Author: WTX Business Team

Richard Branson’s rocket firm Virgin Orbit files for bankruptcy Virgin Orbit, the satellite launch company founded by British billionaire Sir Richard Branson, has filed for bankruptcy in the US due to a failure to secure new investment. The company, which is a spin-off from Sir Richard’s space tourism firm Virgin Galactic, halted its operations weeks ago and announced that it plans to cut 85% of its 750-strong workforce. Virgin Orbit will now look to find a buyer for the business, with the aim of providing clarity to customers, vendors, and employees about the future of the company. It launches rockets…

Economist – America vs China: It’s worse than you think Economist says you may have hoped that when China reopened and face-to-face contact resumed between politicians, diplomats and businesspeople, Sino-American tensions would ease in a flurry of dinners, summits and small talk. But the atmosphere in Beijing just now reveals that the world’s most important relationship has become more embittered and hostile than ever. In the halls of government Communist Party officials denounce what they see as America’s bullying. They say it is intent on beating China to death. Western diplomats describe an atmosphere laced with intimidation and paranoia. In…

City AM – Britain goes own brand Recession fears see Brits stock up on own-brand kitchen staples CITY AM SAYS THE COST of living crisis is beginning to be felt in the pockets of ordinary punters – with more than one in three turning towards own brand products to keep the kitchen cupboard stocked. New research from KPMG suggests more than half of UK consumers have reduced ‘non-essential’ spending amid recession fears, with eating out top of the list of sacrifices. Though the jury remains out on whether the UK will enter a technical recession, the country is undergoing its…

Cineworld ditches sale of UK, US businesses after failing to find buyer Cineworld has abandoned plans to sell its cinema businesses in the US, UK, and Ireland after failing to find a buyer. The cinema chain operator also announced that it has made a conditional deal with lenders to exit bankruptcy. The company, which owns the Picturehouse chain in the UK, intends to raise $2.26bn of new funding to turn around the business, including restructuring its debts. The proceeds will be used to support the company’s long-term strategy in the changing entertainment industry, according to Cineworld’s CEO Mooky Greidinger. The…

UK strikes agreement to join Asia-Pacific trade bloc FT says The UK on Friday unveiled an agreement to join an 11-member Asia-Pacific trade bloc, with British prime minister Rishi Sunak claiming it proved his government was seizing “post-Brexit freedoms”. Talks on Britain becoming a member of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership were finally wrapped up after two years of haggling over quotas and tariffs. The UK will be the first country to join the CPTPP since the group was established in 2018, and Sunak said the trade deal will bring economic benefits and also boost his “Asia-Pacific”…

UK-Asia trade deal to boost UK economy by 0.08% The UK has signed a trade deal with 11 Asia and Pacific nations, including Australia, Canada, and Japan. This deal will help UK exporters by lowering tariffs on products like cheese, cars, and chocolate. The agreement, called the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), will create a market of around 500 million people. CPTPP was established in 2018 and includes Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam. The 11 members of CPTPP account for around 13% of the world’s income and after 21…

Virgin Orbit lays off 85% of staff after failing to secure funding Virgin Orbit has announced that it will lay off 85% of its workforce and suspend operations for the foreseeable future due to its inability to secure new investment. The rocket company was founded by British billionaire Sir Richard Branson and earlier this year the company had attempted to launch the first-ever satellite launch from UK soil. Whilst the mission was unsuccessful, it was billed as a milestone for UK space exploration and it was hoped it would mark a major step towards turning the UK into a global…

Twitter takeover: Elon Musk announces Blue Tick shakeup Twitter boss Elon Musk has announced changes to the social media platform’s paid feature, Twitter Blue.  Starting 15 April, only verified subscribers will have their posts recommended to other users and be allowed to vote in polls. Posts from non-paying accounts will not appear in the “For you” stream of recommended tweets. The current subscription fee for blue-tick verification is $7 (£5.70) per month and also provides access to additional features. Musk stated that these changes are necessary to tackle AI bot swarms and make it easier to identify them. However, the…

CITY AM – UK economy not out of the woods yet UK recession still on the cards after aggressive Bank of England interest rate hikes Read the business pages here   CITYAM SAYS A recession is still on the cards in the UK despite the economy performing much better than experts predicted just a few months ago, new forecasts out today project. Higher interest rates and households responding to the cost of living crunch gripping their finances by trimming spending is tipped to push GDP 0.3 per cent lower this year, according to consultancy KPMG. Families are being hit by the…

FT – Investors pour $286bn into money market funds in scramble for safety The Financial Times leads with the recent banking crisis and how the turmoil has increased the risk to financial stability, the IMF warned. Read the business pages here

Collapsed US Silicon Valley Bank bought by rival First Citizens BancShares has purchased the assets and loans of the collapsed US lender, Silicon Valley Bank (SVB), the US Federal Deposit Insurance Corporation (FDIC) announced. SVB’s collapse earlier this month raised concerns about the stability of other lenders, resulting in a significant drop in bank shares worldwide. In Europe, worries over the strength of Swiss banking giant Credit Suisse led to a rushed takeover by rival UBS. Nerves among investors have remained, and bank shares fell sharply on Friday. SVB collapsed soon after a run on the bank and was swiftly…

UK households ‘spent 12% more on essentials in February than year earlier’ The Guardian says Inflation and rising bills mean UK households are spending 12% more on essentials than they were a year ago, with almost four in 10 people having to use credit cards to cover these costs, new data shows. Two days after it emerged that the UK’s annual inflation rate unexpectedly jumped to 10.4% in February, Nationwide said its figures showed that consumers spent 34% more on utility bills and 17% more on mortgage payments last month than they did in February 2022. The building society analysed…

