Skeleton In The Cupboard? 18 July 2025
Data from GCP Properties seem to indicate that several locations are posting dips in rental rates, including apartments in Jumeirah Village Triangle; on a twelve-month basis, new lease rates have dropped by 2.64%. JVT listings show studios at around the US$ 13.6k level, with one-bedroom apartments ranging between US$ 21.2k and US$ 27.2k, depending on the age of the building and whether furnished or not. Going slightly upmarket, the agency sees new rent leases falling:
- 6.60% in The Springs, with current listings showing a three-bedroom townhouse at US$ 66.8k
- 10.76% at The Lakes, with current listings showing a three-bedroom townhouse at US$ 77.7k
- 9.66% at Jumeirah Park, with current listings showing a four-bedroom townhouse at US$ 100.0k
These appear to be the first rental declines since the January 2025 introduction of the DLD’s ‘smart’ rental index. It does seem that this could be, (or not be), a precursor of future rental trends in Dubai that have started with a two-tier rental market where certain mid-tier locations continue to see rental gains of 5%-15% on average as they level up. And there are those upscale locations where rents have peaked – and are now starting to drop. appear to be the first rental declines since the January 2025 introduction of the DLD’s ‘smart’ rental index. It does seem that this could be, (or not be), a precursor of future rental trends in Dubai that have started with a two-tier rental market where certain mid-tier locations continue to see rental gains of 5%-15% on average as they level up. And there are those upscale locations where rents have peaked – and are now starting to drop.
Meanwhile Bloom Holding has come up with a list of eight UAE locations that currently provide better financial returns for tenants than for homeowners. Only two Dubai areas made the list – Barsha, where the rent-to-mortgage gap exceeds 60%, and Expo City, at around 50%. Al Marjan Island, (RAK), topped the list, where the median monthly mortgage payments of US$ 5.1k is 281% greater than the average monthly rent of US$ 1.8k. Al Amerah (Ajman), and Saadiyat Island, in Abu Dhabi, both have rent-to-mortgage gaps exceeding 60%. The remaining three areas, with notable rent-to-mortgage gaps, are Muwaileh (Sharjah), Al Hamra Village (RAK), and Al Rashidiya (Ajman), with rental savings ranging from 46.44% to 59.23%.
Despite comments to the contrary, the Dubai property market is still buoyant and is moving into a more mature and stable phase. In H1, villa sales surged by 65.5% in value – to US$ 32.3 billion – and by 55.4% in volume, to 20.4k, compared to figures for 2024. fäm Properties posted that in H1, sales for villas and apartments combined rose by 37.7% to US$ 71.58 billion and transaction volumes grew by 22.96%, to 93.99k deals. H1 apartment transactions were 16.2% higher, on the year, to 73.57k, valued at US$ 39.29 billion – up 21.0% on the year.
Reports indicate a 62.7% H1 annual surge for ultra-prime deals (any transaction over US 2.72 million or AED 10 million). Driven by increased demand, mainly from Indian, UK, German, and Portuguese buyers, there were 3.73k sales posted in the Dubai luxury market sector.
The Dubai real estate sector saw US$ 7 billion of transactions and 8.32k sales last week.
Sobha Realty has announced its ‘S Tower at Sobha Hartland 2’, located in Meydan; it will house one hundred and five apartments, each with floor spaces of 5.44k sq ft. The three hundred mt tower, with seventy-one storeys, follows the success of the now completed S Tower – a sixty-two-storey, two hundred and twenty-nine mt structure, located on SZR. The developer has confirmed that, as with its previous S Tower, prices have not been revealed, with the intent to keep the sales process as private as possible, with personalised invitations and calling in interest.
