Fixed Rate Popularity

Fixed-rate mortgages had a good showing during April, during which period they made up 71 per cent of all approvals, according to the latest figured from the CML(Council of Mortgage Lending). This is a rise of two per cent compared to the previous month, and a whole seventeen per cent up on the same period last year, showing that fixed rate mortgages are continuing to find favour with borrowers.

This growth in popularity is down to the security fixed rate deals provide against the murmerings of an interest rate hike being on the cards for some point in 2006, combined with a market that very competitive at present.

Fixed rate deals are beginning to see their rates slowly rise, as lenders are seemingly preparing for the expected base rate rise, having only a few months back been slashing rates after the base rate cuts of last August, and the then widespread belief that further cuts were on the cards.

The popularity in this type of mortgage is well founded, as over the past eight months since that last rate cut, fixed rate mortgages have proved to be the better performers in the market. Continued take up is expected, as consumers like the security that the fixed rate offers, and the forecast of a rate rise is adding to this.

Mitsubishi to Manufacture Electric Cars in 2010

Mitsubishi Motors, the scandal-plagued car manufacturer, will sell electric cars in 2010, aiming to showcase its technological dexterity in an attempt to fix its tattered brand image, the Japanese automaker stated today.

Struggling to regain customer confidence after repeated cover-ups of car deficiencies, the Tokyo-based company showed off a tiny test vehicle equipped with motors embedded in the rear wheels that run on lithium-ion batteries.

Tetsuro Aikawa, who supervises product development and environmental research, told reporters at the company's headquarters "For a company with small sales like ours, this is a way we can assert a meaningful presence."

Since the car manufacturer acknowledged five years ago it had been methodically hiding car deficiencies from authorities the selling of Mitsubishi cars have suffered greatly.

Its global production in March dropped 11 percent from the same month a year ago - the 11th straight month of on-year declines.

Aikawa said the planned mini-electric car, which will be available for test fleets next year, has a cruising range of 93 miles (150 kilometers) on one single charge and can be re-energized in a regular home.

With housewives being the primary target for Mitsubishi Motors Corp. so that they drive to pick up their children from school, go grocery shopping and won't need to travel long distances. Aikawa also added that they expect the targeted customer to enjoy the fact that they own a environmentally friendly car that never needs to be filled up at a petrol station.

Officials said the electric car will cost marginally more than a comparable petrol-engine vehicle but they hope to keep prices low through government aid available for buyers of ecological cars. Although the price isn't decided, it may sell for under 2 million yen (US$19,000; euro15,000; £10,000), according to Mitsubishi Motors.

As for the car being sold overseas the company remains undecided.

Money: Higher Rates Hit UK Retail Sales

British retail sales tumbled at a record rate in April, according to a survey from industry body British Retail Consortium, and analysts said stocks exposed to confidence about the housing market were particularly susceptible to a fall in expenditure.

But they warned against full-scale panic, highlighting the fact that the timing of Easter, unseasonable weather and general election worries may have inflated the April decline.

An analyst at retail consultant Planet Retail, Bryan Roberts, said "It's not Armageddon by any stretch, but tough conditions will make it harder for ailing retailers."

Sales fell 4.7 percent in April stripping out the effects of new and closed stores, the survey showed.

Britain's long-running consumer boom has been the driving force behind the economy for over the last decade, but a succession of interest rate rises, a cooling housing market and increases in gas and electricity costs have taken a toll on demand.

April's drop is the biggest since the industry group's records began 10 years ago and came after a modest rise in March.

But sales fell by a less dramatic 0.9 percent over the three-month period from February to April.

Nick Bubb of Broker Evolution Securities said "The medium-term outlook is pretty grim, but the sector won't fall in a straight line, and we sense that the current gloom on sector prospects now is a bit overdone."

April's slump follows recent warnings that consumer demand has been declining by UK retailers from fashion clothing chain Next to home improvement group Kingfisher.

Retailers' experiences show the recession has accelerated since December. The UK retail sector has underperformed the wider London stock market by around 11 percent since January this year.

Electrical goods and furniture sales, items most closely linked to the fortunes of the housing market, were hit the hardest, the BRC survey showed.

And analysts said stores selling these items were potentially more vulnerable than others to curbs in spending.

Crackdown On Irresponsible Lenders Say Lib Dems

The Liberal Democrat Treasury spokesman, Vince Cable, will push for a crackdown on irresponsible lenders this week as he launches a plan to tackle consumers' trillion-pound debt mountain.

Whilst Gordon Brown puts the finishing touches to his Budget, Cable will confront him to challenge the powerful banking sector or risk jeopardising economic stability.

'The government must improve banking regulation so that debt levels do not spiral out of control and consumers are clear on how much they have borrowed,' Cable said. 'Much of this problem has been caused by the government's complacency.'

The trillion pounds' worth of debt that consumers have generated through mortgages and credit cards are worth as much as an entire year's gross domestic product (GDP).

If lending is not brought under control, The Lib Dems believe that further rises in interest rates, or an external shock such as a further oil price spike, could result in a sharp slowdown as nervous borrowers opt to pay down some of their debts. With his 'action plan' being launched on Wednesday, Cable will also call for better financial education.

Barclays also fell victim to Cable’s onslaught as he accused them of failing to deliver value for money last week. With Barclays announcing record profits of £4.6 billion, Cable pointed out that their 'reward savers' accounts pays an interest rate 1.5 per cent lower than the Bank of England base rate. He urged the Office of Fair Trading to take a tougher approach to regulating banks.

Tesco Employs The Polish Workforce

Tesco, Britain's largest commercial employer, is bringing workers from Poland to work in its stores and drive lorries because it cannot fill vacancies.

The retailer, which holds an eighth of this country’s over all expenditure, confirmed that it had launched a trial at the start of the month with 70 staff shipped over from its stores in Poland.

A spokesman for the supermarket chain said 'We are not the only business to suffer from skills shortages. Unemployment is so low now that in some areas we are having difficulty filling vacancies - so we decided to carry out this trial.’

On union concerns about using foreign workers in British stores he added: 'It is not a huge number when you consider we employ about 250,000 people. We won't make any decisions until we see how this goes.'

Some Polish workers are driving delivery lorries to Tesco's stores across the UK, others are working at distribution centres and some are on the shop floor itself.

The national officer for retail union Usdaw, Pauline Foulkes, said 'a clear case' has been presented to Tesco that they should 'always seek to fill vacancies from the local workforce' and 'should only recruit from Poland as an absolutely last resort'.

Tesco created 16,000 jobs last year, partly as a result of its expansion of convenience-size stores. Usdaw and Tesco emphasised that the Polish workers who are working here are employed on the same terms and conditions as their UK employees.