Bank of England expected to leave UK interest rates on hold and slow bond-selling QT programme – business live
Posted on Thursday September 18, 2025

Rolling coverage of the latest economic and financial newsBank of England urged to slow bond-selling plan to help cut record UK borrowing costsThe health (or otherwise) of Britain’s jobs market will be on the Bank of England’s mind when it sets interest rates today – and the latest update from retailer Next may concern them.Next has told the City this morning that its vacancies have fallen across the board, down 35% overall over the last two years, but with deeper falls at its stores.Increasing cost of employment (due to the higher minimum wage, and increased employers’ national insurance contributions)Mechanisation and AI, which are replacing some manual and desk-based functionsIncreasing legislative barriers to employment (warning that the upcoming Employment Rights bill will reduce jobs and eliminate earnings potential).The pressure on employment is unlikely to be like past recessions, where structural changes have wiped out whole industries, resulting in mass redundancies and regional slumps. These changes are likely to affect people employed in most sectors, and so the effects will be more gradual over time.Our guess is that most companies will respond to the increasing cost of employment by not filling vacancies, rather than large-scale redundancies (that has certainly been our experience). This, to some extent, is good news because it means we are unlikely to see widespread or sudden economic shocks.We expect the BoE to slow the pace of balance sheet reduction from £100bn to £60bn per annum (consensus £72bn). That would both keep the amount of active sales the BoE undertakes broadly steady and decrease the payments HM Treasury (HMT) makes to the BoE to cover its losses, thereby reducing the budget deficit. Slower QT would be a win-win for bond holders.The bonds on the BOE’s balance sheet have been losing value as bond prices have fallen, and yields have risen in recent years. In contrast, the amount that the BOE pays in interest on bank reserves has been rising, and the BOE has required Treasury transfers to manage this.Ultimately, this will be for the Chancellor to solve, and it could lead to bank taxes included in this Autumn’s budget.The vote split. We expect a 7-2 vote split to keep Bank Rate on hold. Alan Taylor and Swati Dhingra, we think, will opt for a quarter-point rate cut in September.The forward guidance. If there’s any surprise in the MPC minutes, it’s likely to come from the Bank’s forward guidance. There are three paths here the MPC can take: one, stick to its current guidance of ‘gradual and careful’ rate cuts, two, tweak its current guidance to ‘gradual and cautious’ rate cuts, or three, simply, drop the current guidance entirely. We place a 40/20/40 probability for each of the three paths. Indeed, there’s a material risk, in our view, that the MPC abandons its ‘gradual and careful’ guidance surrounding the downward path for Bank Rate. Continue reading...

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Tax rises in, two-child limit out: what Resolution Foundation’s boss is urging Reeves before budget
Posted on Thursday September 18, 2025

Pensions triple lock should also go, says Ruth Curtice, a former civil servant who says it’s ‘nice to be allowed to say what you think’“She clearly has to fix the problem. I think it’s one thing to come back twice. We don’t want to be here a third time.” Bluntness served Ruth Curtice well in her past life as a senior Treasury official. These days, she deploys it publicly, as chief executive of the Resolution Foundation – urging Rachel Reeves to think the unthinkable before November’s crunch budget.In the course of half an hour’s conversation in her bright white Westminster office, Curtice says the chancellor must be ready to ditch Labour’s manifesto tax pledges, scrap the pensions triple lock, lift the two-child limit on benefits – and forget the idea that a new wealth tax is the answer to anything. Continue reading...

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‘Privatisation premium’: billions from UK energy bills paid to shareholders
Posted on Wednesday September 17, 2025

Analysis reveals sum equal to 24.2% of average bill taken as pre-tax profits by the major energy industries last year, rather than being reinvestedUK public has paid £200bn to shareholders of key industries since privatisation – studyA quarter of the average UK energy bill was funding corporate profits last year, according to analysis that reveals the hidden cost of privatising some of the UK’s key industries.The study – part of a wider Who Owns Britain project by the Common Wealth thinktank – found that a sum equal to 24.2% of the average energy bill went to the pre-tax profits of the major electricity generators, networks and household suppliers in 2024. Continue reading...

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ChatGPT developing age-verification system to identify under-18 users after teen death
Posted on Wednesday September 17, 2025

Sam Altman said if there is doubt the system will default to the under-18 experience putting ‘safety ahead of privacy and freedom for teens’OpenAI will restrict how ChatGPT responds to a user it suspects is under 18, unless that user passes the company’s age estimation technology or provides ID, after legal action from the family of a 16-year-old who killed himself in April after months of conversations with the chatbot.OpenAI was prioritising “safety ahead of privacy and freedom for teens”, chief executive Sam Altman said in a blog post on Tuesday, stating “minors need significant protection”. Continue reading...

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Temu’s UK operation doubles revenues and pre-tax profits
Posted on Wednesday September 17, 2025

Super-budget Chinese retailer reports revenues of $63.3m last year, almost double its $32m in 2023The UK operation of the Chinese online marketplace Temu doubled revenues and pre-tax profits last year, as British consumers snapped up products offered by the super-budget retailer.Temu UK reported revenues of $63.3m (£46.4m) last year, almost double the $32m in 2023, while pre-tax profits similarly surged from $2m to $3.9m, accounts show. Continue reading...

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Vuelta chaos shows selling sport as a tool for peace can create its own battlefield | Jonathan Liew
Posted on Thursday September 18, 2025

Once teams promote a country, are owned by states or have to reflect government policy, sport becomes a playground for powerHigh fives all round at Hamas high command. The triumphant clink of Gaza Cola tins pings across the bunker. It’s been a tough week for the lads, what with five of their members being killed in the Doha airstrike, but you’ve got to celebrate the little victories, yeah? And as they use what remains of their fragile satellite internet connection to refresh the Cyclingnews live blog for the final time, the Hamas Grand Tour Disruption Division (Vuelta Branch) can toast an operation executed to perfection: the successful mobilisation of more than 100,000 members of the Madrid battalion to force the curtailment of stage 21 of the Tour of Spain.“They asked us to quit the Vuelta, but we did not surrender to the terrorists,” said Sylvan Adams, co‑owner of the Israel-Premier Tech team targeted by mass protests that disrupted several stages. On Sunday, huge crowds of protesters in Madrid forced the race to conclude 27 miles short of the finish. And if the rancorous and chaotic last three weeks have taught us anything, it is the sheer number of terrorists that appear to have been operating within pro cycling, albeit many armed with nothing more lethal than energy gels. Continue reading...

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Simeone blames fan row after Liverpool winner on ‘getting insulted all game’
Posted on Wednesday September 17, 2025

Atlético head coach sent off following Van Dijk’s late goalArne Slot hails side’s fitness and mentality after winnerDiego Simeone said he gave a “human” reaction when he confronted a fan after Liverpool scored a 92nd-minute winner to defeat Atlético Madrid 3-2.The Atlético head coach, who was dismissed by the referee, claimed he received constant abuse throughout the match and his emotions boiled over after Virgil van Dijk’s goal. Continue reading...

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