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UK government borrowing costs are on course for one of their biggest ever monthly rises — and mortgage rates are set to increase as well — following the bond market meltdown triggered by chancellor Kwasi Kwarteng’s fiscal policy announcement last week. The 10-year benchmark gilt yield has increased by 1.26 percentage points so far in

The pound tumbled to an all-time low against the dollar on Monday, losing as much as 4.7 per cent to $1.035 after UK chancellor Kwasi Kwarteng vowed to pursue more tax cuts. The fall takes the pound to its lowest level since the decimalisation of the currency in 1971. The sharp moves in sterling came

Investors have warned UK chancellor Kwasi Kwarteng that the bonanza of tax cuts and spending measures he announced on Friday risk undermining their confidence in the country. On Friday the chancellor heralded a “new era” for the UK economy, in which he plans to boost growth by delivering the biggest tax reduction since 1972 at

During a lull in bustling lunchtime trade at Bury market in the north-west of England on Friday, stallholders Tony and Mary Sinacola mulled over the government’s radical tax-cutting “mini-Budget”. A few hours earlier Kwasi Kwarteng, the chancellor, had unveiled the first fiscal event of the new administration, ushering in £45bn of tax cuts — the

Kwasi Kwarteng, UK chancellor, has taken a huge political gamble with a mini-Budget intended to jolt the British economy back to life, announcing £45bn of tax cuts, including axing the 45p additional tax rate for the highest earners. The package will delight many in the City of London and the wealthy. It removes the 45p

Japan intervened to strengthen the yen for the first time since the late 1990s on Thursday, after the currency tumbled to a 24-year low on pledges by the central bank to stick with its ultra-loose policy. Masato Kanda, the country’s top currency official, said the government had “taken decisive action” to address what it warned

Vladimir Putin said Russia’s armed forces would call up its reserves immediately to support its invasion of Ukraine and indicated Moscow would probably annex large swaths of the country’s territory. In an address to his nation that significantly raised the stakes in the war, the Russian president announced “partial mobilisation” ahead of heavily stage-managed votes

Liz Truss has admitted that a UK-US trade deal, long seen as one of the biggest prizes of Brexit, is not on the horizon, as she arrived in New York on her first overseas trip as prime minister. Brexit supporters insisted that the 2016 Leave vote would open the way for a free trade agreement

Mourners have come to London from all over the UK and around the world in the hope of seeing Queen Elizabeth’s funeral procession and soak up the atmosphere in the capital’s streets. Sarah and Harry, from Kingston-upon-Thames, drove to London on Monday to take their place behind the barriers lining Cromwell Road, where the mood

The US central bank will lift its benchmark policy rate above 4 per cent and hold it there beyond 2023 in its bid to stamp out high inflation, according to the majority of leading academic economists polled by the Financial Times. The latest survey, conducted in partnership with the Initiative on Global Markets at the

Wall Street stocks recorded the biggest weekly drop in months after a profit warning from economic bellwether FedEx jolted investors who are already on edge over a looming interest rate rise by the US Federal Reserve at its upcoming meeting. The blue-chip S&P 500 index fell 0.7 per cent on Friday, bringing weekly losses to

Sterling slid to its lowest level since 1985 on Friday after a round of weaker than expected data on UK retail sales amplified concerns that the country is headed for a prolonged recession. The pound dropped 0.8 per cent in morning trading in London to $1.137, the first time it has breached the $1.14 mark

Kwasi Kwarteng, chancellor, is seeking to scrap Britain’s cap on bankers’ bonuses, introduced after the 2008 financial crash, in a controversial move to boost the City of London’s global competitiveness. Kwarteng argues the move would make London a more attractive destination for top global talent and would be a clear signal of his new “Big

The UK’s rate of inflation eased back into single digits in August on the back of lower petrol prices, providing some relief to households as they go into winter. The headline consumer price index was 9.9 per cent higher than a year earlier during the month, down from a 40-year high of 10.1 per cent

Ukraine still faces “a tough fight” after Russia gave up most of the territory it had taken near Kharkiv following a lightning counteroffensive that forced many retreating troops to leave the country, according to the Pentagon. A senior military official said on Monday that Russian forces “had largely ceded their gains” around Ukraine’s second-largest city

