Seven days in the Square Mile

Bank of England governor Andrew Bailey said the British economy is facing its “darkest hour” in the Covid-19 crisis; BoE policymakers believe the country is already in the grip of a “double-dip recession”. Bailey said that GDP ended 2020 “around 10% lower than at the end of 2019” – the sharpest annual decline since 1920. The onslaught of a third lockdown means it is likely to fall again in Q1 this year. Monetary policy committee member Silvana Tenreyro repeated her call for negative interest rates to stimulate the economy. But the governor played down the idea.

A survey by the Federation of Small Businesses found that a record 250,000 UK small firms expect to fold this year. US crude prices reached $50/barrel for the first time since the pandemic began, spurred by Saudi Arabia’s promise of a hefty one million barrel production cut in February and March.

EU regulators approved the London Stock Exchange’s $27bn deal to acquire the data and trading group Refinitiv. Shares in Twitter fell 6% on the first day of trading after the platform banned Donald Trump. The French advertising conglomerate Publicis was reported to be in talks with a private equity buyer. Philip Day’s stricken retail empire, Edinburgh Woollen Mill (EWM), struck a deal with Middle Eastern investors to save EWM, Ponden Home and Bonmarché from collapse. The group’s Jaeger brand is being sold to M&S, but all of its shops will close.