Refugee Council says many refugees themselves could also be prosecuted' under proposalsRichard Madeley goes next.Q: The Ryanair boss Michael O'Leary says you are wrong, and the third runway won't be built until you are 70. You are 45 now. Why is he wrong?We're signing off decisions on wind farms, on solar farms, a commitment to a new stadium at Old Trafford. We are upgrading the Transpennine route to make journey times easier between York and Manchester via Leeds and Huddersfield. Those things are happening right now. Continue reading...

Live coverage of business, economics and financial news as ECB cuts main interest rate by 0.25 percentage points in effort to support European economiesIt was a flash reading on the Eurozone economy, so we don't have the details on what the drivers were. But it's clear that it was a weak end to 2024.But the European Central Bank might be able to spur a bit of economic growth in the eurozone with looser monetary policy.This marks a weak end to last year, following positive growth in the first three quarters of 2024. As a result, first estimates suggest that the currency bloc as a whole grew by 0.7% in 2024. Declining activity in Germany - the Eurozone's largest economy - has weighed on the bloc's growth, with German GDP contracting by 0.2% on the quarter. This suggests Germany has now seen annual declines in activity for two consecutive years.In 2025, further loosening of monetary conditions is expected to provide a modest uptick in activity for both Germany and the Eurozone, with growth expected to amount to 0.3% and 1.0% respectively. Continue reading...

Reduction by quarter of a point to 2.75% aims to stimulate economy, which stagnated in last quarter of 2024The European Central Bank has cut interest rates to ease the cost of borrowing across the 20-member eurozone as growth stagnates in the region.The central bank cut rates by a quarter of a point to 2.75%, in line with expectations, after a run of bad news showing the bloc's largest nations - France and Germany - suffering a slowdown in economic growth. Continue reading...

In her big plan to get the economy growing again the chancellor, Rachel Reeves, has prioritised growth over almost everything else. But at what cost? John Harris speaks to the Labour MP Clive Lewis about concerns that climate action is taking a back seat. Plus, the columnist Gaby Hinsliff talks us through whether the party's quest for growth will work

We used to call this trickle-down economics', and we learned a long time ago that it is a mythListening to Rachel Reeves today, I could hear the faint strains of a heckler. Not among the VIPs in that Oxfordshire hall but far outside, from a woman in Newcastle. I have told her story before: as the Brexit vote loomed, a London professor warned the geordie heathens that leaving Europe would harm the UK's economy. Then one of the aforementioned heathens yelled back: That's your bloody GDP. Not ours."

The chancellor's measures might have some economic effect but her big speech lacked any sense of political purposeMinisterial speeches have two functions. They tell the audience what the government is doing and they explain why. Both elements were present when RachelReeves addressed an audience in Oxfordshire on Wednesday, but there was a lot more policy than argument. The chancellor listed many actions to kickstart growth in the economy. There will be a lot of new infrastructure and new transport links - including expansion of Heathrow and other airports. The area between Oxford and Cambridge will be developed into Britain's Silicon Valley. Ms Reeves pledged more international trade and more state subsidies for green technology.The list was long, the persuasion was cursory. The chancellor's economic case is that weak productivity growth has been the malaise holding back Britain's economy. The remedy is a supply-side assault on regulation. The government will ease rules that are deemed to have thwarted crucial developments in the past. It certainly can take too long and cost too much to build in Britain. The saga of HS2 - approved in 2012, started in 2017, not due for completion until 2033 and likely to cost nearly double the original 37.5bn estimate - is a parable of that dysfunction.Do 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...

This live blog is now closed, you can read more on this story hereReeves says the supply side of the economy has been held back.Politicians have lacked the courage to confront the factors holding back growth.They have accepted the status quo. They have been the barrier, not the enablers, of change.Without economic growth, we cannot improve the living standards of ordinary working people, because growth isn't simply about lines on a graph. It's about the pounds in people's pockets, the vibrancy of our high streets and the thriving businesses that create wealth, jobs and new opportunities for us, for our children and grandchildren.We will have succeeded in our mission when working people are better off. Continue reading...

