Stocks venture into positive territory after Donald Trump tweets a military strike against Syria ‘could be very soon or not so soon at all’2.53pm BSTIt is time to close the blog for the day. We’ll be back tomorrow. Thank you for all your comments and good-bye. Here’s a quick summary of today’s main developments.Global stock markets are rising after Donald Trump toned down his threats of missile strikes in Syria.2.41pm BSTIn Europe, stock markets are also pushing higher.2.38pm BSTWall Street has opened higher, on the back of expectations that lower US corporate taxes will boost company earnings alongside easing tensions over the Syria conflict.12.56pm BSTWall Street futures are edging higher, supported by expectations of strong corporate profits as the first-quarter earnings season gets under way and easing geopolitical tensions over Syria.Analysts are expecting quarterly profits at S&P 500 companies to be 18.5% higher than a year ago, the biggest gain in seven years, according to a Thomson Reuters poll.12.45pm BSTThe Organisation for Economic Cooperation and Development – the west’s leading economic think tank – has called on governments to use inheritance tax to reduce wealth inequality.Related: Use inheritance tax to tackle inequality of wealth, says OECD12.31pm BSTEuropean stock markets have ventured into positive territory, as tensions eased in the Middle East. Donald Trump sent a new tweet, saying a military strike against Syria after a suspected chemical weapons attack on civilians “could be very soon or not so soon at all”.Never said when an attack on Syria would take place. Could be very soon or not so soon at all! In any event, the United States, under my Administration, has done a great job of ridding the region of ISIS. Where is our “Thank you America?”12.23pm BSTHere is our full story on IAG’s potential bid for low-cost carrier Norwegian.Related: British Airways owner to make bid for transatlantic rival Norwegian12.20pm BSTMichael Hewson at CMC Markets UK has had a closer look at Norwegian, which has undergone an “explosive growth path” in the past few years - raising concerns that the airline might be overextending itself.

Staff to be balloted over chain’s plan to give service charge cash to kitchen staff in lieu of pay riseTGI Friday’s is facing the first strike over tips in the UK in an escalation of a row between waiters and the restaurant chain.In February the casual dining chain, which has 83 outlets, proposed redistributing 40% of service charge payments paid on credit and debit cards to back-of-house employees, including kitchen staff, in lieu of a wage increase. Continue reading...

A frozen February hampered the building and retail industry, but momentum has slowed by sterling’s rise, betting against Brexit, and weak manufacturing

Manufacturing output drops for the first time in a year and construction down sharply for a second month while trade deficit narrows3.03pm BSTOn this note, we are closing the blog for the day.A tweet from Donald Trump warning Russia to get ready for US missile strikes against its ally Syria sent the Russian rouble down 2.5% to its lowest level since November 2016.

Expected growth of 0.2% for February turns into 0.2% decline, ONS data showsEconomic growth in the UK is expected to have fallen by half in the opening months of the year, one of Britain’s leading forecasting bodies has said, amid renewed concerns for the health of the economy.The National Institute for Economic and Social Research (NIESR) said growth was set to fall to 0.2% in the first quarter of 2018 from 0.4% in the final three months of last year, when the economy enjoyed a mini-recovery despite an overall slowdown in 2017 triggered by the Brexit vote. Continue reading...

Chinese president’s comments may be enough to tamp down escalating rhetoricXi Jinping filled his speech at an annual business summit on Tuesday with aphorisms about hard work and openness. “Heaven rewards the diligent,” the Chinese president said, applauding his country’s achievements. The march of history towards economic liberalisation was irreversible, he said at another point, restating China’s commitment to free trade.Then he slipped in a Chinese proverb: “Heaven has its own law and those who embrace it will prosper.” The saying, meant to celebrate China’s unique blend of socialism and a market-driven economy, contained another message: that China would continue to play by its own rules.Related: China does not want a trade war with the US, but it must defend itself | Liu Xiaoming Continue reading...

Lagarde says ‘darker clouds looming’ for global economy amid US-China tensionsThe head of the International Monetary Fund has warned of “darker clouds looming” for the global economy amid simmering trade tensions between the US and China, urging governments around the world to steer clear of protectionism or face negative consequences.Christine Lagarde said the current system for world trade was “in danger of being torn apart”, with the potential to upset the present global economic upswing and make consumers poorer. Continue reading...

In episode 6, Aditya speaks to Lindsey Hall, director of Real Ideas Organisation in Plymouth. Social enterprises are businesses that try to solve social problems while making a profit. Plymouth is the first social enterprise city in the UKSubscribe and review on Apple Podcasts, Soundcloud, Audioboom, Mixcloudand Acast, and join the discussion on Facebook and TwitterIn episode 6, Aditya speaks to Lindsey Hall, director of Real Ideas Organisation in Plymouth. Plymouth is a city that has more than 150 social enterprises that employ over 7,000 people. Continue reading...

