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<ul><li>The Central Board of Employees' <keyword id="45028" type="General" weightage="20" keywordseo="provident-fund" source="Orion">Provident Fund</keyword> Organisation (<keyword id="6372438" type="General" weightage="80" keywordseo="epfo" source="Orion">EPFO</keyword>) has recommended an 8.15% interest rate to be credited on provident funds for the financial year 2022-23.</li><li>In March 2022, the government declared an 8.1% interest rate for more than its six crore members, which was the lowest since 1977-78.</li><li>The recommendation involves the distribution of more than ₹90,000 crore in the members' account on the total principal amount of about ₹11 lakh crore.</li></ul>The Central Board of Employees' Provident Fund Organisation (EPFO) has recommended an 8.15 per cent interest rate to be credited on provident funds for the financial year 2022-23.<br /><br />In March 2022, the government declared an 8.1 per cent interest rate for more than its six crore members, which was the lowest since 1977-78.<br /><br />The recommended interest rate for 2022-23 would be officially notified in the government gazette after approval of the Ministry of Finance, following which EPFO would credit the rate of interest into its subscribers' accounts.<br /><br />The recommendation involves the distribution of more than Rs 90,000 crore in the members' account on the total principal amount of about Rs 11 lakh crore.<br /><br />In 2021-22, the payment outgo and principal amounts were Rs 77,425 crore and Rs 9.56 lakh crore, respectively.<br /><br />"The total income recommended for being distributed is the highest to date. The growth in income and the principal amount is respectively more than 16 per cent and 15 per cent as compared to the last financial year 2021-22," the Ministry of Labour and Employment said in a release on Tuesday.<br /><br />EPFO is a social security organization responsible for providing social security benefits in the form of Provident, Pension and Insurance Funds to the organized workforce of the country. <br /><br />Separately, the provisional payroll data showed a total of 14.86 lakh net members were added in the month of January 2023. Out of the total members added during the month, around 7.77 lakh new members have come under the ambit of EPFO for the first time.<br /><br />Among the newly joined members, the highest enrolment is registered in the age group of 18-21 years with 2.26 lakh members, followed by the age group of 22-25 years with 2.06 lakh members.<br /><br />The age groups of 18-25 years constitute 55.52 per cent of the total of new members during the month of January.<br /><br />For the month of January 2023, it said 3.54 lakh members have exited the fold of EPFO. This is the lowest exit in the last four months.<br /><br /><b>SEE ALSO:</b><br /><br /> <b><a href="https://www.businessinsider.in/tech/news/top-chatgpt-4-plugins-from-math-physics-and-language-tutor-to-vacation-planner/articleshow/99036667.cms">Top ChatGPT 4 plugins: From math, physics and language tutor to vacation planner</a></b><br /><br /> <b><a href="https://www.businessinsider.in/finance/banks/news/rbis-mpc-could-pause-rate-hikes-in-april-to-gauge-the-impact-of-hikes-so-far-sbi-research/articleshow/99030220.cms">RBI’s MPC could pause rate hikes in April to gauge the impact of hikes so far: SBI Research</a></b><br /><br /> <b><a href="https://www.businessinsider.in/business/corporates/news/layoffs-coming-to-the-indian-it-sector-analysts-say-accentures-jobs-cuts-offers-a-blueprint/articleshow/98970175.cms">Layoffs coming to the Indian IT sector? Analysts say Accenture’s jobs cuts offers a ‘blueprint’</a></b><br />

Employees' provident fund interest rate fixed at 8.15% for 2022-23

<ul><li>The Indian wearable market has declined by 10% in Q2 2024, its first ever decline.</li><li>The smartwatch segment has recorded a huge decline in shipments in Q2 2024.</li><li>The earwear segment has remained flat, while the <keyword id="22725791" type="General" weightage="20" keywordseo="smart-ring-segment" source="keywords">smart ring segment</keyword> is going strong.</li></ul> The <keyword id="22725790" type="General" weightage="100" keywordseo="Indian-wearables-market" source="keywords">Indian wearables market</keyword> has declined for the first time ever, recording a 10% decline in shipments in Q2 2024. India’s wearables market shipped 29.5 million devices in Q2 2024.<br /><br />According to a report by the International Data Corporation, the first half of 2024 also reported a decline of 4.7%, with 55.1 million units shipped during the first six months.<br /><br />The decline in shipments includes cautious inventory stocking by the vendors looking to clear existing stock and fewer new launches in the market.<br /><br /><h2><keyword id="20615528" type="General" weightage="20" keywordseo="smartwatch-shipments" source="keywords">Smartwatch shipments</keyword> decline</h2>The <keyword id="22725792" type="General" weightage="20" keywordseo="smartwatch-category" source="keywords">smartwatch category</keyword> recorded a decline of 27.4% as shipments declined from 12.77 million devices in Q2 2023 to 9.27 million in Q2 2024. As per the report, innovation exhaustion and existing channel inventory of older models were the key reasons for the decline in shipments. The Smartwatch average selling price (ASP) dropped to $20.6 from $25.6 a year ago due to discounts being offered to clear inventory.