It Is Time To Wake Up!                                                     12 September 2025

DAMAC Properties has launched, DAMAC District, its latest project – comprising two modern residential towers and a commercial tower. Located in Damac Hills, the towers are within range of DAMAC Mall which will give residents easy accessibility to a wide array of lifestyle and dining options, just steps from the workplace with wellness facilities such as a bespoke gym & AI training lab, outdoor callisthenics, yoga & Pilates, a sensory tank, red light therapy, a zen lounge, a kids’ playground and pool. Social spaces include BBQ stations, private dining pods, and urban farming zones whilst workspaces utilise meeting rooms, meeting pods, relaxation areas, and both indoor & outdoor gyms. Residents and professionals will have seamless access to Downtown Dubai, top-tier schools, healthcare centres, Dubai World Central Airport and Trump International Golf Club – all within a convenient twenty-minute radius.

Driven Properties’ Dubai H1 2025 Market Report highlights the impact that the upcoming Etihad Rail will have on the emirate’s surging real estate sector, with its managing partner, Hadi Hamra, noting that “the Etihad Rail is set to be a transformative project for real estate across the UAE”  and that “improved connectivity not only enhances lifestyle and accessibility for residents but also strengthens investor confidence, driving demand and supporting long-term property values”. The reports consider that seven locations will benefit from that rail connectivity which will see stronger residential demand They include Dubai South, Al Furjan, Jumeirah Village Circle,Dubailand Residence Complex, Dubai Production City, Business Bay and Dubai Creek Harbour.

For the third successive year, Dubai continues to maintain its number one position as a global hub for mobile professionals, in the Savills Executive Nomad Index, (of thirty locations). With Abu Dhabi taking second place, it puts the country as the world’s most desirable destination for a new class of professionals known as “executive nomads”. Such people are usually senior-level professionals or entrepreneurs, (often with their family), who blend remote working with an international lifestyle, typically earning higher incomes, and requiring all the top facilities such as accommodation, world-class medical, reliable infrastructure, security and ease of international travel. This survey showed that Dubai scored highest in the world for its unrivalled global flight network, making it easy for residents to travel to almost any major city within hours, but just behind Abu Dhabi for internet speed.

Other cities in the top ten included Málaga, Miami, Lisbon, Palma, and Barcelona — all coastal centres like Dubai but without the emirate’s USPs such as being major hubs of innovation, world leading financial centres, a centre for global trade and combining business opportunities with lifestyle advantages. Another big plus for Dubai is its property sector which offers both luxury and long-term value, as illustrated by the fact that although prime residential prices surged nearly 20% over the last twelve months, they still remain comparatively affordable on a global scale. For instance, US$ 1 million buys three times more prime space in Dubai than in London or New York. Locations such as Emirates Hills, Palm Jumeirah, and Jumeirah Golf Estates, remain popular with high-net-worth nomads seeking large family homes, with access to international schools and lifestyle amenities. Meanwhile, branded residences — a booming segment in Dubai — are attracting executives who value turnkey living, premium concierge services, and prestige locations. The increased demand that this sector brings to Dubai is one of the main reasons why supply has been ratcheted up so much so that it is estimated that Dubai will see an extra 70k units this year. On top of all that, Dubai has a very progressive administration, having introduced long-term visas, golden residency programmes, and flexible licensing to make relocation easier for executives and entrepreneurs.

Covering a 215.3k sq ft built-up area, Dubai South has announced the launch of Dubai South Business Hub, a digital-first free zone platform, built to simplify and accelerate business setup for entrepreneurs, SMEs, and global enterprises. DSBH redefines company formation by combining same-day licensing, end-to-end digital applications, and a founder-first approach.