President Xi Jinping pledges pro-western reforms, raising hopes of an end to trade row with the USWall Street has staged a sharp recovery after the Chinese president, Xi Jinping, promised economic reforms and lower import tariffs, soothing fears over the country’s simmering trade standoff with the US.Related: Xi Jinping warns against 'arrogance' amid threat of trade war with US Continue reading...

Representatives of the Publishers Association call on the government to make sure the UK retains its place as ‘the world’s publisher’UK publishing is world leading and a cornerstone of Britain’s cultural and economic influence. The books and journals our authors write have helped shape thoughts and ideas the world over for hundreds of years. Together our industry generates up to £7.8bn for the UK economy and supports more than 70,000 jobs. As Britain leaves the EU and looks to build new trading relationships with the world, negotiations in Brussels and beyond offer a unique chance to ensure the future success of one of Britain’s most important exports. The government has a once-in-a-lifetime opportunity to make sure that the outcomes of any negotiations enable the UK to retain its place as the world’s publisher.Supporting our global reach, encouraging new creative and academic works and leading in the digital age will be crucial. We must ensure that the new thinkers and creators of our time can continue to successfully publish their work, sharing ideas and disseminating information that enrich the lives of communities across the world. This week we launched our blueprint for UK publishing at the London Book Fair, which is an exemplar of the global, internationalist and outward-facing economy we should aspire to. It outlines our priorities for government, showing how we can sustain and strengthen the UK publishing sector for many years to come. The continuing success of our industry matters not just to authors, illustrators and publishers, but to the UK’s influence around the world. Publishing is inextricably bound in our country’s history and its values. Let’s make sure it continues to play that role in its future. Continue reading...

