Sterling tumbles as Carney flags key risk

STERLING yesterday tumbled to its weakest level against the dollar since the “flash crash” on October 7.

Bank of England Governor Mark Carney warned yesterday that it would be expected investors would require a risk premium for holding UK assets if the central bank’s independence were called into question. Mr Carney, addressing the economic consequences of the Brexit vote, noted the emergence of any such risk premium would be most prominent around the currency.

The pound, which has plummeted since the Brexit vote and hit fresh 31-year lows repeatedly earlier this month during and in the days after the Conservative Party conference as hard Brexit fears mounted, dropped below $1.21 during trading yesterday. It hit an intra-day low of about $1.2081. Sterling was close to $1.50 on June 23, ahead of the EU referendum result.

On October 7, Thomson Reuters, which owns the Reuters foreign exchange brokerage platform RTSL, said sterling had hit a 31-year low of $1.1491. Bloomberg data put the low at $1.1841.

Appearing before the House of Lords economic committee yesterday, Mr Carney said it was up to the UK Government to set the Bank a target for ensuring price stability, which the Bank’s policy-makers would then decide how to meet.

Prime Minister Theresa May this month unnerved global financial markets by declaring there have been some “bad side effects” from the “super-low” interest rates and quantitative easing programme implemented by the Bank in the wake of the financial crash.

The pound had by 5pm risen from its worst levels to around $1.2162, down 0.42 cents from its close in London on Monday. Sterling also fell against the euro. The single currency was at 5pm trading around 89.49p, up 0.31p. SCOTLAND’S farm workforce is now the smallest on record, with the latest official figures putting it at 63,400 people, down by 1,900 since 2015.

The results of the June 2016 Agricultural Census, released this week by Scotland’s chief statistician, also revealed a reduction in the area of cereals cropped, a static cattle sector, and small increases in potatoes, sheep, pigs and poultry.

Alongside that 1,900 fall in the agricultural workforce, the number of migrant working-days was also down, dropping seven per cent to 430,000. The total number of migrant workers, however, was not collected by the census.

About 80 per cent of the total area of Scotland is agricultural land, spread across 51,900 agricultural holdings. An estimated 6,587 of these holdings had tenancy arrangements, down by 22 on last year. This put the total area of land rented at 23 per cent, the lowest on record.

Alongside this, there was a fall in 91 Act secure tenanted land of about 46,600 hectares and an equivalent increase in Short Duration Tenancy land.

Overall, there was 12,400 hectares less ground devoted to cereals in the census year, equivalent to a drop of three per cent, giving the lowest area of cereals reported since 2010. Barley, in particular, was down by 20,700 hectares (seven per cent), while the areas of wheat remained similar to last year, and oats Limited increased by 5,600 hectares.

Fallow land increased for the second consecutive year, this time up 10,000 hectares to 43,000 hectares.

Potatoes saw an increase, of 1,800 hectares (seven per cent) to 27,500 hectares, bouncing back from last year’s poor figures. However, this is still the second lowest since 1994.

The area of oilseed and of crops for stock-feed decreased again (by 15 per cent and eight per cent respectively), but there were increases in the area of vegetables for human consumption (nine per cent), and of fruit (three per cent). Looking at the fruit sector, the figures showed the area growing strawberries rose by 54 hectares to 990 hectares (a six per cent increase), but raspberries decreased by 24 hectares (seven per cent) to 330 hectares.

Cattle numbers remained constant at 1.8 million, but are still the third lowest recorded since the 1950s. There was little change in dairy or beef numbers. Sheep numbers increased, up two per cent to 6.8 million.

Pig numbers were up 12,500 (four per cent) to 330,000, the third consecutive rise. Poultry numbers increased eight per cent, bouncing back after last year’s 11 per cent fall.

The full statistical publications are at: www.gov.scot/ stats/bulletins/01250