<br /><br />The wristband category however continued to grow, recording a 23.4% growth in shipments.<br /><br />The earwear category remained flat, with a 0.7% shipment growth from 19.95 million in Q2 2023 to 20.09 in Q2 2024.<br /><br /><keyword id="11974058" type="General" weightage="20" keywordseo="ultrahuman" source="Orion">Ultrahuman</keyword> leads the smart ring segment<br /><br />The smart ring market has started making its mark, with over 72 thousand smart rings shipped in Q2 2024 with an ASP of $204.6. Ultrahuman leads the market share in the smart rings segment with a market share of 48.4%, followed by Pi Ring at 27.5% and Aabo with a 10.5% share.<br /><br /><h2>Smartwatch market share in India</h2><table style="border-width: initial; border-style: none;"></colgroup><tbody><tr><td style="border-left:solid #000000 0.5008695000000001pt;border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;background-color:#000000;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">Company<br /><br /></td><td style="border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;background-color:#000000;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">Q2 2024<br /><br /></td><td style="border-right:solid #000000 0.5008695000000001pt;border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;background-color:#000000;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">Q2 2023<br /><br /></td></tr><tr><td style="border-left:solid #000000 0.5008695000000001pt;border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">Noise<br /><br /></td><td style="border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">25.7%<br /><br /></td><td style="border-right:solid #000000 0.5008695000000001pt;border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">27.6%<br /><br /></td></tr><tr><td style="border-left:solid #000000 0.5008695000000001pt;border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">Fire-Boltt<br /><br /></td><td style="border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">24.2%<br /><br /></td><td style="border-right:solid #000000 0.5008695000000001pt;border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">23.8%<br /><br /></td></tr><tr><td style="border-left:solid #000000 0.5008695000000001pt;border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">boAt<br /><br /></td><td style="border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">11.6%<br /><br /></td><td style="border-right:solid #000000 0.5008695000000001pt;border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">15.2%<br /><br /></td></tr><tr><td style="border-left:solid #000000 0.5008695000000001pt;border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">Titan<br /><br /></td><td style="border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">7.9%<br /><br /></td><td style="border-right:solid #000000 0.5008695000000001pt;border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">3.4%<br /><br /></td></tr><tr><td style="border-left:solid #000000 0.5008695000000001pt;border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">Boult<br /><br /></td><td style="border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">3.9%<br /><br /></td><td style="border-right:solid #000000 0.5008695000000001pt;border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">3.4%<br /><br /></td></tr></tbody></table><br /><em>Source: IDC</em><br /><br /> The top two companies, Noise and Fire-Boltt enjoy nearly half of the market share, with Noise leading the segment with a 25.7% market share and Fire-Boltt a close second at 24.2%.<br /><br /><h2>TWS market share in India</h2><table style="border-width: initial; border-style: none;"></colgroup><tbody><tr><td style="border-left:solid #000000 0.5008695000000001pt;border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;background-color:#000000;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">Company<br /><br /></td><td style="border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;background-color:#000000;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">Q2 2024<br /><br /></td><td style="border-right:solid #000000 0.5008695000000001pt;border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;background-color:#000000;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">Q2 2023<br /><br /></td></tr><tr><td style="border-left:solid #000000 0.5008695000000001pt;border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">boAt<br /><br /></td><td style="border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">34%<br /><br /></td><td style="border-right:solid #000000 0.5008695000000001pt;border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">35.3%<br /><br /></td></tr><tr><td style="border-left:solid #000000 0.5008695000000001pt;border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">Boult<br /><br /></td><td style="border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">12.9%<br /><br /></td><td style="border-right:solid #000000 