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Michael Simmons

Can Rachel Reeves woo Trump’s team – without alienating the EU?

The government is on a charm offensive in Washington. Tonight, Britain’s ambassador to the US, Lord Mandelson, will host officials from Donald Trump’s government and American business figures at the British embassy. Tomorrow, the Chancellor will meet her counterpart, Treasury Secretary Scott Bessent. Rachel Reeves is looking to permanently end the punishing 25 per cent tariff on British cars and 10 per levy on other exports. Reeves has given an interview to one of Trump’s favourite channels, Newsmax, in which she was asked about her upcoming meeting with Bessent. In response, Reeves said she believed ‘there was a deal to be done’ and that both Keir Starmer’s and Trump’s governments

Spotlight

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What’s the point of foreign aid?

The UK signed up to a UN target of spending 0.7 per cent of GNP on aid way back in 1970, but didn’t hit that level until 2013. In 2020, aid spending was cut to 0.5 per cent and last week Keir Starmer reduced it further to 0.3 per cent. This will save about £4 billion which will instead be allocated to military spending. There were predictable howls of anguish from aid advocates at the news, and the development minister resigned. There was also begrudging praise from Starmer’s Conservative opponents. But few seemed to question what the point of aid is, and whether a spending target, at any level, makes

Martin Vander Weyer

Save London’s black cabs!

Donald Trump’s Soprano-like threat that the ‘termination’ of Federal Reserve chairman Jerome Powell ‘cannot come fast enough’ has been headlined as one of his wildest thrusts to date, but is actually one of his most conventional. Prickly politicians always resent unelected central bankers, though they also see them as useful scapegoats for economic trouble. Liz Truss longed to fire Andrew Bailey from the Bank of England; Gordon Brown gave Eddie George’s Bank its ‘independence’ but took away so much of its power that George nearly resigned; Margaret Thatcher never accepted the most potent modern governor, Gordon Richardson, as ‘one of us’. Trump’s predecessors took fewer potshots at the Fed because

Donald Trump has bowed to the markets

A deal will be worked out with China to reduce the tariffs. The chairman of the Federal Reserve won’t be fired. Over the last 24 hours, President Trump has softened his stance on two key planks of his economic policy. It is not hard to work out why. For all the bluster, Trump is ultimately a pragmatist – and that makes him a president the financial markets will live with.  The financial markets have soared today, and the dollar has recovered, while gold, the safe haven in troubled times, has dropped by $100 an ounce. The reason? A dramatic shift in American policy. In China, the escalating trade war had

Michael Simmons

Britain’s borrowing is spiralling out of control

Britain borrowed nearly £152 billion in the financial year to March – almost £21 billion more than at the same point in the last financial year, according to the Office for National Statistics (ONS). The latest public finance figures reveal that borrowing in March was the third highest since records began in 1993. Crucially, it’s also nearly £15 billion more than what the Office for Budget Responsibility (OBR) had expected for this point in the financial year. The £9.9 billion headroom Rachel Reeves left herself at the Spring Statement already looks to be in serious doubt. The current budget deficit, which is borrowing to fund day-to-day spending and the metric

Michael Simmons

Why the IMF has downgraded UK growth

The waves from Donald Trump’s tariff upheaval continue to ripple through the global economy. The International Monetary Fund (IMF) has downgraded its forecasts for global growth to 2.8 per cent for this year and 3 per cent for 2026, down from previous estimates of 3.3 per cent for each year. The UK isn’t immune: the IMF expects British growth to come in at 1.1 per cent this year and 1.4 per cent next year. US growth, meanwhile, falls to 1.8 per cent followed by 1.7 per cent. These cuts were widely expected, but they sharpen the focus on the costs of the current trade tensions. The downward pressure on demand

Trump won’t win against the Fed

President Trump yesterday escalated his attacks on the Chairman of the Federal Reserve Jerome Powell over his reluctance to cut interest rates, prompting a fresh plunge on Wall Street. The President may appear determined to cut his central banker down to size. And yet the reality is that Powell is completely right not to cut rates – and the President won’t be able to fight the Fed forever. ‘There can be a SLOWING of the economy unless Mr. Too Late, a major loser, lowers interest rates, NOW,’ Trump said on Truth Social, his social media network, yesterday. It was the latest in a series of bitter attacks on Powell for

Can Starmer sell a US trade deal to UK business?

The White House reportedly expects that a trade deal between the United States and the UK could be signed within the next few weeks. This should be a big deal, at least for the small island if not for the world’s biggest economy. There could be a grand signing ceremony at Buckingham Palace. Or at a state visit to parliament by President Donald Trump. Or, if nothing else, perhaps Paddington Bear could put in an appearance to boost marmalade exports. But there is just one catch. It will have to be sold to the public and business alike – and that will be very hard for the bitterly anti-Trump Starmer

Michael Simmons

Britain is not out of the woods on rising inflation just yet

Price rises have unexpectedly eased. The Consumer Price Index rose by just 2.6 per cent in March, down from 2.8 per cent the month before and slightly lower than analysts’ expectations of 2.7 per cent. The figures, just published by the Office for National Statistics, show that the slowdown was driven by falling fuel costs and flat food prices compared to a year ago. Most of the fall was due to lower prices at the pumps, with both petrol and diesel down by 1.6p last month. Meanwhile, prices in some sectors continued to rise – most notably in education, where costs jumped by 7.5 per cent year-on-year, largely due to the introduction

Katy Balls

Has a US-UK trade deal inched closer?

