Money blog: Should we start worrying about mortgage rates? (2024)

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  • eBay launches beauty advent calendar - we did the maths to see if it's actually good value
  • Should we start worrying about mortgage rates?
  • 'I made £1.85 train ticket error - Northern Rail is threatening to take me to court'
  • UK economy returns to growth
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07:04:54

UK economy returns to growth after two months of stagnation

The UK's economy grew by 0.2% in August, according to official figures.

The slight rise in gross domestic product - which is intended as a measurement of a country's total output - comes aftertwo successive months of stagnation.

The figures from the Office for National Statistics were in line with the forecasts of economists polled by the Reuters news agency, who predicted growth would be 0.2%.

Liz McKeown, from the ONS, said: "All main sectors of the economy grew in August, but the broader picture is one of slowing growth in recent months, compared to the first half of the year."

Rachel Reeves, the chancellor, who is preparing to deliver her first budget at the end of the month, said it is "welcome news that growth has returned to the economy".

"Growing the economy is the number one priority of this government so we can fix the NHS, rebuild Britain and make working people better off," she said.

Business correspondent Paul Kelsosays the news is"not stellar, but it's welcome".

"There's a great deal of focus on the state of the economy and the public finances, as the chancellor wrestles with what she's going to put in her first budget," he says.

Investors from around the world are heading to the City of London for an investment summit on Monday, so this news is "not bad timing" and the government will be "hoping to attract private investment from around the world", he adds.

06:40:12

Should we start worrying about mortgage rates?

Every Friday we take an overview of the mortgage market, hearing from industry voices and getting a round-up of the best rates courtesy of the independent experts at Moneyfactscompare.co.uk.

The most eye-catching news of the week, after months of mortgages rates sliding down, was a few lenders, notably Coventry and Co-operative Bank, withdrawing their lowest rates or announcing hikes.

The escalating conflict in the Middle East, which could affect oil prices and therefore inflation, is creating some uncertainty.

Moneyfacts finance expert Rachel Springall explains: "Over recent days we have seen a rise in swap rates. The uncertainties surrounding future interest rates, such as mixed messages from Bank of England regarding base rate, combined with wider economic uncertainties have their parts to play in lenders pricing decisions.

"Fixed mortgage rates typically follow swaps relatively closely, so any volatility can be an indicator on where rates will go next, but it may be a little too soon to tell how this could impact the market overall."

One factor that could come into play - and potentially prevent hikes being too pronounced - is the timing of all this.

"Each lender will have their own end of year targets to consider and could choose to hold steadfast if they are not priced too low in the present market," says Springall.

This is in line with what we saw with Barclays yesterday, with mainly small improvements to rates but some increases on selected products.

Overall, it's not a time to be too panicked, says David Hollingworth, associate director at L&C Mortgages and Money blog regular.

"This isn't anything like the kind of volatility that we have seen on occasions in the last couple of years," he says.

"Rates aren't likely to spin out of control and it's more a case of understanding that what may have looked like continual cuts to rates may not maintain the same pace.

"Interest rates are still expected to fall and all eyes will be on the inflation data next week."

This week, Moneyfacts has looked at the best rates on offer for home movers...

Moneyfacts also rounds up what it calls "best buys", which look beyond the lowest rates and takes in incentives and fees...

Two other updates of note on the housing market were reported on here in Money. You can read them here...

06:39:08

eBay launches beauty advent calendar - we did the maths to see if it's actually good value

ByMegan Harwood-Baynes, cost of living specialist

eBay has launched its first beauty advent calendar, which promises to be filled with more than £250 worth of products - but is that the case?

We looked behind the advent calendar doors to see if it lived up to the promises...

The pros

In total, we managed to find everything on the list for £225 - this doesn't include any additional discounts some websites offer (Look Fantastic is pretty good at always having some kind of active discount code).

But, at a price of £49.99 for the whole calendar, that's still a pretty good bargain.

There are other plusses: eBay seems to source products from surplus stocks that would otherwise have gone to landfill, plus it is done in support of the Hygiene Bank, a charity dedicated to ending hygiene poverty in the UK.

The cons

There's a reason many of these items are surplus stock. When I was costing it up, there were plenty of people reselling them on eBay fairly cheaply.

And while eBay is still on the cheaper end of beauty calendars (Liberty sell theirs for £260 and Space NK's goes for £250), it is still almost £50 at a very expensive time of year.

You should also ask: are you really going to use 20-something tiny products?

For £50, you could buy a couple of full-sized products you already love and still donate to the Hygiene Bank.

But if you are tempted, have a look before buying to make sure it contains products you will use.

Is it safe to buy cosmetics from eBay?

Lots of people do without issues.

If you're worried, perhaps only buy items that are brand new in the box. If they arrive and it looks like the seal has been tampered with, or the product used, considering chucking it straight in the bin and reporting the seller.

06:37:45

Portugal proposes tax cuts for under-35s to tackle 'brain drain'

The Portuguese government is proposing to slash income taxes for 18 to 35-year-olds in an attempt to tackle "youth brain drain".

As part of the annual budget, Luis Montenegro's government aims to reduce income tax for under-35s to a maximum of 15%, The Guardian reports.

The plans would mean young people earning up to €28,000 (£23,416) a year would be exempt from tax completely in their first year of work.

Then in their second year of work, they would be exempt from 75% of the tax and this would then decrease with each year.