0.5008695000000001pt;border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">9.6%<br /><br /></td></tr><tr><td style="border-left:solid #000000 0.5008695000000001pt;border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">Noise<br /><br /></td><td style="border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">9.2%<br /><br /></td><td style="border-right:solid #000000 0.5008695000000001pt;border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">6.6%<br /><br /></td></tr><tr><td style="border-left:solid #000000 0.5008695000000001pt;border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">Oppo + OnePlus<br /><br /></td><td style="border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">7.4%<br /><br /></td><td style="border-right:solid #000000 0.5008695000000001pt;border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">8.5%<br /><br /></td></tr><tr><td style="border-left:solid #000000 0.5008695000000001pt;border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">Realme<br /><br /></td><td style="border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">6.4%<br /><br /></td><td style="border-right:solid #000000 0.5008695000000001pt;border-bottom:solid #000000 0.5008695000000001pt;border-top:solid #000000 0.5008695000000001pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">4%<br /><br /></td></tr></tbody></table><br /><em>Source: IDC</em><br /><br />boAt has emerged as the market leader in the TWS segment in Q2 2024 despite a decline in its market share. The company leads the market with a 34% market share, with Boult a distant second with a 12.9% market share.<br /><br /><h2>Online channels continue to be the preferred mode</h2>Online channels continued to be the preferred mode with their share increasing to 63.4% in Q2 2024 from 62% in Q1 2024.<br /><br />“The offline channel remains underutilised, often serving merely as a means for brands to offload excess inventory. Due to cost pressures, many brands are shifting their focus toward e-tailer channels, particularly during festive periods. While several smaller brands rely on offline channels, the major players remain heavily dependent on online channels,” said Anand Priya Singh, Market Analyst, Smart Wearable Devices, IDC India.<br /><br /><h2>Average selling price falls</h2>The average selling price (ASP) of wearables declined to a new low, falling by 0.3% from $21 to $18.8 in Q2 2024.<br /><br /><strong>SEE ALSO:<br /><br /><a href="https://www.businessinsider.in/stock-market/news/unicommerce-esolutions-ipo-allotment-how-to-check-allotment-ipo-gmp-listing-date-and-more/articleshow/112393219.cms">Unicommerce eSolutions IPO allotment – How to check allotment, IPO GMP, listing date and more</a><br /><br /><a href="https://www.businessinsider.in/finance/banks/news/rbi-mpc-meet-cheque-clearing-time-reduced-upi-limit-increased-for-tax-payment/articleshow/112366099.cms">RBI MPC meet – Cheque clearing time reduced, UPI limit increased for tax payment</a><br /><br /></strong><a href="https://www.businessinsider.in/business/news/ola-wants-to-re-enter-the-quick-commerce-business-to-take-on-blinkit-and-swiggy-instamart/articleshow/112364583.cms"><strong>Ola wants to re-enter the quick commerce business to take on Blinkit and Swiggy Instamart</strong></a><br />

India’s wearables market decline for the first time as smartwatch shipments fall

(Eds: Adding details) <p> Mumbai, May 22 () Painting a gloomy picture of the economy, the Reserve Bank of India (RBI) on Friday said the impact of COVID-19 is more severe than anticipated and the GDP growth during 2020-21 is likely to remain in the negative territory. </p><p> The outlook of inflation also remains "highly uncertain", RBI Governor Shaktikanta Das said while announcing a 40-basis point cut in the repo rate as part of the monetary measures to deal with the current crisis. </p><p> It is the second sharp cut in the key policy rate in two months. On March 27, the Monetary Policy Committee (MPC), the rate-setting panel of the RBI, had cut the key short-term lending rate by 75 basis points. </p><p> Given all the uncertainties related to the lockdown and social distancing, he said, "GDP (gross domestic product) growth in 2020-21 is estimated to remain in negative territory, with some pick-up in growth impulses from second half of 2020-21 onwards." </p><p> Observing that the risk to the growth are "gravest", in an address through television, the governor said "the combined impact of demand compression and supply disruption will depress economic activity in the first half of the year". </p><p> Even if the economic activities are restored in a phased manner, the combination of fiscal, monetary and administrative measures being currently undertaken would create conditions for a gradual revival in activity only in the second half of 2020-21, he added. </p><p> "Nonetheless, downside risks to this assessment are significant and contingent upon the containment of the pandemic and quick phasing out of social distancing/lockdowns," Das said, adding that much would depend on how quickly the COVID-19 curve flattens and begins to moderate. </p><p> The end-May 2020 release of NSO on national income should provide greater clarity, enabling more specific