Having been closed since a major fire in 2017, Lamcy Plaza, including the property and land, has been sold at auction for US$ 51.4 million, (AED 188.7 million). The once popular five-storey mall, opened in 1997, was one of the leading key retail and entertainment hubs in Dubai. Located in Oud Metha, it housed over one hundred and fifty stores, a cinema and a hypermarket. Over the past twelve months there have been at least two unsuccessful attempts to sell the building, one at a starting bid of US$ 54.5 million, (AED 200 million), and the other at US$ 50.4 million (AED 185 million). It is unclear who purchased the property and the land.

In a classification by the Council on Tall Buildings and Urban Habita, there are two types of skyscrapers  – ‘megatall’ (any building over 600 mt) and ‘supertall’ (any building between 300 mt and 600 mt)

Fourteen of the fifteen tallest buildings in the country are to be found in Dubai:

Burj Khalifa                                         828 mt                        2009  

Marina 101                                         405 mt                        2017

Princess Tower                                   413 mt                        2012

23 Marina                                           392.8 mt         2012

Burj Mohammed bin Rashid               381.2 mt         2014

Elite Residence                                    380 mt                        2012

The Address Boulevard                      370 mt                        2017

Ciel Tower                                           364 mt                        2024

Almas Tower                                       360 mt                        2008

JW Marriott Marquis Dubai               355 mt                        2012

Emirates Office Tower One                355 mt                        2000

The Marine Torch                               352 mt                        2011

Al Yaqoub Tower                                328 mt                        2013

The Landmark (Abu Dhabi)                324 mt                        2013

Ocean Heights                                    310 mt                        2010

UAE’s H1 hospitality sector returned steady growth figures, as revenues increased by 6.7% to top  over US$ 7.0 billion. Speaking at the Emirates Tourism Council’s third meeting of 2025, Abdulla bin Touq Al Marri, Minister of Economy and Tourism, also noted that hotel occupancy rate was up to 80.5% and that it was in alignment with the UAE Tourism Strategy 2031, which aims to boost the industry’s contribution to the national economy to over US$ 122 billion, (AED 450 billion) in the 2030s. The meeting, attended by stakeholders from across the country, to review ongoing initiatives and future plans, also discussed preparations for next month’s UAE-Africa Tourism Investment Summit which will welcome ministers and officials from fifty-three African nations.

Because of the increasing need to accommodate aviation-related services, the Mohammed bin Rashid Aerospace Hub at Dubai South has announced the launch of ‘The VIP Terminal Boulevard’, with it being developed in phases, starting next year. The boulevard, spanning seven hundred and sixty-nine mt and housing sixteen buildings, will have facilities and retail outlets across a total area of 204k sq mt. This new freezone will be utilised by airlines, private jet operators, maintenance/repair/overhaul providers, and related industries, as well as hosting maintenance centres and training/education facilities. Sheikh Ahmed bin Saeed, Chairman of Dubai Civil Aviation Authority, noted that “The VIP Terminal Boulevard is a significant addition to the world-class facilities at Mohammed bin Rashid Aerospace Hub. It will open new opportunities for leading aviation companies and luxury brands to flourish, while further strengthening Dubai’s position as a premier destination for companies and a key player on the global aviation map”.

Abdullah bin Touq Al Marri, Minister of Economy and Tourism, confirmed that the UAE’s Q1 real GDP touched US$ 123.98 billion, by growing 3.9%. Accounting for an increasing balance of the total, to 77.4%, non-oil activity grew 5.3% to a record US$ 95.91 billion, whilst the oil sector contributed 22.6% – US$ 28.07 billion. These figures confirm the strength and resilience of the national economy and its ability to continue its exceptional growth path, as well as confirming the effectiveness of national policies and strategies, in line with the objectives of the We the Emirates 2031 vision, which aims to raise the country’s GDP to US$ 817.44 billion, (AED 3 trillion). The main contributors to growth were manufacturing, finance/insurance/construction, real estate and trade with annual growth levels of 7.7%, 7.0%, 6.6% and 3.0%. Those sectors that contributed most to the total balance were trade, finance/insurance, manufacturing, construction and real estate, with total percentages of 15.6%, 14.6%, 13.4%, 12.0% and 7.4%.

