IMF upgrades UK growth forecast as fears over impact of Iran war diminish

July update projects GDP growth of 1% this year, making UK the third fastest-growing economy in the G7

The International Monetary Fund (IMF) has upgraded its growth forecast for the UK, while leaving those for other G7 countries weaker or unchanged, amid hopes the economic impact of the Iran war may be less severe than feared.

In a July update of its World Economic Outlook, which was finalised before the latest outbreak of hostilities in the Middle East, the Washington-based organisation projected UK gross domestic product to grow by 1% this year – up 0.2 percentage points from its April forecast.

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Italy PM Meloni ‘stunned’ by Trump’s claims she begged him for a photo

US president provokes outrage as PM says he ‘totally invented’ story in interview with Italian media

Italy’s prime minister, Giorgia Meloni, has said Donald Trump “totally invented” a story about her after the US president claimed she begged him to take a photo with her during the G7 summit.

The two former allies had appeared to be getting their relationship back on track by having several one-to-ones on the sidelines at the gathering in Évian after falling out in April over the US-Israeli war in Iran.

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Tuesday briefing: How the UK’s military spending row exposes Starmer’s defence dilemma

In today’s newsletter: An argument about money has also spotlighted questions about Britain’s place in the world and the changing face of warfare

Good morning. What conflict has raged longer than the hundred years war? The fight between the Ministry of Defence and the Treasury over defence spending.

I’d love to claim this as my own, but avoid patter theft this early in the day. So I’ll credit my colleague Dan Sabbagh, the Guardian’s defence and security editor, who spoke to me ahead of this week’s G7 meeting, in France, where Keir Starmer arrived yesterday for what could be his final international summit. The prime minister can anticipate candid discussions about international partnerships in conflicts in Ukraine and the Middle East, both of which may soon demand increased involvement from the British military.

Middle East | Donald Trump has declared that the strait of Hormuz will be “completely open” from Friday, as western leaders gathering at the G7 summit in Évian-les-Bains battled to prevent the fragile US deal with Iran from almost immediately unravelling.

UK politics | Political hatred and division in the UK is probably worse now than during the Brexit referendum, when Jo Cox was murdered, says Kim Leadbeater, Cox’s sister who is now also a Labour MP.

Crime | A schoolteacher described as a “serial manipulator and a serial liar” has been found guilty of sexually abusing and murdering a baby he and his partner had adopted.

Environment | Half of the world’s children are exposed to at least three overlapping climate hazards threatening their health, education and survival, according to a Unicef report.

US news | Eight people are presumed dead after a B-52 bomber crashed shortly after takeoff on Monday morning at a US air force base in California’s Mojave Desert, officials said.

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Indian outrage over US killing of sailors mounts as leaders attend G7 summit

Relations at lowest ebb in years after Washington refuses to apologise for deaths in strait of Hormuz

Fury has continued to mount in India over the US’s refusal to apologise for the deaths of Indian sailors killed in strikes in the strait of Hormuz, further straining relations between the two countries as their leaders meet at the G7 summit in France this week.

Last week, three Indian seafarers, who were working on board commercial oil tankers, were killed when the US launched missile strikes on the vessel as it sailed through the strait of Hormuz.

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Palestinian and Israeli civil society groups urge G7 to take action on Gaza

Paris meeting draws up proposals and calls for urgent diplomacy towards two-state solution at summit next week

Palestinian and Israeli civil society groups meeting in Paris on Friday have urged G7 leaders to act at their summit in the French spa town of Évian-les-Bains next week to save the narrowing chances of a two-state solution.

The groups called for specific action on enforcing a ceasefire, disarming Hamas and starting reconstruction in Gaza, and said the various peace processes including the Board of Peace initiative should be integrated into one programme.

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Canada in push for joint G7 and Middle East effort to de-escalate Iran war

Foreign minister Anita Anand says she has drafted principles to reduce risk of regional spillover and wider shocks

Canada is pushing for a collective G7 and Middle East approach to de-escalating the Iran war, including off ramps that could bring an end to the conflict, the Canadian foreign minister, Anita Anand, has said.