projections of GDP growth in terms of both magnitude and direction, he said. </p><p> Das-headed MPC, whose meeting was advanced, was of the view that the macroeconomic impact of the pandemic is turning out to be more severe than initially anticipated, and various sectors of the economy are experiencing acute stress. </p><p> Also, the impact of the shock was compounded by the interaction of supply disruptions and demand compression. </p><p> In view of the virus crisis, the three-day meeting of the rate-setting body was advanced to May 20-22 from the earlier scheduled date of June 3-5. </p><p> "The recent release of macroeconomic data, that for the first time revealed the damage wrought by COVID-19, brought forward the need for an off-cycle meeting of the MPC," the governor said. </p><p> He said domestic economic activity has been impacted severely by the two-month lockdown. The top-six industrialised states that account for about 60 per cent of industrial output are largely in red or orange zones. </p><p> Giving details, he said electricity and petroleum products consumption -- indicators of day-to-day demand -- have plunged into steep declines. </p><p> The double whammy in terms of losses of both demand and production has, in turn, taken its toll on fiscal revenues, he said. </p><p> Investment demand has been virtually halted by a decline of 36 per cent in the production of capital goods in March, which was coincident with a contraction of 27 per cent in imports of capital goods in March and 57.5 per cent in April. </p><p> "The biggest blow from COVID-19 has been to private consumption, which accounts for about 60 per cent of domestic demand," Das said in his nearly 30 minutes address. </p><p> He said that by all counts, the macroeconomic and financial conditions are austere. "The global economy is inexorably headed into recession." </p><p> As he projected a grim outlook for the economy, Das also said that "amidst this encircling gloom", agriculture and allied activities have provided a beacon of hope on the back of an increase of 3.7 per cent in foodgrains production to a new record. </p> A ray of hope also comes from the forecast of a normal southwest monsoon in 2020 by the India Meteorological Department. NKD CS HRS

2020-21 GDP growth likely to remain in negative territory: RBI Guv

<p><div class="KonaFilter image-container display-table"><div><div class="image on-image"><p class="source"><span>Anthony Devlin/Getty Images; Samantha Lee/Business Insider</span></p><p class="caption">Bank of England Governor Mark Carney.</p></div><p></p></div></div></p><ul><li><strong>The Bank of England is set to hike interest rates for just the second time since the financial crisis later on Thursday.</strong></li><li><strong>Britain's central bank is expected to raise rates from 0.5% to 0.75%, taking the UK's base rate of interest to its highest level since March 2009.</strong></li><li><strong>Markets are pricing a more than 90% chance of a hike but </strong><strong>UBS strategist John Wraith says a hike on Thursday is an "unnecessary risk."</strong></li></ul><p><br />LONDON - At lunchtime today, the <a href="http://uk.businessinsider.com/category/bank-of-england">Bank of England</a> looks set to raise interest rates <a href="http://uk.businessinsider.com/bank-of-england-interest-rate-rise-brexit-mark-carney-2017-11">for just the second time since the financial crisis.</a></p><p>If financial market expectations are met, Britain's central bank should raise rates from 0.5% to 0.75%, taking the UK's base rate of interest to its highest level since March 2009. Markets are pricing a more than 90% chance of a hike, according to the latest data.</p><p>The rate hike is set to be one of the most divisive decisions in recent bank history, with opinions split on whether or not increasing borrowing costs will be a good idea going forward.</p><p>Governor Mark Carney and the other eight members of the bank's rate setting Monetary Policy Committee have been signalling that a hike is likely to come at some point in 2018 since their last hike in November last year, and Thursday looks like the day it will happen.</p><p>Many had expected a hike in May, but weaker than expected data stopped the committee from doing so. Now, however, the time - if not perfect - is right to raise rates.</p><p>"There is only a very remote possibility that the BOE won't hike rates on Thursday," Kathleen Brooks, research director at Capital Index said in an email.</p><p>Carney and his team's problem is that markets are now so convinced that a rate hike is coming, that the committee's credibility would be under threat if it were to leave rates on hold. Throughout his tenure as governor, Carney has faced accusations of being a so-called "unreliable boyfriend," frequently promising rate hikes and then ultimately failing to deliver.</p><p><a href="http://uk.businessinsider.com/bank-of-england-may-2018-interest-rate-decision-2018-5">The accusation was levelled at Carney after May's policy meeting</a>, which many had expected would see a rate hike.</p><p>"Not for the first time, Mark Carney's policy of guiding the markets as to what to expect has backfired," Ben Brettell, a senior economist at FTSE 100-listed investment manager Hargreaves Lansdown said at the time.