Labour embraced the forecaster's powerful role, but now finds itself scrambling in the face of gloomy projections

Chancellor hopes to raise enough funds to stop damaging speculation about breaching fiscal rules

President suggests layoffs will be a lot' and in Democrat areas as unions for federal workers take the matter to court - key US politics stories from 10 October at a glanceMass firings of US federal workers have begun, as Republicans work to exert pressure on Democrat lawmakers to end a government shutdown. The White House budget office said the layoffs were substantial", with unions for federal workers taking the matter to court. President Donald Trump said of the job losses it'll be a lot" and suggested those losing their jobs would be in areas that were Democrat oriented".The government shutdown comes as the US president has revived the trade war with China, this time promising to increase tariffs on Chinese imports by 100%. His administration is also considering using visa restrictions and sanctions against countries that support the International Maritime Organization's net zero framework" proposal. Continue reading...

My father, Eric Potts, who has died aged 89, was an economist working in engineering and manufacturing businesses, in a period of considerable change for those industries.He began his career as a graduate apprentice at Rolls-Royce, in Derby, in the early 1960s. Joining the marketing department of the Weir Group, Glasgow, he rose to the top position, before being made marketing director at Weir Polypac, Hartlepool, in 1980. Continue reading...

Jeremy Cross says disjointed policies are trapping people in poverty and isolation, while Monica Hall considers the cost of potholes. Plus letters from Derrick Joad and Colin BurkeGeorge Monbiot is correct that cuts in public services cost far more than the money saved (It hurt when I crashed my bike into a pothole - and it taught me the true price of austerity, 4 October).I am a trustee of a small charity in Kent, The Social Justice Network, which runs a number of projects, including supporting refugees and their families to settle locally. Recently we welcomed a family of 10 (parents and eight children aged five to 16) from another county. The council had worked hard to house the family in its area but was unable to, despite having accepted its duty to do so. As a result of a forced move of nearly 100 miles at 24 hours' notice, the father lost his job and isnow benefit capped. Removing the two-child limit would make this family only marginally better off as they would still face the family benefit cap. Continue reading...

Business leaders are prioritising automation through AI to fill skills gaps, rather than training junior employees, survey findsBusiness leaders may be pulling up the ladder' behind them, by focusing on AI tools rather than taking on new staff, warns Kate Field, global head human and social sustainability at the BSI.Field explains:As roles are streamlined or eliminated before experience can be gained, we risk eroding the professional aspirations of people at the very start of their careers and before they've had the chance to flourish.Our findings suggest a troubling trend: senior leaders may be pulling up the ladder', prioritizing short-term productivity over long-term workforce resilience. If left unchecked, this could have lasting consequences, from weakening our skills pipeline, deepening generational inequality and our research suggests, dividing large companies and SMEs.Half (51%) of the respondents working in SMEs say AI is crucial to the growth of their organization, compared with nearly seven in ten respondents in large organizations (69%). This is reflected in its impact being felt; 70% of large businesses reported AI saves money compared to just half of SMEs (51%). Continue reading...

US president's threat to impose 92% tariffs targeting major manufacturers put family-run firms in the firing line as wellIt's a real pity," laments Antonio Rummo of Donald Trump's latest target in his ever-evolving tariff war: Italian pasta. Rummo is the sixth-generation grandson of the founder of Pasta Rummo, who opened a wheat mill in Benevento in southern Italy in 1846, using the family's three horses to lug grain from the surrounding Campania region and Puglia to produce fresh pasta.Demand for premium pasta in the US has been growing," says Rummo. Appreciated by consumers for a traditional processing method that guarantees it will cook to al dente perfection, sales of Pasta Rummo have been thriving. Continue reading...

Why UK steel sector is alarmed by prospect of punitive tariffs from its biggest customerThe EU shocked the UK steel industry on Tuesday with an announcement of 50% import tariffs - with no apparent carve-out for metal crossing the Channel.UK Steel, an industry lobby group, said the plan poses an existential threat" to British steelmakers. Here's what you need to know. Continue reading...

