Our Blog
Equilibrium's Finance and Investment News Roundup

Our roundup of the world of finance and investment this week includes findings that rail fares are rising at twice the speed of wages, a record loss for global miner BHP Billiton, claims from the ABI that some people are taking too much from their pension pots and new figures showing a surge in demand for gold.


Rail fares 'increasing at double the speed of wages'

The cost of train travel in the UK is increasing at a much greater speed than wages, new research has indicated. According to the findings from the TUC and the Action for Rail campaign, rail fares have risen by 25% since 2010, while average weekly earnings have climbed by just 12% over the same six-year period.

The research suggests rail costs have accelerated at double the speed of wages over the last six years, despite the government claiming the opposite is true.

Frances O'Grady, TUC General Secretary, said that passengers are currently paying more but receiving less in return, stating: "Fares go up while trains remain overcrowded, stations are unstaffed, and rail companies cut the guards who ensure journeys run smoothly and safely." 

BHP Billiton reports £4.9bn loss

Mining company BHP Billiton has posted a record annual loss of £4.9 billion. The biggest mining company in the world has been heavily impacted by a slump in commodity prices, which resulted in a 31% plummet in revenue. It also suffered due to a dam disaster in Brazil and a bad bet on shale.

Despite the downturn, BHP Billiton expects cash flow to more than double this year thanks to a reduction in net debt and other various cost cuts.

Chief Executive Andrew Mackenzie explained: "While commodity prices are expected to remain low and volatile in the short to medium term, we are confident in the long-term outlook for our commodities, particularly oil and copper." 

ABI: Some people are dipping into pension pots too much

The Association of British Insurers (ABI) has warned that some people aged 55 and over may be taking from their pension pots a little too much. While the majority of people have been sensible in the year following the introduction of new pension freedoms, there is a minority who have withdrawn more than 10% of their pensions.

Yvonne Braun, Director of Policy, Long-term Savings and Protection at the ABI, said this represents a warning sign that the government needs to investigate.

She stated: "The data suggests a minority are withdrawing too much too soon from their pension pot - 4% of pots are having a tenth or more withdrawn - and many other customers are taking their entire pot in one go." 

'Surge in gold demand' following base rate cuts

Demand for gold has risen markedly since the Bank of England's cut in base rates to 0.25% earlier this month. This is according to the Royal Mint, which revealed it saw a 25% surge in transactions on its bullion website during the week of the cut.

The Royal Mint said it also witnessed a 50% climb in gold bar and coin sales compared with the week before. In sterling terms, the price of gold has so far increased by 45% in 2016, while in dollar terms it has climbed by 25%.