Bank of England warns interest rates will rise again if businesses hike prices The Independent says The head of the Bank of England has warned businesses that raising prices will lead to interest rates being hiked again. Interest rates were lifted to 4.25 per cent from 4 per cent on Thursday after policymakers on the Bank’s nine-strong Monetary Policy Committee (MPC) voted seven to two for the quarter-point rise following a surprise jump in inflation last month. Chancellor Jeremy Hunt said he supports the Bank’s decision to hike rates further as “the sooner we grip inflation the better for everyone”.…

UK interest rates: Another Bank of England rise expected as prices soar Following an unexpected jump in the rate of inflation, the Bank of England is expected to raise interest rates for the 11th consecutive time. Analysts predict that the Bank rate will increase from 4% to 4.25% at the upcoming Monetary Policy Committee meeting, as policymakers strive to balance inflation control with financial stability. While savers may benefit from an improved rate of return, variable and tracker mortgage holders and other borrowers could face higher interest rates. The rate of inflation rose to 10.4% in the year to February,…

UK borrowing in February hits highest level since record began  According to the Office for National Statistics (ONS), government borrowing in February hit its highest level since records began in 1993, reaching £16.7bn. This increase was largely due to spending on energy support schemes for households. However, interest payments on government debt fell by £1.3bn from the previous year, due to changes in the inflation rate. Although the borrowing exceeded economists’ expectations, Chancellor Jeremy Hunt attributed it to the government’s efforts to support households coping with rising living costs. The government recently announced an extension of energy bill support until…

$3bn IMF bailout for Sri Lanka’s struggling economy Sri Lanka has been given a $3 billion bailout from the International Monetary Fund (IMF) to help the country overcome a crippling economic crisis. The deal provides a lifeline for Sri Lanka, which owes billions in loans, and is struggling with inflation and rising energy prices. To raise funds, the government is planning to restructure state-owned enterprises and privatise the national airline, according to the country’s Foreign Minister Ali Sabry. But even with the $3bn bailout, Sri Lanka is still facing massive challenges. Shortage of essential goods The country’s economy has been…

Christine Lagarde’s comments come in the midst of persistent turmoil across Europe’s banking sector.

Thousands may have fallen for Crypto app scam The Metro says Another cryptocurrency trading app may have lost thousands of people their hard-earned savings, it has been reported. In corporate terms, iEarn Bot told customers their investments would be handled by the artificial intelligence programme, guaranteeing high returns. But experts who have investigated company, which claims to be based in the US, say it could be one of the biggest crypto scandals to date. Roxana – not her real name to protect her identity – from Romania, told the BBC she lost hundreds of euros when she invested.

City AM – It’s a Swiss rescue UBS agrees to buy Credit Suisse to avoid “unthinkable” consequences CITY AM says THE SWISS government last night brokered a discount $3bn (£2.6bn) deal that will see UBS rescue Credit Suisse from bankruptcy and avoid “irreparable” damage to the global financial system. In an extraordinary press conference last night, the Swiss President said deposit outflows on Friday at Credit Suisse on Friday meant it was “no longer possible to restore the necessary confidence” in the bank and that a “stabilising” solution was required. “This solution is a takeover of Credit Suisse by UBS,”…

Workers £11,000 worse off a year due to stagnant wages – Resolution Foundation Research shared exclusively with BBC Panorama by the Resolution Foundation think tank, which focuses on low-to-middle income households, reveals that British workers have suffered from 15 years of wage stagnation, leaving them £11,000 worse off per year. The think tank also found that typical UK household incomes have fallen further behind those in Germany, with a gap of £4,000 compared to just over £500 in 2008. The Treasury argues that the UK economy is more resilient than many predicted, however, experts argue that problems with incomes go…

Central banks to boost flow of US dollars amid market troubles Following a turbulent period in the US banking sector and the Credit Suisse merger, six central banks, including the Bank of England, have taken coordinated action to boost the flow of US dollars through the global financial system. The US dollar liquidity “swap line” arrangement will allow banks in the UK, eurozone, Canada, Japan, Switzerland, and the US to access funding on a daily basis directly from their respective central banks, rather than borrowing on the open market. In a statement, the Bank of England, Bank of Japan, Bank…

Silicon Valley Bank collapse If you work in the technology industry, it’s likely that you are familiar with Silicon Valley Bank. However, if you haven’t heard of this seemingly localised bank, don’t worry – it primarily served a specific clientele of startups, venture capitalists, and technology firms, with only a few branches despite holding billions in deposits. Unfortunately, the bank has since collapsed, marking the second-largest bank failure in US history, after banking regulators shut it down on Friday, March 10. Just two days before, Silicon Valley Bank had signalled a cash shortage and attempted to raise money by selling…

Bosses blamed the lack of bonuses on ‘inflationary pressures’.

Virgin Orbit to pause all operations from Thursday Virgin Orbit plans to halt operations from Thursday and reportedly furlough almost all its employees in a move believed to be aimed at boosting its finances. The company’s CEO, Dan Hart, told employees that the furlough would provide time to finalise a new investment plan. It is unclear how long the furlough will last, but Hart promised to provide more information by next week. Shares in the company fell 18.8% to 82 cents in extended trading. UK failed mission A statement from the company said: “Virgin Orbit is initiating a company-wide operational…

Credit Suisse emergency loan sparks banking fears Credit Suisse announced that it will be borrowing up to 50 billion Swiss francs (£44.5bn) from Switzerland’s central bank to bolster its finances, in an effort to simplify and strengthen its business. The troubled bank’s shares plummeted by 24% on Wednesday after revealing weaknesses in its financial reporting, sparking concerns of a wider banking crisis and leading to steep drops in Asian shares. However, European markets are expected to open higher on Thursday. The Bank of England has reportedly been in contact with Credit Suisse and Swiss authorities to monitor the situation. The…