The chancellor has made an assault on the barriers, but the uncertain global backdrop is out of her hands

The term has Keynesian roots and was explored in a 2009 book. Problem is, it can mean very different things to different people ...We're all sick of Britain being in the slow lane ... we want to see a revival of those animal spirits so that we can grow the economy and bring investment here," said Rachel Reeves on her return from Davos last week. Plainly a memo has gone round: in a radio interview this morning, business secretary Jonathan Reynolds claimed Labour's willingness to take bold decisions unleashes the animal spirit, the sense of something exciting happening". When Reeves set out her plan for growth this afternoon, she reprised many of her Davos themes. She's on a strange crusade against newts and bats, holding wildlife concerns responsible for Britain's anti-growth mindset; she thinks bringing down net migration and fearlessly growing the economy are compatible and equal priorities; she's putting a hell of a lot of faith in extra airport runways. But at least this time she wasn't saying we should be more like Trump.But what does animal spirits" mean? Does it mean what Reeves thinks it means? Is it a useful concept? And how do we get hold of some of these spirits? Continue reading...

The bank says that the shift to digital banking has prompted further branch closesRachel Reeves has confirmed that the Labour government will back a third runway at London's Heathrow airport.If that sounds familiar, it is because it has been heavily trailed in the last week. And readers with longer memories might remember a succession of Labour and Conservative governments saying they would back it.So I can confirm today that this government supports a third runway at Heathrow and is inviting proposals to be brought forward by the summer.We will then take forward a full assessment through the airport National Policy Statement. This will ensure that the project is value for money, and our clear expectation is that any associated surface transport costs will be financed through private funding, and it will ensure that a third runway is delivered in line with our legal, environmental and climate objectives.The unusual timing of the Qwen 2.5-Max's release, on the first day of the Lunar New Year when most Chinese people are off work and with their families, points to the pressure Chinese AI startup DeepSeek's meteoric rise in the past three weeks has placed on not just overseas rivals, but also its domestic competition. Continue reading...

Around the world, soaring inflation has pushed voters to turn on incumbent governments.But one country bucked the trend - Mexico, where the leftwing Morena party recorded a landslide victory. The key to its success? A policy platform built on minimum salary rises, labour reforms and price controls on staples.So are there lessons to be learnt from the country's success for Anthony Albanese's Labor party?Senior business reporter Jonathan Barrett tells Nour Haydar why so many governments didn't survive high inflation, and what Labor could learn from the country that bucked the trend

In economic growth speech, chancellor says move would make UK world's best-connected place to do business'

Businesses should avoid panic amid fears US will attempt to repatriate jobs and taxes, says Danny McCoy

Comments by Christine Lagarde seen as veiled warning to Donald Trump, who demanded Federal Reserve lower interest rates immediately'Political interference in central bank policymaking could harm plans to bring down inflation, the head of the European Central Bank (ECB) has said.In a veiled warning to Donald Trump, after the US president last week demanded the Federal Reserve immediately" lower interest rates, the ECB president, Christine Lagarde, said meddling by politicians could lead to greater economic volatility and sharply rising prices. Continue reading...

Pippa Crerar and Kiran Stacey talk through what Keir Starmer's first phone call with Donald Trump since the inauguration means for the special relationship'. Also, as the chancellor, Rachel Reeves, prepares for a big speech on growth, does she have any new plans to boost the economy? And will they work?Click here to buy tickets to Pippa Crerar's Guardian Live event with the health secretary, Wes Streeting Continue reading...

While Rachel Reeves may be facing financial headaches, the turmoil is bringing serious good news for saversThe economic headwinds that have been buffeting the chancellor, Rachel Reeves, might be a headache for her, but they have brought positive news for some of those looking for a better deal on their savings.We have heard a lot recently about turmoil in the bond markets and higher UK government borrowing costs - but they are also pushing up the interest you can earn on some fixed-rate savings accounts. Continue reading...

CBI says businesses plan to cut jobs and raise prices while debt charity says millions are facing worries'The government is under growing pressure to get momentum back into the economy amid warnings that businesses plan to cut jobs and raise prices, while millions of families believe their finances will worsen this year.Before a major speech this week by the chancellor, Rachel Reeves, designed to restate Labour's commitment to improving the economy, the CBI said private sector firms were urgently assessing their budgets to offset measures announced in last October's budget. Continue reading...

