Canadian dollar and Mexican peso hit their lowest levels in a month, and UK's FTSE 100 posts biggest one-day fall of the year

Markets tumble around world as US president's levies against Canada, Mexico and China are implemented

Government to expand coverage of employment rights bill, according to reportAgency workers will reportedly be included in a ban on exploitative" zero-hours contracts as part of changes to the UK government's employment bill.Under the new rules, employers will have to offer agency workers a contract that guarantees a minimum number of hours every week, the BBC reported. Continue reading...

Donald Trump has said there is no room' left for negotiation with Mexico and Canada on planned tariffs. He also said the US would institute tariffs at 20% on China. All Mexican exports to the US face a levy of 25% under the plans. Most Canadian exports will face a 25% tariff, with 10% for energy products

Policy Exchange report blames austerity for breakdown in policing and criminal justice

Companies will never solve the climate emergency alone. The impetus for change needs to come from governmentIt would be very easy to be sharply critical of BP, given its sudden volte-face on its environmental commitments. Under pressure from a shareholder, Elliott Management, it has abandoned the green ambitions it announced in 2020 and pivoted squarely back to an overwhelming focus on oil and gas.While easy, it would arguably be unhelpful, and perhaps even misguided. Because viewed in the round, this isn't really about BP: it's about capitalism at large, and its inability to respond to the climate crisis in the manner we need.Brett Christophers is a professor in the Institute for Housing and Urban Research at Sweden's Uppsala University and author of The Price is Wrong: Why Capitalism Won't Save the PlanetDo you have an opinion on the issues raised in this article? If you would like to submit a response of up to 300 words by email to be considered for publication in our letters section, please click here. Continue reading...

The government and the City want to push regular savers into risky investments, but we're right to be wary, says David RedshawThere are good reasons why cash Isa holders like me don't want to convert to share-based investments (Cash Isas: pressure grows against rumoured move to 4,000 allowance, 1 March). We don't trust the City or governments. After Margaret Thatcher and Nigel Lawson's deregulation of the City in 1986, people were encouraged to become part of the shareholder democracy". This worked until it didn't. In 1990, the splurge of loose cash and cheap shares dulywentpop.In the end people will decide for themselves. It's all very well investment firms telling us that a share instrument will perform better than cash over a period - but what period? Suppose great volatility arrives out of nowhere - where economic cycles are so short that they are measured in the lifetime of a lettuce. The bankers were back taking their bonuses long ago, and are now asking the chancellor to allow them to hold less capital. Continue reading...

Global Times signals Beijing's likely countermeasure after US president threatened a further 10% duty to come into force on TuesdayChina is preparing countermeasures against fresh US import tariffs that are set to take effect on Tuesday, China's state-backed Global Times reported, with American agricultural exports likely to be targeted.Donald Trump last week threatened China with an extra 10% duty, resulting in a cumulative 20% tariff, while accusing Beijing of not having done enough to halt the flow of fentanyl into America, something China said was tantamount to blackmail". Continue reading...

With Trump's true intentions clear, new thinking is needed to fund UK defence, be it fully seizing Russian assets or reversing Hunt's NI cutsPrincipled political resignations are rare at Westminster, so Anneliese Dodds's departure on Friday, over Labour's cuts in aid to fund defence spending, was a significant moment.In her powerful resignation letter, Dodds rightly highlighted the heavy costs of the cuts for some of the world's poorest people, compounding the damage caused by the Trump administration shutting US aid projects. Continue reading...

Last week's much-trumpeted Anglo-US meeting has not reduced concerns about Ukraine, Nato or tariffs - or boosted confidence in the UK governmentMost people I know were concerned about the prospect of a second Trump presidency; but we did not have a vote. However, those Republicans who elected him should have been mindful of the old Chinese proverb: be careful what you wish for.A classic example has been provided recently in the columns of the New York Times. On 17 December, the rightwing columnist Bret Stephens wrote: Here's a thought for Trump's perennial critics, including us on the right. Let's enter the new year ... by dropping the lurid comparisons to past dictators, by not sounding paranoid about ... the ever-looming end of democracy." Continue reading...

Participants commit to not spending money for 24 hours to resist Trump administration and Musk's cuts

UK's balanced trade with the US, Trump's fondness for Britain, and new invitation for a state visit at Buckingham Palace, make the UK popular with investors today

London and Washington aim to avoid obstacles and forge a narrower agreement, likely with a focus on tech and AI

A weak economy, higher borrowing costs and increased defence spending will mean tough decisionsRachel Reeves is rapidly running out of wriggle room amid higher borrowing costs, stubborn inflation, a sluggish economy and a promise to find billions of pounds for additional defence spending.On Tuesday, the chancellor will get the final verdict from the Office for Budget Responsibility (OBR) before her 26 March spring statement on whether her fiscal rules have been smashed apart by increasing financial pressures since last autumn's budget. Continue reading...

