Category Archives: Economics

Canada’s provincial leaders in disarray over response to Trump tariff threats

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Responses range from conciliation to retaliation, including cutting off electricity and halting the purchase of US liquor

Canada’s provincial premiers are sharply divided on how to prepare for US trade tariffs, less than a week before Donald Trump takes office with a threat to dramatically reshape the relationship between the two countries.

Canadian officials have sought to defuse the crisis with personal appeals to the president-elect, multimillion-dollar advertising sprees and targeted threats, but the country remains gripped by uncertainty over how Trump’s tariffs might take effect. On Monday, Bloomberg reported that the incoming US administration is weighing hiking tariffs by 2%-5% a month to avoid spiking inflation.

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UK bans German meat and dairy products after foot-and-mouth case

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Import of pork, lamb and beef as well as live cattle, sheep and pigs suspended amid outbreak near Berlin

Britain has banned imports of German pork, lamb, beef and dairy products to prevent foot-and-mouth disease spreading to the UK after a case of the disease was confirmed last Friday on the outskirts of Berlin.

As well as prohibiting imports of ham, bacon, salami and cheese, the measure bans the import of live cattle, sheep and pigs, along with other animals which are susceptible to foot-and-mouth. No health certificates will be issued by Britain for fresh meat from Germany.

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Business confidence falling in UK and eurozone, recruiters warn

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Fears over UK growth and political uncertainty in France and Germany making firms reluctant to hire staff

Recruitment companies have warned about declining confidence across Europe and the UK, as political uncertainty adds to concerns about economic growth.

The FTSE 250 recruiter PageGroup said on Monday that profits had dropped by nearly a quarter in Germany and 17% in France during the last three months of 2024, compared with the same period in 2023. Its UK profits fell by 14%, as companies grew more nervous about taking on new staff.

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One in six UK workers skipping meals to make ends meet, says TUC

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Trade unions body finds 17% have skipped meal in past three months, and as many as 10% do so most days

As many as one in six workers in Britain are skipping meals to make ends meet as households remain under pressure from the higher cost of groceries, energy and other essentials.

Highlighting the impact of the cost of living crisis on working households, figures from the Trades Union Congress (TUC) showed 17% of full- or part-time workers had skipped a meal to reduce their spending in the past three months.

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UK can be ‘AI sweet spot’: Starmer’s tech minister on regulation, Musk, and free speech

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Technology secretary Peter Kyle has the task of making Britain a leading player in the AI revolution, but says economic growth will not come at the cost of online safety

With the NHS still struggling, a prisons crisis still teetering and Britain’s borrowing costs soaring, there are few easy jobs going in Keir Starmer’s cabinet at present.

But even in such difficult times, the task of convincing Silicon Valley’s finest to help make Britain a leader in the artificial intelligence (AI) revolution – all while one leading tech boss uses the Labour government as a regular punching bag and others ostentatiously move closer to Donald Trump – is among the most challenging.

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Ontario leader warns of ‘pain’ for US if Trump imposes tariffs on Canada

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Premier of most populous province says rhetoric clouds trade relationship worth hundreds of billions of dollars

The United States will “feel pain” if Donald Trump doesn’t back down from his threat to impose steep tariffs on its northern neighbour, the leader of Canada’s most populous province has warned.

After a tumultuous week that left Canadian leaders flailing for a coherent national response to Trump’s provocations – including the suggestion that the US would annex its closest ally – the Ontario premier, Doug Ford, told the Guardian: “We will never be for sale.”

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Pound falls to 14-month low as bond sell-off piles pressure on Rachel Reeves

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UK borrowing costs rise again, with analyst warning ‘things are also getting rather ugly’

The pound has fallen to a 14-month low against the US dollar as the sell-off in the bond market fuelled investors’ anxiety over UK assets and piled further pressure on the chancellor, Rachel Reeves.

As the bond sell-off gathered steam, sterling lost a cent against the US dollar, extending recent losses, falling to about $1.226.

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Rachel Reeves heads to China to build bridges, but a new golden era of relations is impossible

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Seeking business partners post-Brexit is sound policy, but even in these darker geopolitical times the UK will ultimately side with the US

Rachel Reeves will fly with a delegation of City grandees to China this week as Labour seeks closer economic links with Beijing as part of its quest for growth.

With the outlook increasingly rocky at home after a run of soft economic data, the chancellor is sorely in need of a positive story to tell.

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UK retailers may have to cut thousands of jobs after bleak Christmas

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British Retail Consortium figures show sales growth close to flatlining, as card spending fails to rise

Britain’s largest retailers are warning they could be forced to cut thousands of jobs this year as the industry braces for higher taxes and employment costs after a bleak Christmas shopping season.

In the latest sign of tough trading conditions on the high street, figures from the British Retail Consortium (BRC) show sales growth over the “golden quarter” between October and December came close to flatlining.

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Xi says China’s economy on course to expand by 5% despite Trump concerns

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President seeks to allay fears that world’s second-largest economy will falter in 2025 because of high US tariffs

China’s economy is on course to expand by 5% in 2025, according to its president, Xi Jinping, meeting official growth targets and rebutting concerns that Donald Trump’s incoming US administration will harm Beijing’s prospects in the new year.