Chinese president promises to lower import tariffs, easing fears of trade war2.45pm BSTStock markets are moving higher after a speech by China’s president Xi at the Boao Forum defused some of the fears of a trade war between Beijing and the US. Xi said China would take measures to widen market access for foreign investors and would lower import tariffs on products including cars.However China is reported to have filed a complaint with the World Trade Organisation over the proposed US tariffs on steel and aluminium.2.34pm BSTWith trade war fears easing after the overnight speech from Chinese president Xi, US markets have opened sharply higher.The Dow Jones Industrial Average is currently 390 points or 1.63% higher, while the S&P 500 is up 1.36% and the Nasdaq Composite has climbed 1.65%.The expectation was [the Xi speech] could have gone one of two ways: he could have been aggressive about US tariffs or been conciliatory, and it feels like he’s more conciliatory.2.27pm BSTBack with the Boao Forum in China, and the managing director of the International Monetary Fund has also had talks with president Xi:I was pleased to meet President Xi at #Boao2018. The IMF will continue working with China to help strengthening global cooperation. pic.twitter.com/MlqoWwVu8b1.44pm BSTStronger than forecast US producer price figures for March give more ammunition for the Federal Reserve to raise interest rates again later this year.The Fed has indicated it could increased borrowing costs another two times in 2018 but some expect another rise on top of that if the economic data merits it.A major factor in the March advance in prices for final demand services was the index for outpatient care (partial), which climbed 0.4 percent. The indexes for machinery, equipment, parts, and supplies wholesaling; cable and satellite subscriber services; airline passenger services; food and alcohol wholesaling; and hospital inpatient care also moved higher. In contrast, margins for automotive fuels and lubricants retailing fell 10.4 percent. The indexes for apparel, footwear, and accessories retailing and wireless telecommunications services also decreased.12.35pm BSTAs a sign things are a little calmer on the stock markets at the moment, the VIX volatility index - which had been rising in recent days - is currently down 5% at 20.61.That is not to say there are not a number of uncertainties for investors, from the US/China trade dispute, the situation in Syria, Russian sanctions and the latest on the Mueller investigation in the US.11.52am BSTEuropean stock markets are holding on to their gains, and Wall Street is still expected to open sharplyhigher. Connor Campbell, financial analyst at Spreadex, said:The Dow Jones is all set to leap 320 points after the bell, a chunky jump that would take the beleaguered index to 24300, pushing it towards the top end of its recent trading bracket.However, it is important to note that the US open and close can often operate in completely different universes, especially if Trump gives into his urge to cause a bit of Twitter chaos.11.40am BSTBrexit is getting real:Brexit Day has arrived early in stato land. From today, the EU's number crunchers at Eurostat will publish aggregate data for the EU without the UK (as well as the current composition...): https://t.co/nWh8O1jzZ211.35am BSTThe pound has hit a day’s high of $1.4179, up 0.38% on the talk of further interest rate rises. David Cheetham, chief market analyst at XTB, said:Sterling has moved higher after some hawkish comments from BoE member McCafferty in which he cautioned fellow rate-setters against dallying when it comes to further tightening monetary policy. McCafferty was one of two dissenters who called for higher rates at the last meeting when the bank decided to keep its policy unchanged and his recent comments have pushed the pound/dollar rate to its highest level in more than a fortnight.With the bank expected to raise rates next month, remarks from the voting members will take on a greater importance in the coming weeks with the previous hike in November - the first such increase in more than a decade - being widely telegraphed in advance.11.30am BSTDespite the slump in the rouble, Russia’s central bank has no plans to introduce any measures to reduce volatility.The bank’s first deputy chairman Sergei Shvetsov said the situation with the rouble was “adequate”, according to Reuters.10.30am BSTAnd back with the effects of the US sanctions on Russian companies:Traders' Bloomberg terminals no longer giving stock prices of sanctioned Oleg Deripaska's London-listed En+. Not a great look for the London Stock Exchange, which rolled out red carpet for oleg's en+ float last year.We warmly congratulate Mr Sokov and his management team on their successful IPO today. Welcoming En+ Group to London Stock Exchange is a significant milestone which underlines the City’s position as the leading global listing venue for international companies and investors’ appetite for Russian issuers. With 100 Russian and CIS businesses listed and traded on London’s markets, with a total capitalisation of over $550 billion, London is a strong partner to Russian companies seeking access to global investor capital, as well as an open and dynamic place to do business..@LSEplc delighted to welcome En+ Group to open trading today and celebrate London listing https://t.co/7KQ92HwbvP pic.twitter.com/QYdnmHPVlJ10.09am BSTThe average British household benefited from the Bank of England’s emergency interest rate cut in the financial crisis to the tune of almost £9,000 in pay and £90,000 in household wealth, according to its chief economist.Speaking in Australia, Andy Haldane is defending some of the benefits from low interest rates just before Threadneedle Street looks to increase them to levels unseen since the 2008 crash began.10.00am BSTAnd here is the dramatic movement in the rouble - it shows the rise in the number of roubles needed to buy one dollar:9.46am BSTMeanwhile the Russian rouble continues to come under pressure following the US sanctions against a number of its companies.The currency is down around 4% against the dollar to 63.28, its second day of heavy losses and its lowest level since December 2016.9.43am BSTAnd there is another twist in the trade dispute between the US and China. Associated Press reports:China is filing a complaint with the World Trade Organisation against U.S. tariffs on steel, aluminium products.The Geneva-based trade body said on Tuesday that China has requested 60 days of consultations with the United States to resolve the dispute.9.18am BSTThe Bank of England is not the only central bank to be considering reigning in the financial stimulus - low interest rates and quantitative easing - that have supported stock markets since the financial crisis.Speaking in London, European Central Bank policymaker and Bank of Austria governor Ewald Nowotny said it was now time to “start the gradual normalisation of monetary policy.” He said:We are at an important turning point in monetary policy. We must normalise policy not too soon but not too late.8.59am BSTSterling has edged to a two week high after the comments from Bank of England policymaker Ian McCafferty that there should be no delay in raising interest rates.The pound hit $1.4168 against the dollar in the wake of the remarks, up 0.28%. Against the euro sterling is 0.13% better at €1.1485.8.42am BSTUK interest rates should be raised again without delay, a leading Bank of England policymaker has said.After its meeting last month the Bank hinted at an increase in May, and in an interview with Reuters, Ian McCafferty said the prospect of faster pay rises and a strong pick-up in the global economy emphasised the need for dearer borrowing costs before long.We shouldn’t dally when it comes to tightening policy modestly,.McCafferty said he could not be certain about whether to vote again for a rate rise until May’s policy meeting, but there had been no data or Brexit developments so far to make him think he was wrong in March to vote to raise rates to 0.75 percent.The former chief economic adviser to the Confederation of British Industry has been in the minority of BoE policymakers pushing for a rate hike previously in the past four years.While the BoE had been wrong in the past about wages finally gaining momentum, labour market surveys so far this year showed that the recent recovery in the headline rate of growth of pay to nearly 3 percent looked more sustainable this time, he said.Often called one of the BoE’s most hawkish policymakers, McCafferty said there had been a case for following up November’s rate move with another hike as early as February.But he held off to avoid surprising households who had been told by the BoE that it plans to raise rates only gradually...8.28am BSTMining shares are leading the way in London, while news that US regulators have approved Bayer’s takeover of Monsanto and a positive update from LVMH have also helped sentiment.But ahead of the start of the US reporting season, the main support for the market in early trading is Chinese president Xi’s speech at Boao. Kit Juckes at Societe Generale said:What President Xi didn’t say at the Boao Forum matters more than what he did. There are plenty of reforms to come, including reduced auto tariffs, but no details. But the lack of any ramping-up of the US/Chinese trade-war-by-rhetoric was the key for equities to rally.President Xi’s speech overnight appears to have struck the right tone, providing some relief for investors who have been buffeted by the recent war of words between Trump and China over trade. While there was already an overwhelming sense that Chinese officials were keen to achieve a negotiated settlement before the proposed tariffs do any lasting damage to either the Chinese or US economies, today’s speech was the clearest indication yet that China is prepared to take concrete steps to address some of Trump’s chief criticisms. The big question is whether President Trump will now take the olive branch offered by Xi’s conciliatory approach and dial down the rhetoric from his side too.Corporate profits have taken a back seat to trade tensions and increased volatility over the past few weeks, but as the US earnings season starts in earnest this week, they will take on huge significance. Equities received a huge boost when the US tax reform bill was signed into law in December and investors will want to see that this is feeding through to the bottom line to justify their continued faith. A good earnings season would do a lot to regain some equilibrium and provide some much-needed relief and calm for beleaguered investors.8.05am BSTAs fears of a trade war between China and the US ease - for the moment - after president Xi’s speech overnight, European markets have opened in a positive mood.The FTSE 100 is up 0.5% or 41 points, while Germany’s Dax has added just over 1%, France’s Cac has climbed 0.8% and Spain’s Ibex is 0.6% better.7.58am BSTMore fallout from the US imposition of sanctions on various Russian companies.Glencore, which has various contracts with Russia’s Rusal for the purchase of aluminium, says it is now evaluating these contracts.7.41am BSTGood morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.A keynote speech by Chinese president Xi Jinping at the Boao Asian forum overnight has eased some of the concerns about a possible trade war with the US.When a car is sent to the United States from China, there is a Tariff to be paid of 2 1/2%. When a car is sent to China from the United States, there is a Tariff to be paid of 25%. Does that sound like free or fair trade. No, it sounds like STUPID TRADE - going on for years!Related: Xi Jinping warns against 'arrogance' amid threat of trade war with USEuropean Opening Calls:#FTSE 7235 +0.56%#DAX 12373 +0.91%#CAC 5314 +0.95%#MIB 23253 +0.86%#IBEX 9819 +0.79%Once again it is the background noise that is driving short term sentiment with big swings intraday making the price action difficult to predict. [Xi’s] pledges to open up China’s economy and lower import tariffs, while nothing particularly new, sent Asia markets higher and are likely to translate into a positive European open this morning. Whether they translate into anything other than words is another story but for now they appear to signal a willingness for China to move forward the discussions on trade with the US.The raid was in connection with payments to adult star Stormy Daniels and conducted by the Justice Department with help from a referral from the Mueller investigation. The escalation that people are watching out for is that Trump responds by firing Robert Mueller. Political fireworks at home would put extra pressure on delicate trade negotiations. Continue reading...

