1 month ago
UK economical maturation forecasts slashed arsenic IMF warns of higher power prices
Newsflash: The International Monetary Fund has trim its forecast for UK maturation this twelvemonth and successful 2026, arsenic nan Iran warfare hurts nan world economy.
The UK has been deed by nan sharpest maturation downgrade successful nan G7 successful nan IMF’s caller economical forecasts, conscionable released, astatine its outpouring gathering successful Washington DC.
UK GDP is now expected to emergence by conscionable 0.8% this year, down from a erstwhile forecast of 1.3% – a bigger downgrade than different awesome economies.
The UK’s maturation forecast for adjacent twelvemonth has been trim from 1.5% to 1.3%.
The Fund says:
double quotation markIn nan United Kingdom, nan warfare and a slower gait of monetary easing mean that maturation is projected to diminution from 1.3 percent successful 2025 to 0.8 percent successful 2026, a downward revision of 0.5 percent constituent comparative to nan October 2025 forecast.
Growth is projected to retrieve to 1.3 percent successful 2027, slower than expected earlier nan warfare arsenic nan effect of higher power prices linger.
In a rustle to households, IMF economists besides foretell ostentation will emergence towards 4%.
But, ostentation is past expected to return to target by nan extremity of 2027 arsenic nan effects of higher power prices slice and a weakening labour marketplace puts downward unit connected costs growth.
Key events Show cardinal events only Please move connected JavaScript to usage this feature
IMF: imaginable of a awesome power situation should hostilities continue.
War successful nan Middle East has halted nan world economy’s momentum this year, says Pierre-Olivier Gourinchas, main economist astatine nan IMF.
He is informing that nan Iran warfare has darkened nan world economical outlook, arsenic nan Fund presents its latest economical forecasts.
Despite awesome waste and acquisition disruptions and argumentation uncertainty, past twelvemonth ended connected an upbeat note, Gourinchas tells journalists successful Washington DC.
Gourinchas says:
double quotation markThe closing of nan Strait of Hormuz and superior harm to captious accommodation successful a region cardinal to world hydrocarbon proviso raise nan imaginable of a awesome power situation should hostilities continue.
Iran warfare escalation could trigger world recession, IMF warns
Richard Partington
The IMF has besides warned that a further escalation successful nan Iran warfare could trigger a world recession, spiralling ostentation and a crisp backlash successful financial markets.
Against an progressively volatile backdrop, nan Washington-based money said nan economical harm from nan Middle East conflict was steadily rising arsenic it trim its maturation forecasts for 2026 based connected nan effect from nan warfare truthful far.
Under a worst-case “severe scenario,” involving a drawn-out warfare and persistently higher power prices, it said nan world would look “a adjacent telephone for a world recession” for only nan 5th clip since 1980.
Here’s nan afloat communicative from my workfellow Richard Partington, who’s astatine nan Spring Meeting successful Washington DC:
Reeves: Iran warfare has a costs to nan UK
Chancellor of nan Exchequer, Rachel Reeves, has responded to the IMF’s maturation downgrade:
“The warfare successful Iran is not our war, but it will travel astatine a costs to nan UK. These are not costs I wanted, but they are costs we will person to respond to. I person vowed that my economical attack to this situation will beryllium some responsive to a changing world and responsible successful nan nationalist interest, keeping ostentation and liking rates successful cheque to protect households and businesses.
“We entered this conflict successful a stronger position because of nan choices this authorities took to build economical stability, but location is much to do. That is why we are strengthening Britain’s power security, backing British manufacture and protecting households, to build a Britain that is stronger, much resilient, and prepared for nan future.”
UK economical maturation forecasts slashed arsenic IMF warns of higher power prices
Newsflash: The International Monetary Fund has trim its forecast for UK maturation this twelvemonth and successful 2026, arsenic nan Iran warfare hurts nan world economy.
The UK has been deed by nan sharpest maturation downgrade successful nan G7 successful nan IMF’s caller economical forecasts, conscionable released, astatine its outpouring gathering successful Washington DC.
UK GDP is now expected to emergence by conscionable 0.8% this year, down from a erstwhile forecast of 1.3% – a bigger downgrade than different awesome economies.
The UK’s maturation forecast for adjacent twelvemonth has been trim from 1.5% to 1.3%.
The Fund says:
double quotation markIn nan United Kingdom, nan warfare and a slower gait of monetary easing mean that maturation is projected to diminution from 1.3 percent successful 2025 to 0.8 percent successful 2026, a downward revision of 0.5 percent constituent comparative to nan October 2025 forecast.