</p><p>The u-turn in May and the lack of attempt from the MPC to try and dampen financial market expectations of a hike point in one direction, John Wraith, strategist at UBS wrote in a note on Monday.</p><p>"Guidance and communication from the MPC over recent months, and in particular the lack of any attempt to rein in the ever higher market-implied probability of a 25bp hike, suggests a majority of members are set to vote for a hike on Thursday," he said.</p><p>But Wraith is one of a handful of analysts who sees the bank's likely hike as premature. He called it an "unnecessary risk" in a note sent to clients this week.</p><p>"We continue to view even the tentative tightening embarked on since late 2017 as an unnecessary risk, and see several reasons why a hike is not justified at this point in time," he added.</p><h2>Uninspiring data</h2><p>The British economy could be summed up as average. Growth is hovering at around 0.3% per quarter, <a href="http://uk.businessinsider.com/uk-inflation-level-for-june-2018-2018-7">inflation is just above 2%,</a> and <a href="http://uk.businessinsider.com/ons-uk-employment-data-from-july-2018-2018-7">real wage growth is just about climbing</a>. <a href="http://uk.businessinsider.com/ons-uk-employment-data-from-july-2018-2018-7">The number of people in jobs is at a record high.</a></p><p>On the downside, <a href="http://uk.businessinsider.com/no-deal-brexit-impact-uk-economy-2018-7">consumer and business confidence are falling</a>, largely due to continued uncertainty about what Brexit is actually going to look like.</p><p>"Despite ongoing healthy job creation and the very low level of unemployment, confidence among consumers has been softening of late, particularly in their forward-looking assessment of the economic outlook," Wraith said. "Corporate confidence too looks weak, and is being reflected in ongoing very soft business investment."</p><p>"The latest edition of the Ipsos Mori Issues Index provides striking evidence that concerns about Brexit are the reason that consumer confidence is ailing," he continued.</p><p>"The proportion of respondents viewing the EU and Brexit as one of the most important concerns facing the UK shot up from 46% to 58% in July, the highest reading in the history of the index which dates back to 1974."</p><p>Wraith doesn't believe that such data will stop the Bank of England from hiking rates but believes it should, particularly when considering that this behaviour is going against the bank's own forecasts.</p><p>"It has long been the MPC's explicit assumption that 'households and companies (will) base their decisions on the expectation of a smooth adjustment to new trading arrangements'," he said.</p><p>"Subsiding consumer and business confidence, especially in forward looking gauges, together with the responses to the Ipsos Mori opinion poll, suggest strongly in our view that private sector economic agents are increasingly and demonstrably not behaving in this way," Wraith concluded.</p><h2>What to look out for</h2><p><div class="KonaFilter image-container display-table"><div><div class="image on-image"><p class="source"><span>Jim Edwards</span></p><p class="caption">The outside of the Bank of England</p></div><p></p></div></div>Given that a rate hike is almost a foregone conclusion, other parts of the MPC's decisions, and the minutes of the meeting are likely to provide more intrigue.</p><p>Kathleen Brooks said that one of the main things to look for will be the "mechanics of the rate decision," particularly with regard to how the vote goes in terms of who votes for what.</p><p>"The market is currently expecting an 8-1 split in favour of a hike, with Sir Jon Cunliffe the only member expected to dissent and vote against a hike," she wrote.</p><p>"However, if we get more MPC members voting against a hike then sterling could come under pressure, as it would suggest a future dovish stance by the BOE."</p><p>Mark Carney's press conference will also be of interest, particularly if the governor provides an update on the equilibrium rate of UK interest rates.</p><p>Here's Brooks one last time: "Earlier this year the BOE Governor Mark Carney said that the Bank would give its view on the latest equilibrium, or neutral, interest rate for the UK economy.</p><p>"This is also known as R*. The market is expecting this rate to come in around 1.5%. If an R* of 1.5% is confirmed by the BOE, then it would suggest another three rate hikes are likely in the next 3 years."</p><p>Stay tuned to Business Insider for updates after the decision is announced at 12.00 p.m. BST (7.00 a.m. ET).</p>    <div class="margin-top">        <h3>NOW WATCH: <a href="https://www.businessinsider.com/cigna-ceo-explains-the-problem-with-healthcare-in-america-2018-7">Cigna's CEO says that the problem with healthcare in America has nothing to do with employers</a></h3>        <div>                    </div>    </div>

The Bank of England is ready to raise interest rates today - it could be an 'unnecessary risk'