The Minister of Energy and Infrastructure, Suhail Mohamed Al Mazrouei, who chaired the inaugural meeting of the UAE Logistics Integration Council, stated that its target is to increase the logistics sector’s contribution to the national economy, by 46.3%, to over US$ 54.57 billion by 2031. The council’s members will be a range of entities involved in the many facets of the logistics sector, from both the public and private sectors, including ports, roads, transportation, customs, railways, border crossings, and others. With all stakeholders on board, this will make an interesting integrated platform that will coordinate policies and strategies and streamline procedures. Once in place, it will enhance the efficiency of the sector and consolidate the country’s position as a pivotal hub in the global trade system. It will also aim to strengthen the interconnection between different modes of transportation and align with the shift toward digital and smart solutions that support national strategies. It also discussed the development and adoption of the National Logistics Integration Strategy, along with topics such as data management, digital platforms, eliminating red tape and other related issues. The Minister also commented that the US$ 54.50 billion target aligns with the We the UAE 2031 vision, which seeks to position the country among the world’s top three in the Logistics Performance Index.

The Dubai Court of Appeal has fined an Asian domestic worker US$ 409 for negligence in failing to control a dog which bit a fourteen-year-old boy in an apartment elevator in Tilal Al Emarat. Her fine was halved after the court ruled that her negligence had been minor. The boy’s mother filed a complaint, claiming the maid failed to properly control the dog. The worker noted that she had the dog on a leash but suddenly it lunged at the teenager, and she did not know why it had become aggressive. The Appeals Court acknowledged her explanation but maintained that she bore some responsibility for the incident.

As part of its efforts to ease congestion and improve urban mobility, Dubai-listed Parkin is planning a further 3k parking slots before the end of 2025; it is also preparing four multi-storey car parks over the next two years. By the end of H1, it had a 211.5k portfolio of parking spaces – 11.1k, and 5.5%, higher than in June 2024 – attributable to new on-street and developer-linked private zones. So far in Q3, it has introduced new paid parking areas in Al Jaddaf and also re-opened a renovated multi-storey car park in Dubai’s Al Rigga district with 44k spaces.

The DFM opened the week, on Monday 08 September, on 5,989 points, and having shed two hundred and seventeen points (3.6%), the previous five weeks, gained forty-two points (0.7%), to close the week on 6,031 points, by 12 September 2025. Emaar Properties, US$ 0.09 lower the previous fortnight, gained US$ 0.01 to close on US$ 3.92 by the end of the week. DEWA, Emirates NBD, DIB and DFM started the previous week on US$ 0.75, US$ 6.80, US$ 2.57 and US$ 0.46 and closed on US$ 0.75, US$ 6.92, US$ 2.69 and US$ 0.45. On 11 September, trading was at one hundred and ninety-one million shares, with a value of US$ one hundred and forty-nine million dollars, compared to one hundred and thirty-eight million shares, with a value of US$ one hundred and twenty-two million dollars, on 05 September 2025.

By 12 September 2025, Brent, US$ 3.05 lower (4.5%) the previous week, gained US$ 1.86 (2.8%) to close on US$ 66.99. Gold, US$ 173 (5.1%) higher the previous fortnight, gained US$ 27 (0.8%), to end the week’s trading at US$ 3,681 on 12 September. Silver was trading at US$ 42.68 – US$ 1.21 (2.9%) higher on the week.

Opec+ has been increasing production since April and in the pursuing six months has already finalised its first tranche of some 2.5 million barrels – being 550k bpd (August and September), 411k bpd – June and July and 289k bpd (April and May). Prior to the April change, the cartel had been slashing production levels to support the market. Many had expected to see Opec+ return to cutting production because of a potential over supply – and a possible oil glut come the Northern winter. As from 01 October, eight members of Opec+ agreed to raise production from October by 137k bpd, thus starting to unwind its second tranche of some 1.665 million bpd; it is thought that steady global economic outlook and current healthy market fundamentals will help boost demand. With most members pumping near capacity, it seems that only Saudi Arabia and the UAE will be able to add more barrels.