Barclays analysts compare speculation in digital currency to spread of infectious diseaseThe rise of bitcoin has comparisons with the spread of an infectious disease, according to economists who argue the digital currency may have peaked in value as more consumers become immune to its appeal.Analysts at Barclays said the soaring value of the digital currency last year, when prices rose by more than 900%, was helped by new buyers being “infected” by the euphoria surrounding bitcoin. The price has since crashed from almost $20,000 before Christmas to less than $7,000.

The US trade barriers list shows that Liam Fox could let more than just chlorinated chicken into the UK. The public deserve to know the detailsRelated: Keep close trade ties with EU post-Brexit, UK government warnedThe British public is already scared about a trade deal with the US. They don’t care for chickens washed in chlorine, nor for cows stuffed with hormones. But this week, an epic US document setting out the barriers to foreign trade it would like to remove shows that these concerns are just the tip of the iceberg.Related: Nigel Farage is no fisherman’s friend: he’s been ignoring them for years | Fay SchopenA whopping 82% of Brits would rather not have a trade deal with the US than sacrifice decent food standards Continue reading...

A new IMF report shows some stark gender trends in European and US workforce, including one that follows virtual reality in a new Spielberg film

Fund’s report advises advanced economies against greater controls on migrationThe International Monetary Fund has said advanced economies such as Britain, the US and Japan risk being overwhelmed by their ageing populations, and calls on them to throw open their borders to more migrant workers in response.Within the next few decades, working-age adults will need to support double the number of elderly people than they do now, putting immense pressure on welfare systems and wiping out as much as 3% of potential economic output by 2050, the IMF said in its latest World Economic Outlook report.What is the IMF? Continue reading...

