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Summary

  1. UK inflation falls more than expected to 1%
  2. Co-op fails Bank of England stress test
  3. Russia raises interest rates to 17%
  4. Chinese factory activity slows in December

Live Reporting

By Ben Morris and Matthew West

All times stated are UK

  1. Post update

    Matthew West

    Business Reporter

    That is it for today folks. Tomorrow brings the promise of half-year results from the newly merged Dixons Carphone. We'll also have the latest unemployment figures and Bank of England minutes. And the Chancellor, George Osborne, will face MPs on the Treasury Select Committee to discuss the Autumn Statement. We'll be here from 06:00.

  2. Llewelyn-Bowen attraction closed

    The Wonderland Walk at The Magical Journey Christmas

    A Christmas attraction designed by Laurence Llewelyn-Bowen has been shut down after after a financial back pulled out. The Magical Journey attraction posted an apology on its website as well as details of how to get a refund for those who have already bought tickets. The attraction got off to a bit of bad start and had to be closed after just one day due to complaints from parents.

  3. Oil prices slump

    Brent crude one day

    Oil prices continue to slide. The benchmark Brent crude price has fallen as low as $58.56 a barrel, before bouncing back to trade at almost $59 a barrel, but still down 3.6% for the session.

  4. Inflation at 12-year low

    Capital Economics says that price pressures are weak across the UK economy. In particular it highlights a sharp drop in the inflation for "cultural and recreational goods" which includes computer games and computer equipment. It also notes that the fall was also not due to Black Friday discounts as the data was collected around 11 November.

  5. Financial Conduct Authority leak

    Ms McMillan says her colleague Clive Adamson has "every right" to fell aggrieved that "an off the record briefing" to a newspaper journalist "somehow got switched into" an on the record one. She says she had never experienced that in her career until nine months ago and up to that point "she wouldn't have believed it was possible."

  6. Financial Conduct Authority leak

    FCA communications director Zitah McMillan says she "wasn't conscious" that the Daily Telegraph had a long running campaign on rip off pension charges. She says many newspapers claim to have long running campaigns, which then turn out not to be long running campaigns at all. She adds she didn't quite expect the "euphoric tone" the newspaper took in its front page story.

  7. Rouble falls further

    A reflection of a yearly chart of U.S. dollars and Russian rouble

    And now the rouble has fallen to 75 roubles to the US dollar. Can we call this a freefall yet? After all 60 roubles per US dollar was supposed to represent the currency's psychological barrier, wasn't it?

  8. Financial Conduct Authority leak

    FCA communications director Zitah McMillan tells the Treasury Select Committee she is disappointed by accusations that members of her communications team were aggressive towards colleagues and put pressure on them to get briefings out to the press as claimed in the Davis Report. But she says no-one complained about poor treatment. The most common complaint was that they didn't get enough of a certain communication team member's time, she says.

  9. Via Twitter

    Rouble falls further

    Steve Collins

    Global head of dealing at London & Capital Asset Management

    RUB down 10% on the day ... total swing about 18.5%

  10. Russia cancels bond sale

    Reuters now reports the Russian finance ministry as saying it is cancelling its weekly bond auction due to "unfavourable market conditions".

  11. Rouble falls further

    The rouble has fallen even further this morning despite the Russian central bank's action overnight to bolster the national currency by hiking interest rates to 17% four days after it rose interest rates from 9.5% to 10.5%. The rouble is currently trading at 72 roubles per US dollar.

  12. Financial Conduct Authority leak

    Zitah McMillan, director of communications at the FCA is being asked by Treasury Select Committee chairman Andrew Tyrie, whether she is leaving the regulator as a direct result of the findings of the Davis Report, into the leak of market sensitive information to the Daily Telegraph. She says she would have gone anyway. She says she disagreed with the removal of communications from the FCA's executive committee, which she says she believes is "fundamental" to the work of the regulator.

  13. Inflation at 12 year low

    The last time inflation was this low was September 2002. The rate was last lower than this in June 2002 when it was 0.6%, the ONS has said.

  14. Via Twitter

    Douglas Fraser

    Business and economy editor, Scotland

    "Repsol of Spain buying Canada's Talisman for £8.3bn, includes UK North Sea jt venture with Sinopec: oil turmoil creating some deal opp's"

  15. Via Email

    Oil prices slump

    Oil is on track to be in the low $50 dollars a barrel range this year and could fall to the low $30 dollars a barrel range by the end of January says Panmure Gordon analyst Colin Smith. He believes OPEC will be forced to call an extraordinary meeting in the New Year "but there is clearly a risk of a more prolonged stand-off" among the cartel's members.

