THE UK will slide into deflation this week as factors such as competition in the grocery sector, cheaper petrol, lower air fares and cheaper water bills drive prices down.

 

Official figures due on Tuesday will say the consumer prices index dipped below zero in April, reports in the weekend press stated.

However, The Sunday Times suggests inflation will not remain in negative territory for long thanks to rebounding oil prices and rising wages.

The same newspaper reports that talks have opened up between the Treasury and the Bank of England to water down moves to split the big banks' retail and investment operations. It comes amid concern within the UK Government that HSBC will relocate its headquarters overseas, following reports the proposal will force it to sell its retail business in the UK.

The Co-operative Group faced significant opposition to its remuneration policy at its annual meeting on Saturday, including the £2.7m package of chief executive Richard Pennycook. More than a third of the 114,000 members who voted declared their opposition to the remuneration report, or abstained, The Mail on Sunday said.