In London to meet the UK foreign secretary, Yvette Cooper, after talks with the her Turkish counterpart, Hakan Fidan, Anand told the Guardian she hoped a G7 meeting chaired by France, this year’s president of the group, might start to build a broader collective approach to the crisis.

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‘History will remember who showed up’: Keir Starmer faces call to attend Cop30 summit

Response from leaders and key climate figures comes after PM’s aides advised non-attendance over concerns Reform may attack him

Leading climate figures and Labour MPs have urged Keir Starmer to attend the crucial Cop30 climate summit this November, after aides advised him not to attend for fear of attracting the ire of the Reform party.

Simon Stiell, the UN’s climate chief, said: “Cop30 is where leaders are expected to come and roll up their sleeves, make deals to help their nation’s economy transition faster, creating more jobs, and guide the world on what next steps we take together.”

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Canada’s security operation for G7 summit faces unorthodox threat … bears

Apex predators are one of several large and unpredictable animals concerning officials in foothills of Rockies

Security preparations for G7 summits normally involve the elite close protection afforded to world leaders, and then a series of of concentric defences against street demonstrations and protests.

Not in the Rockies.

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Iran threatens to leave nuclear weapons treaty as Israeli bombing enters fourth day

Death toll in both countries continues to rise as Iran says it is preparing bill to withdraw from 1968 nuclear non-proliferation treaty

Iran has threatened to leave the nuclear non-proliferation treaty (NPT) as Israeli bombing raids enter a fourth day, underlining the conflict’s potential to trigger a broader war and Tehran’s race to construct a nuclear weapon.

The human cost of the war continued to escalate with both sides broadening their range of targets, as G7 leaders convened in the Canadian Rockies with no clear plan to end the conflict. As he left for the summit on Sunday, the US president, Donald Trump, told reporters: “Sometimes they have to fight it out.”

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UK moves jets to Middle East as Starmer refuses to rule out defending Israel

Military assets to provide ‘contingency support’ as PM repeats call for de-escalation after Iran’s retaliatory strikes

The UK is moving jets and other military assets to the Middle East, Keir Starmer has said, refusing to rule out defending Israel from Iranian strikes despite Tehran’s threat that such an action could lead to British bases in the region being targeted.

Speaking to reporters on the plane to the G7 summit, Starmer reiterated his call for de-escalation, saying he had held a series of calls with other world leaders in the hours after Israel’s attack on Iran, including the Israeli prime minister, Benjamin Netanyahu, and Donald Trump.

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Canada’s PM faces backlash for inviting India’s Narendra Modi for G7 summit

Mark Carney declined to answer if he believed Indian PM had a role in murder of Sikh activist Hardeep Singh Nijjar

Canada’s prime minister, Mark Carney, has defended his decision to invite India’s prime minister, Narendra Modi, to the upcoming G7 summit in Alberta, despite the conclusion of Canada’s federal police’s that the murder of a prominent Sikh activist in British Columbia was orchestrated by the “highest levels” of the Indian government.

Carney declined to answer reporters’ questions over whether he believed Modi had a role in the assassination of Hardeep Singh Nijjar – a killing on Canadian soil that shattered relations between the two countries.

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World’s seven wealthiest countries agree to counter China’s trade practices

G7 finance ministers and central bank governors pledge to address ‘economic imbalances’, without naming China

Top finance officials from the world’s seven wealthiest democracies have set aside stark differences on US tariffs and agreed to counter global “economic imbalances”, a swipe at China’s trade practices.

Ahead of the meeting of G7 finance ministers and central bank governors there had been doubt about whether there would be a final communique, given divisions over US tariffs and Washington’s reluctance to refer to Russia’s war on Ukraine as illegal.