Across the world, exporters to the US are preparing for an era of disruption if tariffs are imposedDonald Trump, a self-declared big believer" in tariffs on foreign goods, has promised to use them to boost the US economy, revitalize America's industrial heartlands, and reward the tens of millions of voters who sent him back to the White House.Come make your product in America," the president told top executives gathered at the World Economic Forum in Davos this week, promising low taxes to those who take him up on the invitation. But if you don't make your product in America - which is your prerogative - then, very simply, you will have to pay a tariff." Continue reading...

Engaging with councils, universities and developers will be key to bringing the economy back to lifeIt has been a tough beginning to the year for Rachel Reeves. The chancellor has found herself in the spotlight as debt interest costs spiralled, while consumer and business confidence fell. Manufacturers, hampered by high energy costs and the consequences of Brexit, are struggling, while Donald Trump's threats against those who dare to trade with the US are unsettling.It's not a completely new situation. Since the budget, Reeves has been criticised for the mix of tax rises and higher borrowing needed for what is only a modest rise in government spending over the next couple of years. Businesses are angry that much of the tax burden has fallen on them. Consumers, uncertain about the nation's prospects, hunker down. If they spend big, it's on a foreign holiday to escape the gloomy atmosphere at home. Continue reading...

The EU is facing a torrid year ahead from enemies both within and without. But it is still far from a lost causeEurope is in trouble. Multiple, long-simmering external and internal challenges are coming to the boil. Taken together, they comprise the modern EU's biggest existential test since its creation in the early 1990s. But strong, united leadership is lacking. Questioning Europe's will to survive, Poland's prime minister, Donald Tusk, warned last week of a spiritual crisis", of a palpable mood of uncertainty, of loss."The EU's borders, democracies, laws and liberties are threatened by an aggressive Russian nihilism. Relations with the US, transatlantic blood brother and key Nato partner, are coming under unprecedented strain. China, an expansionist, authoritarian superpower, circles like a predatory foe. The economies of leading countries, notably Germany, are contracting or stagnating. Continue reading...

Achim Steiner calls for ministers to discuss reversals to overseas aid squeeze imposed by Rishi SunakThe UN's development chief has urged UK ministers to have a public debate about reversing the brutal" cuts to the country's aid budget made by the Conservative government.Achim Steiner, the administrator of the UN Development Programme, told the Guardian he found it a little bit sobering" that Labour had not yet promised to undo the squeeze imposed by Rishi Sunak. While chancellor, Sunak suspended the UK's commitment to spend 0.7% of national income on overseas aid during the pandemic in 2021, citing budget pressures, switching instead to 0.5%. Continue reading...

Survey signals private sector firms charging higher prices and cutting jobs at fastest rate since 2009 bar pandemic

Gary Stevenson grew up poor, got rich in the City - then found himself wrestling with depression. Now he says he's the only person on the left who really understands the British economy - and the people who wield the powerI've interviewed Gary Stevenson three times. First in 2020 about global finance being screwed with a capital S"; again in 2022 about the cost of living crisis; and then last year when he published The Trading Game, his compelling memoir about life as a trader at Citibank. Now I'm meeting him for the first time in the flesh, ahead of the book's appearance in paperback, and we're talking about yet another crisis.Have you seen the news?" is the first thing he asks, presenting it like a challenge even before he says hello". I rack my brain distressingly slowly, like a librarian using a card index for the very first time, thinking: which bit of the news? LA is on fire; Gaza is on fire; Ukraine is on fire; a bunch of Teslas are on fire. Seriously, we've all seen a lot of news. Continue reading...

Chancellor says scheme aims to bridge gap between Whitehall and local leaders to avoid previous top-down approachRachel Reeves will instruct bosses of the national wealth fund (NWF) and the new Office for Investment to work with regional mayors for the first time, as part of a package of initiatives to boost growth.After a meeting of combined authority mayors and civil servants in Rotherham on Thursday, the chancellor said a deeper relationship between Whitehall and regional leaders would enhance her push to enhance growth nationally. Continue reading...