<p><strong><div class="KonaFilter image-container display-table"><div><div class="image on-image"><p class="source"><span><a href="http://www.flickr.com/photos/soukup/5158894011/">Martha Soukup / Flickr, CC</a></span></p></div><p></p></div></div></strong></p><ul class="summary-list"><li><strong>There is almost zero wage growth in the US and the UK, even though there is full employment.</strong></li><li><strong>That is unexpected, because a tight labour market usually drives up wages. So what is going on?</strong></li><li><strong>New data in a research paper for the National Bureau of Economic Research suggests the wage-dampening effect of mass unemployment has been overtaken by the underemployment of the gig economy.</strong></li><li><strong>The paper's author told Business Insider that the US Fed and the Bank of England don't understand this, and are raising interest rates on false assumptions about what is really going on in the labour market.</strong></li></ul><p>One of the central mysteries about the economy right now is why there is so little growth in wages even though unemployment is low. Normally, when there is full or near-full employment, salaries and pay packets rise as employers find it harder to find and keep their workers. But that is not happening. Real wage growth after inflation is just <a href="https://www.theguardian.com/business/live/2018/sep/19/china-trump-tariffs-uk-inflation-house-prices-haldane-draghi-business-live?page=with:block-5ba20d71e4b0b5565ec2fe86#block-5ba20d71e4b0b5565ec2fe86">-0.1% in the UK</a> and <a href="https://www.forbes.com/sites/eriksherman/2018/09/09/as-some-cheer-wage-growth-rate-median-income-is-only-up-by-5-1-since-2006/#14a1d4fe65dc">1% in the US</a>.</p><p>This chart shows just how pitiful wage growth in the US is:</p><p><div class="KonaFilter image-container display-table"><div><div class="image on-image"><p class="source"><span><a href="https://www.bls.gov/news.release/pdf/realer.pdf">Bureau of Labour Statistics</a></span></p></div><p></p></div></div></p><p>The US and the UK both have very low unemployment, 4% and 3.9% respectively. They are record lows. Technically, we have full employment in both countries and much of Europe.</p><p>So what is going on?</p><p><div class="KonaFilter image-container display-table"><div><div class="image on-image"><p class="source"><span>NBER</span></p></div><p></p></div></div></p><h2>Why isn't full employment making workers richer?</h2><p>Economists David N.F. Bell and David "Danny" Blanchflower have published new evidence showing that the official statistic for "unemployment" is now a misleading indicator of what is actually happening to workers who are trying to find jobs.</p><p>In <a href="http://www.nber.org/papers/w24927">a research paper for the National Bureau of Economic Research published in August</a>, they write that "unemployment" (where workers have no job whatsoever) has been largely replaced by "underemployment" (where workers have poorly paid part-time jobs and can't make enough money to meet their needs). Receiving unemployment benefits has been replaced by working 20 hours a week in an Amazon warehouse, in other words.</p><ul><li><strong>US increase in underemployment, pre-Great Financial Crisis to now:</strong></li><li>April 2006: 3.1 million</li><li>Sept 2010: 9.25 million</li><li>July 2018: 4.56 million</li><li>Increase over the period: 1.46 million, up 47%</li></ul><p>Wages are not rising, Blanchflower and Bell say, because whenever employers need new workers they can increase the hours of these part-timers rather than create new jobs.</p><p><div class="KonaFilter image-container display-table click-to-enlarge"><div><div class="image on-image"><a title_source="UK Office for National Statistics" title_caption="Historic UK unemployment rates." class="zoomin" href="https://static-ssl.businessinsider.com/image/5ba3a7632154a389328b53f1-960/1 underemployment in the uk.png"><span class="sprites click-to-enlarge-icon" title="Click to enlarge"></span></a><p class="source"><span>UK Office for National Statistics</span></p><p class="caption">Historic UK unemployment rates.</p></div><p></p></div></div></p><p>This sounds like a technical distinction but it has potentially huge consequences, Blanchflower tells Business Insider. Governments and politicians tout their records on reducing unemployment. The unemployment rate is a key measure of economic success. Central banks often "target" an unemployment rate as part of their dual mandate to control inflation and support jobs.</p><h2>What if they're wrong?</h2><p>In fact, central banks like the Bank of England and the US Fed are fundamentally misunderstanding what is happening to employment, and are making bad interest rate decisions based on these misleading signals, Blanchflower says. The low unemployment rate makes it look like the economy is at full employment. So central banks are raising rates in order to snuff out the inflationary effects that workers' wage demands usually have in such boom times. But because the role of unemployment has been largely replaced by the role of underemployment, we are <em>not</em> at "full employment" - and wage rises are <em>not</em> imminent.