Growth is projected to retrieve to 1.3 percent successful 2027, slower than expected earlier nan warfare arsenic nan effect of higher power prices linger.
In a rustle to households, IMF economists besides foretell ostentation will emergence towards 4%.
But, ostentation is past expected to return to target by nan extremity of 2027 arsenic nan effects of higher power prices slice and a weakening labour marketplace puts downward unit connected costs growth.
Surging power costs thrust up US PPI index
US shaper value ostentation has deed its highest level successful almost 3 years, owed to nan surge successful power costs.
The US PPI index, which measures prices ‘at nan mill gate’, roseate by 4% successful nan 12 months to nan extremity of March, nan largest summation since February 2023.
Prices for power jumped successful nan period – nan first since nan Iran warfare began – by 8.5%, including a crisp move higher successful centrifugal fuel.
The US Bureau of Labor Statistics explains:
double quotation markNearly half of nan March beforehand successful nan scale for last request equipment is attributable to a 15.7% emergence successful gasoline prices.
The indexes for diesel fuel, pitchy fuel, location heating oil, meats, and superior basal integrated chemicals besides increased. Conversely, prices for caller and barren vegetables fell 10.7%.
The International Monetary Fund is owed to merchandise its latest World Economic Outlook successful 40 minutes.
The study is expected to show overmuch higher (than before) ostentation forecasts and a notable downgrade to economical growth, says Professor Costas Milas, of nan University of Liverpool’s guidance school.
double quotation markThe IMF, however, and successful crisp opposition to the Pope, is improbable to beryllium captious of nan US involution successful Iran and nan resulting economical damage.
After all, nan US exerts much bigger influence connected IMF than immoderate different state pinch a 17.42% quota (which reflects nan comparative financial publication of nan US to nan IMF) and a 16.49% stock successful votes.
Amazon signs $11.5bn woody for outer patient Globalstar to situation Starlink
Amazon.com has secured an $11.57bn woody to bargain outer usability Globalstar, to accelerate nan rollout of its outer operation, Leo.
The woody will let Amazon Leo to adhd direct-to-device (D2D) services to its debased Earth orbit outer web and widen cellular sum to customers beyond nan scope of terrestrial networks, nan institution explains.
Amazon says acquiring Globalstar’s web of non-geostationary orbit (NGSO) satellites is portion of its “long-term imagination for space-based connectivity”.
It will thief Amazon to situation Elon Musk’s Starlink outer network.
Panos Panay, Senior Vice President of Devices & Services astatine Amazon, says:
double quotation mark“By combining Globalstar’s proven expertise and beardown instauration pinch Amazon’s customer-obsession and innovation, customers tin expect faster, much reliable work successful much places—keeping them connected to nan group and things that matter most.”
Greenpeace person calculated that nan UK has commissioned capable upwind and star this twelvemonth to make 10 times arsenic overmuch energy than nan fossil substance it imports done nan Strait of Hormuz.
It says:
double quotation markCalculation: Gas coming done Hormuz would make 4.2TWh of power. Offshore upwind from renewables auction 36.0TWh, star 5,15TWh, onshore upwind 4.1TWh.
Total upwind and star is 45.25TWh, which is 10.8x much than nan 4.2TWh that nan Hormuz state would generate.
According to nan government, only astir 1% of nan UK’s state proviso successful 2025 came from Qatar – much comes from North Sea production, pipelines pinch Norway, interconnectors pinch continental Europe and 3 LNG terminals.
RAC: UK substance prices person stopped rising, and should driblet soon
UK substance prices look to yet beryllium levelling disconnected aft 43 days of increases, nan RAC reports.
The motoring group argues that prices should now commencement to decline.
RAC caput of argumentation Simon Williams explains:
double quotation markWholesale substance costs are now importantly little than they were astatine nan commencement of nan month, truthful forecourt prices should statesman to travel down. As things stand, we’d expect petrol and diesel to driblet by respective pence a litre successful nan adjacent week aliases so.
“It will beryllium very absorbing to spot if this plays retired arsenic nan information indicates. We dream it does arsenic drivers could do pinch immoderate alleviation astatine nan pumps pinch a vessel of petrol for a family car now costing £87 and nan diesel balanced £105 - £14 and £27 much than they did astatine nan commencement of nan conflict.”
According to nan RAC, petrol is averaging 158.30p a litre, while diesel is 191.54p a litre.
JP Morgan profits emergence contempt 'complex group of risks'
JP Morgan has reported a surge successful profits arsenic nan Middle East conflict drove volatility successful nan financial markets.
Net income jumped 13% to $16.5bn successful January-March 2026, up from $14.6bn successful nan first 4th of 2025.
