Alex Daniel

Chinese carmaker Chery plans to open a research and development centre at UTAC Millbrook in Bedfordshire in late autumn, expanding its UK operations and adapting vehicles to local roads and drivers. The facility will provide access to more than 70km of test tracks and may later support work on autonomous vehicles and artificial intelligence. Chery’s Jaecoo, Omoda and Chery brands reached nearly 8% of UK market share in July, while the Jaecoo 7 became the country’s best-selling model in March. The company has also agreed with Nissan to manufacture cars at Sunderland from 2027 and says it plans to recruit locally, although it has not disclosed the investment or expected job numbers.

A cooling UK labour market, falling vacancies and slower private-sector wage growth have led economists to question whether the Bank of England needs to raise interest rates. Total UK earnings growth slowed to 4.1% in the three months to June, while grocery inflation eased to 2.1%, although rising energy prices linked to the renewed US-Iran conflict are expected to push overall UK inflation close to 3%. The ceasefire’s collapse drove Brent crude above $91 a barrel and lifted government borrowing costs across major economies. The live coverage also reported UK gas-supply risks, regional weakness in the housing market, improving but fragile eurozone sentiment, higher US crop prices, weaker housing starts and a sharp fall in Klarna shares after reduced guidance. Ikea is preparing to launch a UK secondhand marketplace, while Stonegate faces scrutiny over alleged mistreatment of pub tenants.

Brent crude rose above $90 a barrel after the two-month window for US-Iran peace negotiations expired without a deal. Iran warned it could adopt a fully offensive military stance, while Donald Trump demanded Iranian surrender and threatened to bomb Oman if it obstructed his efforts. A cargo ship was attacked in the Strait of Hormuz, and shipping traffic has fallen sharply, increasing fears of a prolonged closure through a waterway that normally carries about a quarter of global seaborne oil. Analysts warn that continued conflict, combined with Russia’s war in Ukraine, could produce further oil and gas price spikes and volatility.

UK grocery price inflation slowed to 2.1% in the four weeks to 9 August, its lowest rate since October 2024, as shoppers increasingly used supermarket promotions. Hot weather drove higher spending on picnic foods, dips, coleslaw, potato salad, olives, chilled finger foods, soft drinks, ice cream, sorbet and frozen fruit. Grocery spending averaged £410 per household, down from the previous period after the boost from the men’s football World Cup, while online food sales reached £2.1bn. Analysts expect shopping patterns to change as summer ends and children return to school, potentially prompting retailers to revive money-off vouchers.

Mike Ashley’s Frasers Group has increased its stake in Hugo Boss to 48% after 17.6% of shareholders accepted its €38-a-share offer, bringing the retailer close to control of the German fashion house. Hugo Boss rejected Frasers’ nearly €2bn takeover bid in June as inadequate, but analysts say the enlarged holding puts Frasers firmly in the driving seat. The move follows Frasers’ purchase of Harvey Nichols and Ashley’s growing interests in luxury brands including Burberry and Mulberry, despite challenges across the luxury-fashion market.

Government bond yields in the US, France, Germany, Japan and the UK reached multi-year or post-financial-crisis highs as investors worried that the Middle East crisis would sustain inflation and prompt further interest-rate increases. UK house asking prices fell 2% in August, leading Rightmove to cut its annual forecast to between 0% and -2%. Oil and gas prices rose as shipping through the Strait of Hormuz slowed sharply, while Canadian inflation accelerated because of higher fuel prices. The liveblog also covered Jamie Dimon's opposition to higher UK bank taxes, criticism from the TUC, regulatory approval for Virgin Trains' future cross-Channel services, musician opposition to North Sea drilling, a strong English wine harvest, and the firing of Russian economist Andrei Klepach after criticism of the wartime economy.

Andy Burnham could face immediate pressure from bond markets if he enters Downing Street promising higher borrowing to fund nationalised utilities, council housebuilding and infrastructure. Although he has accepted Rachel Reeves’s fiscal rules and Labour’s pledge not to raise income tax, VAT or national insurance, advisers warn that expanded spending would require cuts, tax increases or carefully targeted investment borrowing. Jim O’Neill argues there is more room under existing rules for infrastructure investment, while market analysts say Burnham’s choice of chancellor will signal whether he adopts a centrist or interventionist approach. External factors, including energy prices and the Iran war, may ultimately influence borrowing costs more than his decisions.