AVENEW Development announced the first phase of its US$ 354 million AVENEW 888 – MODO, located in Dubai South. The whole project covers five architecturally distinct buildings, with expansive green spaces, and vibrant communal areas. MODO will consist of two hundred and seventeen units, comprising one to three-bedroom apartments, as well as two and three-bedroom duplexes, featuring floor-to-ceiling windows and spacious balconies with panoramic views. Amenities include indoor and outdoor gyms, half basketball court, ping pong table, and two large adult pools with comfortable seating areas, dedicated children’s pool, kids’ play areas, and safe recreational zones and a curated selection of retail stores throughout the complex. Prices start at US$ 218k, with the project being released in three phases.
Not many people outside of the UK would have heard about Tom Dean. However, the triple Olympic gold medallist swimming champion has probably become the first Olympian to be the name behind a branded residence. ‘Hadley Heights 2’ is a new project in Dubai Sports City, developed by Leos Developments. Its founder noted that “our partnership with Tom Dean brings a new level of authenticity and inspiration to the project,” and that it aims “to create a residential experience that supports physical wellbeing, personal growth, and meaningful connection”. Prices for one-bedroom apartments will start at US$ 272k.
According to Sapna Jagtiani, director and lead analyst, Middle East at S&P Global Ratings, Dubai’s commercial real estate real estate vacancy rates are now at record low 8.6%, driven by the twin whammies of the inflow of foreign players and the launch of new companies. This in turn has a direct impact on rentals which have continued to rise, especially for prime/grade-A offices. Furthermore, there has been resilient demand and small rental growth seen for Dubai retail space, with prime super regional malls continuing to dominate the market, with many having a waiting list for new clients wanting to open outlets.
Having been awarded the design and build project for the Dubai Metro Blue Line Project, by Dubai Road and Transport Authority, a consortium of MAPA, LIMAK, and CRRC has concluded a US$ 1.06 billion Syndicated Bonding Facilities with Emirates NBD. The total project, valued at US$ 5.59 billion, is a key component in Dubai’s 2040 Urban Master Plan to create, develop, and expand a world-class network of public transportation services and mobility solutions. Scheduled for completion in September 2029, it will connect with both the existing Red and Green Metro lines and will be used by an estimated 350k daily passengers by 2040.
Dubai Chambers has opened its first international centre and a major step toward expanding its global business reach by launching ‘Dubai Hub London’. With its main aim being to facilitate international investors and businesses to set up in Dubai, it is intended to offer a one-stop platform for both government and private sector services. Managed by Al Burj Holding, (and overseen by Dubai Chambers), the first phase of services includes support from key entities such as the Dubai Land Department, Dubai Economy and Tourism, the General Directorate of Identity and Foreigners Affairs, and Dubai Courts.
Ripple has announced a key partnership with Ctrl Alt, recently licensed by Dubai’s Virtual Assets Regulatory Authority, to deliver institutional-grade digital asset custody for DLD’s Real Estate Tokenisation Project. Its main aim is to revolutionise how real estate ownership is managed in Dubai, using the US-based digital asset infrastructure provider’s custody technology to securely store digital title deeds issued on the XRP Ledger (XRPL), a public blockchain; Ctrl Alt will integrate Ripple’s technology as part of its role as tokenisation infrastructure provider for the project. In June, Ctrl Alt announced its partnership with the Dubai Land Department as the tokenisation platform for the Real Estate Tokenisation Project which will tokenise property title deeds, enable fractional ownership and facilitate real estate investment through blockchain technology.
A Dubai-based employee has been awarded US$ 92k, in end of service benefits, after he had filed a complaint with the Ministry of Human Resources and Emiratisation. The claimant started working for the company in 1996 and served twenty-seven years, on an indefinite contract, until May 2023. An expert report confirmed that his final salary was US$ 3.8k (AED 14k). The court followed the legal formula – twenty-one days’ wages for each of the first five years and thirty days’ pay for each subsequent year, capped at a total of two years’ wages. It also clarified that any waiver or settlement of end-of-service benefits made before the end of the employment relationship is void – rendering previously claimed payments by the employer invalid, contributing to the total award. However, the court ordered the claimant to repay U$ 27.2k, based on an admitted loan.