  16. Financial Conduct Authority leak

    The whole event exposed weaknesses in controls in multiple places in the FCA says Clive Adamson its former director of supervision. He's talking about the leak of market sensitive information to the Daily Telegraph earlier this year. An FCA staff member who directly reported to him gave the quotes to the Telegraph, but "at no time" did he give approval for those quotes, Mr Adamson tells MP's.

  17. Financial Conduct Authority leak

    Clive Adamson, former director of supervision at the Financial Conduct Authority

    Clive Adamson, former director of supervision at the Financial Conduct Authority (FCA) is answering questions at the Treasury Select Committee about leaked information to the Daily Telegraph earlier this year. He says media strategy changed in 2012 when the FCA was formed and Martin Wheatley took charge. Mr Wheatley felt that communication to the industry and public should be a "tool of regulation", according to Mr Adamson. Before then media "was more under the radar".

  18. Via Email

    Rouble back in trouble

    Alex Nice

    Russia analyst at the Economist Intelligence Unit

    "The extent of the rate hike and the manner in which it was conducted at an emergency late-night session smacks of some desperation at the central bank. The move sent a signal that the central bank is willing to be decisive. But there is now a lot of credibility at stake and the risk remains that even this may not stabilise the currency....A further weakening in the oil price would surely trigger further falls."

  19. House prices rise 10.4% in October

    For Sale signs in Finsbury Park, North London

    UK house prices rose by 10.4% in the year to October, official figures show. That is down on the previous month's increase of 12.1%. The average UK property is now worth £271,000, according to the Office for National Statistics (ONS). On a seasonally adjusted basis, average property values were only 0.1% higher between September and October.

  20. Pound pushes higher

    Pound dollar

    As you can see the pound was volatile after those inflation figures came out. It fell as low as $1.5622, but then bounced up to $1.5688. That's up almost half a cent on Monday's close.

  21. Russia risks

    When Russia defaulted in 1998 it shook the financial markets. But Mr Carney says we are in "a very different place" compared to that crisis. But he accepts significant deterioration in Russia's position could "reinforce weakness" in Europe and encourage "risk-aversion" in financial markets.

  22. Bank of England stress tests

    Andrew Bailey, Bank of England deputy governor, says ​the new management of Co-op Bank has taken "decisive action" to stabilise the bank. He says the bank is particularly addressing and de-risking the mortgage book.

  23. Inflation at 12 year low

    The Office for National Statistics (ONS) says inflation is now at a 12 year low. There were broad price falls. But it notes in particular falls in transport costs (for motor fuels, air transport and second-hand cars) and in the prices of recreational and cultural goods. Food price falls also contributed to the fall in inflation. Fuel and food prices usually push inflation up.

  24. Bank of England stress tests

    Bank of England governor, Mark Carney

    The bank will look more closely at global risks in its next round of stress tests. In particular the risks in Asia will be a component. We are not "complacent" at all about the dynamics in the global economy, Mr Carney says. There could be sharp adjustments in emerging markets which could rebound on the UK he says. The direct exposure of UK banks to Russia is "very modest", Mr Carney says.

  25. BreakingBreaking News

    Inflation falls to 1%

    Consumer Price Index (CPI) inflation in November fell back to 1%, from 1.3% the previous month, September, official figures show.

  26. Bank stress tests

    We can hear Mr Carney now. UK banks are "transitioning" towards greater resilience and are ahead of the regulator's timetable, he says.

  27. Bank stress tests

    Bank of England governor Mark Carney has started speaking at the press conference about the bank stress tests. Alas, there is no audio, so we can't tell you what he is saying. I can confirm he is wearing a navy tie, white shirt and dark (possibly black) suit.

  28. Rouble back in trouble

    Rouble notes

    The Russian rouble has fallen back to 66 roubles to one US dollar, after briefly recovering to 58 roubles to the dollar earlier today. Overnight the Russian central bank raised interest rates to 17% in an emergency move to support the currency.

  29. European business activity

    There's been some mildly encouraging data on the eurozone economy. Business activity grew at a slightly faster rate in December, according to the latest survey from research firm Markit. Its flash eurozone PMI composite output index came in at 51.7, up from 51.1 in November.