It is hoped the proposed tax cuts will dissuade young people from emigrating and living abroad in search of better pay and career prospects.

Low salaries in Portugal are an issue - the minimum wage is €870 (£727) - and the average salary is one of the lowest in Europe.

This has meant many are choosing to leave the country, with around 30% of Portuguese aged between 15-39 now living abroad, according to data from the Emigration Observatory.

18:57:01

Aldi is hiring 3,500 people for Christmas - how do the perks compare to other supermarkets?

Aldi is looking to hire 3,500 people in the lead-up to Christmas.

Roles on offer include store assistants, managerial positions and cleaners.

The starting pay for a store assistant is £12.40 and £13.65 at any location inside the M25.

Aldi also offers its staff paid breaks, which it says are worth around £900 a year to the average store colleague.

It is not the only supermarket gearing up for a busy few months. As we have reported, Sainsbury's is looking for thousands of people to fill 18,000 festive roles.

Workers will also be offered free food during shifts and a 10% discount across stores (rising to 15% every Friday and Saturday).

Here's a look at how staff perks compare across the major UK supermarkets...

17:45:01

'Speed no longer a luxury, it's a necessity': Waitrose launches on Just Eat

Waitrose has become the latest supermarket to launch on Just Eat.

In the coming weeks, millions of customers will be able to order their favourite Waitrose food and drink from 229 locations across the UK, with the aim of it being delivered in under half an hour.

More than one million Britons now regularly get their groceries delivered by Just Eat.

It comes as the supermarket chain confirmed plans to open up 100 convenience shops across the UK in the next five years.

16:20:33

Sales slump for IKEA UK as retailer 'prioritises affordability'

IKEA has reported a slump in UK sales for the past year.

The company revealed retail sales dropped by 6.8% to £2.3bn for the year to August, compared with the previous financial year, as shoppers held off buying bigger-ticket items.

It linked the drop to a "strategic decision to prioritise affordability" as it invested more than £117m into lowering prices over the year for customers hit hardest by the cost of living crisis.

The retailer said more than 3,000 products, representing about a third of its range, were reduced in price.

15:28:01

Ryanair axes thousands of flights next year in row with Germany

Ryanair has said it will cut 12% of its traffic through German airports next year in a row with the government there over high location charges.

The cuts will result in a loss of 1.8 million seats from the start of the summer flight plan in April 2025 and will see Ryanair close its Dortmund, Dresden and Leipzig operations as well as reducing its Hamburg operations by 60%.

The closure of specific routes means as many as 10,000 flights will be hit, The Telegraph reports.

The move "will be devastating for jobs, tourism and connectivity", Ryanair has said, calling on Germany's transport minister Volker Wissing and the government "to act immediately to lower access costs and fix Germany's broken air transport system".

The airline has repeatedly warned that it would switch capacity to other EU countries if Germany did not meet its demands to reverse an aviation tax increase and reduce air traffic control charges.

14:53:07

'I got fined £115 for an expired railcard'

Our inbox is full of comments from readers about Sam Williamson (see post earlier this afternoon), who is facing prosecution for falling foul of a confusing railcard rule.

Here's what some of you had to say...

Interesting how Northern Rail have the resource to follow up such heavy handed frivolous prosecutions, while they so often struggle to fulfil their scheduled trains due to "no staff being available". Perhaps a shift in focus is required?

DisgruntledNorthern Rail Patron

Surely it is false advertising by Northern Rail by selling the ticket as an anytime day return. Anytime means anytime, not between certain times.

JSL

Others have reached out to say they have experienced similar heavy-handed prosecutions.

Reader Caden's dispute was with TransPennine Express.

"I was fined £115 for accidentally purchasing my ticket 48 hours after my railcard had expired," he said.

"The conductor who issued the fine was very aggressive, making the situation quite uncomfortable, and treating me like a criminal. They obviously got some power trip out of it.

"Even though I bought a new railcard just two minutes later and showed it to the inspector, I have now received a letter demanding the fine and stating that if I don't pay, I will be prosecuted."

Other readers say they have faced similar problems.

I made an error on the train - my ticket was for a later train that day, I never realised and because I was already half way through my journey, no money etc. They charged me £85, even though my ticket was in date just the wrong time, and I'd just been to court for a [domestic violence] hearing.
Bianca

Northern rail isn’t the only company doing this. I took my son to London on a Saturday on SWtrains. We were booked the 10.30, but was ready early so just jumped on an earlier train. The ticket was "off peak", so we were forced to spend another £70 on tickets.
H's mummy

I purchased a full price ticket for the 13.30 train [on Northern Rail] and the previous train was late so I arrived for my train and got on the earlier train and they took me to court.I won my case because they fraudulently completed the paper.
Phil S

13:43:01

Shein overtakes fast fashion rival

Shein has overtaken its fast-fashion rival Boohoo for sales.

Sales rose 38% to £1.55bn - some 30% more than Boohoo's £1.09bn last year.

Shein opened a UK head office in Manchester last year, which is also home to Boohoo and PrettyLittleThing. It now employs around 33 people, primarily in the marketing department.

It is also considering a float on the London Stock Market, in a debut estimated to be worth £50bn.

The company has been at the centre of controversy over its use of cotton from the Xinjiang region of China and other issues related to workers' rights and its vast supply chain.

Money blog: Should we start worrying about mortgage rates? (2024)

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