The Metropolitan police investigation into the Post Office Horizon scandal could be delayed by up to five years without substantially more funding and staff. Commander Stephen Clayman says the budget may need to rise to £19.3m, compared with a £2.8m Home Office grant, and the investigative team must expand from 111 to 210 people to meet a late 2027 or early 2028 deadline for submitting files to prosecutors. The inquiry has 8 million documents, 53 people under investigation and 13 suspects interviewed, while police await the second part of Sir Wyn Williams’s public inquiry before considering charges. The scandal involved more than 900 prosecutions linked to faulty Fujitsu Horizon software, with compensation payments reaching £1.48bn across redress schemes.

Jaguar Land Rover and General Motors are among several companies competing for a potential £900m UK Ministry of Defence contract to supply an initial 3,000 light military vehicles from 2030. The programme aims to replace an ageing fleet of Land Rovers and Pinzgauers used by the army, Royal Navy and Royal Air Force, with further orders potentially replacing about 7,800 vehicles. JLR is considering partnerships with the Ministry of Defence, while GM has joined BAE Systems and NP Aerospace to propose US-built Chevrolet-based trucks modified in Britain. Ineos Automotive, Babcock, Rheinmetall and General Dynamics are also bidding as rising NATO defence budgets create opportunities for carmakers facing weak profits and intense competition.

The Institute for Public Policy Research has urged the UK government to temporarily cap speeds at 20mph in towns and cities and 60mph on motorways to reduce fuel demand and limit the inflationary impact of the Iran conflict. It also proposes a 10p-per-litre fuel-duty cut and an automatically triggered £2,000 annual energy price cap, warning that inflation could reach 5.8% without intervention. The package could cost up to £5bn annually but, according to the IPPR, reduce peak inflation by as much as two percentage points and help avert further Bank of England rate increases. The proposals face public opposition, while the government has indicated that any support will be targeted at the most vulnerable households.

A survey by S&P Global found that UK service-sector companies raised prices at the fastest rate in more than three years in April, with fuel and wage costs the main drivers. Airlines are among firms introducing fuel surcharges or other price adjustments: IAG said it was increasing prices across its airlines, while Virgin Atlantic added charges of up to £360 to business-class tickets. Although service-sector activity improved slightly, subdued new business and weak confidence suggest the recovery may be short-lived. Economists warned that the Iran-related disruption to energy supplies could weaken growth and increase unemployment, while persistent inflation may increase pressure on the Bank of England to raise interest rates.

An Opinium poll found that 80% of Britons fear the Iran war will raise grocery prices, while 73% expect higher prices for other products. The Strait of Hormuz blockade has driven up oil, gas, fertiliser, shipping and distribution costs, prompting retailers to urge the UK government to remove non-commodity energy charges. Food and non-alcoholic beverage prices rose 3.7% year-on-year in March 2026, and the Bank of England forecasts food inflation could reach 7% by year-end. The government says it has suspended some food tariffs and is working with the sector, but retailers warn that the opportunity to prevent further price increases is rapidly narrowing.

UK 30-year gilt yields reached 5.77%, their highest level since 1998, as fears of inflation from the Iran war combined with uncertainty over Keir Starmer’s leadership. Rising borrowing costs could significantly reduce Rachel Reeves’s £24bn fiscal headroom, with analysts estimating that more than half may already have been eroded by higher yields and weaker growth prospects. Labour may face pressure to use the remaining buffer to shield households from higher energy bills, while potential leadership successors could pursue looser fiscal rules and increased spending. Prolonged disruption in the Strait of Hormuz could intensify inflation, energy and growth risks, leaving the UK particularly exposed and potentially keeping borrowing costs elevated.

Reform UK has asked steel industry executives to develop an alternative strategy focused on retaining domestic virgin steelmaking, targeted public support, procurement and trade measures, while abandoning net zero policies. The initiative is part of Nigel Farage’s party effort to win support in former Labour manufacturing areas, particularly Wales, but industry opinion is divided: some executives welcome Reform’s attention, while others doubt its policy ideas and oppose greater reliance on gas. Reform’s proposal contrasts with Labour’s new steel strategy, which includes higher import tariffs and measures to reduce energy costs. Steelmakers and the government argue that clean power, rather than ending net zero, is the path to lower bills and greater energy security.