Dave Ramsden said gradual and careful approach needed to balance inflation risks and interest rate cuts

US president's plan could prove to be an economic shock to both blocs, German thinktank says

Harris poll finds 51% of Americans think US economy is worsening with views on Trump tariffs split on party linesThe majority of Americans believe the economy is getting worse rather than better, even as Republican views on the nation's finances have performed a dramatic backflip since Donald Trump's re-election, according to an exclusive poll conducted for the Guardian.One month into Trump's second presidency, a Harris poll found that 51% of Americans now believe that the US economy is worsening, while just 20% said it was improving and 29% said it was the same.39% of Republicans now believe the US economy is improving compared with just 8% last May. Over a quarter, 26%, believe it is worsening compared to 70% last May.69% of Democrats now believe the US economy is getting worse compared with 36% last May; 11% think it is getting better compared with 32% last May.Independent voters' views have shifted the least with 12% believing the economy is improving (11% last May) and 56% thinking it is getting worse (59% last May).49% of all polled said tariffs will have a negative impact on the US economy.43% of Republicans, 17% of Democrats and 19% of independents said the impact would be positive.28% of Republicans, 63% of Democrats and 54% of independents said it will have a negative impact. Continue reading...

European reconstruction bank will help rebuild country if peace is agreed but a lasting end to conflict is neededThe war-torn Ukrainian economy could expand by 5% next year if a ceasefire is agreed, the European Bank for Reconstruction and Development (EBRD) has predicted - but prospects for reconstruction depend on a lasting peace.The London-based lender has invested $6.2bn (4.9bn) in projects in Ukraine over the course of the three-year conflict. Continue reading...

Capital's mayor wants return to productivity growth, which has struggled to recover from 2008 financial crisisSadiq Khan, the mayor of London, has announced an ambitious plan to add more than 100bn to the capital's economy within a decade.Unveiling what he is calling the London growth plan, Khan said he was allocating hundreds of millions of pounds in devolved funding in an attempt to return the annual productivity growth of the London economy to the levels seen before the 2008 financial crisis. Continue reading...

How much is immigration responsible for Spain's economic growth? Ashifa Kassam reportsWhen the Guardian's European community affairs correspondent, Ashifa Kassam, first moved to Spain 14 years ago, the country was still reeling from the 2008 financial crisis. All they talked about was la crisis, la crisis. They couldn't see a way out. There was just no light at the end of the tunnel."Today, things are very different - businesses are opening up, restaurants are packed, and in Madrid there's just a buzz to the city that wasn't there before". Continue reading...

The question how do we pay for it' only seems to come up when the government spends money on things that help low and middle-income earners

President opens new front in assault on global trade norms as advisers claim China moving to dominate copper marketDonald Trump on Tuesday opened yet another front in his assault on global trade norms, ordering a new investigation into possible tariffs on copper imports to rebuild US production of a metal critical to electric vehicles, military hardware, semiconductors and a wide range of consumer goods.Trump, looking to thwart what his advisers see as a move by China to dominate the global copper market, signed an order directing the commerce secretary, Howard Lutnick, to start a new national security investigation under Section 232 of the Trade Expansion Act of 1962, the same law that Trump used in his first term to impose 25% global tariffs on steel and aluminum. Continue reading...

Friedrich Merz, expected to be next chancellor, has spoken of urgent need for ramped-up defence, but blocking minority' could form in future BundestagGermany's outgoing parliament could be asked to sign off on a new defence fund in its final weeks as the conservative winners of Sunday's election seek to balance geopolitical demands with the looming pressures of a new Bundestag hostile to military spending.Since the victory of his CDU/CSU alliance, Friedrich Merz has spoken of the urgent need for Europe to ramp up its own defence capabilities, saying it needs independence from the USA" amid an unpredictable Trump administration and a looming threat from Russia. Continue reading...

Index reflects consumer optimism, which is shaky as inflation seems to be stuck and a trade war over tariffs loomsUS consumer confidence plummeted in February, the biggest monthly decline in nearly four years, a business research group said on Tuesday, with inflation seemingly stuck and a trade war under Donald Trump seen by a growing number of Americans as inevitable.The Conference Board reported that its consumer confidence index sank this month to 98.3 from 105.3 in January. That's far below the expectations of economists, who projected a reading of 103, according to a survey by FactSet. Continue reading...

Apple has pledged to spend $500bn in US investments in the next four years, including a giant factory in Texas for artificial intelligence servers.