Last Saturday, 06 September, Microsoft reported that because of multiple undersea fibre cuts in the Red Sea, some Azure users might experience higher latency and also may experience increased disruptions when traffic from the ME originates in or terminates in Asia or Europe. Apart from disrupting global internet and communications traffic, connectivity still remains available, after rerouting led to increased latency and congestion on key routes. Microsoft added that “undersea fibre cuts can take time to repair, as such we will continuously monitor, rebalance, and optimise routing to reduce customer impact in the meantime. We’ll continue to provide daily updates, or sooner if conditions change”.

Yet again Google has faced the wrath of EC technocrats with it being fined almost US$ 4.0 billion for allegedly abusing its power in the ad tech sector – the technology which determines which adverts should be placed online and where. The tech giant had been accused of breaching competition laws by favouring its own products for displaying online ads, to the detriment of rivals. There was no surprise in Google arguing that the decision was ‘wrong’ and it would appeal, and that “it imposes an unjustified fine and requires changes that will hurt thousands of European businesses by making it harder for them to make money”, adding that “there’s nothing anti-competitive in providing services for ad buyers and sellers, and there are more alternatives to our services than ever before”. Google found an ally in Donald Trump who said, “my Administration will NOT allow these discriminatory actions to stand”.

A US federal court has ordered Google to pay US$ 425 million to a group of users who had alleged that the tech giant had accessed their mobile devices to collect, save and use their data, in violation of privacy assurances in its Web & App Activity setting. It had found that Google were liable to two of three claims of privacy violations but said the firm had not acted with malice but had breached users’ privacy by collecting data from millions of users, even after they had turned off a tracking feature in their Google accounts. The plaintiffs had been seeking a mega US$ 31.0 billion in damages.

Apple may rue the moment it decided to launch its iPhone 17 last Tuesday, which went down like a lead balloon, with stakeholders including investors and buyers – the former can show their displeasure by selling their shares and the latter by not purchasing the new phone. The launch triggered a sell-off that erased more than US$ 112 billion in market value in just two days. Immediately after its unveiling, Apple shares lost 1.5% and the next day 3.23%, with analysts seeing this as a show of deep concerns about Apple’s innovation strategy, margins, and its place in the AI race. By late Friday, shares were changing hands at US$ 234 – almost the same price as posted on 01 January.

Wednesday saw Oracle shares go through the roof, driven by a wave of multi-billion-dollar cloud deals, after the tech company had posted that its order backlog is on track to hit half a trillion dollars in the coming months. There were reports that OpenAI had signed a US$ 300 billion deal with Oracle for computing power. Having surged by 35.9%, to a record US$ 933 billion market cap, in early trading, Oracle’s shares fell about 4% in later trading ending the day valued at US$ 894 billion. Nevertheless, this year its share value has outpaced ‘the Magnificent Seven’, having started with an 01 January price of US$ 166.32, rising to US$ 328.33 before falling to US$ 307.86 yesterday. The shares were trading at a premium compared to its cloud services peers, with their twelve-month forward price-to-earnings multiple being 45.3, compared with Amazon’s 31.3 and Microsoft’s 31.0.