Pro-growth charm offensive aimed at getting Labour back on the front foot has drawn concerns and questions

President also threatens tariffs on imports to US and repeats call for Nato countries to increase defence spending to 5%

New US president shakes up World Economic Forum with call for lower oil price, interest rate cut, increase in Nato spending, and criticised EuropeJavier Milei then takes a swing at feminism, telling delegates at Davos that it's wrong to make femicide a seperate crime with tougher sentences than for murdering a man.You are legally making a woman's life worth more than a man, he argues. Continue reading...

Trade chief has said membership of Pan-Euro-Mediterranean convention could be part of reset' discussions

Maro efovi says the ball is in the UK's court' as British ministers reportedly consult businesses

From Trump's Project 2025 to a huge aid cut by the Dutch, donors are turning their backs on the developing worldForeign aid spending reached a record high of $223bn (180bn) in 2023, new figures released this week from the Organisation for Economic Co-operation and Development (OECD) confirmed.Yet, in 2024, eight wealthy countries announced $17.2bn in cuts to official development assistance (ODA), and three others hinted at reductions, all to take effect over the next five years. Continue reading...

Rolling coverage of the second day of the World Economic Forum in DavosRachel Reeves has also revealed ministers want to increase higher skilled migration by creating with more visas for people working in AI and life sciences:She told attendees at Davos that the government will publish an immigration white paper later this year.He recognised that this government has got a different strategic approach when it comes to regulation, and he recognised it was time for him to move on and make way for somebody who does share the mission and the strategic direction that this government are taking." Continue reading...

Chancellor tells World Economic Forum in Davos she absolutely' supports wealth creation

S&P 500 and Nasdaq Composite largely unmoved as it opened for trading for first time after inaugurationFinancial markets largely shrugged after Donald Trump outlined plans to impose punitive tariffs on Mexico and Canada as soon as next month while signing scores of executive orders on his first day in office.The US president told reporters in the White House Oval Office he was thinking about introducing 25% US tariffs on imports from Mexico and Canada as soon as 1 February. Continue reading...

US president is expected to slash financial controls and prompt wave of dealmakingWall Street bankers say they are at the beginning of go mode" as they expect Donald Trump's return to the White House to lead to a boom in the industry.Trump's second term is expected to result in a bonfire of regulations, including across financial services, with the president having promised during his election campaign to slash 10 existing regulations for every new one created in an attempt to spur economic growth. Continue reading...

Rolling coverage of the first full day of the World Economic Forum in DavosThere's drama inside the Congress Centre here at Davos, where two Greenpeace International activists have held a protest calling for wealth taxes.Two Greenpeace activists unveiled a banner reading Tax the Super-rich! Fund a Just and Green Future", above the main lobby near the WEF Congress Hall (where the big speeches take place).As the world faces increasing threats to democracy through the collusion of wealth and power, the urgency to tax the super-rich is ever increasing.Having billionaires in positions of leadership, governing with impunity, is a stark reminder of the dangerous intersection of extreme wealth and politics, and its impact on democracy, people and the planet." Continue reading...

Labour market figures add to dilemma for Bank of England as it considers interest rate cuts

European Commission president tells Davos that the bloc can no longer rely on rising tide of global trade'

We'd like to hear from those looking for work in the UK as well as from UK employers about their recent experiences of the labour marketBritain's unemployment rate has risen unexpectedly and the number of workers on payrolls has fallen by the most since the height of the pandemic, according to new figures from the Office for National Statistics (ONS).It estimated that the number of payrolled employees had shrunk by 47,000 in December, the biggest drop since November 2020. The jobless rate meanwhile increased to 4.4 per cent in the three months to November, up from 4.3 per cent in the three months to October. Continue reading...

Reports that government could weaken employment rights bill as NI rise prompts fears of redundancies

President's energy emergency declaration aims to usher in affordable and reliable American energy'Donald Trump signed a memorandum on inflation and multiple orders aimed at lowering energy prices, but the incoming president's advisers offered few details on the policies, raising serious questions about whether the new administration will be able to address one of Americans' most pressing concerns.During a press call on Monday morning, incoming White House advisers pledged that Trump would pursue an all of government approach to bringing down costs for American citizens" but they declined to outline concrete steps that the administration would pursue to lower prices. Continue reading...