Scores in the US say they're grappling with raised mortgage and loan interest rates and exploding insurance premiumsI bought my home in a hurry in 2020," said Meg, 60, an office manager from Maryland. It was less expensive to take on a mortgage than to keep paying ever-increasing rents for my college-student daughter and me."Now housing costs consume 50% of her income. Continue reading...

Green sector growing at triple the rate of the UK economy, providing high-wage jobs and increasing energy securityThe net zero sector is growing three times faster than the overall UK economy, analysis has found, providing high-wage jobs across the country while cutting climate-heating emissions and increasing energy security.The net zero economy grew by 10% in 2024 and generated 83bn in gross value added (GVA), a measure of how much value companies add through the goods and services they produce. Continue reading...

US consumer debt is high and rising but 16 cents on every dollar spent by the government is now going to interestA recent report from the Federal Reserve warned that consumer debt is now more than $18tn and the people are worried. Americans' credit card and household debt reach all-time high", reports Fox News. Consumers are finding it harder and harder to pay off their debt", claims CNN. A third of Americans have more credit card debt than emergency savings", says Marketplace.Yes, consumer debt has ticked up this year. It's true that some consumer debt - particularly student loans - has soared in the past few years. But - although worrisome - this debt is still being used to fund education and skills. Other consumer debts are being used to buy homes and cars and fund the purchases that make life livable, not to mention the many industries that rely on this spending. Continue reading...

Bucket-loads of political capital and cash will be used to reconfigure English councils' two-tier set-up, but the benefits could be hugeAcross England a quiet rebellion is brewing. In Rutland, locals have started a campaign to save the tiny county from abolition. Villagers in High Peak, rural Derbyshire, worry they could be bundled in with Andy Burnham's Greater Manchester. Nottingham is expanding, Medway wants to become a city, and Surrey will have a mayor.Flick through your local newspaper (if one still exists), or fight past the online pop-ups and chances are there will be a story about Labour's plans for the biggest shake-up of local government since the 1970s. Continue reading...

There is political agreement that Britain and Europe need to increase military spending. But in straitened times, how can it be done?Can Britain increase defence spending without cuts elsewhere?

As China's cheap prices continue to dominate western markets, attempts to revive or invent UK brands has never been tougherBritons might never again get the chance to buy an electric kettle made in the UK. Even a 150 kettle from Dualit, the company most famous for making its celebrated toaster in Crawley, West Sussex, is produced by Chinese workers 5,000 miles away.Most consumers think the whereabouts of the factory or assembly plant riveting their latest purchase together is irrelevant, but those who do want it to be produced locally do not have a choice. Continue reading...

All three major stock indexes moved decisively lower, extending sell-off in wake of dour economic reportsUS stocks tumbled on Friday, extending a sell-off in the wake of dour economic reports and closing the book on a holiday-shortened week fraught with new tariff threats and worries of softening consumer demand.All three major US stock indexes moved decisively lower on the heels of the data, and continued their slide into afternoon trading. Continue reading...

Sharon Graham, the Unite general secretary, says direct action is being considered to save UK jobsBritain's income from inheritance tax is on track to hit a record this financial year, having risen around 10%.Inheritance Tax receipts for April 2024 to January 2025 are now 7.0bn, new data from HMRC shows, which is 700m higher than the same period last year.The inheritance tax creep crawls ever higher, hitting 7bn so far this tax year. This puts it well on track to surpass the 7.5bn record that it hit a year earlier.With government plans to include pensions in the net for inheritance tax from 2027 and thresholds remaining frozen, the tax take is only going to get higher. Continue reading...

Until centre-left parties can escape the mental prison built by decades of soft neoliberalism, it is what we are likely to get

Rule dating from 2009 that limits borrowing looks vulnerable as main political parties promise to revive stalled economyGermany is used to running its economy with the brake on. Ever since the 2008 financial crisis Berlin has sought to burnish a reputation as the world capital of fiscal discipline, with a near-pious aversion to debt and pride in strong government finances.Under a rule known as the debt brake" - introduced in 2009 by Angela Merkel to show Germany was committed to balancing the books after the banking crash - the federal government is required to limit annual borrowing to 0.35% of GDP. Continue reading...

Donald Power, Dr Neil Lancastle and Andrew Risby respond to an editorial on Britain's broken economyRe your editorial (The Guardian view on Britain's broken economy: That's your bloody GDP, not ours', 13 February), we are frequently reminded of the inadequacy of GDP growth as an objective, given that it includes the money spent on dealing with pollution, sickness, crime etc. But nobody gets out of bed thinking, I have to grow GDP today". We're thinking about how to earn a living and pay the rent. Nobody, that is, except the chancellor, for whom growth is the No 1 mission" that underpinseverything else" -schools, hospitals, net zero.Yet decades of growth since the 1960s have left us with thousands of food banks and facing an environmental abyss. The idea that only more growth will allow us to protect the planet is like saying we can only finance the fire brigade by selling petrol to arsonists. Continue reading...