On its first day of trading in the US, Klarna shares jumped to give the pay-later lender a market cap of US$ 19.0 billion.; the firm had raised US$ 1.37 billion from its IPO. By the end of the day, it had lost US$ 2.0 billion and was valued at US$ 17.0 billion. Founded twenty years ago, it was billed as a challenger to credit cards and traditional banks, becoming known for allowing shoppers to pay for purchases in smaller, interest-free instalments; it has more than one hundred million active users across twenty-six countries. It is hugely popular and has been a major global player in the UK since 2014 and the US since 2019; in its home country, it claims to service more than 80% of the Swedish population. However, there are still doubts about the company that had been valued at US$ 45.0 billion just after the pandemic. In its latest Q2 figures, it posted a US$ 52 million loss, (H2 2024 – US$ 7.0 million), as last year’s revenue came in 24% higher at US$ 2.8 billion. Time will tell.

With competition heating up from an increasing number of “knock-off” weight-loss drugs, the path-finding Danish pharma company, Novo Nordisk is planning a 9k retrenchment – equating to 11% of its workforce. The maker of Wegovy and Ozempic appointed Mike Doustdar as its chief executive last month and he has wasted no time in taking on the competition from the likes of Eli Lilly which makes Mounjaro, and warning that profits will fall as more “knock-off” weight-loss drugs emerge. He warned that “our markets are evolving, particularly in obesity, as it has become more competitive and consumer driven. Our company must evolve as well”, and that “over the past years, Novo Nordisk’s rapid scaling has increased organisational complexity and costs”. The company aims to cut costs by US$ 1.25 billion by the end of 2026.

Citing increased employers’ national insurance contributions, (US$ 19 million), and the increased cost of dealing with waste packaging, (US$ 20 million), John Lewis posted that its H1 losses had almost tripled to US$ 119 million. With Waitrose sales rising by 6% to US$ 5.5 billion, total revenue, across the partnership, increased by 4% to US$ 8.39 billion Jason Tarry, the chair of the employee-owned company, whose shops include the John Lewis department stores and Waitrose, noted that “no doubt that consumer confidence is subdued” ahead of the November Budget. However, he still expects that it will turn in an annual profit after the key Christmas period. He also confirmed that John Lewis was committed to paying its staff bonus “as soon as we possibly can” but it was “far too early in the year” to say when that would happen; no bonus has been paid since 2022.

Early last year, Marks & Spencer appointed Rachel Higham, as their chief digital and technology officer, responsible for its technology function. She had previously been a BT Group executive. This week it was announced that she was to leave her position months after a devastating cyber-attack disrupted its systems at a cost of hundreds of millions of pounds.

The South Korean government has expressed “concern and regret” that over four hundred and seventy-five people, (of which three hundred and twenty-five were Korean), had been arrested at a Georgia state Hyundai factory, by immigration authorities because of “unlawful employment practices and other serious federal crimes”. The 3k-acre site was built to manufacture EVs and has been operational for a year, with a majority of workers being Korean. Authorities confirmed that this was “the largest single-site enforcement operation in the history of homeland security investigations”, with Donald Trump adding that “they were illegal aliens, and ICE was just doing its job.” This presents a conundrum for the President who is keen to attract large international companies to set up in the country and also keen to crack down on illegal immigrants. South Korean companies have already promised to invest billions of dollars in key US industries in the coming years, partly as a way to avoid tariffs. The South Korean foreign ministry has issued a statement saying that, “the economic activities of Korean investment companies and the rights and interests of Korean citizens must not be unfairly infringed upon during US law enforcement operations”.

At the opening of the eleventh meeting of GCC labour undersecretaries, Marzouq Al Otaibi, acting director general of Kuwait’s Public Authority for Manpower, reaffirmed the bloc’s commitment to advancing joint labour strategies and tackling shared challenges. He noted that the six-nation bloc employed some 24.6 million, of which over 77% were expats. The meeting had certain aims including to harmonise labour regulations, improve work environments, and strengthen the Gulf’s competitiveness at regional and global levels. Two other topics were the need for governments to maintain a balance between hiring nationals and benefitting from skilled foreign labour, warning that global economic shifts demand continued cooperation and the increasing pressures of digital transformation, noting that studies predict nearly half of traditional jobs could be disrupted within twenty years; this would require a commitment to accelerate workforce training and adapt education systems to ensure resilience.