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Rubio says Trump’s ‘51st state’ plan not on G7 summit agenda in Canada

Secretary of state’s visit has backdrop of trade war between US and allies and Trump’s threats to take over Canada

Marco Rubio has said he is not planning to discuss Donald Trump’s threat to “take over Canada” during a visit to Quebec, as Washington’s top diplomat arrives to the backdrop of a raging diplomatic crisis and trade war.

The US secretary of state is flying on Wednesday for a two-day summit with other foreign ministers from allied G7 countries at the river resort of La Malbaie, the first such gathering since Trump retook power with his “America first” agenda.

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US vetoes G7 proposal to combat Russia’s shadow fleet of oil tankers

US pushes to remove references to sanctions and Russia’s war in Ukraine from a Canadian draft statement

The US has rejected a Canadian proposal to establish a task force that would tackle Russia’s so-called “shadow fleet” of oil tankers, according to reports last night.

Canada, which has the current Group of Seven presidency, proposed the measure ahead of a meeting of G7 foreign ministers in Quebec later this week.

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UK awarded its lowest ranking for workplace gender equality in a decade

‘Sluggish’ pace in tackling gender pay gap and worsening employment levels push UK back to 18th in PwC index of OECD countries

Women’s worsening unemployment and participation in the workforce has pulled the UK behind Canada to its lowest ranking for workplace equality among large economies in a decade.

The “sluggish” pace of change on women’s earnings relative to men’s – which means closing the gender pay gap could take more than 30 years at the current pace – has knocked the UK back one place to 18th in the Women in Work Index produced by advisory firm PwC.

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Trump has changed Ukraine debate ‘for the better’, says Downing Street

Starmer’s spokesperson says US intervention ‘could bring lasting peace’ as No 10 treads carefully before White House visit

Donald Trump has changed the global conversation around Ukraine “for the better”, Downing Street has said, as the UK imposed further sanctions on Russia in an effort to force Vladimir Putin to make concessions.

As world leaders marked the third anniversary of Russia’s full-scale invasion of Ukraine, Keir Starmer’s spokesperson said the US president had opened the door to talks that could bring lasting peace.

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G7 vows to clamp down on Russia’s oil sanctions evasion

Group commits to unspecified measures to enforce price cap on Russian exports in response to Ukraine war

Finance ministers of the G7 nations vowed on Saturday to step up efforts to prevent Russia from evading sanctions imposed after its invasion of Ukraine.

“We remain committed to taking further initiatives in response to oil price cap violations,” the group said in a statement after a meeting in Washington. Those further steps were not spelled out in detail.

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Child ‘trampled’ to death among fatalities on Channel boat, says French minister

Young child reportedly found on overcrowded boat trying to cross Channel, hours after G7 countries agree plan to combat smuggling gangs

A two-year-old child was crushed to death and three other people died in two attempts to cross the Channel from France on Saturday.

French authorities said the infant died after being trampled following a “wave of panic” among migrants trying to board a dinghy.

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Biden says US ‘discussing’ possible Israeli plans to attack Iran’s oil industry

President’s off-the-cuff remark outside White House over possible retaliation triggers global oil price rise

Joe Biden has said that his administration has been “discussing” possible Israeli plans to attack Iran’s oil industry in retaliation for the Iranian ballistic missile attack on Tuesday.

Biden’s off-the-cuff remark did not make clear whether his administration was holding internal discussions or talking directly to Israel, nor did he clarify what his attitude was to such an attack.

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UK economy to grow faster than Japan, Italy and Germany this year, says OECD

Forecast upgrades UK to joint second after US but it is still expected to have highest inflation among G7 countries

The global economy is “turning a corner”, according to the Organisation for Economic Cooperation and Development, which has upgraded the UK’s growth forecast for this year to faster than that of Japan, Italy and Germany.

The OECD’s latest outlook ranked Britain joint second among the G7 developed countries in its latest outlook for the world economy. However, the UK is still expected to have the highest inflation in the group.

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