13 min listen

As Donald Trump’s policies on tariffs keep shifting, leaving countries scrambling to react, there has been some good news for Keir Starmer and the Labour government. Speaking to UnHerd, the US vice-president J.D. Vance spoke up the UK’s chances of securing a trade deal. While this would be a win for Starmer, questions remain over the substance – from agriculture to food, what would be included? And can we really believe it will happen? The Spectator’s political editor Katy Balls and deputy US editor Kate Andrews join Patrick Gibbons to discuss.  Produced by Patrick Gibbons.

Ross Clark

Is Britain really going to get a trade deal with the US?

Donald Trump loves Britain and loves the King; therefore we can expect a trade deal. That is the gist of J.D. Vance’s interview with UnHerd. Whether that means anything in practice is another matter. Evidently, the President’s love and affection was not enough to spare us from a 10 per cent tariff on exports to the US (and 25 per cent for cars). While Trump changed his mind last week and delayed most tariffs for 90 days there was no delay to the introduction of the 10 per cent tariffs, which will apply to all countries. All that happened as a result of last Thursday’s pullback was that Britain lost

Michael Simmons

The Bank of England’s mission to tame inflation just got harder

Much to the concern of the Bank of England, British workers are continuing to bank inflation-busting pay rises. Figures just released by the Office for National Statistics (ONS) show that over the three months to February, the average worker received a pay increase of 5.6 per cent. Remove inflation and that works out as a 2.8 per cent real-terms rise.  The persistence of strong pay growth is likely to alarm the nine members of the Bank of England’s Monetary Policy Committee. They have repeatedly warned that they consider sustained wage increases to be a key sign of entrenched inflation. The committee has previously said it wants to see pay growth slow before

Katy Balls

Scunthorpe’s steel and Birmingham’s bins: a tale of two Labours

10 min listen

Panic has subsided over the British Steel crisis as Deputy Prime Minister Angela Rayner, while visiting the site in Scunthorpe, confirmed that the raw materials needed to keep the furnaces running have been secured. While questions remain over the long-term future of the site, the Government are quite confident in their handling of the crisis so far – something not unhelpful with just over two weeks to go from the local elections. Less helpful is the news that over in Birmingham workers have rejected a pay deal with the Labour-run city council; the bin strike will continue. Is there more the government could be doing to end the dispute? Political

Katy Balls

‘Nationalisation in all but name’: the blame game over British Steel

11 min listen

Parliament was recalled from Easter recess for a rare Saturday sitting of Parliament yesterday, to debate the future of British Steel. Legislation was passed to allow the government to take control of the Chinese-owned company – Conservative MP David Davis called this ‘nationalisation in all but name’. Though, with broad support across the House including from Reform leader Nigel Farage, the debate centred less around the cure and more around the cause.  Katy Balls and James Heale join Patrick Gibbons to discuss the debate, the political reaction and how much of a precedent this sets for Starmer.  Produced by Patrick Gibbons.

Michael Simmons

Tariff turmoil: the end of globalisation or a blip in history?

17 min listen

Globalisation’s obituary has been written many times before but, with the turmoil caused over the past few weeks with Donald Trump’s various announcements on tariffs, could this mark the beginning of the end for the economic order as we know it? Tej Parikh from the Financial Times and Kate Andrews, The Spectator‘s deputy US editor, join economics editor Michael Simmons to make the case for why globalisation will outlive Trump. Though, as the US becomes one of the most protectionist countries in the developed world, how much damage has been done to the reputation of the US? And to what extent do governments need to adapt? Produced by Patrick Gibbons.

Michael Simmons

China is hitting back with even more tariffs

China has retaliated against Donald Trump by raising duties on all American imports to 125 per cent from 84 per cent, declaring that it has no interest in responding further to what it calls a ‘joke’ policy. The higher rate will come into force from tomorrow. The announcement comes after the White House’s clarification that tariffs on Chinese exports have climbed to 145 per cent this year – a move China’s commerce ministry described as ‘economically meaningless’ and a tool for ‘bullying and coercion’. The world’s two largest economies exchange goods worth around $700 billion annually. Beijing has made it clear that it considers American goods effectively unmarketable within its

Ross Clark

Rachel Reeves has managed to grow the economy

Just when everyone seems to be revising down expectations of growth, real world data starts pointing in the opposite direction. The Office for National Statistics estimates this morning that GDP grew by 0.5 per cent in February. It also revised January’s figures upwards to give growth for the last quarter of 0.6 per cent, and annual growth of 1.4 per cent. That is almost looking healthy – although less so when you consider the growth in the population is thanks to high migration. What’s more, growth was reasonably balanced, with the production sector growing by 1.5 per cent in February and construction by 0.3 per cent. Even car manufacturing had

Donald Trump has got what he wanted

Donald Trump has peered into the abyss. The US President watched the Wall Street meltdown and the global trading system (from which America benefits as much as anyone) start to collapse, and he hit pause. The conventional narrative will be that Trump has blinked, but I think he simply got what he wanted. Yesterday’s decision to put a 90-day pause on reciprocal tariffs, while increasing the rate on China to 125 per cent, has certainly come as a relief to the markets. The S&P500 was up almost 9 per cent on the news. Investors can breathe again. It would be easy to argue that President Trump has simply chickened out