In another interesting legal case, Dubai’s Court of Cassation in Dubai issued a binding ruling declaring that, “Islamic financial institutions and Takaful companies that operate fully or partially in accordance with Islamic Sharia law are not permitted to impose late interest fees — whether labelled as compensation or by any other name — on any debt or financial obligation arising from Sharia-compliant transactions or commercial contracts. This applies in cases of delayed payments, regardless of the debtor’s intent. This principle is a matter of public order and must be applied by the court independently, even if prior rulings suggest otherwise.”
In a bid to improve the health of many residents, the Federal Tax Authority has announced that from next year, the tax on ‘sugar-sweetened beverages’ will be linked to the sugar content in the product. The authority is incentivising local producers of sugary drinks by offering up a flexible scheme on what they pay as excise tax. This amendment removes the flat tax that has been in place on sugary drinks – carbonated and energy – since 2017, and from December 2019, on sweetened drinks. Currently, all fizzy drinks are taxed at a standard 50% rate, (and 100% on energy ones), even though the sugar content differs from one drink to another. It will be interesting to see the drink makers’ reaction to the government’s drive to make the country a healthier place.
According to the 2024 Mental State of the World Report, by Sapien Labs, there is some sort of generational divide as the UAE recorded one of the world’s highest mental health scores for adults aged over 55, posting a Mind Health Quotient of 112.5. This score positions the UAE, the only MENA country in the highest global tier, alongside Finland, Singapore, and Malaysia, and is in direct contrast to those of younger adults who are experiencing rising levels of distress. Participating younger adults scored an MHQ of 44.4, with a distress level of 36.9%, reflecting a considerable 2.5-fold and 4-fold generational disparity, respectively. It seems that the main drivers include early exposure to smartphones, increased consumption of ultra-processed foods, weaker family connections, (with only 45% of young adults reported feeling close to their families, compared to 74% of older adults), and a higher dependence on digital devices.
DP World has been involved in what could be the most significant foreign investment in Syria since its civil war began in 2011. It has signed a US$ 800 million, thirty-year concession with the country’s General Authority for Land and Sea Ports to redevelop and operate the Port of Tartus. This deal followed high level discussions between UAE President HH Sheikh Mohamed bin Zayed and Syrian President Ahmad Al-Sharaa, aimed at strengthening bilateral relations. The agreement will see DP World assume full responsibility for financing, developing and operating Syria’s second-largest port, with the funds used to modernise its infrastructure, badly damaged by years of economic and social unrest. Planned upgrades include new cargo-handling equipment, as well as improvements to both the container and general cargo terminals. When completely upgraded, the port will service a mix of general cargo, containers, breakbulk and roll-on/roll-off traffic, accessing routes linking Europe, the Levant and North Africa. The Dubai company will also study the future potential of developing free zones, inland logistics hubs and transit corridors in coordination with Syrian stakeholders.
A partnership agreement will see Emirates Post and DHL Express launch DHL’s ‘Express Easy’ service across select Emirates Post branches. The official postal service provider is in the throes of transforming its network into a globally connected service platform that prioritises simplicity, accessibility, and customer-centric solutions. This latest initiative is designed to simplify sending packages, for individuals and small businesses, via a user-friendly experience and transparent, all-inclusive pricing.
During his official visit to Turkiye, President His Highness Sheikh Mohamed bin Zayed and his Turkish counterpart Recep Tayyip Erdoğan, witnessed the two countries signing several key agreements and MoUs, with the aim of expanding cooperation across a wide range of sectors. The agreements covered areas including the mutual protection of classified information, the formation of a joint consular committee, and investment partnerships in food, agriculture, pharmaceuticals, tourism, hospitality and industry. The two countries also signed a memorandum on cooperation in polar research.
