Week ended 13 December 2008 – Sterling still under pressure and falling against the Euro

Posted by admin on 15 December, 2008 under Weekly business news summary | Be the First to Comment

This week has seen tourists travelling to Europe getting just under one to one in an exchange between Sterling and the Euro, with the rate falling to under 1.12 and after commission and with the lower rates that tourists get they received less than one Euro for each Pound paid.

With UK interest rates at the lowest they have been for 57 years and worries that the UK economy will be one of the worst hit by the credit crisis and financial slow-down the Pound has taken a serious hit.

Job losses

This has been another week of heavy job losses with the Bank of America announcing job cuts of up to 35,000 this week as part a its efficiency drive after it merged with Merrill Lynch. Another bank Santander, which owns Abbey, Alliance and Leicester and Bradford & Bingley, is to cut its workforce by 1,900 and in the receivers of Woolworths have cut 700 jobs in the distribution side of the company.

The car industry

The US government is considering using money already earmarked to rescue the banking sector, but their plans were rejected this week. The US government is worried that the US economy could not face a major collapse of one of the three major car manufacturers (Ford, General Motors and Chrysler), so that it had to provide cash to keep them going to avoid major job losses and the knock-on effect of such a failure.

With the economy already weak a loss of up to 250,000 jobs and the impact on related businesses would be too much to bear right now! The Unions of the UK car manufacturers are now asking the UK government for similar help for the UK car industry as car sales fall off!

End of the week saw:
Stock exchanges:
FTSE 100: 4,280
DOW: 8,630
S&P: 879.73
Nikkei: 8,236

Currencies
UK Sterling £ to US Dollar $ 1.49470
UK Sterling £ to Euro € 1.11813
UK Sterling £ to Aus $ 2.25213
US Dollar $ to Euro € 0.748113

Commodities
Nymex Crude oil – $46.28
Gold – $820.50