Ukraine needs to secure the vast territory it has recaptured from possible Russian counter-attack, the country’s defence minister has warned, as he said Kyiv’s lightning offensive had gone far “better than expected”. The attack has routed the Kremlin’s forces, led to the recapture of some 3,000 sq km of Ukrainian territory and prompted an unusual

Russia abandoned military strongholds in northeastern Ukraine on Saturday in an apparent rout of its front line positions, after Ukrainian forces pushed forward in a lightning advance that has left Moscow’s forces in disarray. Russia’s defence ministry said its forces had pulled back from the strategic city of Izyum, claiming it had decided to “regroup” and transfer

Charles III has addressed his nation for the first time, vowing to emulate his late mother Queen Elizabeth’s “life-long service”, ahead of his formal proclamation as king on Saturday. The new monarch’s words came after a day of parliamentary tributes, gun salutes and raw emotion, as thousands of people gathered at the gates of Buckingham

Queen Elizabeth II, Britain’s longest-serving monarch, has died, leaving her people in mourning but reflecting on a life of duty in which she bound the country together through 70 years of momentous change. Her death, at the age of 96, was announced by Buckingham Palace at 6.30pm on Thursday. It marked a watershed moment in

The pound has fallen to its weakest levels since 1985, reflecting the daunting scale of the economic challenge new prime minister Liz Truss faces as she prepares to unveil an emergency energy package. Truss will on Thursday give details of the state intervention to shield households and companies from soaring energy bills. Government insiders said

Liz Truss has vowed Britain will “ride out the storm”, as the new UK prime minister began confronting an economic crisis with a massive energy bailout for families and businesses that could cost more than £150bn. Truss dodged torrential rain outside Downing Street to tell the country that she would create an “aspiration nation”, adding:

Liz Truss will enter Downing Street on Tuesday after a bruising battle to become the UK’s next prime minister and will finalise a two-year package of energy relief for households and business that could cost up to £100bn. The foreign secretary beat rival and former chancellor Rishi Sunak in a ballot of Conservative party members

Kwasi Kwarteng, who has been tipped as Britain’s next chancellor, has launched a pre-emptive bid to reassure markets that Liz Truss will not blow a hole in the public finances if, as widely expected, she is named as prime minister on Monday. Kwarteng writes in the Financial Times that although there will need to be

Sweden will give emergency liquidity support to electricity producers as its prime minister warned that Russia’s decision to halt gas deliveries to Europe could place its financial system under severe strain. Magdalena Andersson said on Saturday that the government would offer hundreds of billions of kroner in funding to electricity producers, who have seen the

Surging inflation, the rising cost of government debt and Liz Truss’s promises on tax cuts and defence spending will blow a £60bn hole in the public finances by the middle of the decade, according to Financial Times calculations. Although Truss, favourite to be named Britain’s next prime minister on Monday, has said she will stick

Starbucks has named the outgoing head of Reckitt Benckiser as its next chief executive, handing Laxman Narasimhan the task of executing a “reinvention” strategy designed by Howard Schultz since he returned in April to take charge of the coffee chain for the third time. The India-born, US-educated executive will join as “incoming CEO” on October

Sterling has recorded its steepest monthly decline against the dollar since the wake of the Brexit referendum against a backdrop of intensifying economic and political uncertainty. The pound fell 4.5 per cent in August to $1.16 in the biggest monthly drop since October 2016. Sterling also declined by almost 3 per cent against the euro.

Rishi Sunak, Tory leadership contender, has warned that it would be “complacent and irresponsible” to ignore the risk of markets losing confidence in the British economy, as wagers against UK government debt sent short-term borrowing costs in the gilt market soaring. In an interview with the Financial Times, Sunak said his leadership rival Liz Truss

The EU is preparing emergency measures to curb the price of electricity by separating it from the soaring cost of gas, as Shell warns the energy crisis could last for years, and utilities turn to the state for support. With member states stepping up pressure for action, European Commission president Ursula von der Leyen said

Central bankers face a more challenging economic landscape than they have experienced in decades and will find it harder to root out high inflation, top multilateral officials and monetary policymakers have warned. The world’s leading economic authorities this weekend sounded the alarm about the forces working against the Federal Reserve, European Central Bank and other