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GfK and S&P Global readings show consumer confidence remains negative but improved slightly, while mortgage costs rise and energy prices add to pressures. Analysts warn of tougher borrowing conditions and potential budget decisions.
Inflation has moved to a five‑month high of 3.1% as fuel prices and airfares climb, driven by Middle East conflict. The government has announced relief measures while stressing fiscal prudence. The Budget is six weeks away, and markets face higher borrowing costs amid a fragile headroom.
China's official manufacturing PMI has edged into expansion at 50.3 in June from May's 50.0, with improvements in new orders and production. Export demand remains a key engine, while domestic consumption shows caution amid a prolonged property downturn. Analysts expect policy support to sustain momentum.
Tech stocks led a cautious rebound after Micron’s forecast topped estimates, helping Nasdaq futures claw back losses and easing fear over AI-driven demand. Investors are watching for further data and central-bank cues.
The government has released June employment data showing payrolls rising by 57,000, far below forecasts, while the unemployment rate edges down to 4.2%. The labor force participation rate has fallen, highlighting a shift in the job market as fewer people are seeking work. Revisions to May and April data point to a softer hiring pace than previously thought.
UK service activity has contracted in June while manufacturing continues to expand, signaling a mixed momentum for the economy. Analysts warn growth remains weak into the second half as energy costs and geopolitical tensions weigh on demand.
The US and Iran have exchanged fresh strikes this weekend and on Monday, reversing a recent interim ceasefire and re‑opening doubt over control of the Strait of Hormuz. President Donald Trump has declared the ceasefire "over," ordered further strikes and revoked a temporary oil waiver. Oil has jumped into the high $70s–$80s and global markets have fallen.
Houthi forces have claimed missile, drone and cruise-missile strikes on two Saudi oil tankers, Encelia and Layla, in the Red Sea and have declared a naval blockade of Saudi ports. The attack has caused a fire aboard one tanker, forced several ships to turn back and driven marine insurance and oil prices higher while US strikes on Iranian targets continue.
Consumer confidence has improved in July as heatwaves, football success, and the new prime minister boosted mood. However, overall sentiment remains negative, with the GfK index at -17, and gains rely on government delivery to tackle cost‑of‑living pressures.
The UK construction PMI has improved in July, rising to 44.7 from 38.4, signalling a stabilisation after a sharp downturn in Q2 2026. Housebuilding declines eased to the slowest pace since October 2025, while civil engineering remains the weakest area. New orders fell at the slowest rate since September 2025. Employment fell for the 19th straight month but at the slowest pace since February.
A block of UK indicators shows services activity expanding and consumer confidence firming, while manufacturing remains modest. PMI readings point to continued growth in Q3, supported by tech investment and exports, though inflation and public finances remain a risk.