Revenues astatine JP Morgan’s markets section reached a grounds $11.6bn successful nan quarter, while finance banking fees roseate by 28% “due to stronger advisory and ECM [equity superior market] activity.”
JP Morgan’s CEO Jamie Dimon says nan institution faces ‘an progressively analyzable group of risks’, including conflict and surging power prices, saying:
double quotation mark“The U.S. system remained resilient successful nan quarter, pinch consumers still earning and spending and businesses still healthy. Several tailwinds are supporting this resiliency, including accrued fiscal stimulus, nan benefits of deregulation, AI-driven superior finance and nan Fed’s plus purchases.
At nan aforesaid time, location is an progressively analyzable group of risks— specified arsenic geopolitical tensions and wars, power value volatility, waste and acquisition uncertainty, ample world fiscal deficits and elevated plus prices. While we cannot foretell really these risks and uncertainties will yet play out, they are important and they reenforce why we hole nan Firm for a wide scope of environments.”
Axel Springer: We'll 'invest significantly' successful nan Telegraph
Axel Springer has confirmed it has received support from nan UK Department for Culture, Media and Sport (DCMS) to proceed pinch its acquisition of Telegraph Media Group.
It says nan determination marks “a important milestone toward completing nan transaction”.
Mathias Döpfner, CEO of Axel Springer, says:
double quotation markWe are pleased to person received UK authorities support to proceed pinch this acquisition. After a agelong play of uncertainty, we tin corroborate that we will put importantly successful The Telegraph’s editorial excellence and world growth.”
The acquisition will fortify Axel Springer’s portfolio of premium publicity brands, which includes POLITICO, BUSINESS INSIDER, BILD, and WELT, among others. The Telegraph will subordinate a world web committed to independent reporting while retaining its chopped editorial sound and British identity.
Nandy gives greenish ray to Axel Springer buying nan Telegraph
In nan media world, Culture caput Lisa Nandy has fixed support for European media group Axel Springer is to get nan Telegraph newspaper.
In a written connection to parliament, Nandy says she has fixed her written consent for RB Investco Ltd to waste its telephone action to acquisition nan Telegraph Media Group Holdings Ltd to Axel Springer.
Importantly, Nandy besides says she is “not minded” astatine this shape to intervene successful nan projected merger, nether either nan nationalist liking media mergers authorities and nan overseas authorities power regime, adding:
double quotation markI americium pleased to beryllium capable to return these affirmative steps, which springiness greater certainty to nan Telegraph and its staff.
RB Investco is simply a associated task betwixt US backstage equity firm, RedBird Capital Partners LLC and Abu-Dhabi based media conglomerate, IMI. They dropped their £500m bid for nan Telegraph Media Group past November, pursuing concerns astir links to China.
Axel Springer swept successful pinch its a £575m woody successful early March, scuppering a rival deal from nan proprietor of nan Daily Mail.
Oil value spike drove US mini business sentiment to 11-month low
The surge successful power costs has pushed assurance among mini US companies down to its lowest level successful almost a year.
The National Federation of Independent Business has reported that its Small Business Optimism Index dropped 3.0 points to 95.8 past month.
That pushes nan scale beneath its semipermanent mean for nan first clip since April 2025 (the period of Donald Trump’s ‘Liberation Day’ tariffs).
Higher power costs wiped retired nan benefits from taxes cuts, NFIB found.
NFIB main economist Bill Dunkelberg explained:
double quotation mark“The 20% Small Business Deduction and different supportive mini business taxation provisions successful nan Working Families Tax Cut Act person had galore positives for mini business owners.”
“However, nan melodramatic spike successful lipid prices has spooked consumers and owners alike. Small business owners are having to sorb those higher input costs and walk them on to their customers.”
Investors were bracing for a maturation daze successful Europe earlier past week’s US-Iran ceasefire, Bank of America reports.
It’s latest Fund Manager Survey has recovered that investors lowered their world maturation prospects again successful nan past month, owed to nan ostentation daze from nan Iran conflict.
They found:
-
A nett 36% of respondents deliberation nan world system will weaken complete nan coming year, nan astir since August past twelvemonth and compared to a nett 39% seeing a world maturation acceleration backmost successful February.
-
Across regions, investors person turned astir gloomy connected Europe, pinch a nett 25% now expecting maturation to slow, compared to a nett 66% that expected acceleration backmost successful February connected nan backmost of support from fiscal stimulus.
-
Recession concerns stay reasonably low, pinch 79% of investors seeing a recession arsenic improbable complete nan adjacent year, adjacent to caller months.
However, astir 80% of participants responded to nan study earlier past week’s US / Iran ceasefire announcement….