Kristalina Georgieva outlines mounting risks to economic stability before fund's annual meetings next week

Precious metal having biggest rally since 1970s amid political uncertainty in US, France and JapanThe price of gold has risen above $4,000 (2,980) per ounce for the first time as investors continue to seek a safe place to put their money at a time of global political and economic uncertainty.The spot price of gold - the real-time market value of gold and viewed as the global benchmark - had reached $4,031.54 by 8am in London on Wednesday morning, after climbing 1.2% during early trading. Continue reading...

ONS says public borrowing estimates have been out by 200m-500m a month since JanuaryMistakes in recent public finances data mean government borrowing has been overstated by a cumulative 3bn, the Office for National Statistics has said.In a fillip that gives Rachel Reeves a little bit more wriggle room in her November budget, the ONS said its estimates of public borrowing had been out by 200m-500m a month since January. Continue reading...

Research finds it would take average worker saving all their earnings for 52 years to match wealth of richest 10th of societyIt would take the average earner in the UK 52 years' worth of earnings to become as wealthy as the richest 10%, according to new research by the Resolution Foundation.In a new report, the influential thinktank analyses the Office for National Statistics' latest wealth and assets survey, which covers the Covid pandemic period of 2020-22. Continue reading...

Starmer says UK in discussions with EU over Brussels plan to double import tariff to 50%, which unions warn could kill UK steel industryThe EU has announced it will match Donald Trump's steel tariffs, doubling levies on imports to 50% in a decision condemned as an existential threat" to the industry in the UK.With 80% of British exports going to the EU, the change poses the UK steel industry's biggest ever crisis, according to the lobby group representing the sector, while unions said they could kill off the industry. Continue reading...

Company says more roles will be at risk unless UK government supports tariffs to protect industry

Investors rattled by resignation of French PM but country is not alone in trying to grapple with political maths

Mel Stride outlines plans to slash 47bn a year from public spending, including 23bn welfare cut

Rolling coverage of the latest economic and financial news, as France's prime minister resigns unexpectedly

From Ohio to Florida, the US government's clampdown on students from abroad threatens rural universities and local businessesFor a town of 20,000 residents a few miles from the Indiana state line in rural Ohio, the city of Oxford boasts an outsized number of international eateries.On High Street, the Phan Shin Chinese restaurant sits a few doors down from the Happy Kitchen, another Chinese food joint, which is next door to the Krishna Indian restaurant. There's a French bakery and even a Uyghur restaurant selling central Asian fare. Continue reading...

In Johnstown, thousands live in poverty - and voters went for Trump. How are people feeling as his devastating cuts take hold?Ernest Hairston has a plan. He's going to buy a car and find a job, then he'll be able to start saving for a down payment on a house.A car this year, house next. That's his plan. But first, he has to fix his health. Continue reading...

Labour colleagues advise chancellor against string of small money-raising measures, as OBR presents forecastSome of Rachel Reeves's Labour colleagues have urged her to ditch the party's manifesto promises rather than risk a pasty tax" budget that raises money through a string of small measures.As the independent Office for Budget Responsibility (OBR) presented its first fiscal forecast to the Treasury on Friday, several sources said there was tension within the government over the manifesto pledges. Continue reading...

Data was collected for closely-watched jobs report before shutdown, but Trump officials so far defy calls to publish itCompanies, consumers, policymakers and investors across the US are flying blind" at a crucial time for the world's largest economy, a former top official has warned, after Friday's closely-watched jobs report was not published as a result of the federal government shutdown.The data for the release have already been collected, according to two former heads of the Bureau of Labor Statistics (BLS). But the Trump administration has so far defied calls to publish the report. Continue reading...

Rolling coverage of the latest economic and financial news

History suggests that bullying the Fed for political gain can have serious consequences for the rest of usOne of the more critical lessons economists gleaned from the Nixon administration is about the exorbitant cost of allowing politicians to mess with the Federal Reserve. Donald Trump also learned an important lesson from Richard Nixon - a very different one.Nixon had blamed the Fed for his loss in his first bid for the presidency in 1960. By keeping rates high, he believed, it caused a recession that led voters to punish the then vice-president. In 1972, he would not let that happen again. Continue reading...

