UK economics:

1. On 11th of January, the pound slumped to its lowest level in a year, falling to $1.2207 against the dollar, after Government borrowing costs hit their highest level since 2008.
2. The government has been warned that borrowing costs are set to exceed targets outlined in the October budget. If the OBR predicts in its upcoming March borrowing forecast that the Chancellor’s fiscal rules were likely to be broken, markets are likely to remain in turmoil.
3. UK retailers show a weak year of sales growth in their end of year reports, with sales in 2024 only 0.7% higher than in 2023; the British Retail Consortium warning that 2025 will be a difficult year for shops due to increasing taxation and wage costs. The British Chamber of Commerce says that more than half of companies, part of a 5000 firm survey, are planning to raise prices in the next 3 months to combat rising costs.
4. Chancellor Rachel Reeves says that agreements concerning trade and investment made during her visit to China, on 9th January could be worth £600mn to the UK, in an effort to accelerate the nation’s economic growth.

UK politics:

1. The Conservatives have accused Rachel Reeves of ‘fleeing to China’, as her trip to improve economic ties with the nation coincided with soaring government borrowing costs.
2. Labour’s row with X owner Elon Musk over the rejection of inquiries into ‘grooming gangs’ continues as UK Homeland Security continue to monitor the American billionaire’s posts as a possible security risk.
3. On the 10th of January, 10 Reform councillors in Derbyshire have resigned in protest to Reform leader Nigel Farage’s leadership. This ‘rogue branch’ accused Farage of running the party in an ‘increasing autocratic manner’.  
4. Sir Keir Starmer has been urged to sack anti-corruption minister Tulip Siddiq after an investigation claimed her family embezzled £3.9bn from infrastructure spending in Bangladesh.
5. Former Prime Minister Liz Truss sent a ‘cease and desist’ letter threatening legal action if Sir Keir Starmer continued to claim that Truss ‘crashed the economy’. The PM’s spokesman asserts that Starmer is firm in his stance on what Truss’s lawyer’s call ‘false and misleading’.

World Economics: 

1. The US economy closed off 2024, with another month of massive job growth, adding 256,000 positions in December. As a result, the unemployment rate fell from 4.2% to 4.1% –  a return to pre-pandemic levels. 
2. The incoming President of the US, Donald Trump, has called for NATO members’ spending to increase from 2% to 5% of GDP. The Polish defence minister, Władysław Kosiniak-Kamysz, backs Donald Trump’s demand with Poland being the NATO member closest to meeting the new target, with a defence spending of 4.7% of GDP.
3. Malaysia’s economy minister, Rafizi Ramli, expects a surge of Chinese investment within the next few years, as Trump has threatened to impose 60% tariffs on Chinese imports once he re-enters the White House in the coming days. Between 2019 and 2023, through its data centres and semiconductor industry, Malaysia had attracted $30bn of investment. Rafizi has said that the tariff measures targeted at Chinese companies helps countries like Malaysia to sift out the more genuine and long-term investments from China.
4. A $1bn offer from Apple was not enough to lift the iPhone 16 ban in Indonesia. The government banned the sale of the latest iPhone in October due to Apple’s failure to meet a policy that mandates 40% of content in handsets and tablets to be sourced locally. Indonesia has consistently called for investment from Apple, which has 4 developer academies in the country to train students to develop apps, but has provided no manufacturing facility.
5. Eurozone inflation climbs to 2.4% in a third consecutive rise for the European Central Bank. The latest rise has seen inflation above the ECB’s goal of 2%. The pace of price rises in the Eurozone’s largest economy, Germany, hit 2.8% in December, which was higher than expected from economists polled by Reuters.

World Politics: 

1. Time could be running out for TikTok in America, after a Supreme Court hearing. The social media app is scheduled to be banned on January 19th unless the parent company, ByteDance, divests itself of the platform’s American operations.
2. On 29th December 2024, Jimmy Carter, the 39th President of America, died in his hometown. A member of the Democratic Party, he was the longest-lived U.S. president and the first to reach 100 years of age. 
3. The incoming 47th president of America, Donald Trump, has spelt out his determination to put America in his dealings first. The president-elect has not ruled out the use of force or economic coercion to take control of Greenland and the Panama Canal. The president-elect has also caused a stir by calling for the Gulf of Mexico to be renamed as the Gulf of America, and has referred to Canada as ‘the 51st state.’
4. After increasing pressure from the Liberty party in Canada, the prime minister, Justin Trudeau, has announce his step down from the role, after a nine year tenure. Trudeau will remain in office until the Liberal Party elect their new leader.