International News 07/05

May 07, 2024 No. 71

OECD cuts UK growth forecast.

The UK economy is expected to grow at a slower pace this year and next, according to the Organisation for Economic Co-operation and Development (OECD). The forecast for economic growth in 2024 has been cut from 0.7% to 0.4%. In addition, the forecast for economic growth next year is now 1.0% instead of 1.2%. This means that the UK is expected to have slower economic growth in 2024 compared to countries such as France or Germany. The OECD also expects the UK to have higher inflation than other countries in 2024 and 2025. UK Chancellor of the Exchequer Jeremy Hunt said that these forecasts were not surprising given the efforts made over the past year to tackle inflation through higher interest rates.


US Federal Reserve FOMC statement 1 May 2024.

Recent economic indicators show that the economy is growing strongly, with high job creation and a low unemployment rate. However, inflation remains high, although it has eased somewhat compared with last year. The Committee's objective is to achieve maximum employment and 2 per cent inflation over the longer term. The risks to achieving these objectives are seen as more balanced than they were last year, but the economic outlook remains uncertain and the Committee is cautious about the risks to inflation. To support these objectives, the Committee has decided to maintain the target range for the federal funds rate. It will carefully assess recent data and developments in the economic outlook before making any adjustments. The Committee does not expect to lower the target range until there is greater confidence that inflation will move toward 2 percent. In addition, the Committee will continue to reduce its holdings of Treasury and corporate securities beginning in June.


Unilever beats earnings expectations in first quarter of 2024.

Unilever PLC, the maker of Dove soap and Hellman's mayonnaise, has reported a strong first-quarter performance that beat analysts' expectations. The company managed to win back consumers who had turned to cheaper products during the recent surge in global inflation. Unilever's sales growth rose 4.4%, beating the average analyst forecast of 3%. This strong performance was accompanied by a 2.2% increase in sales volumes, the second consecutive quarter of growth after several declines. Other consumer goods companies had struggled to recover lost volumes after implementing price increases to cope with increased costs from the pandemic and rising energy costs. Unilever CEO Hein Schumacher expressed confidence in the company's ability to sustain volume growth and accelerate gross margin expansion. Unilever also maintained its full-year sales growth guidance and expects volumes to continue to drive earnings growth.