielded weak results. And with customer KPIs continuing to trend in the wrong direction, it doesn’t look like a miraculous recovery is around the corner.
Fast fashion firm Boohoo. Photograph: Ian West/PAShareASLEF members are on strike today at Avanti West Coast, Chiltern Railways, CrossCountry, East Midlands Railway, Great Western Railway and West Midlands Trains.Solidarity to all those seeking a fair deal at work.#ASLEFStrike pic.twitter.com/qLYxySVDlp— ASLEF (@ASLEFunion) May 8, 2024During a week of rail strikes, in nearly 2 years of this industrial action, I spoke to commuters, the ASLEF union, and those involved in pay deal negotiations for train drivers. More on ⁦@BBCLondonNews⁩ pic.twitter.com/4oZjOjOoCF— Luxmy Gopal (@luxmy_g) May 7, 2024

ShareUpdated at 09.10 CESTIntroduction: Train strikes halt most services in west of England, Midlands and routes to Scotland and WalesGood morning, and welcome to our rolling coverage of business, the financial markets and the world economy.There’s more disruption for rail passengers in England today, after train drivers began another round of industrial action on Monday to push for better pay and conditions.In a three-day strike, drivers in the Aslef union will strike for 24 hours at each of England’s national train operators over the course of three days from Tuesday until Thursday, and an overtime ban will apply nationwide from Monday until Saturday.The first wave yesterday affected commuter routes into London. Today, there’s a 24-hour strike at Avanti West Coast, Chiltern Railways, CrossCountry, East Midlands Railway, Great Western Railway and West Midlands Trains – halting most services in the west of England, Midlands and routes to Scotland and Wales. Tomorrow, drivers will strike at LNER, Northern and TransPennine Express.The union is pushing for an improved pay offer, with some of its members not having had a pay rise for five years. The last talks broke down a year ago.The Rail Delivery Group, representing train operators, emailed Aslef late last week to suggest discussions about a framework for formal talks, which the union said it welcomed.Toyota, the world’s largest carmaker, has forecast a near-20% drop in annual profit, after safety scandals forced it to cut back production. The Japanese carmaker plans to invest 1.7tn yen (£8.8bn) in electric vehicle and artificial intelligence technology to keep up with rivals.Honda and Nissan, Japan’s second- and third-largest carmakers, recently joined forces to work together on electric vehicle technology.Toyota said operating income will fall by 19.7% to 4.3tn yen in the year to March 2025, which is worse than expected. It also said it would buy back up to 1tn yen, around 3% of its shares.The Agenda
8.30am BST: Sweden Riksbank rate decision (forecast: cut from 4% to 3.75%)
9am BST: Italy Retail sales for March
12.00pm BST: US MBA Mortgage applications for week of 3 May
ShareUpdated at 09.01 CEST



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