Canada’s Prime Minister is overseeing an economy that is on the downturn, with its latest labour news showing that 66k jobs were lost last month and unemployment nudged higher to 7.1% – the highest level since 2016. The former BoE governor has also had to deal with Donald Trump and his tariffs but has not performed as well as was expected; indeed, Canada dropped some of its billions of dollars in retaliatory tariffs on an array of US products, as it sought to restart trade talks with Washington. He has also reversed the administration’s previous stance of advocating to ban petrol and diesel vehicles by 2030, and this week, he has paused a key electric vehicle sales target, so that Canadian automakers will no longer be required to ensure 20% of new car sales are electric by next year. Latest figures indicate that 2024 sales of zero-emissions vehicles had only reached 11.7% of market value. Last October, Ottawa had introduced 100% tariffs on imports of Chinese EVs with Beijing reacting last month with a 75.8% duty on Canadian canola.

Q2 saw the number of employed persons, in both the EU and euro area, increase by 0.1% – this was in the comparison to the Q1’s returns of zero and 0.2% respectively; on the year, the increases were 0.6% and 0.4%. In Q2, the country with the highest increases of employment were, Bulgaria, Spain and Malta – by 1.1%, 0.7% and 0.7%, with the highest declines of employment posted in Lithuania Greece and Croatia – 0.9%, -0.5% and -0.5%. Based on seasonally adjusted figures, in Q2, there were 219.9 million people employed in the EU, of which 171.6 million were in the euro area.

In Q2, seasonally adjusted GDP increased, on the quarter, by 0.1% in the euro area and by 0.2% in the EU, compared to Q1’s increases of 0.6% and 0.5%. A year earlier, the Q1 seasonally adjusted GDP increased by 1.5% in the euro area and by 1.6% in the EU. The three nations with the highest GDP increases were Denmark, Croatia and Romania – at 1.3%, 1.2% and 1.2%, with the highest decreases being Finland, Germany and Italy – -0.4%, -0.3% and -0.1%.

Germany is going through turbulent economic times as demand dropped 2.9% in July, compared to June, as the country’s factory orders slumped the most since January, and at a time when the country was on the verge of moving on after three years of recession; analysts had expected a 0.5% gain. Economy Minister Katherina Reiche said in a statement. “No further warning signals are needed to recognise that we must now act decisively and consistently align our entire policy with competitiveness — in energy costs, non-wage labour costs, and the reduction of bureaucracy, both in Germany and in Europe. It’s about jobs and preserving locations.”

It is almost two years since the disgraced Alan Joyce left Qantas, with the carrier announcing that there were serious “penalties” against the recently departed chief executive following a string of scandals involving everything from dubious ticket sales on ghost flights to the illegal sacking of more than 1.8k workers. (Only two weeks ago, the airline was hit with a US$ 59 million fine for this offence).  Interestingly, in the two years, since he left, earlier than expected, Qantas shares have risen by a mega 103% to US$ 7.81 This week, a perusal of the airline’s annual report shows that he will pick up his final bonus, along with a wad of Qantas shares, worth US$ 2.5 million. His successor, Vanessa Hudson, will take home about US$ 4.2 million this year, well short of the Irishman’s 2018 record of US$ 15.7 million.

According to an REA Group and Commonwealth Bank report, a typical Australian first home buying household could only afford to purchase 17% of properties sold last year, but strangely the study estimated that the number of first home buyers, in the market now, is higher than the average over the 2010s. The bank expects the cash rate to settle at 3.35% by the end of the year – 0.25% lower than the current rate. The study traces records over the past thirty years and the today’s housing affordability remains around record lows after “the surge in mortgage rates between 2022 and 2023 has pushed housing affordability to its lowest level for households of all incomes. This is especially true for first home buyers, as they are typically younger than existing homeowners, earlier in their careers, and earn lower incomes”. It concluded that prospective first home buyer households — defined as one aged 25-39 and earning US$ 85k per year — could afford the mortgage on just 17% of homes sold last year. In comparison, the percentage rises to 33% for existing owners with a mortgage, helped by factors such as family assistance, low deposit loans, Lenders Mortgage Insurance and recent government policies. It also noted that “many also seek homes in more affordable areas or purchase semi-detached homes or units to overcome affordability challenges”.