The Iran war has weakened confidence in the UK housing market by driving up oil prices, inflation fears and mortgage rates. In Canterbury, fewer homeowners are listing properties after valuations, buyers are withdrawing from chains, and sellers are cutting prices as demand and competition diminish. UK house prices fell 0.5% in March, while the average two-year fixed mortgage rate rose to 5.90% from 4.83% at the start of the month. Nearly one million homeowners are due to refinance five-year fixed-rate deals this year, with replacement payments averaging £94 more per month. A temporary ceasefire briefly eased expectations for interest-rate rises, but experts warn that mortgage costs may remain elevated and renewed conflict could trigger further market volatility.

CK Infrastructure is urging Ofwat and the UK government to reopen the sale of Thames Water after preferred bidder KKR withdrew from last year’s takeover process. CKI co-managing director Andrew Hunter said Thames’s management should abandon its exclusive approach, share the due-diligence information previously provided to KKR and allow competing firms to bid. Thames Water, burdened by £17.6bn of debt and facing fines linked to leaks and pollution, is instead negotiating a £10bn rescue with creditors including Elliott Management and Silver Point Capital. CKI argues that distressed-debt investors lack the expertise to operate a major UK water company, while its own record running Northumbrian Water and UK energy networks makes it a more suitable owner. Its potential acquisition remains politically sensitive because of concerns about its Hong Kong and China links.

UK steel industry leaders warn that new tariffs designed to protect domestic steelmakers may contain a loophole allowing foreign steel parts that have already been cut, drilled or fabricated to enter the country without equivalent restrictions. They say this could raise the cost of UK raw materials, make downstream manufacturers uncompetitive, and cause job losses and factory closures across a sector supporting about 300,000 jobs. The government says its measures will protect UK producers, reduce reliance on overseas steel and prioritize British suppliers in public contracts, while promising a review after 12 months. The warning comes as British Steel is expected to be fully nationalized and the industry faces additional pressure from high energy costs and cheap Chinese imports.

The UK government is expected to take full economic control of British Steel from its Chinese owner, Jingye, within weeks after already assuming responsibility for the Scunthorpe plant’s daily operations. Ministers reportedly offered £100m for the business, far below Jingye’s original demand of more than £1bn, and may instead impose a deadline for an agreement. The plant employs 3,500 people, supplies most of Network Rail’s track and operates the UK’s last blast furnaces, but keeping it running has already cost £377m and could exceed £1.5bn by 2028. UK Steel supports nationalisation, while potential private buyers have shown early interest; any future owner would need to invest heavily in electric arc furnaces and improve profitability.

Greater adoption of electric vehicles could extend the UK’s petrol and diesel reserves and strengthen energy security, with EVs already estimated to save roughly two days of fuel and Norway-level adoption potentially adding seven days of petrol reserves. Vehicle-to-grid technology could allow parked cars to return stored electricity to the grid, potentially providing up to 16GW daily by 2030 while reducing owners’ charging costs. However, adoption is constrained by duplicate electricity taxation, insufficient hardware, limited manufacturer support and weakening EV sales, while the UK’s 2035 zero-emission vehicle mandate faces industry pressure.

UK vehicle production fell 17% year on year in February, while exports dropped 12%, driven by weak demand in China, declining US shipments and global trade pressures. Electric, plug-in hybrid and hybrid production also declined, although these vehicles represented 40% of output. Industry leaders warn that the conflict in the Middle East, rising energy prices and supply-chain disruption could cause a further March decline. Proposed EU “Made in Europe” rules could threaten Nissan’s Sunderland plant, while the downturn conflicts with Labour’s goal of producing 1.3 million vehicles annually by 2035.

UK defence manufacturers say the government’s six-month-plus delay in publishing its Defence Investment Plan has left the sector unable to plan, with smaller firms losing cash and some going out of business. Industry representatives warn that global defence companies may invest instead in Germany, Poland or the US, potentially weakening UK supply chains. The delayed plan is intended to explain how the government will fund its strategic defence review amid an estimated £28bn funding gap, rising NATO commitments and plans to increase defence spending to 3% of GDP. The Ministry of Defence says it is working to publish the plan as soon as possible.