My generation is struggling for stability in a system that no longer feels fit for purpose. It's time to take that seriouslyFor gen Z Americans, it's hard to remember a version of the economy not defined by crisis. We finished our education online as Covid devastated the world, only to graduate into high costs of living, stagnant wages and now AI's threat to entry-level jobs. We've come of age in a system that no longer feels fit for purpose.The result is a generation that's lost faith in the traditional markers of stability. What once defined a secure life - home, family and comfortable retirement - feels out of reach. A pension is out of the question," one friend told me. So staying in the same job no longer makes sense." She's not alone: jobseekers' confidence in keeping or finding work dropped sharply this spring, with a survey in June suggesting nearly 60% of graduates were still looking for their first jobs.Alice Lassman is a policy expert with a focus on the global economy and gender. Her forthcoming book explores how AI's influence on gender and emotions are reshaping economic life Continue reading...

Chancellor has ways to cover UK deficit without breaching spirit of Labour manifesto, Morgan Stanley claimsRachel Reeves could raise as much as 45bn in taxes without breaking Labour's manifesto promises, according to a City report.Economists at the US investment bank Morgan Stanley said they expected the chancellor to use next month's budget to announce billions of pounds in tax increases to cover a potential 30bn shortfall in the public finances. Continue reading...

Theresa May, Alok Sharma, business and church leaders say plan would harm UK and not even Margaret Thatcher would have countenanced itThe former prime minister Theresa May has condemned a promise made by Kemi Badenoch to repeal the Climate Change Act if the Tories win the next general election, calling the plans a catastrophic mistake".She joined other leading Tories, business groups, scientists and the Church of England in attacking the Conservative leader's announcement, which would remove the requirement for governments to set carbon budgets" laying out how far greenhouse gas emissions will be cut every five years, up to 2050. Continue reading...

Employees wonder if the shutdown will leave them out of work temporarily or set stage for permanent terminationAn estimated 750,000 federal employees are furloughed as a result of the first federal government shutdown since 2018.Many have been on edge for months", according to James Kirwan, who works as a labor attorney inside a government agency. Now the Trump administration is threatening to implement another sweeping wave of cuts to their ranks. Continue reading...

Donald Trump wanted EJ Antoni to head agency, but critics said he was too partisan and exceedingly unqualified'Economists are expressing relief that the White House withdrew its nomination for head of the Bureau of Labor Statistics (BLS), the government agency that reports key economic data.In August, Donald Trump nominated EJ Antoni, chief economist at the conservative Heritage Foundation and a co-author of Project 2025, to replace Erika McEntarfer, whom Trump fired after the bureau released revisions to its monthly jobs report that showed weak job growth over the summer. Continue reading...

Report says changes to occupational mix since release of ChatGPT in 2022 sluggish' compared with 1940s and 50sThe US jobs market has yet to experience serious disruption from breakthroughs in artificial intelligence, according to an academic study.Analysis by Yale University's Budget Lab found there had been no discernible disruption" since ChatGPT's release in November 2022. Continue reading...

Losses narrow to nearly 16m for 48 weeks to 4 January 2025 but group has not made pre-tax profit since 2019Selfridges has blamed a slump in the number of international tourists shopping for luxury goods in the UK and weaker consumer confidence for a fall in annual sales, as the retailer racked up losses for a fifth year in a row.The upmarket department store chain reported a 7% decline in sales in the 48 weeks to 4 January 2025 to 775m compared with 835m recorded over the 53 weeks of its previous year. Continue reading...

Survey of bosses shows energy prices also a concern, as Bank policymakers warn inflation may take longer to dropBusiness confidence fell to its lowest level on record in September, driven by concerns over soaring costs, according to a survey of bosses.Topping the unease were labour costs, with energy prices also weighing on the outlook. Continue reading...

