Fuel price drop expected after fall in oil price

The Chancellor, George Osborne, has said the government will be watching petrol and diesel
distributors “very carefully” to ensure they pass on oil price reductions to customers.

Oil has fallen from about $115 per barrel in June to about $84 per barrel, a decline of about a quarter.

In comparison, petrol prices in the UK have fallen from a high of about 131.7p per litre in the summer to 124.22p – a decline of about 6%.

Diesel dropped from 136.37p to 128.58p.

Campaigners argue that taxes account for the bulk of UK pump prices, and that the government therefore has more power to reduce prices than petrol companies.

“our message is clear – the oil price has fallen and we expect that to be passed on to people at the
petrol station filling up their cars,” said Mr Osborne.

“We expect the oil companies to do this and we will be watching very carefully to make sure they do.”

Source: www.bbc.co.uk/news/business
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UK interest rates remain at record low of 0.5%

The Bank of England has held UK interest rates at a record low of 0.5% for another month.

It has also decided not to extend its quantitative easing programme, designed to stimulate lending in the economy, beyond the £375bn already spent.

The Bank’s Monetary Policy Committee has held rates at 0.5% since March 2009 in a bid to help economic recovery.

Rates were expected to rise early next year, but economists think this will be pushed back due to recent poor news.

The Chancellor, George Osborne, has also warned that the UK will not escape the slowdown in the
Eurozone.

The Bank of England has said it wants to be sure growth is on a firmer footing, and that slack in the labour market is reducing, before it raises interest rates.

Source: www.bbc.co.uk/news/business

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Public Borrowing Rises to £11.8bn in September

Government borrowing increased to £11.8bn in September, an increase of £1.6bn in comparison with a year earlier, according to the Office for National Statistics. 

The latest figures have been a setback for Chancellor George Osborne, who in March pledged to cut the budget deficit by more than 10% over the next 12 months. 

Between April and September borrowing was £58bn, a rise of £5.4bn compared with the same period last year. Economists were forecasting that borrowing would become stable. 

That is an increase of 10.3%. Last month’s figures showed borrowing between April and August was 6% higher than a year earlier.

“We have seen stronger growth in receipts this month, but as today’s figures show, the impact of the great recession is still being felt in our economy and the public finances,” a treasury spokesman said. 

Source: www.bbc.co.uk/business

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