Rouble suffers biggest daily fall for over three years and shares in Oleg Deripaska’s firms slumpThe Trump administration’s new sanctions on Russian oligarchs and top government officials began to bite on Monday as the rouble suffered its biggest daily fall in more than three years, the main Russian stock index slumped and investors dumped shares in businesses controlled by Oleg Deripaska.Russia’s currency briefly dipped more than 4% before recovering slightly to trade at 60.42 to the dollar on Monday evening, down 3.8%, its biggest daily percentage fall since January 2015.Related: Trump administration hits 24 Russians with sanctions over 'malign activity' Continue reading...

Investors hope for talks to resolve trade dispute, while new figures on UK housing show better than expected performance in March3.06pm BSTStock markets are having a nervy day, as investors try and come to terms with the current state of the trade dispute between the US and China.A seemingly conciliatory tweet from President Trump over the weekend gave some grounds for optimism that the tit-for-tat tariffs may not turn into a full blown trade war. But today Trump was back on the attack again, calling the current trade practices “stupid.”3.05pm BSTThe International Monetary Fund has warned of a demographic timebomb for developed economies such as Britain, the USA and Japan that will require a radical rethink for immigration policies in response.Identifying a mounting threat to economic growth and the welfare systems of the world’s most advanced countries, the fund said increasing numbers of baby boomers reaching retirement could potentially “overwhelm” these countries.

Business outlook seen as promising despite concerns over rising interest rates and tougher tech regulationEuropean flotations have made a strong start to the year despite the current market uncertainty brought on by a possible trade war between the US and China, rising interest rates and the prospect of tougher regulation on tech firms.Across Europe, the first quarter of the year recorded 67 initial public offerings (IPOs) raising a total of €12.5bn (£10.8bn), up from 54 and €4.6bn in the same period in 2017, according to PWC’s latest survey of flotations. Continue reading...

After the EU transition deal UK firms now rank weak domestic demand as a more pressing problem, says DeloitteBrexit has fallen into second place as the most significant risk facing company bosses for the first time since the EU referendum, as weak domestic growth saps demand for their goods and services.According to a Deloitte survey of chief financial officers (CFOs) at some of the UK’s biggest businesses, companies are now less pessimistic about Brexit after ministers agreed the terms of a transition period with Brussels to smooth Britain’s exit from the EU.

The single market benefits manufacturers far more than providers of services. Guess which Britain excels inAt the time it was big, big news. Three days before the general election, official figures showed that Britain’s trade had taken a marked turn for the worse. Government claims that the economy was healthy took a knock.That was June 1970, a time when the size of Britain’s trade gap was front page stuff. Headlines screamed about the UK being back in the red. The TV news bulletins were full of it. Harold Wilson is supposed to have blamed it – along with England’s defeat by West Germany in the World Cup – for his unexpected defeat at the hands of Ted Heath the following Thursday. All this for a trade deficit of just £31m, distorted by the arrival in Britain of a couple of Boeing’s new jumbo jets.Productivity is an economic measure of the efficiency of a workforce. It typically measures the level of output per hour of work, or per worker. Continue reading...

A lesson for Brexit: the postwar Labour government was elected, re-elected and humiliated in the space of six years. Each time, the people ‘spoke’On 5 July 1945, the British people “spoke”. Churchill had been a great war leader, but memories of the unemployment and penury of the interwar years were strong. Labour was elected by a resounding majority. On 23 February 1950, the Attlee government went to the country, and, again, the people “spoke”. The government was re-elected.Although that immediate postwar Attlee government has been almost sanctified by modern historians, things were rough for it most of the time. The largely Conservative press attacked many of the social reforms that were subsequently accepted by the Tory party.How long will it be before the government – and the Labour party – realise that our EU partners mean what they say? Continue reading...

World leaders urged to act as anger over inequality reaches a ‘tipping point’The world’s richest 1% are on course to control as much as two-thirds of the world’s wealth by 2030, according to a shocking analysis that has lead to a cross-party call for action.World leaders are being warned that the continued accumulation of wealth at the top will fuel growing distrust and anger over the coming decade unless action is taken to restore the balance. Continue reading...

Dow closes down 572 points as Beijing says it will fight back against new Trump proposalsThe war of words between the Trump administration and China over trade has escalated after Beijing threatened to fight back “at any cost” against new US proposals for an additional $100bn (£71bn) in tariffs.Chinese officials said on Friday they would “definitely fight back firmly” should the US persist in using “protectionism”, in a warning issued hours after President Trump unexpectedly suggested imposing extra trade tariffs on goods shipped from China to the US – on top of the $50bn worth of tariffs announced last month.Related: US stock markets sink on China trade war fearsChina, which is a great economic power, is considered a Developing Nation within the World Trade Organization. They therefore get tremendous perks and advantages, especially over the U.S. Does anybody think this is fair. We were badly represented. The WTO is unfair to U.S. Continue reading...