Insolvency firm running Lindsey oil refinery announces job losses after collapse of parent company Prax GroupAbout 125 jobs are to go at the Lindsey oil refinery in north Lincolnshire, following the collapse of its parent company, the energy conglomerate Prax Group.However, there are at least two bids to buy and operate the site as a going concern with a full workforce, according to the Unite union.We can confirm that 125 Prax Lindsey Oil Refinery employees have been informed that their positions will be made redundant at the end of October. A further 255 employees will remain at the site.This decision was not taken lightly and follows a thorough review of all aspects of the business, following its insolvency.The government has been tin eared to the plight of workers at the second oil refinery facing closure in less than a year. This makes a mockery of government promises to protect workers and its plan for net zero.The government had promised to ensure that job focused bids would be the priority at Lindsey, yet prior to bids even being considered, they are already issuing redundancy notices. Continue reading...

Looming funding cuts to the US food assistance program come as food prices continue to rise under Trump's administrationAmericans are bracing for the impact of the largest cuts to the government's food assistance program for low-income people in US history that have begun to take effect as a result of Donald Trump's One Big Beautiful Bill Act.Effective 1 October, the beginning of fiscal year 2026, funding for Snap-Ed, part of the Supplemental Nutrition Assistance Program (Snap) that provided funding for food banks across the US, is being eliminated. The cuts are part of the sweeping spending bill Trump signed in July. Continue reading...

Core disinflation process will continue as wage growth slows, BoE deputy governor explains

Conference speech sets out likely Labour economic argument at next general election and pitch to party

While Javier Milei's shock therapy to tame inflation has won support from Washington and the IMF, ordinary Argentinians seem less impressedWe're backing him 100%. We think he's done a fantastic job. Like us, he inherited a mess." Donald Trump gave his enthusiastic endorsement to Javier Milei's radical economic experiment when the pair met in New York last week.The US has declared itself ready to offer more than rhetorical support to the chainsaw-wielding Argentinian president in the coming days, as Buenos Aires stands on the brink of a fresh financial crisis. Continue reading...

Federal workers say they have little choice but to depart, with 100,000 leaving under deferred resignation programThe Trump administration is set to oversee the largest mass resignation in US history on Tuesday, with more than 100,000 federal workers set to formally quit as part of the latest wave of its deferred resignation program.With Congress facing a deadline of Tuesday to authorize more funding or spark a government shutdown, the White House has also ordered federal agencies to draw up plans for large-scale firings of workers if the partisan fight fails to yield a deal. Continue reading...

After being promised last year they could partner' with party on policy, many executives are asking what happenedLast year Keir Starmer had an invitation for bosses at Labour's first party conference in power in 15 years: You can have your finger prints on our policy ... you can shape it." Fresh from love-bombing corporate Britain before his election landslide, the prime minister told a sold-out business day" audience at its Liverpool get-together that he wanted his new government to partner" with industry.You have the right to badger us ... Our decisions will be better if we are talking to you and taking into account what you say," Starmer said. Continue reading...

Retailers stock up on countdown gifts as Britain's enthusiasm for (and spending on) spooky holiday growsIt is the stuff of nightmares if you think Christmas is too commercial: the Halloween Advent calendar is here.In this version of advent the countdown spans 13 (unlucky for some) to 31 nights of fright" and is meted out in everything from horror dolls to KPop Demon Hunter keyrings. Continue reading...

President places new duties on cabinets, vanities and sofas but national-security justification prompts puzzlementDonald Trump has often cited national security when announcing new tariffs. America and its military can not run without steel and computer chips. The nation's food and drug supply must be protected. But have you considered the security implications of your kitchen sink?Announcing his latest wave of tariffs on goods from overseas - a 50% levy on kitchen cabinets and bathroom vanities, and 30% on upholstered furniture, to be enforced next month - Trump once again cited the top priority of any president. Continue reading...

Rate-setter Swati Dhingra denies high inflation is a particularly British problem' and says short-term factors are to blameThe causes of the UK's inflation spike will fade" and policymakers should avoid being overly cautious" about cutting interest rates, a Bank of England rate-setter has argued.Swati Dhingra, a trade expert and external member of the Bank's monetary policy committee (MPC), rejected the idea that inflation is a particularly British problem". Continue reading...

