Introduction: UK flight disruption expected to clear; Primark to start offering home delivery in UK
Good morning, and welcome to our rolling coverage of the global economy, the financial markets, the eurozone and business.
Flight chaos in the UK is expected to clear today, after more than 2,000 flights arriving in or departing the UK have been cancelled since an air traffic control system issue on Tuesday.
Flight schedules are expected to return to normal, with no flights cancelled today, according to the aviation analytics company Cirium.
The chief executive of National Air Traffic Services (Nats), Martin Rolfe, has faced calls to resign. The government has given him a week to report back on the reasons for the technical failure.
The problem was fixed on Tuesday but further flights were cancelled or delayed on Wednesday, a total of 2,145 over two days. Cirium said 399 flights were cancelled on Wednesday alone.
British Airways was the worst affected airline, with 88 of its 507 flights scheduled to depart on Wednesday affected. The airline said it was “incredibly sorry” to its customers and that the issue had been “entirely out of our control”.
Michael O’Leary, the outspoken boss of budget airline Ryanair, called Rolfe’s position “untenable” and he is likely to voice more criticism at Ryanair’s annual meeting at its headquarters close to Dublin airport later on Thursday.
Primark will start offering home delivery in the UK in the future, according to its parent Associated British Foods, which plans to spin the budget retailer off next year.
While Primark offers a Click + Collect service, it had been resisting a move into home delivery, arguing it did not make economic sense because of its low price points.
But AB Foods said today:
Primark’s digital maturity, including the success of Click + Collect, and online market developments, mean there is now the opportunity for profitable growth through the home delivery channel.
Primark has acquired a highly-automated warehouse in Sheffield, northern England. AB Foods said work on the demerger of Primark from its food businesses is advancing well and is expected to be completed in December 2027.
Crude oil prices have dipped but Brent crude remains above $100 a barrel after fighting in the Middle East escalated. it is currently trading at $100.42, down 79 cents or 0.8%.
Shipping traffic through the strait of Hormuz has dwindled to single digits, fuelling concerns over oil supply.
Asian stock markets are a sea of red, with Hong Kong’s Hang Seng tumbling 1.4% while Japan’s Nikkei was flat and China’s CSI 300 index lost 0.4%.
Yields on 10-year US Treasury bonds held steady at 4.8406% after rising to their highest levels in three years on Wednesday, when the Treasury Department announced a $6bn buyback of longer-dated bonds that disappointed some investors.
The European Central Bank is widely expected to raise interest rates by a quarter point at lunchtime, to bring inflation under control.
The Agenda
1.15pm BST: European Central Bank interest rate decision
1.30pm BST: US Producer prices for August
1.45pm BST: ECB press conference
3pm BST: US Home sales for August