📈US economy grows at fastest rate since 1980s

US
US economy grows at fastest rate since 1980s

What’s going on?
In the final three months of last year the US economy grew by 6.9%, smashing the 5.5% expected by the market. Over the whole of 2021 the world’s largest economy expanded by 5.7% -  the fastest rate since 1984.

Why is this important?

Putting it all together shows that the American economy is strong and recovering well from the pandemic. 

But of course Covid is still around and the Omicron variant is still causing problems with a wave of American workers either sick or isolating.

This along with the Fed’s hawkish approach – that is to act quickly to control inflation by raising interest rates – could put the brakes on US economic growth in 2022.
 

CONSUMER
Klarna launches UK physical credit card

Swedish payment giant Klarna is launching its first physical credit card in the UK in a bid to take market share from traditional lenders like high street banks.     

Founded in Stockholm in 2005, Klarna pioneered buy now pay later (BNPL) which allows customers to spread online purchases over multiple interest-free payments instead of using a credit card.

The sector has flourished in recent years as ecommerce has rocketed during the pandemic. A recent survey found that one in five Brits planned to use BNPL during Christmas, to spread out the costs.

The new physical credit card will allow customers to shop in bricks and mortar stores and delay payments for up to 30 days. Klarna said it had built up a waitlist of 400,000 consumers in the UK. The company already has 15m British customers using its online BNPL services and 90m worldwide.

Unlike a typical bank credit card the Klarna card won’t charge interest or late payment fees.

But the company and BNPL industry has drawn criticism from debt charities that warn that the services encourage people to spend beyond their means.