The major indexes as well as tech stocks tumbled despite Trump officials downplaying any likelihood new tariffs would be enactedInvestors fled US stocks on Friday after Donald Trump threatened more tariffs against Chinese goods, China vowed to battle “to the end” and US employment data missed analysts’ expectations.Related: China threatens 'Trump country' with retaliatory tariffs ahead of midterms Continue reading...

Following a shocking rise in violence in London in which four of his constituents died, the Tottenham MP is calling for politicians to admit the ‘war on drugs’ has failed – and that black lives matterDavid Lammy is one of those politicians whose public profile has never correlated with his position in his party, or converted into frontbench power, and this sort of maverick celebrity operator tends to attract suspicion. Elected to represent Tottenham 18 years ago, the 46-year-old has at various key moments – the Grenfell fire, the London riots – distinguished himself in the public’s affection by seizing individual ownership of the agenda. To some, particularly in Westminster, this highly personalised brand of political identity is opportunistic self-promotion, artfully disguised as heroism.To me, his politics look sincere and principled, I’ve just never been entirely sure what they are. He used to joke: “I’m not Blair, I’m not Brown, I’m just black.” And he has successfully eluded all association with any ideological faction with such dexterity that he can sometimes look a bit slippery, as if his public persona is contingent on whatever strategy he has devised to please his audience.Related: Teenage girl shot dead in Tottenham, north LondonRelated: London teenager fatally stabbed named as Israel Ogunsola Continue reading...

As economists scramble to find answers, game theory rather than history may be the best guideThe trade confrontation between the United States and China is heating up. After firing an opening salvo of steep tariffs on steel and aluminium, the US administration has released a plan for a 25% tariff on 1,333 Chinese imports – worth about $50bn (£35bn) last year – to punish China for what it views as decades of intellectual property theft. China has fired back with a plan to slap 25% levies on a range of US goods, also worth about $50bn. In response to what he labels “unfair retaliation,” President Donald Trump is now said to be considering yet another set of tariffs, covering another $100bn worth of imports from China. Economists and market analysts are scrambling to figure out what will come next.One might be tempted to rely on historical experience. But, given today’s economic, political and social conditions, history is likely to be a poor guide. More useful insights come from game theory, which can help us to determine whether this exchange of tariffs will ultimately amount to strategic posturing that leads to a more “cooperative game” (freer and fairer trade), or develop into a wider “non-cooperative game” (an outright trade war). The answer will have significant consequences for the economic and policy outlook, and markets prospects. Continue reading...

The US president has raised the stakes again with fresh tariff threats. But trade with China is not the same thing as a buying real estateTrade wars do not start by accident. If the US and China contrive to launch a new era of tit-for-tat protectionism to match that last seen in the 1930s it will be because of political decisions taken in Washington and Beijing by those with a full understanding of the consequences of their action. Comparisons with the drift to war in the summer of 1914 are wide of the mark.Despite announcing plans for 25% tariffs on a small range of US imports this week, China has made clear that it wants to avoid a trade war. It will be happy to disarm if Donald Trump removes his threatened action against $50bn of Chinese goods. But Mr Trump is now threatening to escalate the battle with another $100bn of tariffs. The financial markets have been by turns spooked, then calmed, then alarmed again. Continue reading...

Data for final six months of 2017 show strongest economic growth, but worker efficiency languishedThe productivity of British workers in the second half of 2017 rose at the fastest rate since before the financial crisis, handing a rare boost to the government.Labour productivity, or economic output per hour of work, rose by 0.7% in the three months to December, marking the second consecutive quarter for positive growth, the Office for National Statistics said. Together, the two periods showed the strongest growth rate seen since the second half of 2005.

US president instructs trade agency to mull options as onlookers fear tit-for-tat will become full-blown trade war

Weather partly blamed for weakest month since the Brexit voteThe UK services sector has had its weakest month since the Brexit vote, after arctic weather brought businesses to a standstill.The latest snapshot of the economy from IHS Markit and the Chartered Institute for Purchasing and Supply found that services – which account for almost 80% of national output – registered virtually no growth in March. Continue reading...

Economic uncertainty and falling demand for diesel extend run of sliding sales to 12 monthsSales of new cars in the UK plunged in March as economic uncertainty weighed on demand and consumers turned their backs on diesel, extending the run of falling sales to 12 months.A total of 474,069 new cars were driven off the forecourts of car showrooms last month, down 15.7% compared with March 2017 and the sharpest monthly fall since April last year. Continue reading...

Trade barriers would not only damage both countries but would also disrupt global supply chains, raising prices for consumers worldwideThe tit-for-tat exchange of tariffs between the United States and China gives the impression the world’s two biggest economies are headed down the road towards a trade war, which would have hugely damaging economic consequences. But this could be averted if they continue quiet backroom discussions to open up their markets, particularly China’s.Related: Trump plays down US-China trade war concerns: ‘When you’re $500bn down you can’t lose’Related: Cold weather slows UK economy, as car sales slide again – business liveRelated: US and China playing a gigantic game of chicken | Larry Elliott Continue reading...

