Trump trade drives dollar rally and gold hits record high; Lloyds beats profit expectations – business live

Almost half a million workers in the UK whose employers are signed up to pay the voluntary real living wage are in line for a pay rise to at least £12 an hour, taking their annual wage to £3,000 a year above the government’s minimum wage.

The Living Wage Foundation said employers in London that are part of the scheme will pay an enhanced rate of £13.15 an hour to cope with the extra costs of living in the capital.

According to the charity that sets the rate, the rise was needed after research found the cost of living crisis continued to affect many of Britain’s low-paid workers.

It said recent polling of those earning below the real living wage found 60% had visited a food bank in the past year and 39% regularly skipped meals for financial reasons.

Azerbaijan, the host of the Cop29 global climate summit, will see a large expansion of fossil gas production in the next decade, a new report has revealed. The authors said that the crucial negotiations should not be overseen by “those with a vested interest in keeping the world hooked on fossil fuels”.

Azerbaijan’s state-owned oil and gas company, Socar, and its partners are set to raise the country’s annual gas production from 37bn cubic metres (bcm) today to 49bcm by 2033. Socar also recently agreed to increase gas exports to the European Union by 17% by 2026.

The Cop29 summit, starting on 11 November, comes as scientists say that continued record carbon dioxide emissions means “the future of humanity hangs in the balance”. The International Energy Agency said in 2021 that no new fossil fuel exploitation should take place if CO₂ emissions were to fall to zero by 2050.

Gaza’s economy has been left in “utter ruin” by the year-long war between Israel and Hamas, and it would take 350 years to return to its pre-conflict levels, the United Nations has warned.

In a report on the economic costs of the war prepared by its trade and development wing (Unctad), the UN said the fighting since Hamas killed more than 1,000 Israelis on 7 October last year had devastated the remnants of Gaza’s economy and infrastructure.

The report, presented to last month’s UN general assembly, said economic activity across Gaza – which had been weak before the war – had ground to a halt, apart from minimum humanitarian health and food services provided under conditions of severe water, fuel and electricity shortages, and significant access constraints.

The cost of cleaning up Sellafield is expected to spiral to £136bn and Europe’s biggest nuclear waste dump cannot show how it offers taxpayers value for money, the public spending watchdog has said.

Projects to fix buildings containing hazardous and radioactive material at the state-owned site on the Cumbrian coast are running years late and over budget. Sellafield’s spending is so vast – with costs of more than £2.7bn a year – that it is causing tension with the Treasury, the report from the National Audit Office (NAO) suggests.

Officials from finance ministry told the NAO it was “not always clear” how Sellafield made decisions, the report reveals. Criticisms of its costs and processes come as the chancellor, Rachel Reeves, prepares to plug a hole of about £40bn in her maiden budget.

Hundreds of millions of pounds of local transport funding in England could be cut in next week’s spending review despite having been agreed with regional mayors, putting bus, tube and tram improvements at risk, report my politics colleagues, Kiran Stacey, Jessica Elgot and Pippa Crerar.

The mayors, most of whom are Labour, are engaged in a last-minute lobbying campaign to stop the Treasury raiding their transport budgets as Rachel Reeves looks for immediate savings.

Officials say that without this moneybus subsidies, rolling out electric buses and schemes to increase walking and cycling could all be delayed or cut. One official said:

The mayors have been pushing back on the idea that their sustainable budgets should be cut, not least because many of them thought the money was guaranteed until 2027.

The new boss of Starbucks has pledged to shake up its “overly complex menu” in an effort to turn around the struggling coffee chain.

Brian Niccol, who joined the company as chief executive in September, said Starbucks needed to “fundamentally change” its strategy in order to win back customers.

The coffee chain reported falling sales, revenue and profit in the fourth quarter, amid weak demand in its US home market and in China, highlighting the challenges facing its new boss.

In a video message, Niccol said he had heard from customers that the chain had “drifted from [its] core” and were visiting less often.

To welcome all our customers back and return to growth, we need to fundamentally change our recent strategy.

Britain’s competition watchdog has launched a formal investigation into Carlsberg’s £3.3bn acquisition of the British soft drinks maker Britvic.

