EUROPE
06 Jan 06. Time to cut rates says TUC. Without a cut in interest rates, the UK economy faces real difficulties in the year ahead with the threat of lower growth, higher unemployment and real problems for the manufacturing sector which could face up to 80,000 redundancies, the TUC says in a new report Cut or Bust – Why the Bank must cut interest rates in 2006 published today (Tuesday). The arguments against an interest rate cut do not stack up when examined in depth, says the TUC, so the Bank of England should act early in 2006 to cut rates, which should ensure that this year is a better one than 2005 with economic growth at the top end of Treasury forecasts. Interest rate hawks oppose cuts, says the TUC, because they believe that the economy is currently running at full capacity and that we face inflationary threats, including higher oil prices and rising wages. But the TUC’s detailed analysis set out in Cut or Bust – Why the Bank must cut interest rates in 2006 shows that neither are a reason not to cut interest rates. Far from running at full capacity, official figures published in the Pre-Budget Report show that there is a higher than expected gap between what the economy could produce and what it actually produces of 1.75% of GDP. Energy prices have undoubtedly increased but they have not fed through to increased prices across the economy with the consumer inflation rate, excluding energy prices, actually falling in recent months. Nor have higher energy prices caused an increase in wages. Indeed earnings growth slowed in 2005, and, at 3.9 per cent, has consistently been below the level (4.5 per cent) that most economists consider inflationary. Warning signs that the economy could hit the rocks without a cut in interest rates include a small rise in the unemployment rate in the last year. And although unemployment is relatively low, the TUC estimates that there could be up to 80,000 job losses in manufacturing in 2006. Nor should the Bank worry that low unemployment carries an inflationary risk as there is a reserve of people who want to work but do not show up in unemployment figures. Cut or Bust – Why the Bank must cut interest rates in 2006 shows that 11 per cent of the working age population without jobs want to work.
11 Jan 06. The UK Ministry of Defence’s (MoD) Tornado F3 Sustainment Programme (FSP), primed by BAE Systems, has achieved a significant milestone with the UK’s first firing of the latest (C-5) variant of the Advanced Medium Range Air-to-Air Missile (AMRAAM) AIM-120. The firing took place at the Naval Air Warfare Center range in Point Mugu, California in December using a Tornado aircraft of the RAF’s Fast Jet Weapons Operation Evaluation Unit (FJWOEU). The missile was released from the supersonic fighter, piloted by Simon Hargreaves, the former BAE Systems deputy chief test pilot, with navigator Flight Lieutenant Owen Harcombe from the FJWOEU, and successfully engaged a subsonic target. A second firing was completed the following day using a wholly RAF crew, Squadron Leaders David (Dick) Withington and Mark (Mario) Puzey. The AIM-120C-5 has a longer new motor and revised software, significantly enhancing its capability. The decision to integrate the missile onto Tornado enhances the F3’s capability, and allows it to use Typhoon AMRAAM stocks. This first firing of an AIM-120C-5 by the UK was the culmination of 12 months co-operation between the Defence Logistics Organisation’s Tornado Integrated Project Team (IPT), BAE Systems, other industry partners, and the FJWOEU. The formation of a combined trials team at the FJWOEU at RAF Coningsby has been a fundamental part of the project.
Dec 05. Record year for Iveco. Speaking to UK journalists at Iveco’s 20th annual ‘State of the Nation’ press conference in London, Chris Thorneycroft-Smith, the firm’s new managing director said Iveco registered and sold more trucks in 2005 than at any time in its 30 year history. ‘We did an incredible 9,406 ne