It’s inauguration day, and as the world watches with bated breath to see how President Trump’s first days in office pan out, the dollar is dwindling. Reuters reports that it fell 0.1 pc in the hours before Trump’s speech, which economists hope will shed some light on his economic policies. Hitherto, his pledges have been sketchy and inconsistent; some investors have paused trading to see whether he can adopt a more presidential tone in his speeches today.
Anyone without their gaze glued to Washington will have been keeping a close eye on Davos this week, with the World Economic Forum closing today. Amid talks from renowned economic experts Shakira, Princess Beatrice and Matt Damon, Philip Hammond managed to get a word in yesterday. The Chancellor – known for his preference for a ‘soft’ Brexit – insisted that Britain is ‘not trying to close the doors’ on the world. The Telegraph tells us that business leaders are ‘delighted’ by his pledge to make the UK as competitive as possible, a possible hint at future tax haven status if the EU doesn’t play ball. ‘If, somehow, despite our best efforts, political retribution were to triumph over economic logic and we don’t get a fair deal providing the reasonable access to each other’s markets… we will have to do whatever is necessary to ensure the continued competitiveness of our economy in those circumstances,’ Hammond said. The current rate of corporation tax – for those who pay it – is 17 pc.
George Soros also grabbed headlines today after an interview at the Forum. The billionaire dubbed Donald Trump a ‘would-be dictator’, an ‘imposter’ and a ‘con man,’ says The Independent. Soros warned that Trump looks to be gearing up for a trade war. ‘The ideas that guide him are inherently self-contradictory,’ he said. He didn’t have a good word to say about the UK either, claiming that Theresa May will be ousted and that we might re-join the EU only a few days after leaving it. ‘The divorce is going to take a very long time,’ he said. ‘It’s much harder to divorce than to get married, so I think the desire for rapprochement will develop… Britain will leave the EU, because it does have to take place, but they could leave on a Friday but join over the weekend and have the new arrangement in place on Monday morning.’ Mr Soros donated $1 million to Hilary Clinton’s campaign.
Meanwhile, back in blighted Blighty, the City is already losing out after Teresa May’s Brexit speech on Tuesday. Goldman Sachs has stalled on plans to move some vital global operations to London, says The Guardian. The firm is in the middle of building a new, £350 million, London office. ‘We were on track to move more and more of our global activities – global ops, global technology – all those things made more and more sense to operate out of [the] UK. Now we are slowing down that decision,’ said Lloyd Blankfein, the bank’s chief executive. HSBC has also warned that up to 1,000 jobs may be relocated to mainland Europe, and UBS is considering shifting 5,000 of its workforce to Frankfurt or Madrid. J. P. Morgan has also said that 4,000 jobs might be at risk.