Business
2019.10.10 19:36 GMT+8

Europe biz: UK to avoid recession, Ritz Hotel for sale

Updated 2019.10.10 19:36 GMT+8
Gary Parkinson

UK recession fears abate despite economy shrinking in August

The UK's gross domestic product (GDP) dropped by 0.1 percent in August, the first monthly contraction since April. However, the Official for National Statistics (ONS) also revised July's GDP growth up from 0.3 percent to 0.4, meaning the three months to August showed overall growth of 0.3 percent. 

The figures will help to quell fears of the UK economy entering a recession ahead of Brexit. For a second successive quarterly contraction, the GDP would have to shrink by an unusually severe 1.5 percent in September, for which the data will be revealed in early November. 

GDP figures suggest the UK will avoid recession (Credit: AP Photo/Matt Dunham)

Accelerated German exports slump suggests recession

German exports fell by more than expected in August, amplifying fears that Europe's biggest economy is sliding into recession. The Federal Statistics Office said seasonally-adjusted exports fell 1.8 percent on the month, with imports rising 0.5 percent. Economists had predicted a 1.0 percent export drop and a 0.2 percent import reduction.

August's export reduction was the sharpest since April, and the biggest drop was to countries beyond the EU. The German economy shrank by 0.1 percent in the second quarter. "We will likely have a contraction in GDP in the third quarter, and thus a recession," said LBBW bank economist Uwe Burkert.

Ritz Hotel made available for $978m

The owners of London's world-famous Ritz Hotel are sounding out potential buyers - with a suggested price of $978m. At $7.46m per bedroom, it would become the world's most expensive hotel. 

The Grade II-listed, 113-year-old hotel on London's Piccadilly has long been a magnet for high society, with patrons including Winston Churchill, the Aga Khan, Paul Getty and the future Edward VIII. It is currently owned by the billionaire Barclay brothers, who also own The Daily Telegraph and the Channel Island of Brecqhou. 

A room at the Ritz is yours for $7.46m (Credit: AP Photo/Matt Dunham)

Philips blames profit warning on global trade wars

Dutch healthcare technology company Philips has posted a profit warning, which it blames on trade wars. Reporting that the company's EBITA margin would improve by 10 to 20 basis points rather than its goal of 100 basis points, chief executive Frans van Houten said the shortfall was "due to increasing headwinds from tariffs". 

Philips was known for its lighting and consumer electronics but has spun these off in recent years. 

In January, Philips said the trade disputes between Washington and Beijing were forcing it to move hundreds of millions of euros worth of production from the United States to China, and vice versa, to avoid punitive tariffs. It releases its full quarterly results on October 28 and expects sales to have increased 6 percent in the quarter to $5.16 billion.

BA, Shell commit to (limited) carbon offsetting deals

British Airways is to offset all carbon emissions from domestic flights from next year as its owner IAG becomes the first airline group to commit to net-zero carbon flying by 2050. IAG chief exec Willie Walsh says carbon fuel is currently unavoidable: "It's going to be some time until we see an electric or hybrid-electric plane. The technology to cover the entire network is some time away."

Meanwhile, fuel producer Shell has said it will offset the CO2 emissions of around 1.5m British road users under a loyalty scheme to be launched this month. From 17 October to September 2020, fuel purchased by customers with its Shell Go+ app will be offset for free. Shell says around one-fifth of its customers are registered with the scheme, and it expects the offsetting to cost around $12.2m.

Shell is to offset its most loyal customers' carbon emissions (Credit: AP Photo/Michael Sohn)

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