The UAE Ministry of Finance has launched the federal general budget cycle for the three-year period to 2029. With the aim of improving service quality and supporting long-term national goals, the budget concentrates on key sectors such as education, healthcare and social welfare. This budget represents a new phase in the country’s development to further enforce its financial system and is designed to boost fiscal sustainability and has a strong focus on enabling federal entities to deliver world-class services. Public debt levels remain stable at US$ 16.89 billion as of June 2025, while federal assets have grown to more than US$ 126.43 billion by the end of 2024, reflecting the strength of the UAE’s financial position. HH Sheikh Maktoum bin Mohammed bin Rashid Al Maktoum, Minister of Finance, commented that the budget reflected a proactive and flexible approach to financial planning.
Having finally decided to focus on its core European markets – Central and Eastern Europe, as well as Austria, Italy and the UK, budget airline, Wizz Air, is to pull its operations out of Abu Dhabi, as from 01 September. Other drivers behind this exit include operational challenges, geopolitical developments in the ME and the inability to secure the flying rights for certain routes. The budget airline confirmed that it would be contacting customers regarding refunds.
The DFM opened the week, on Monday 14 July, on 5,855 points, and having gained one hundred and fourteen points (2.0%), the previous week, was two hundred and thirty-nine points higher, (4.1%), to close the trading week on 6,094 points, by Friday 18 July 2025. Emaar Properties, US$ 0.49 higher the previous three weeks, gained US$ 0.23, closing on US$ 4.10 by the end of the week. DEWA, Emirates NBD, DIB and DFM started the previous week on US$ 0.76, US$ 6.62, US$ 2.52 and US$ 0.49 and closed on US$ 0.77, US$ 7.30, US$ 2.65 and US$ 0.48. On 18 July, trading was at two hundred and one million shares, with a value of US$ one hundred and eighty-four million dollars, compared to seven hundred and fifty-three million shares, with a value of US$ two hundred and five million dollars, on 11 July 2025.
By mid-afternoon Friday, 18 July 2025, Brent, US$ 3.24 higher (4.9%) the previous week, gained US$ 1.16 (1.7%) to close on US$ 70.68. Gold, US$ 245 (7.9%) higher the previous three weeks, dipped US$ 3 (0.1%) to end the week’s trading at US$ 3,362 on 18 July.
On Monday, Bitcoin reached new heights reaching US$ 123.16k – climbing by more than 30% YTD, driven by a weak greenback, enhanced institutional/sovereign demand, pro-crypto Trump-led US legislation and ETF inflows, (175% higher on the year). Its Monday value places the cryptocurrency with a market cap of US$ 2.39 trillion, making it the fifth most valuable global asset. As confidence in traditional systems fade, cryptocurrency tends to prosper and at the same time is becoming an even more mainstream asset.
In a bid to catch up with rival OpenAI, Elon Musk has deepened the ties between SpaceX and xAI, with the former committing US$ 2.0 billion to xAI as part of a US$ 5.0 billion equity round. This follows xAI’s merger with X and values the combined company at US$ 113 billion, with the Grok chatbot now powering Starlink support and eyed for future integration into Tesla’s Optimus robots. When asked whether Tesla would invest in xAI, he responded, “it would be great, but subject to board and shareholder approval”. Despite industry concerns concerning Grok, Musk noted that it was “the smartest AI in the world,” with xAI continuing to spend heavy on model training and infrastructure.
With H1 revenue more than tripling – and profits by more than 350% – the Chinese toy firm behind Labubu dolls is set to report impressive financials. Pop Mart, (with a market cap, having surged by over 600% in the past twelve months to US$ 40.0 billion), posted that the two main drivers behind the results were increased recognition of the brand globally and cost controls. There is no doubt that its marketing strategy has helped with selling its viral Labubu dolls – fictional elf-like creatures with a row of jagged teeth – that were launched in 2019. Their huge success has resulted in the company becoming a major retailer, operating more than two thousand vending machines and stores around the world. In 2024, 60% of sales are in its domestic market.