Using his annual address to the nation, Xi sought to allay fears that the world’s second-largest economy would falter over the next 12 months after the government battled to prevent a slide towards recession during 2024.

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Trump versus trade: the global economic outlook for 2025 in five charts

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Unpredictable change will sweep through America, while old problems, from war to inflation, are likely to afflict other countries

The global economy is entering the new year with rising geopolitical tensions looming over its prospects, as the world’s leading central banks attempt to cut interest rates after the worst inflation shock in decades.

Donald Trump’s second term in the White House is expected to dominate the economic agenda. Global trade tensions are on the horizon as the president-elect threatens to impose sweeping tariffs on US imports.

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ECB faces tough task after flip in fortunes for eurozone economies

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Economists say EU countries hardest hit by 2010s debt crisis now in stronger position than France and Germany

The European Central Bank is facing a tough balancing act in 2025 as it tries to navigate a reversal of fortunes in eurozone economies, as the hardest-hit nations of the 2010s debt crisis outperform the traditional core.

Highlighting a potential shift in power dynamics within the single currency bloc, economists said countries in the EU periphery ravaged by last decade’s sovereign debt crisis were in a stronger position than northern Europe’s most powerful nations, including France and Germany.

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UK interest rates to fall more slowly than expected after budget, claims report

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Government’s spending and borrowing plans mean rates will stay higher for longer, according to OECD

UK interest rates will fall by less than expected over the next two years after Rachel Reeves revealed significant spending and borrowing plans in the budget, according to an influential report.

In its annual economic survey, the Organisation for Economic Cooperation and Development (OECD) said UK inflation would also surpass previous forecasts next year, and upgraded growth projections for the economy, because of boost from October’s budget.

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China’s share of global electric car market rises to 76%

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Market share increases after strong demand within country offsets risks from western tariffs on Chinese-made EVs

China’s share of the global electric vehicle market reached 76% in October, the country’s automotive trade body said, reflecting strong demand for EVs in the country even as western tariffs risk hobbling exports.

Between January and October, sales of EVs reached 14.1m units, according to the China Passenger Car Association, with 69% of those sales in China. In October, China’s share surpassed three-quarters.

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Trudeau in Florida to meet Trump after tariffs threat – reports

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Canada’s PM to dine with US president-elect at Mar-a-Lago resort, news reports say, days after Trump threatens 25% tariff on Canadian imports

The Canadian prime minister, Justin Trudeau, has arrived in Palm Beach, Florida, ahead of a meeting Donald Trump at his Mar-a-Lago resort, according to media reports, days after the US president-elect threatened the US’s neighbour with import tariffs once he takes office.

The Canadian prime minister’s public itinerary does not list a scheduled visit to Florida. Neither Trudeau’s office nor Trump’s representatives immediately responded to requests for comment.

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Why has France’s austerity budget caused a political storm?

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Country is at risk of fresh turmoil with its government on the brink amid soaring sovereign borrowing costs

France is at risk of being plunged into fresh political turmoil as its minority government teeters on the brink of collapse amid opposition anger over a planned austerity budget.

Reflecting growing unease in financial markets, French sovereign borrowing costs have risen sharply, reaching the highest premium over German bonds since the height of the eurozone debt crisis in 2012.

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French sovereign borrowing costs rise to highest premium in 12 years

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Government faces risk of collapse over planned austerity budget

French sovereign borrowing costs have soared to the highest premium since the eurozone debt crisis amid political turmoil as the government faces the risk of collapse over a planned austerity budget.

The gap between French 10-year government bond yields and their German equivalent ballooned to as much as 90 basis points on Wednesday, the widest level in 12 years, while shares listed on the Paris stock exchange also tumbled.

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Trump’s tariff threat sets stage for bitter global trade war

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Trade experts hail ‘new era of protectionism’ with targeted countries retaliating with their own tariffs

Donald Trump’s threat to impose steep tariffs on goods imported into the US has set the stage for a bitter global trade war, according to trade experts and economists, with consumers and companies warned to brace for steep costs.

The president-elect announced on Monday night that he intends to hit Canada, Mexico and China with tariffs on all their exports to the US – until they reduce migration and the flow of drugs into the country.

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Retailers warn inflation could hamper UK shoppers in run-up to Christmas

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British Retail Consortium figures come alongside data showing a fall in household disposable income

Shoppers’ ability to afford Christmas treats has been put under threat as retailers warned November could mark a turning point for inflation, with the recent fall in prices slowing amid increased fresh produce costs and fewer discounts on the shelves.

Shop prices fell by 0.6% in November, compared with a fall of 0.8% in October, according to the latest report from the British Retail Consortium (BRC) and research firm NielsenIQ. The slowdown in deflation was driven by non-food goods and a slight increase in fresh food prices, including seafood.

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Ireland prices corporation tax loss from Trump policies at €10bn

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Figure costed for three multinationals repatriating to US after nomination for commerce secretary hits out at Ireland’s tax regime

Ireland’s prime minister has said the country could lose €10bn (£8.35bn) in corporate tax if just three US multinationals were repatriated to America under a hostile Donald Trump administration.

His remarks come just days after Trump nominated the Wall Street investor Howard Lutnick to lead the Department of Commerce with direct responsibility for trade.

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