It is estimated that the average loan-to-value ratio for a first home buyer is around 85%. (If a house is purchased for US$ 1.0 million and you contribute US$ 200k as a deposit, the LVR comes to 80%; if the deposit was only US$ 150k, the LVR would be 15%). It has been calculated, in June 2025, that the average-income Australian household would need to save for the equivalent of 5.9 years to put down a 20% deposit for a median-priced home. This varies between states:

South Australia           7.2 years                     NSW               6.9 years

Queensland                 6.1 years                     Victoria           5.7 years

Tasmania                    5.6 years                     WA                  4.5 years

Bets are on for both a rate cut by the RBA in Q4 and home prices nudging higher for the remainder of the year. Next month, the uncapped Home Guarantee Scheme will come into force that will enable       people to buy a property, with a 5% deposit, and avoid paying lenders’ mortgage insurance. This will be limited to properties below price thresholds, with between 55%-67% of homes in the largest capitals falling beneath those limits. There is always the danger that with so many entering the scheme it could skew the market by pushing up prices that fall beneath the thresholds.

Those nations that have already struck deals on industrial exports such as nickel, gold and other metals, as well as pharmaceutical compounds and chemicals will be offered some tariff exemptions by the US President Donald Trump. His latest order identifies more than forty-five categories for zero import tariffs from “aligned partners” who clinch framework pacts to cut Trump’s “reciprocal” tariffs and duties imposed under the Section 232 national security statute. This will bring US tariffs in line with its commitments in existing framework deals, including those with allies such as Japan and the EU. Trump says his willingness to reduce tariffs depends on the “scope and economic value of a trading partner’s commitments to the United States in its agreement on reciprocal trade” and US national interests. The cuts cover items that “cannot be grown, mined, or naturally produced in the United States” or produced in sufficient volume to meet domestic demand.

August saw US inflation levels move higher – up 0.2% on the month to 2.9% – at its fastest pace since the beginning of the year. Figures from the US Labor Department highlighted that the cost of cars, household furnishings and grocery staples, like tomatoes and beef, all rose. Such figures make it almost inevitable the next week’s meeting of the Federal Reserve rates will be cut – the only question being whether this will be 0.25% or 0.50%. Since Trump tariffs took effect last month, most goods entering the US face taxes of between 10% and 50% and there are concerns that they will drive up prices or weigh on the economy, as businesses pass on these extra costs to customers. For example, 70% of tomatoes consumed in the US are imported from Mexico, which face a 17% tariff – in August tomato prices came in 4.5% higher on the month.

Ahead of next week’s meeting, the Fed is not only concerned with inflation but also on the job front which is showing definite signs of weakness, with only 22k jobs created in August and the unemployment rate nudging 0.1% on the month to 4.3%. When the US Bureau of Labor Statistics posted its August statistics that only 22k jobs were generated, with June figures revised down from a reported 27k growth to a negative contraction – the first negative payrolls reading since 2020; the unemployment rate nudged 0.1% higher to 4.3%. Furthermore, the Labor Department noted that the US economy added 911k fewer jobs than initial estimates had suggested in the year to March, as well as weekly unemployment filings climbing to 263k – the highest level in nearly four years. These figures opened the door for the Federal Reserve to consider cutting interest rates for the first time this year, as contracting jobs figures are often an early indicator of a recession. Traders are looking at a certain 0.25% rate reduction from its current 4.25% to 4.50% range, with the chances of a 0.5% cut now on the cards. The figures were well down on market forecasts of 75k, leading to US bourses hitting fresh highs, bond markets rallying and the greenback moving lower.