After the US Health Secretary, Robert F Kennedy Jr, had voiced concern about its ingredients’ health impact, Donald Trump has noted that Coca-Cola has agreed to use real cane sugar in its drinks, sold in the US. He wrote on social media that “I have been speaking to Coca-Cola about using REAL Cane Sugar in Coke in the United States, and they have agreed to do so. I’d like to thank all of those in authority at Coca-Cola.” A spokesperson said they “appreciate President Trump’s enthusiasm, and more details on new innovative offerings within our Coca-Cola product range will be shared soon”. It is reported that whereas the drink sold in other countries, including UK and Australia, tends to use cane sugar, the one sold in the US is typically sweetened with corn syrup.
Debra Crew has relinquished her position, with immediate effect, as chief executive of Diageo, the FTSE 100 listed drinks giant, with two hundred brands including Guinness, Johnnie Walker, Captain Morgan’s and Tanqueray. She had taken over the top job in the summer of 2023, but has stepped down from the position, and also as a board member, immediately “by mutual agreement”. With no succession plan in place, Diageo is in the market for a replacement, with CFO Nik Jhangiani, taking over the role on a temporary basis, being the frontrunner for the position.
Having been battered by a marked fall in sales, Jaguar Land Rover is set to cut five hundred jobs as it moves to save costs. The carmaker posted that most of the reductions will be in management roles, which currently accounts for some 1.5% of the workforce, with most of the lost jobs going via a voluntary redundancy programme. It has not been helped by the 25% Trump tariff on vehicle imports, despite a truce agreement with the UK that sees 100k cars only being charged at 10% – but that preferential rate only covers the cars it makes in the UK, and after the first 100k, imports will return to the 25% global rate; it was also impacted after stopping exports in April, when the first tariffs were levied. Q2 sales of 94k vehicles were 15% lower with the decline also down to a planned wind-down of older Jaguar models.
It is reported that the US budget jeweller and fashion accessories chain Claire’s is hoping to sell its UK operations, as it explores options – including bankruptcy – for its US-based business. It is working with Interpath Advisory on a potential sale or restructuring of its two hundred and eighty UK shops. If it were to go down the former route, there is the distinct possibility of a significant number, as high as a hundred, of store closures. US reports indicate that Claire’s Stores Inc, the US-based parent company, was considering filing for bankruptcy protection while it explores a sale of its operations in North America and Europe. The company, which is reported to trade from two thousand stores globally, is owned by former creditors Elliott Management and Monarch Alternative Capital, following a previous financial restructuring.
In the UK, the Financial Conduct Authority Britain’s financial regulator fined Barclays US$ 56 million for failing to evaluate money laundering risks while providing services to two of its clients – Stunt Co, a customer of Fowler Oldfield, and WealthTek, a wealth management firm. In the case of the former, the regulator found that “Barclays did not gather enough information at the start of the relationship or carry out proper ongoing monitoring”. Notwithstanding having received US$ 63 million from Fowler Oldfield, it continued offering services despite police raids and regulatory warnings. In relation to WealthTek, its former principal partner, John Dance, was charged with fraud and laundering more than US$ 86 million from client accounts last December when the firm was not legally allowed to hold client money.
June saw China’s rare earths exports rising 32%, on the month – a possible sign that bilateral agreements, with the US reached last month to free up the flow of the metals, are bearing fruit; this followed China imposing export controls in April during the height of its trade war. Late last month, China confirmed Europe’s normal rare earths demand could be met, although there are reports that it is not working completely. Meanwhile, some carmakers said late last month the elements were starting to flow again, although not freely. June exports of 7.74k metric tonnes were 32.1% higher, on the month, and up 60.3% on the year. China is the world’s largest producer of rare earths, a group of 17 minerals, used in products vital for autos, consumer electronics and defence.