In July, the Danish brewer Carlsberg struck a deal to take over Britvic, known for Robinsons squash and J2O, as it tries to establish a UK beverage “powerhouse”.

The Competition and Markets Authority (CMA) said it is assessing whether the deal will result in a substantial reduction in competition in any market in the UK for goods or services. It has set a deadline of 18 December for its phase-1 decision.

“This is a normal process that was expected, and we look forward to working constructively with the CMA as it progresses,” a Carlsberg spokesperson told Reuters in an emailed statement.

The UK government is “closely monitoring” Thames Water and ready to take action if necessary, according to the environment secretary, as Britain’s biggest water company is battling for its survival, blighted by sewage scandals, fines and huge debts.

Steve Reed told LBC Radio:

We’re closely monitoring the situation with Thames… the company remains viable, but if we have to take action, we are prepared to do that.

The news came after it emerged that water companies in England could be banned from making a profit under plans for a complete overhaul of the system.

The idea is one of the options being considered by a new commission set up by the Department for Environment, Food and Rural Affairs (Defra) amid public fury over the way firms have prioritised profit over the environment.

Sources at the department said they would consider forcing the sale of water companies in England to firms that would run them as not-for-profits. Unlike under nationalisation, the company would not be run by the government but by a private company, run for public benefit.

The nonprofit model, which is widely used in other European countries, allows staff to be paid substantial salaries and bonuses but any profits on top of that are returned to the company.

Deutsche Bank, Germany’s biggest bank, has reported higher profits for the third quarter, after taking a smaller-than-expected financial hit from shareholder lawsuits over its Postbank division. The bank said it would resume share buybacks.

Deutsche paused plans for more share buybacks in July, after booking a €1.3bn litigation charge linked to its botched acquisition of the lender Postbank more than a decade ago. The group has since settled with 80 plaintiffs, about 60% of the lawsuits, and cut provisions by €440m. However, provisions for credit losses doubled from a year earlier.

The investor lawsuits going through the courts in recent years claim that the bank underpaid for Postbank. This has weighed on Deutsche’s share price.

Deutsche reported a profit before tax of €2.3bn between July and September, up 31% from a year earlier, boosted by the litigation provision release. Excluding this, profits rose by 6% to €1.8bn.

Its investment bank beat expectations, with revenues up 11% from a year earlier, mirroring gains at US rivals like JPMorgan and Goldman Sachs.

Deutsche’s chief executive Christian Sewing said:

In these three months, we made important progress in putting legacy litigation matters behind us, while also producing a record third-quarter profit in our operating business.

However, revenues at the retail division, which includes Postbank, were flat, while the corporate bank posted a 3% decline in revenue, worse than expected.

Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.

The dollar has rallied, boosted by strong economic data and investors betting that Donald Trump can clinch next month’s presidential election, while gold prices hit a new all-time high amid rising geopolitical tensions in the Middle East.

The dollar is up again today, as markets shortened the odds of a second Trump administration. Strong US jobs figures earlier this month drove investors to scale back their expectations for Federal Reserve rate cuts, also lifting the currency. The dollar index – which measures the US currency against six other major currencies – rose to 104.17, the highest since early August.

Gold prices have hit a fresh record as the conflict in the Middle East along with uncertainty around US interest rates and the US election fuelled demand for safe-haven assets.

Spot gold climbed to $2,752 an ounce, while silver prices also rose, by 3% to $34.78 an ounce.

Over here, Lloyds Banking Group, Britain’s biggest mortgage lender, predicted higher house prices as it reported third-quarter profits ahead of expectations. Chief executive Charlie Nunn credited income growth, cost discipline and strong asset quality.

It made a statutory pre-tax profit of £1.8bn between July and September, down from £1.9bn a year ago, but above City forecasts of £1.6bn.

The bank has raised its forecast for UK house prices to rise by 3.1% this year, compared with an earlier prediction of 1.9%.

The Agenda

• Noon BST: US MBA Mortgage applications

• 2.45pm BST: Bank of Canada interest rate decision

• 3pm BST: European Central Bank president Christine Lagarde speech

• 3pm BST: Eurozone Consumer confidence flash estimate for October

• 3pm BST: US Home sales for September