Figures released yesterday confirmed that the UK economy grew by 0.1% in the last quarter of 2009, meaning that the recession is finally over, but later and which much less impact than the US or the Eurozone economies. Britain’s economy had been in recession for eighteen months, the longest period since quarterly figures were first recorded in 1955.

The news was widely anticipated with signs such as last week’s UK unemployment figures that fell for the first time in 18 months.

Analysts now predict that no matter which party wins this year’s election when it happens, the loser will be the pound/ Reasons given are that neither David Cameron or Gordon Brown will be able to muster sufficient support in parliament to control the UK’s budget deficit, which is the largest in the in the Group of 20.

Strategists have pruned back their forecasts on the sterling versus dollar pair by as much as 2 percent this month, to the lowest level since June 2009, with Sterling liable to be weighed down by possibility of the first parliamentary stalemate in more than a generation and growth levels that lag far behind Britain’s rival industrialized economies. Add that to a fiscal shortfall that has ballooned to almost 13 percent of gross domestic product and the picture for the pound looks less than rosy.

Previous precedents do not bode well for the pound, as when the last time a U.K. election failed to produce a clear winner in 1974, Sterling fell in value by 28 percent in the next two years, with the government’s failure to fund its deficit leading to the International Monetary Fund stepping in to bail-out the economy.

The UK’s so-called ‘Big Six’ group of energy suppliers is on course for a profits windfall due to the extremely cold weather conditions experienced in the UK during December and early January. Consumers were forced to turn up their thermostats when the country experienced the coldest weather conditions for decades with the daily demand for gas hitting an all-time high on Jan. 7th of 454 million cubic meters. Analysts predict that accumulative profits for the big six (Centrica, EDF, E.ON, Scottish and Southern Energy, ScottishPower and RWE npower) could easily reach an additional £100 million for the period.

The Chelsea and Yorkshire building societies are expected to finalise details of a merger this week. Doing so will mean the creation of the second biggest society in Britain, after the Nationwide. Yorkshire Building Society members are liable to give their thumbs up for the merger, following the lead of the Chelsea Building Society who gave their support to the deal on Friday. A successful deal would mean the consolidated company would have combined assets of £35 billion pounds, around three million members and 180 branch offices around the UK.

On the news that Barclays plans to defer bonuses for top executives including Chief Executive Officer John Varley for up to three years, stock in the company 4.1 percent, to 271.35 pence.

Pilots at British Airways pilots have been warned by the labor unions representing the cabin crews not to become strike breakers if an employment dispute leads to a work stoppage. News that caused BA’s stock to decline 0.8 percent, to 207.9 pence.

Prudential Plc, the U.K.’s largest insurer have announced plans to cut back expansion in developed markets to focus on growth in developing Asian countries, such as Malaysia, Vietnam and Indonesia. Shares in Prudential shares dropped 0.4 percent to 605.5 pence.

Sterling rose slightly against the dollar and the Europe in early week trading. The pound closed at 1.6144 against the dollar, with the Euro being traded at 1.146

Shares in the FTSE 100 took a minor downturn, despite the news that the recession was over in the UK. It closed on Tuesday down 26 points to 5,276.85.

A calmer mood prevailed in markets on Monday and Tuesday after a three day downturn that knocked 5 per cent of its values. Reports coming out of Washington over the weekend suggesting that Ben Bernanke looks like being reappointed chairman of the Federal Reserve for another four-year term settled the markets which had closed at fresh a 15-month high as recently as last Tuesday.

The Dow Jones rose by 84 points, to close at 10255.28, while the NASDAQ recovered 14 points, to finish at 2210.53.

According to the National Association of Realtors (NAR) sales of previously-owned US homes fell 16.7% in December, after having risen in the three months from September to November as first-time buyers took advantage of tax credits. However the decline in December came as no surprise as most buyers had rushed to complete deals before the original 30 November deadline. The first-time buyer tax credit has since been extended until 30 April, causing the NAR to predict that there was likely to be another surge in sales in the spring. December sales fell to a seasonally-adjusted annual rate of 5.45 million from 6.54 million in November, 15% higher than in the comparable period in December 2008.

Computer giant Apple have announced a 50% increase in profits after seeing a bumper Christmas period, with sales of iPhones doubled from a year ago.

Net income rose to $3.38 billion (£2.08 billion) in the three months to 26 December, from the $2.26 billion in the same period in 2008. A spokesman for Apple announced that they had succeeded in selling 8.7 million iPhones in the quarter. Sales of Macs also rose 33%, although iPod sales fell by 8%.

General Motors (GM) has confirmed that Saab is to be eventually acquired by Dutch luxury carmaker Spyker.

GM has been trying to sell Sweden’s Saab since January 2009 although recently they announced that they would begin the procedure of winding down the company while still continuing their search to find a buyer.

Wind-down activities have now been suspended, "pending the close of the transaction".