Britain will actively engage' with US over possible 100% duties, with truck and cabinet makers also in firing lineDonald Trump's threat to impose new tariffs from next week on branded drugs, trucks and kitchen cabinets has raised fresh concerns for the UK pharmaceutical industry, which remains excluded from Keir Starmer's US tariff deal agreed five months ago.Trump promised the UK preferential treatment" on pharmaceutical tariffs in May but has yet to deliver on his pledge. Continue reading...

Rolling coverage of the latest economic and financial news

Rachel Reeves may have to find up to 30bn in tax rises or spending cuts if forecaster revisits expectationsTreasury policymakers frustrated by the politically damaging timing of a downgrade to UK productivity forecasts by the Office for Budget Responsibility (OBR) are pressing the watchdog to score the benefits of Labour's pro-growth plans.Rachel Reeves faces the prospect of having to find up to 30bn in tax rises or spending cuts in her 26 November budget if, as expected, the OBR cuts its forecast for future productivity growth to match the consensus of other experts. Continue reading...

Approach would risk fresh bond market crisis, say investors, amid speculation Greater Manchester mayor is seeking Westminster returnA call to end the UK's dependence on foreign lenders by Andy Burnham has been criticised by City investors who said such an approach would risk another bond market crisis.The mayor of Greater Manchester said the UK should not be in hock" to bond markets as he outlined measures that he believed a Labour government should pursue, including a big council housebuilding programme and the nationalisation of utilities paid for with a rise in taxes on the higher paid, a charge on expensive London homes and 40bn of extra borrowing. Continue reading...

It's more complicated than that, says Rosa Anderson in response to an article by Phillip Inman, while Peter Mather says boomers are being stereotyped, and Moira Sykes says the article picks the wrong targetOh no, not again. Guardian readers deserve better than Phillip Inman's tedious and hateful boomer-bashing (Boomers think their wealth came from wise choices - this myth needs busting, 20 September). This summer we've had his tax plans (tax boomers more), his suggestions for dealing with the housing crisis (kick boomers out of their homes), his idea for boomer national service" built around volunteering, and now his attacks on older people's occupational pensions. Goodness, Phillip, you really can't let this obsession with boomers go, can you?Economic inequalities - and with them social and health inequalities - are getting worse, and while Inman tells us with monotonous regularity that it's the boomers wot dun it", it is in fact a little more complicated. Generation is a far less important factor than gender, race, disability and, above all, class, and if we don't start looking at intra-generational inequalities we are going nowhere - not least because wealthy parents raise wealthy children, and support them financially to a value about 26 times more than poorer parents in the same generation, according to the Institute for Fiscal Studies. Continue reading...

The longer the period between crises, the greater the complacency. That complacency is pushing share prices ever-higherUS job creation has stalled and, despite the curbs on migration, unemployment is rising. Tariffs are pushing up the cost of imports. And Donald Trump is at war with the governor of his own central bank and wants him out.But traders on Wall Street are not bothered by the fact that inflation is above the target or that growth is slowing. Share prices are testing new record levels on an almost daily basis. Jerome Powell, the man Trump wants to be rid of, says stocks are fairly highly valued", which is an understatement if ever there was one. By historical standards, stocks are extremely highly valued. There is trouble - perhaps big trouble - ahead.Larry Elliott is a Guardian columnist Continue reading...

What we are witnessing right now is the rise of two Americas. One for the billionaire class. And one for everybody elseLet's take a deep breath and, for one moment, forget about Donald Trump, Jimmy Kimmel, the UN, Charlie Kirk, Gaza, a government shutdown and the other crises that we face.Let's talk instead about the reality which the corporate-controlled media and the corporate-controlled political system don't talk about very much. Continue reading...

Amid battle over independence, Fed chair pushes back against claim that central bank lets politics drive decisionsThe US Federal Reserve chair, Jerome Powell, pushed back hard against claims the central bank allows politics to drive decisions, in the midst of an extraordinary battle over its independence.Donald Trump, who is seeking to increase his administration's control over the Fed, has branded Powell a very political guy" after he declined to bow to the president's public demands for drastically lower interest rates. Continue reading...

Jaguar Land Rover's disruption following a cyber-attack is hurting manufacturing, while OECD releases latest economic outlook