  30. Bank of England power failure

    We are awaiting a Bank of England press conference on those bank stress tests. But apparently there has been a power failure at the BoE so the conference is delayed. It is now supposed to start at 09:15. Let's hope governor Carney bought his screwdrivers to work today.

  31. Market update

    European markets are mixed this morning after disappointing factory data from China earlier today and another fall in Brent crude to a new five-and-a-half year low, which took it below $60 a barrel.

    • The FTSE 100 Index is up 0.09% at 6,188
    • Germany's Dax is 0.04% lower at 9,330
    • France's Cac-40 is 0.03% higher at 4,006
  32. Newspaper review

    Business pages

    The business pages are dominated by BT's talks to buy mobile phone firm EE. Alistair Osborne in the Times points out that the phone business does not have a good track record when it comes to takeover deals. The lead on the FT says that $1 trillion of energy projects could be axed due to the fall in oil prices. The Daily Telegraph's business section says that Sir Philip Green and Mike Ashley have suffered large paper losses from their investment in online fashion retailer MySale.

  33. Bank stress tests

    BBC Radio 4

    Lloyds Banking Group is "looking relatively safe" but again its problems are mortgage related, Baroness Wheatcroft tells Today. Some of those mortgages would have been offered at the top of the market but "are beginning to sort themselves out, "she says. "We should all feel a little more comfort this morning actually," she adds.

  34. Co-op Bank fails stress test

    BBC Radio 4

    The Co-op Bank "will have to raise capital and it will have to sell assets," Baroness Patience Wheatcroft, the former editor of the European edition of the Wall Street Journal tells Today. It will also have to slim down its operations. The bank has branches and loans, which it can sell at a discount. She says she "hopes" the bank won't go bust and that she is sure there will be a way it can continue to trade but "it will find it a struggle".

  35. BT in talks to buy EE

    If BT completes a deal to buy mobile phone firm EE, then rival Vodafone will push regulators to put conditions on the deal, reports Bloomberg today. It says that Vodafone will want to be treated fairly when BT sets prices for access to its high-speed fibre network and wants fair access to the service, which links up mobile phone masts that are also operated by BT (know as the backhaul).

  36. Brent Crude below $60 a barrel

    Brent Crude three session

    The benchmark Brent Crude oil price has fallen below $60 a barrel for the first time since July 2009. The chart above shows three sessions.

  37. Russia raises interest rates

    Rouble dollar

    Following that drastic rise in Russian interest rates, the rouble rose as high as 58 to the dollar, but has fallen back a little to 61. That's still better (as far as the Russians are concerned) than the record low of more than 66 roubles to the dollar.

  38. New electricity funding for Scotland

    Wind farm, Scotland

    Energy regulator, Ofgem has approved £1.1bn of funding for a new subsea link in the north of Scotland. The regulator's decision is £105m less than the funding request from Scottish Hydro Electricity Transmission but is intended to ensure consumers pay "no more than necessary" for their electricity. The new link will connect 1.2 gigawatts of extra renewable electricity generation by 2018.

  39. Imagination technology

    It's one of Britain's most successful technology companies, but you've probably never heard of it. Imagination Technologies designs computer chips that run graphics on mobile and its technology can be found in most mobile phones and tablets. Anyway, it has announced results for the six months to 31 October. It made a loss of £9m after heavy investment in its product lines and anticipates "a much stronger" second half performance.

  40. Co-op Bank fails stress test

    The Co-op Bank has already submitted a revised capital plan, which it says has been accepted by the Prudential Regulation Authority (PRA). The Bank says that under the plan Co-op will speed up the sale of non-core assets and focus on the reduction of its residential mortgage portfolio.

  41. Co-op Bank fails stress test

    Co-operative Bank

    Co-op Bank has released a statement following the announcement that it has failed the Bank of England stress tests. It says it is not required to raise additional funds. The company has been busy building its capital base over the last 18 months and it says the stress tests do no reflect £400m it raised in May of this year. The test also did no reflect the proceeds from selling assets over the six months to June 2014, according to Co-op Bank.

  42. Via Blog

    Bank stress tests

    Kamal Ahmed

    BBC Business editor

    The overall message of the stress test is that banks and building societies are stronger than they were in 2013 when the last test was taken. Under the test house prices would collapse by 35%, unemployment would surge by 12%, interest and inflation rates would rise and financial markets would collapse by 30%. Lloyds and RBS, with a large amount of mortgage lending, would be particularly exposed.