World's largest retailer expects inflation-weary consumers to pull back after shares hit record high of $105 last weekWalmart on Thursday forecast sales and profit for its latest fiscal year below Wall Street estimates, suggesting that the world's largest retailer expects inflation-weary consumers to pull back after several quarters of solid growth.Walmart shares, which had risen about 72% in 2024 and hit a record high of $105 last week, were down 6% in early trading. Shares of its rival retailer Target were down 1.6%, with Amazon 0.9% lower. Continue reading...

Spot price of gold is approaching $3,000/ounce while Amazon has acquired creative control of the spy franchise from the Broccoli dynasty.

Exclusive: Torsten Bell defends Labour's spending plans, saying the status quo is economically and morally bankrupt'Britain's crumbling public services are bad for business, and spending more taxpayers' money to fix them is a pro-growth policy, the pensions minister, Torsten Bell, has argued.Rachel Reeves has been accused by business lobby groups of clobbering the economy with the 25bn increase in employer national insurance contributions imposed in her October budget. Continue reading...

Glencore considering move to New York or elsewhere where it can get the right valuation;' UK inflation rises more than expected as meat, bread and cereals become dearerWhile UK inflation has hit 3%, interest rate cuts are still on track, says Philip Shaw, chief economist at Investec.Today's headline figures are above the 2.8% which the Bank of England had pencilled into its forecasts in its Monetary Policy Report earlier this month. We gain some comfort though that neither core nor services inflation exceeded our expectations, as this points towards inflation strengthening due to volatile' or one-off items.Indeed what matters is not so much the precise peak in inflation, but the length of time it subsequently takes to subside towards the 2.0% target.the many demands placed on consumer discretionary incomes, which combined with the later booking profile and cost headwinds details, may mean profit margins in the year ahead come under some pressure. Continue reading...

Annual CPI inflation rate hit 10-month high in January in blow to ministers amid rise in food bills and fuel costs

There is a long path back to recovering our lost living standards, but now we can have some hope that the worst is behind us

Tough route also awaits Rachel Reeves as households reel from sharp increase in living costs

With Spanish GDP growth leading Europe last year, diversity is making us richer - not only financially but culturally, tooThe world's fastest growing major advanced economy last year was most likely Spain. According to preliminary official data for 2024, Spain's GDP grew by 3.2%, almost five times the eurozone average and more than the US, which did pretty well too. In December, the Economist ranked Spain first among 37 mostly wealthy countries based on five indicators: GDP, stock market performance, core inflation, unemployment and government deficits. Forecasts for 2025 look good.Why is Spain doing so well? One key reason is immigration. Recent population flows, particularly but not only from Colombia, Venezuela and other Latin American countries, as well as Morocco, have boosted domestic demand and rejuvenated the workforce. According to the main labour national survey, nearly 90% of new jobs were filled by workers of foreign origin or dual nationality. Unemployment is at its lowest level since 2007.Maria Ramirez is a journalist and deputy managing editor of elDiario.es, a news outlet in Spain Continue reading...

White House has raised threat of levies as a means to bolster US economy, ignoring warnings trade wars could derail itDonald Trump stood firm against warnings that his threatened trade war risks derailing the US economy, claiming his administration could hit foreign cars with tariffs of around 25% within weeks.Semiconductor chips and drugs are set to face higher duties, Trump told reporters at a news conference on Tuesday. Continue reading...

Rolling coverage of the latest economic and financial news, as plans to restructure Thames Water are approved by a High Court judge

Unemployment rate unchanged in three months to December, while vacancies increased in January

Quick cuts unlikely because persistently high pay rises will probably be deemed inflationary

As immigration has increased, GDP has surged and unemployment has fallen to lowest level since 2008From Madrid to Barcelona, restaurants and bars are brimming with people, and reservations have become essential for everything from fine dining to high-end hotels.It's a glimpse of how Spain has become Europe's buzziest economy - named the world's best by the Economist in 2024 - fuelled in part by what analysts have described as the government's strikingly different approach to migration. Continue reading...

Sarah Cardell says role of competition regulator remains the same but it must be wary of perceptionsSigns by the lifts in the Canary Wharf headquarters of the Competition and Markets Authority (CMA) remind staff not to talk about their work in public, given the billions of pounds resting on its decisions.But a very public debate is taking place about how the competition watchdog works and is run, with the Labour government determined to make an example of it. Continue reading...