Saab lost £255 million in 2008, and has not made a profit since 2001.

In the commodities market, gold took advantage of the relative stability in the dollar, to rise to $1,097 an ounce. Oil also rose by 0.5 percent to $74.92 a barrel.

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Tags: Apple, Banking, Barclays, British airways, British Economy, British Pound, Centrica, Chelsea Building Society, Credit Crunch, David Cameron, Dow Jones, E.ON, Economics, Economy, EdF, Federal Reserve, Financial News, FTSE, General Motors, Gordon Brown, International Monetary Fund, iPhone, John Varley, Money, NASDAQ, National Association of Realtors, Nationwide, Prudential Plc, Recession, RWE npower, Saab, Scottish and Southern Energy, ScottishPower, Spyker, UK Banks, UK Economy, UK government, UK Recession, Yorkshire Building Society

Apart from a few hiccups during the global financial downturn, investor Warren Buffett has gained a reputation as a man who knows where to put his and his shareholders, money where the profits will follow. The news that Buffet is considering making a £1 billion investment in the UK green energy revolution has certainly created a bit of excitement in the world of energy.

The UK government have made no secret that they see Britain as the future world leader in offshore wind energy generation. However in order to harness the energy both for internal consumption but also for export to Europe, hundreds of miles of undersea cables to bring the electricity ashore will need to be laid.

This network of cables is expected to cost more than £12 billion to supply and place before the project is completed. In order to finance the operation, UK regulator Ofgem have launched a series of auctions for the rights to build and maintain the offshore wind energy infrastructure.

In the first phase of the project, investors have been invited to bid on the connections for nine offshore farms, some of which that have been built or are in construction or advanced planning stages. The wind farms are all situated off the coast at Kent.

Buffet’s company Mid-American Energy, having passed the the qualification stage, are expected to place a bid on the project to build and maintain the networks for the next twenty years.

Other candidates for the project include the UK National Grid, RWE, Scottish and Southern Energy, Macquarie, Transmission Capital and IFM. Other international competitors for the tender are Norway’s Statkraft, as well as Dong of Denmark.

The auction is expected to raise £1.15 billion, with two larger auctions covering future networks will be launched after next summer’s sales. In the meantime, Buffett is remaining non-committal on future participation.

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Tags: Dong of Denmark, financial downturn, IFM, Macquarie, Mid-American Energy, offshore wind energy, Ofgem, RWE, Scottish and Southern Energy, Shareholders, Statkraft, Transmission Capital, UK government, UK green energy, UK National Grid, Warren Buffett

Most of the financially pressed UK public will not be falling to their knees in gratitude at the news that British Gas, Scottish and Southern Energy, and Eon have finally cut at least some of their prices which rumour has it was only agreed to after considerable political pressure. All in all, the ‘big six’ UK energy suppliers – British Gas, EdF, Eon, Npower, Scottish and Southern Energy and Scottish Power – have reportedly been threatened with a windfall tax if they did not do more to help their customers, especially those in the lower income bracket.

The lack of gratitude displayed by British consumers may be largely due to the fact that the reductions in energy costs range from four to ten per cent, not a lot when you consider that energy prices in the UK have raised by an estimated fifty percent in the last twelve months. During that time, energy companies were blaming oil price increases as the principal factor. However, now that oil has dropped to around a third of what it was costing when these price increases were forced upon the majority of UK households, already struggling to make ends meet , the pittance offered in the way of price adjustments is no less than insulting. And to make the insult even more stinging, most of the new price tariffs are not due to come into effect till the spring. After one of the longest and coldest winters and most profitable for energy companies in living memory

With the UK becoming increasingly aware of the benefits of green energy, energy companies are calling upon the public to become silent partners in their move to push the British consumer to be less dependent on fuel driven energy scources. Gradual increases in fuel bills will be used to

Subsidise the installation of solar panels and wind turbines to create power as well as to allow the appropriation of wood-burning boilers for hundreds of thousands of homes instead of coal or gas driven.

However, there are several citizen protection bodies that claim that the public should not be asked to subsidize these investments and instead that UK energy companies should finance this form of expansion from the considerable profits they have earned over the last few years, while the public have been forced to stretch themselves to the limit to make ends meet.

This new Government driven ‘Renewable Heating Incentive’, package, unveiled before the weekend by Energy and Climate Secretary Ed Miliband, as part of an energy package designed to reduce costs in the long term for the British public. The programme includes grants for domestic windmills and solar panels, as well as plans to insulate seven million UK homes. The sting in the package is that a levy imposed on fossil fuel energy suppliers will be passed on to the UK public in their energy bills.

The Government insists that in the long term the package will cut energy waste and reduce fuel bills for millions. However in the short term the public is once again been not asked but forced to pay the bill for progress.

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Tags: British Gas, E.ON, EdF, Fuel Costs, Fuel Package, Npower, Scottish and Southern Energy, Scottish Power