  43. BreakingBreaking News

    Co-op Bank fails stress test

    As expected, Co-op Bank has failed the Bank of England stress test. Both Royal Bank of Scotland and Lloyds Banking Group remain at risk in a "severe economic downturn", according to the Bank of England.

  44. Bank stress tests

    BBC Radio 4

    "Co-op [Bank] is a tricky one because the balance sheet has changed a lot in the last year," Mike Trippitt, of Numis Securities tells Today of the bank stress tests. He thinks Co-op Bank will fail, but will have a contingency plan drawn up with regulators. More worryingly he says if we have another financial crisis on the scale of that in 2007/08 then "the taxpayer is still on the hook". "My own view is there is not enough capital in the system to avoid that," he adds.

  45. Russia raises interest rates

    BBC Radio 4

    Russia faces the threat of recession and Jeremy Stretch of CIBC tells the Today programme: "Forecasts for next year look pretty horrendous in terms of the economy". Estimates suggest Russia needs oil prices to rise back to $100 per barrel to break even and avoid recession. Mr Stretch adds: "about the only real bullet left in the Russia gun is full capital controls" - barring people from taking money out of the country.

  46. Via Twitter

    Robert Peston

    Economics editor

    "At end of this are my ramblings for @BBCRadio4 on why what is happening in China matters more than anything else"

  47. Russia raises interest rates

    BBC Radio 4

    After Russia hiked rates overnight to 17% the rouble, which had fallen to 67 to one US dollar, recovered a bit. But the question is now "whether this is going to be a temporary bounce [in the currency's value] or a turning of the tide," Jeremy Stretch, a senior currency strategist at CIBC, tells the Today programme.

  48. Keeping the lights on

    Radio 5 live

    Pylons

    There are concerns over whether the UK has enough spare power capacity over the coming years. So to ensure the lights stay on the government is offering electricity producers a "capacity payment", which is a payment simply for having power available at peak demand times. An auction will be held to see which producers gets the capacity payment, explains the BBC's John Moylan on Radio 5 live.

  49. BT in talks to buy EE

    Radio 5 live

    So where would BT get the funds from to buy EE? Well its shares are at a 14-year high so it can just issue more shares, says Paul Kavanagh on Radio 5 live. EE's current owners, Deutsche Telekom and France Telecom, seem to be happy to be paid in BT shares, he says. The deal would leave Deutsche Telekom owning 12% of BT and France Telecom owning 4%, according to Mr Kavanagh.

  50. BT in talks to buy EE

    Radio 5 live

    EE sign

    Backhaul. Does that mean anything to you? In the phone business it is the service which links mobile phone masts to the networks and it's run by BT's wholesale unit. That could be a problem with competition regulators if they examine the potential deal between BT and mobile phone group EE, according to Stephen Gibson, formerly a top economist at the regulator Ofcom. There could also be concern over the amount of spectrum the two firms will own, he says.

  51. Post update

  52. Bank stress tests

    Radio 5 live

    "They are tough tests," says Paul Sharma former deputy head of the UK's Prudential Regulation Authority, about the stress tests, the results of which we will get at 07:00. They test banks under a "potent mix" of the worst factors from the last few recessions, says Mr Sharma. It will be "interesting" to see how much detail the Bank of England publishes with the results, he says on Radio 5 live.

  53. Chinese factories slow

    Radio 5 live

    Chinese steel plant

    "China is leaving 2014 on a very weak note," said the BBC's Rico Hizon on Radio 5 live. His comment follows a report, which showed a contraction in Chinese factory activity in December. The flash HSBC/Markit purchasing managers' index fell to 49.5 in December. A reading of 50 indicates expansion. It is the first contraction in 7 months.

  54. Russia raises interest rates

    Radio 5 live

    It's a "panic stricken reaction" says currency strategist Jeremy Stretch from CIBC, about an increase in Russian interest rates from 10.5% to 17% overnight. He says the country is trying to prevent the flight of capital from the country and wants to punish speculators. Russia also hopes to bolster the rouble as its fall has been pushing up inflation. Mr Stretch says that the Russian population is not as exposed to higher interest rates, as nations with more consumer debt.

  55. Post update

    Matthew West

    Business Reporter

    Morning folks. Where to start? Russia raised interest rates to 17% in its continuing efforts to stop the devaluation of the rouble and BT announced it was in exclusive talks with EE about a takeover deal. We get the latest official inflation figures and house price data and, of course, the results of the Bank of England stress tests. Stay with us it's going to be a busy morning.