Seven days in the Square Mile

Bank of England governor Andrew Bailey warned that Britons face a “historic shock” to their real incomes – bigger than in any single year in the 1970s oil crisis. Kantar figures showed that food price inflation hit its highest level in a decade, suggesting that the squeeze on household incomes may be tighter than expected. Stock markets continued to hold steady, extending a period of calm: the MSCI All-Country World Index has jumped back above its pre-war level. But there were signs of jitters. The US bond market yield curve – a closely watched sign of recession – flashed red as investors worried that efforts to tame inflation might prompt a sharp slowdown in US economic activity. In Japan, where the central bank remains in full stimulus mode, the yen fell by about 7% in March against the dollar – its worst month since 2016. Oil prices fell after the Chinese authorities imposed a Covid lockdown on Shanghai.

The Government’s stand-off with P&O continued. Plans to resume sailings were hit by the impounding of two vessels, raising fears of Easter travel chaos. Insurer LV= was heavily criticised for awarding its CEO, Mark Hartigan, a £511,000 bonus following a calamitous year. The founder of Gazprom’s UK business, Andrey Mikhalev, quit as the company struggled to avoid insolvency. The US insurer AIG filed for an IPO of its life and asset management business, potentially valued at $20bn. Transport Minister Grant Shapps seized the first Russian yacht in UK waters. Ownership of the £38m vessel was reported to be “deliberately well hidden”.