Every week we bring you the world’s biggest business, currency, and travel stories. This week: rates could rise in the US, but remain low in the UK despite stronger than expected indicators; a calgary firm is suing Air Miles for ripping off Canadians; and Britain has a new fiver.
US Rates Rise Possible
The Fed could raise interest rates on September 21st in response to positive economic data, however global economic uncertainty may prompt the Fed to be more cautious. The uncertainty caused some stock markets to take their largest single day stumble since the Brexit vote rocked markets around the world.
Britain’s new fiver
Britain’s newest bank note, a polymer £5, was released into circulation this week. The note, dubbed, “the new fiver” by the Bank of England was announced in June, but is now being dispensed by ATMs in England and Wales. Winston Churchill is featured on the bill (along with Queen Elizabeth of course). Although it is Britain’s first polymer note, Canada, Australia and other countries have been using the waterproof, fire resistant polymer bills for a long time.
Air Miles Alleged Ripoff
A Calgary law firm launched a class action lawsuit against the company that owns the Air Miles reward program in Canada claiming that the company “engaged in unfair practices.” The company, LoyaltyOne, failed to give adequate notice before implementing an expiry policy which has led to a huge loss of points for members, and a huge profit for LoyaltyOne. The five year expiry policy was announced in 2011, and means that by on January 1, 2017 any points earned prior to 2012 will be wiped out. Since the policy was announced LoyaltyOne has made it difficult to claim miles, according to the lawsuit.
Party like it’s 1999
American real median household income grew last year by 5.2% to US$56,500. It is the first such increase since 2007, and the largest increase since 1967. Despite the rise median household income was 2.4% higher at its peak in the 1990s when adjusted for inflation. The number of Americans living below the poverty line has also fallen to just 13.5%. Economic progress could encourage the Fed to raise interest rates, which would strengthen the USD.
Brexit hasn’t hurt jobs
So far there has been no indication that the Brexit vote has negatively affected jobs in Britain. The unemployment rate in Britain is down from 5.5% to 4.9% since last year, and a month after the vote unemployment fell as low as 4.7%.
Bank of England Rates Hold
The Bank of England maintained a 0.25% interest rate, but has said that it may still cut rates in the coming months. The Bank acted decisively to half rates from 0.5% to 0.25% after the Brexit vote. It was the first rate cut since 2009, but economic indicators have been more positive in the aftermath of the Brexit vote than had been feared, so further cuts have been postponed.
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