Rising tensions stoke fears of full-blown trade war but both sides leave room for manoeuvreAfter firing the opening shots of a trade war, China and the US have entered what is likely to be a protracted standoff as they jockey to win concessions from each other and avoid hurting their respective economies.Eleven hours after the White House announced a list of 1,333 Chinese imports to be subject to punitive tariffs of 25%, China responded in kind with a list of about 106 American products, including key US exports to China, such as soya beans, cars and aircraft. Both sides are targeting about $50bn (£36bn) in imports from each other.Related: Trump plays down US-China trade war concerns: ‘When you’re $500bn down you can’t lose’Related: Made in China policy at centre of tariff war with US Continue reading...

After decades of globalisation, our political system has become obsolete – and spasms of resurgent nationalism are a sign of its irreversible decline. By Rana DasguptaWhat is happening to national politics? Every day in the US, events further exceed the imaginations of absurdist novelists and comedians; politics in the UK still shows few signs of recovery after the “national nervous breakdown” of Brexit. France “narrowly escaped a heart attack” in last year’s elections, but the country’s leading daily feels this has done little to alter the “accelerated decomposition” of the political system. In neighbouring Spain, El País goes so far as to say that “the rule of law, the democratic system and even the market economy are in doubt”; in Italy, “the collapse of the establishment” in the March elections has even brought talk of a “barbarian arrival”, as if Rome were falling once again. In Germany, meanwhile, neo-fascists are preparing to take up their role as official opposition, introducing anxious volatility into the bastion of European stability.But the convulsions in national politics are not confined to the west. Exhaustion, hopelessness, the dwindling effectiveness of old ways: these are the themes of politics all across the world. This is why energetic authoritarian “solutions” are currently so popular: distraction by war (Russia, Turkey); ethno-religious “purification” (India, Hungary, Myanmar); the magnification of presidential powers and the corresponding abandonment of civil rights and the rule of law (China, Rwanda, Venezuela, Thailand, the Philippines and many more).Related: Globalisation: the rise and fall of an idea that swept the world Continue reading...

Trade minister rejects suggestion its only temporary as Australia braces for fallout from China’s tit-for-tat import taxes on USThe trade minister, Steve Ciobo, has claimed Australia has a permanent exemption from US steel tariffs because of its trade deficit.Ciobo has rejected claims that Australia’s exemption to the steel tariff is temporary, despite the fact that, in March, the White House said Australia was among a group of countries that would have an exemption until 1 May – after which the deal will be renegotiated or quotas will apply.Related: Trump plays down US-China trade war concerns: ‘When you’re $500bn down you can’t lose’ Continue reading...

After China proposed tit-for-tat import taxes and stock markets fell, there are fears Trump’s aggressive tariffs could cause a slowdown

Trade war intensifies as Beijing targets $12bn soybean imports produced in Trump heartlandChina has raised the stakes in the escalating trade showdown with the US, unveiling tariffs on a targeted list of American imports in response to levies on more than 1,300 Chinese goods put forward by Donald Trump.Sending a message to Washington that economic threats made by the Trump White House would be matched with equal force, Beijing said it would impose additional tariffs of 25% on 106 American products from 14 categories; including soybeans, cars and chemical products.Related: Vaccines and golf carts: the Chinese products targeted by TrumpRelated: Trump is on path to full-scale trade war: first China, then Europe Continue reading...

If Trump withdraws his threatened tariffs, the Chinese have said they will do the sameWhen Donald Trump tweeted that “trade wars are good and easy to win” most commentators thought the US president was merely sabre-rattling. The prospect of a return to full-scale 1930s protectionism was thought to be minimal. Cooler heads would prevail.A month on, the chances of a trade war between the US and China have significantly increased. Trump has said he will slap a 25% tariff on $50bn of Chinese goods and Beijing has now responded in kind. It has drawn up a list of US goods also worth $50bn which it will target if the White House goes ahead with its action.Related: China retaliates to Trump tariffs with new levies on US productsRelated: Golf carts to soybeans: products targeted in US-China trade war Continue reading...

Biggest slowdown since Brexit vote shows overall UK economic activity slumped in MarchHeavy snowfall from the “beast from the east” caused Britain’s construction industry to grind to a halt last month, according to an industry survey showing the biggest fall in activity since immediately after the Brexit vote.Confirming fears that freezing weather across the country last month would harm the economy by forcing diggers and cranes to fall idle, the closely watched Markit/Cips UK construction purchasing managers index showed the industry contracted in March.