The lb has recovered each its losses since nan Iran warfare started.
Hopes of de-escalation successful nan Middle East person lifted currencies against nan US dollar, which has dropped today.
The lb has gained almost half a cent to $1.354, nan highest since 26 February.
Matthew Ryan, caput of marketplace strategy at Ebury, says:
double quotation mark“Renewed optimism complete nan warfare has driven nan US Dollar Index to its lowest level since nan conflict began, underscoring conscionable really quickly sentiment has shifted. This leaves room for a correction should we spot immoderate further bumps successful nan road, which is astir apt likely moreover if a woody materialises earlier nan period is out.”
March saw nan largest summation successful world power ostentation successful astatine slightest 25 years, UBS finds
The Iran warfare has led to nan biggest emergence successful world power ostentation successful astatine slightest 25 years, caller information suggests.
Swiss slope UBS has analysed nan latest ostentation reports from precocious and emerging economies, and recovered that power prices roseate by 5.5% connected mean successful March. That exceeds nan surge seen aft nan onset of nan Russia–Ukraine conflict successful March 2022.
UBS tracks ostentation crossed astir 45 awesome precocious and emerging economies; 27 person reported March information truthful far.
Arend Kapteyn, world caput of economical and strategy research, told clients:
double quotation markThe increases were broad-based. Around two-thirds of reporting economies registered monthly gains successful nan 97th percentile aliases higher of their humanities distributions, reflecting nan globally synchronised daze to power prices triggered by developments successful nan Middle East.
That said, location were a fewer exceptions. Energy ostentation declined successful Sweden—mainly owed to a crisp autumn successful energy prices (March was nan warmest period ever recorded successful Sweden) which offset beardown substance value increases—as good arsenic successful Estonia and Slovenia, while Chile besides recorded only humble increases.
UBS has besides recovered that nan emergence successful header ostentation inflation remains somewhat beneath nan highest reached successful March 2022.
Thats’s because location was besides acute supply-chain disruptions and exceptionally beardown post-pandemic request 4 years ago, which led to value rises crossed a broader group of equipment and services.
Reeves 'very disappointment and angry' complete 'folly' of Trump's deficiency of Iran exit plan
Chancellor Rachel Reeves has blasted Donald Trump complete his ‘folly’ for starting nan Iran warfare without an exit plan.
In an question and reply pinch nan Daily Mirror, Reeves says she is “very disappointment and angry” astir nan situation.
She says:
double quotation mark“This is simply a warfare that we did not start. It was a warfare that we did not want. I consciousness very disappointment and angry that nan US went into this warfare without a clear exit plan, without a clear thought of what they were trying to achieve.”
“And arsenic a consequence nan Strait of Hormuz is now blocked,” nan Chancellor added. “We are hosting a convention this week pinch President Macron of France connected really to unafraid transition done nan Strait of Hormuz.
Reeves (who is heading to Washington DC for nan IMF’s outpouring meetings this week) points retired that earlier nan conflict, ostentation was expected to fall, allowing much cuts to liking rates.
She adds:
double quotation mark“Obviously nary sensible personification is simply a protagonist of nan Iranian regime, but to commencement a conflict without being clear what nan objectives are and not being clear astir really you are going to get retired of it, I do deliberation that is simply a folly and it is 1 that is affecting families present successful nan UK but besides families successful nan US and astir nan world.”
European steelmakers invited caller tariffs
Lisa O’Carroll
The European alloy manufacture has said extremist caller measures to double tariffs connected alloy imports and halve duty-free quotas (see earlier post) will thief propulsion nan manufacture “back from nan brink” of collapse.
Faced pinch unprecedented inexpensive imports from China and elsewhere, nan manufacture has for nan past twelvemonth pleaded pinch Brussels to present waste and acquisition measures to woody pinch nan sheer measurement of title for section manufacturers.
Axel Eggert, head wide of nan European Steel Association (EUROFER), said:
double quotation mark‘European alloy has been opinionated astatine nan separator of a cliff and this waste and acquisition measurement helps pulls america backmost from nan brink. By curbing unsustainable import pressure, it supports viable home alloy capacity and enables nan manufacture to proceed its decarbonisation.
“It will bring backmost 15 cardinal tonnes of EU steel-making capacity utilisation, while helping sphere astir 30,000 nonstop jobs and 200,000 indirect jobs successful Europe’’.
The caller tariffs and quota strategy agreed successful precocious nighttime talks by nan European Parliament and personnel states will spot quotas imposed successful each of nan 28 alloy merchandise sectors and could effect exports from nan UK arsenic good arsenic countries for illustration China.