</p><ul><li><strong>UK increase in underemployment, pre-Great Financial Crisis to now:</strong></li><li>April 2008: 696,000 </li><li>April 2013: 1.46 million </li><li>April 2018: 991,000</li><li>Increase over the period: 295,000, up 42%</li></ul><p><div class="KonaFilter image-container display-table"><div><div class="image on-image"><p class="source"><span>NBER</span></p></div><p></p></div></div></p><p>"Central banks think they are at full employment and they're raising rates and that's a mistake," Blanchflower says. "That's a major error of policymaking and thinking."</p><p>When central banks make mistakes - as they did prior to the 2000 and 2008 crises - it can trigger recessions.</p><p>Blanchflower's comments should be taken seriously. He is a former member of the Bank of England's Monetary Policy Committee (MPC), the panel that sets interest rates in the UK, in addition to being an economics professor at Dartmouth College. He told Business Insider that at least one current member of the MPC called him recently to discuss this research.</p><h2>The data may contradict the Bank of England's official view</h2><p>The BOE may be making a new mistake if Blanchflower's data is correct and the BOE's view is wrong. The pair have opposing views of what the data says: In the <a href="https://www.bankofengland.co.uk/-/media/boe/files/monetary-policy-summary-and-minutes/2018/september-2018.pdf?la=en&amp;hash=94C93EAE54800F9A271E74231E918503F4BD925D">BOE's most recent inflation report</a>, dated September 13, the Bank said it believed there was "a very limited degree of slack remaining" in the labour market. ("Slack" is the official term that describes jobless people who might yet be drawn into the workforce.) Blanchflower's study says the<em> opposite</em>: There is <em>plenty</em> of slack, and it is all in the form of part-time workers who aren't earning enough.</p><p>"Even though the unemployment rate has returned to its pre-recession levels in many advanced countries, underemployment in most has not," his study says. "Underemployment replaces unemployment as the main influence on wages in the years since the Great Recession."</p><h2>Blanchflower and the Bank of England cannot both be right</h2><p>One of them is wrong.</p><p>Previously, I have argued that <a href="http://uk.businessinsider.com/unemployment-in-the-uk-is-now-so-low-its-in-danger-of-exposing-the-lie-used-to-create-the-numbers-2017-7">the way the government, the media and economists focus on the headline unemployment rate but ignore the underemployment rate constitutes a "lie"</a> because "unemployment" significantly underplays the actual lack of work available for workers who want it - <em>and because the powers that be all know it but rarely talk about it.</em></p><p><a href="http://uk.businessinsider.com/the-lie-behind-the-unemployment-numbers-2017-7">Blanchflower disputed my use of the word "lie," calling it "ridiculous."</a></p><p>Fair enough.</p><h2>"They're trying to create unemployment"</h2><p>But in a conversation with me last week he sounded alarmed at just how severe the misunderstanding among policymakers is on the effect underemployment has on wages. It is not simply that low "unemployment" makes the economy look good when it's actually disguising historically high "underemployment."</p><p>It is <em>worse</em> than that: When the Fed and the BOE raise interest rates, they are essentially trying to generate extra unemployment in order to stave off future wage increases.</p><p>"They're raising rates because they think wages are set to explode [in the UK and US] ... in both cases they're trying to create unemployment," Blanchflower says. </p><p>So in theory, it's not just that wage growth is nonexistent. It's that the central banks of the UK and US may be about to make the situation worse if they're reading Blanchflower's data wrong.</p><p class="tagline"><p><em>This story is part of <a href="http://www.businessinsider.com/category/inequality-in-britain">Business Insider's series on inequality in Britain.</a></em></p></p>    <div class="margin-top">        <h3>NOW WATCH: <a href="https://www.businessinsider.com/adventures-worth-the-hike-2018-9">7 outdoor adventures that are worth the hike</a></h3>        <div>                    </div>    </div>

Misleading unemployment numbers may be prompting the Fed and the Bank of England to make a huge error

<p><div class="KonaFilter image-container display-table"><div><div class="image"></div><p></p></div></div><strong><a href="http://www.wellsfargo.com/economicsemail">The UK May Not Hike Rates Until Well Into 2015</a></strong><strong style="font-size: 15px; line-height: 1.5em;"> (Wells Fargo)</strong></p>
<p>The consensus among economists is that the UK will commence tightening its monetary policy in Q1 2015. Wells Fargo believes there's reason to think it could come a bit later.</p>