Having to take several jobs and sending kids to work used to be a sign of living precariously – now it’s just a question of what your ‘side hustle’ is

All the day’s economic and financial news, as European markets fall following last night’s Wall Street rout

One in seven vulnerable employees in developed world least likely to be receiving helpThe west’s leading economic thinktank has warned its members that they are failing to prepare workers for an automation revolution that will leave 66 million people at risk of being replaced by machines in the coming years.A new report by the Paris-based Organisation for Economic Cooperation and Development found that the most vulnerable – one in seven workers on average across the 32 countries studied – were less likely to be receiving help than those whose jobs were more secure.Related: The Guardian view on automation: put human needs first | EditorialRelated: We fear robots at work, but robotic jobs for humans are awful too | Gaby Hinsliff Continue reading...

Surprise monthly increase comes despite sector experiencing its weakest quarter in a yearBritain’s factories increased production unexpectedly last month despite the sector experiencing its weakest quarter in a year, with signs the growth spurt enjoyed towards the end of 2017 has fizzled out.Shaking off concerns that heavy snowfall from the “beast from the east” would trigger a slowdown, the UK manufacturing sector maintained a steady pace of growth in March.

Dow and S&P tumble amid fears of a full-blown trade war as Beijing targets food importsThe opening salvos of a tariff spat between the US and China that some observers fear could escalate into a full-blown trade war sent jitters through Wall Street on Monday.Stock markets fell after Beijing hit back against Donald Trump’s imposition of tariffs on Chinese steel and aluminium with a swath of retaliatory duties on 128 imported American products, including pork and apples.Beijing had announced fresh tariffs on imports of 128 US products, a market worth almost $3bn per year. Continue reading...

Responding to US president’s tariffs on steel and aluminium, China targets 120 US products including a 25% tariff on frozen porkChina has implemented retaliatory tariffs of up to 25% on $3bn in food imports from the US, raising uncertainty over the possibility of a trade war between the two countries.China’s ministry of commerce said it would be “suspending tariff concessions” on 120 US food products. Fresh and dried fruits, almonds, pistachios and wine would be subject to an additional 15% tariff. Eight other items, including frozen pork, would be subject to a 25% tariff. The tariffs would begin on Monday, the ministry said.Related: Markets rattled again by trade war fears after Chinese retaliationRelated: Trump's China tariffs risk 'tit-for-tat protectionism' that threatens world economy Continue reading...

The post-departure outlook is not good. But it will be hard to recognise or quantify any damage to the economy if growth is merely lower than it might have beenBrexit has brought the UK and EU closer in some regards. While the prime minister began the letter to the president of the European council that triggered article 50 with “Dear President Tusk”, her missive this March was headed “Dear Donald”. But that’s about it. On the substance of the future relationship, the two sides remain deadlocked. Mrs May has her red lines. Donald has his.What this all means is that, while we’re obviously not sure what the future might hold, if things continue down their current path Britain will leave both the single market and the customs union.Economies are complicated. Noticing change is hard, and attributing it harder still Continue reading...

What can we expect from a takeover led by a protege of Lord Hanson, the man who laid waste to industrial Britain?The past is never dead. When the wheeling, dealing, asset-stripping Hanson Trust finally collapsed in 2007, having played a major part in the deindustrialisation of Britain – but having greatly enriched its Thatcherite founder Lord Hanson – I thought a stake had finally being driven through the heart of a particular ghoul.Never again would our Westminster, Whitehall and City establishments indulge a glorified super-accountant who knew the price of everything but the value of nothing. And, in the name of “culture change” and rigorous “management”, had laid waste to industrial Britain. I was wrong.Related: MPs call for government to block Melrose's £8bn hostile takeover of GKN Continue reading...

GKN | National debt | Beatlemania | Hamlet relief | Returning the empties | OffenbachIf the government fails to intervene to prevent the acquisition of GKN by Melrose it will be further proof, if any is needed, that the UK is being run for the benefit of big business (Outcry as GKN falls to hostile takeover, 30 March). If the takeover is permitted, it is clear that shareholders will walk away with fat profits while employees will be flung on to the jobs market to scrabble for precarious work and zero-hours contracts.

Deal relates to sale of mortgage-backed securities in run-up to financial crisisBarclays has agreed a $2bn (£1.4bn) settlement with the US justice department over the sale of mortgage-backed securities in the lead-up to the 2008 financial crisis.The settlement follows a three-year investigation into allegations that the bank caused billions of dollars of losses to investors by “engaging in a fraudulent scheme” to sell Residential Mortgage-Backed Securities (RMBS) between 2005 and 2007.Related: Barclays to suspend online services while it splits bank Continue reading...

Official figures show UK household spending grew by 1.7% in 2017, the weakest rate since 2011 as falling real pay took its toll on family finances