Economic Week In Review | Issue 332 | 6 June 2022

Materials and commodities

• Nickel | A US Hedge Fund, Elliott Management, is to sue the London Metal Exchange over its decision to suspend and cancel trades in nickel in March as the metal reached unprecedented heights over a short squeeze.
• Copper prices fell, weighed down by a strong dollar and growing concerns over a slowdown in the global recovery. The metal has dropped 13% since its record peak in March.
• Pallets have been identified as a major source of construction waste, and Pallet Loop has proposed a deposit scheme to encourage reuse. Currently, 18 million pallets are manufactured for construction every year, with only 10% being reused.
• British Steel is running a six-month study at its Teeside Beam Mill into the use of green hydrogen to help decarbonise steel production, using funding from the government’s Net Zero Innovation Portfolio.
• Construction materials | The latest data from BEIS shows an annual increase in the cost of basic construction materials of nearly 21% (April-April)

UK construction and property

• The Procurement Bill which will replace the EU’s system post-Brexit was put before the House of Lords last week. The Bill is set to establish a single digital platform for procurement and enshrine objectives for public procurement including value for money, maximal public benefit, equal treatment of suppliers, and acting with integrity.
• Emissions | Research by the University of Cambridge into two Tide Construction projects shows that factory-made apartment units can cut construction emissions by 45%.
• Cladding | Tougher standards have been introduced for external walls on all residential buildings above 18m- including hotels, hostels and boarding houses.
• London housing | According to Hamptons, the exodus from London is now in reverse with 30% of residential lettings now being to people who previously lived outside of the city.

UK economy

• Rishi Sunak will be questioned by the House of Commons Treasury Committee over the recently announced cost of living support package.
• Borrowing on UK credit cards rose at its fastest annual rate for 17 years, increasing at an annual rate of 5.7%, higher than levels seen in February 2020.
• Small Businesses | The Federation of Small Businesses warned that nearly 500,000 small businesses could go bust in the near term without additional support from government.

Global economy

• EU | The European Parliament will meet to discuss and vote on its Fit for 55 package, which aims to reduce greenhouse gas emissions and be climate neutral by 2050.
• Inflation in the OECD rose to 9.2%, driven by food and services.
• China lifted its lockdown of Shanghai which has been in place since March. The Port of Shanghai has been operating at lower capacities but is expected to see demand increase as manufacturers rush to clear backlogs.
• Disinflation | Pantheon Economics expects that China will help to ease inflationary pressure this year as its stimulus efforts focus on increasing production rather than demand. The measures are intended to support production at a lower cost, especially as unemployment levels are relatively high, meaning that wage pressure is unlikely to be a problem.
• Germany | Inflation reached its highest rate since the 1970s oil shock, hitting 7.9%.