The survey of chief executives, published ahead of the World Economic Forum, follows an upgraded growth forecast from the IMFThe UK is the second most attractive country for investment behind the US, signalling a climb up the rankings, according to an annual survey of global business leaders by the consultancy PwC.Published at the start of the World Economic Forum (WEF) in the Swiss ski resort of Davos, the survey of almost 5,000 chief executives from 109 countries puts the UK in second place, ahead of China, Germany and India. Continue reading...

Annual survey finds workers have multifaceted expectations' after changes cause by Covid pandemicWork-life balance has soared in importance for workers around the world, becoming their top motivator and pushing pay into second place, according to an annual international survey of thousands of employees.It is the first time that finding or keeping a job that fits in with the rest of their lives has outranked salary in the 22-year history of the international recruitment company Randstad's annual review of the world of work, highlighting the corporate revolution caused by the coronavirus pandemic. Continue reading...

Treasury orthodoxy is such that the chancellor doesn't seem to think she has a choice, writes Anthony Lawton, while Ros Wain says the government needs to get over the household view of the public finances. Plus a letter from Phil TateYour editorial (14 January) rightly critiques Rachel Reeves's adherence to Treasury orthodoxy. But the persistence of this framework goes deeper than institutional inertia. It reflects a failure to recognise a choice at all - and an inability to imagine and craft better alternatives.Treasury orthodoxy is rooted in the Thatcher-Reagan era. It is not just outdated, but has become invisible to those who wield it. Traditional economic training teaches policymakers to see fiscal discipline and market reassurance not just as good options but as the only ones. This narrow view blinds them to evidence that transformative public investment, targeted redistribution and state-led solutions can be essential to tackle inequality, stagnation and the environmental crisis. Continue reading...

WFH has harmed employee productivity, says Stuart Rose, who was also executive chair of Asda

Unlike tariffs, a new form of protectionism could target climate-wrecking, untaxed corporations and their billionaire owners

Number of homes new to market 11% higher than a year ago, despite uncertainty over interest rates and stamp dutyA record number of new sellers have come on to the UK housing market since Boxing Day, while the average price and the number of sales agreed also increased, pointing to a busier 2025, according to a report.The average price of a property coming to market rose by 1.7%, or 5,992, this month to 366,189, the biggest jump in prices at the start of the year since 2020, the property website Rightmove said in its monthly report. While prices usually bounce back in the new year after a seasonal fall in December, before Christmas, the rise was pronounced this month. Continue reading...

The annual gathering of the globally minded is looking forlorn in the light of Trump 2.0 and trade rowsThis year's week-long gabfest in the Alpine resort of Davos, which kicks off on Monday, will be held under the banner: A Call for Collaboration in the Intelligent Age".Given that it will open as Donald Trump is inaugurated with a promise to jack up import tariffs, trash the Paris climate agreement and put an anti-vaxxer in charge of the US health system, hopes of either collaboration or intelligence being much on display in 2025 appear bleak. Continue reading...

A new paper has found that social capital is the cake, not the icing' of a strong, well functioning economyWindfarms, train lines, science labs - when policymakers think about the ingredients for kickstarting the UK's sagging economy, they tend to imagine tangible bits of infrastructure. But two of the UK's most eminent public economists have banded together to urge Rachel Reeves to reconsider another dimension of the UK's makeup: social capital.Andy Haldane is the former chief economist at the Bank of England, now chief executive of the Royal Society of Arts. David Halpern is the man behind the so-called nudge unit, which brought behavioural economics into the policy mainstream. Continue reading...

Chancellor survives chaos in markets but faces more questions on growth, cuts, public sector pay and fraudRachel Reeves was given a warning this month how the most carefully plotted budget strategy can be blown off track by turmoil in financial markets.Calm has been restored, for the time being, but the lingering effect has been to increase the UK government's cost of borrowing. Continue reading...

The chancellor will seek investment in the UK as the Labour government prepares to reduce the benefits billA drive to reduce the benefits bill will be pursued by the government alongside a charm offensive to attract more companies to invest in Britain, amid nervousness in Labour circles over a new round of spending cuts.The chancellor, Rachel Reeves, will travel to the World Economic Forum's annual meeting in Davos this week in the hope of convincing some of the world's largest companies to invest, with allies saying she will use spending cuts rather than further tax increases to meet her own fiscal rules. Continue reading...