<p>"The Bank of England has pledged to keep its Bank Rate at 0.50 percent, where it has been maintained since March 2009, until spare capacity in the British economy has been more fully absorbed," they write. "Unfortunately, spare capacity is an unobservable variable, and it can vary over time due to fluctuations in actual GDP growth and changes in potential GDP growth, which is also unobservable. Wage growth is an observable variable that should be inversely correlated with spare capacity in the labor market (i.e., as spare capacity in the labor market falls, wage growth should rise), and we think that it will be very important to watch wage growth in coming months-the MPC has essentially told us to do so-to determine the timing of the first rate hike by the BoE since 2007. The consensus forecast among economists (as measured by Bloomberg) looks for the MPC to commence its tightening cycle in Q1-2015, and the yield curve implies that investors believe the first rate hike will happen by then as well. Our forecast looks for the first rate hike to occur in the <br>second quarter of next year. In any event, the MPC likely will not raise rates this year, unless wages accelerate significantly over the next few months."</br></p>
<p><strong><a href="http://www.thereformedbroker.com/2014/08/15/chart-o-the-day-sp-500-current-vs-historical-valuation/">Nine Out Of 16 Equity Valuations Above Average</a> (Josh Brown)</strong></p>
<p>Josh Brown points us to this table from Bank of America showing a snapshot of the S&amp;P500's valuation on sixteen metrics. US large cap stocks are currently at or above their historic valuation on nine of them.</p>
<p><div class="KonaFilter image-container"><div class="image"></div><p></p></div></p>
<p><strong><a href="http://www.blackrockblog.com/2014/08/15/middle-east-tensions-oil-prices-equity-portfolios/">Stick With Energy Stocks</a> (BlackRock)</strong></p>
<p>BlackRock's Russ Koesterich believes that on valuations alone, energy stocks still look good, regardless of what's happening geopolitically.</p>
<p>"Despite outperforming year-to-date, energy sector valuations still have room to grow, as measured by looking at the S&amp;P Global 1200 Energy index," he writes. "Multiples are still at a discount to their 10-year average and fund positioning is low, as I point out in my new <a href="http://www.blackrock.com/investing/literature/market-commentary/oils-precarious-balance-market-perspectives-sept-2014.pdf">Market Perspectives paper</a>. In addition, I continue to see good free cash flow and several recent investment projects are beginning to bear fruit. In particular, I see good opportunities in certain integrated companies and exploration and production companies where there is resource growth. You can read more about my outlook for oil prices, and what this means for investors, in <a href="http://www.blackrock.com/investing/insights/market-perspectives">the full <em>Market Perspectives</em>piece, "Oil's Precarious Balance, and you can </a><a href="http://youtu.be/-xrXHB-yLmI">listen to a client call on the subject here</a><a href="http://www.blackrock.com/investing/insights/market-perspectives">.</a></p>
<p><strong><a href="http://www.voxeu.org/article/secular-stagnation-facts-causes-and-cures-new-vox-ebook">About That Secular Stagnation Book</a> (VoxEU.org)</strong></p>
<p>On Friday Paul Krugman <a href="https://twitter.com/NYTimeskrugman/status/500279589349105664">said</a> a new book compiled by Vox.eu on secular stagnation is a must-read. He happens to be a contributor, but he has a point. <a href="http://www.voxeu.org/article/secular-stagnation-facts-causes-and-cures-new-vox-ebook"></a><a href="http://www.voxeu.org/article/secular-stagnation-facts-causes-and-cures-new-vox-ebook"></a></p>
<p>"Our authors are far from a homogeneous group - they come from different continents and different schools of thought," VoxEU says. "Their contributions were uncoordinated and they do not entirely agree, but a fairly strong consensus has emerged on three points.<span style="font-size: 15px; line-height: 1.5em;"> </span></p>
<ul>
<li>"First, a workable definition of secular stagnation is that negative real interest rates are needed to equate saving and investment with full employment.</li>
<li>"Second, the key worry is that secular stagnation makes it much harder to achieve full employment with low inflation and a zero lower bound on policy interest rates.</li>
<li>"Third, while it is too early to tell whether secular stagnation is going to materialise in the US and Europe, economists and policymakers should start thinking hard about what should be done if it does. Doing so is a no-regret option.</li>
</ul>
<p><strong><a href="https://www.thefinancialist.com/theres-no-such-thing-as-normal-anymore/" target="_blank">Bond Yields Won't See A Massive Sell-Off Yet Because Corporations Have Plenty Of Cash And Credits Have Been Performing</a> (The Financialist)</strong></p>
<p><span>As the Federal Reserve winds down its quantitative easing program, people have started to worry about the bond market.</span></p>
<p>Credit Suisse's Senior Advisor, Robert Parker <span>"expects a slow burn over the next 18 months in which bond yields do rise but still remain well below their historical averages." Despite the fact that he isn't expecting "further upside" for corporate bonds, he also doesn't expect a massive selloff because most credits have been performing, and corporations "are also sitting on plenty of cash and are less leveraged than in recent years".</span></p>
<p>He also points out interesting investment opportunities in equities. He believes that North Asian markets (including Japan, South Korea, China, and Taiwan) are attractive. And he expects Southeast Asian markets to underperform.</p>

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