In July, the US trade deficit widened markedly – by 32.5% to US$ 78.3 billion – as imports were boosted by record inflows of capital and other goods. In Q1, trade subtracted a record 4.61% from GDP but, with a 9.56% swing turned this to a positive 4.95% in Q2 – the largest contribution on record. Over the two quarters, the US$ economy moved from a 0.5% contraction to a 3.3% expansion. Meanwhile, there are forecasts that the economy will grow by 3.0% in Q3.

One unexpected loss for Keir Starmer over the last eventful week, was the surprise announcement by his investment minister that she plans to resign her position, after only eleven months. Baroness Gustafsson of Chesterton’s decision is yet another body blow for the Prime Minister and to his fledgling industrial strategy. The former boss of cybersecurity firm Darktrace is said to be resigning because her challenging professional schedule clashing with the demands of raising a young family.

Mainly due to the manufacturing output slumping to its biggest contraction – of 1.3% – in twelve months, there was no July growth for the UK economy even though there was a 0.4% expansion in the July quarter; the main drivers were solid figures from the health sector, computer programming and office support services, offset by a fall in output from the production sector, which includes manufacturing.  The ONS, confirming Q1 and Q2 increases of 0.7% and 0.3%, noted that the economy had “continued to slow” over the past three months but there is still time for a Q3 positive return.

The BoE’s Decision Maker Panel data indicates that UK businesses have cut jobs at the fastest pace in almost four years – a sure indicator that employment levels and wage growth are in downturn; employment levels in the quarter to 31 August were 0.5% lower on the year – its worst decline in four years mainly driven by Rachel Reeves’ April rises in both national insurance contributions and the minimum wage levels, along with business rates moving higher. To make matters even worse, the advent of Donald Trump’s tariffs impacted global trade. The study also noted that there was no improvement in hiring intentions, with companies expecting to reduce employment levels by 0.5% – its weakest return in almost five years. When it came to prices and wage rises, the outlook was for increases of 3.8% and 4.6%, (1.0% lower than a year ago). The latter forecast would see household spending being cut again, with its knock-on effect on business and consumer confidence. As she has consistently committed not to target working people but focus on growth, there is no doubt that measures taken by her in the October 2024 budget are the main drivers that have seen up to 100k jobs lost in the retail and hospitality sectors.

Having recently announced 6k job losses and US$ 3 billion (£2.2bn) per year cost cuts. there was further bad news for Rachel Reeves, with Merck’s decision to scrap a plan to invest US$ 1.36 billion in its UK operations because it thought that the government was not investing enough in the sector. A spokesman added that the decision “reflects the challenges of the UK not making meaningful progress towards addressing the lack of investment in the life science industry and the overall undervaluation of innovative medicines and vaccines by successive UK governments”. It confirmed that it would move its life sciences research to the US and cut UK jobs, blaming successive governments for undervaluing innovative medicines. Merck had already begun construction on a site in London’s King’s Cross which was due to be completed by 2027, but said it no longer planned to occupy it, and will also soon vacate its laboratories in the London Bioscience Innovation Centre and the Francis Crick Institute. There is every likelihood that other major pharmas may do likewise. For example, AstraZeneca has paused plans to invest US$ 271 million at a Cambridge research site that would have created 1k new jobs, in addition to another project in Liverpool being shelved last January. Even though the Starmer administration defended its investments in science and research, it acknowledged there was “more work to do”. It appears that a decade ago, the NHS spent 15% of healthcare spend on pharmaceuticals; now it is in the region of only 9%, compared to the average OECD country spend of between 14 – 16%. Major companies are being encouraged to invest in the US or face triple-digit Trump tariffs. It is obvious that the UK is losing out in the global competitive stakes and for those responsible  It Is Time To Wake Up!