In H1, China’s GDP grew by an annual 5.3% to US$ 9.21 trillion and in Q2, by 5.2%, compared to a year earlier, and 5.4% from Q1. Total goods imports and exports rose to US$ 3.05 trillion in H1 – 2.9% higher on the year; over that period, exports were 7.2% higher whilst imports declined by 2.7%.
Although its economy slowed, as the Trump tariffs state to take their toll, it was not as drastic as anticipated. In Q2, China posted a 0.2% dip in quarterly growth to 5.2%. However, it would appear that if no government stimulus package is in the offing, then consumer demand will flatten even further and rising global trade will become even more turbulent and hit the country’s exports. The situation would have been more critical if it were not for China taking advantage of a US trade truce which allowed factories to front load shipments. However, H2 will see a different environment, with exports sinking because of the tariffs, falling prices and even lower consumer confidence. This is despite the administration ramping up infrastructure spending and consumer subsidies, along with the central bank cutting interest rates and injecting liquidity as part of broader efforts to cushion the economy. Although June industrial output rose 6.8%, on the year, retail sales growth lost 1.6% to 4.8%., as producer prices fell at their fastest pace in nearly two years. Furthermore, the country’s property downturn remained a drag on overall growth despite multiple rounds of support measures, with investment in the sector falling sharply in the first six months, while new home prices in June tumbled at the fastest monthly pace in eight months. Other worrying figures include H1 fixed-asset investment moving at a slower-than-expected 2.8% pace, from 3.7% in January-May, and the country’s crude steel output falling 9.2% from the previous year, as more steelmakers carried out equipment maintenance amid seasonally faltering demand.
Despite the Trump administration, imposing 30% tariffs on products from the EU, (and Mexico), as from 01 August, and despite ongoing negotiations, there was no early retaliation, as the bloc postponed any decision until early next month. The fresh tariffs were announced in separate letters posted on Truth Social on Saturday. Earlier, EC President Ursula von der Leyen had confirmed that a letter had been sent by Washington outlining measures that will take effect unless a negotiated solution is reached and that it would suspend its countermeasures until early August to allow for further negotiations. The twenty-seven-country bloc had released previous details that any planned countermeasures could affect US$ 24.5 billion of US exports. It had hoped for an early, but unlikely, comprehensive trade agreement, in line with that of the UK, that would include zero-for-zero tariffs on industrial goods. Whilst Germany would prefer a quick deal to safeguard its industry, other member states, including the likes of France, would prefer to go ‘the whole nine yards’ and not cave into a one-sided deal on US terms. Trump’s escapades, with his tariffs, have already garnished billions of dollars of new revenue, as customs duties have surpassed US$ 100 billion in the federal fiscal year through to June.
Donald Trump has now settled his tariffs on another country. He has agreed to lower tariffs he had threatened on goods entering the US from Indonesia to 19%, in exchange for what he called “full access” for American firms. Its President, Prabowo Subianto, remarked that it was a “new era of mutual benefit” with Washington. The country had also received a letter from Trump last week outlining plans for a 32% tariff on its goods, but this seemingly was reduced following a telecon between the two leaders last Tuesday. Trump commented that “they are going to pay 19% and we are going to pay nothing… we will have full access into Indonesia”. The US administration has been sending out warning letters to dozens of countries that it would be charging high tariffs from 01 August. Furthermore, the country also agreed to purchase US$ 15 billion worth in US energy, US$ 4.5 billion in American agricultural products and fifty Boeing jets. Indonesia ranks as one of America’s top twenty-five trade partners, exporting about US$ 28 billion, including clothing, electronics, footwear and palm oil.
US inflation rose by 0.3% to 2.7%, mainly attributable to the fallout from Trump tariffs that saw higher energy and housing costs, such as rents, There are indicators that consumers are beginning to feel the pinch from the tariffs with prices for the likes of citrus fruits, coffee, appliances and toys up on the month by 2.3%, 2.2%, 1.9% and 1.8% respectively; even clothing prices rose by 0.4% – its first upward movement in months. Increases were partly offset by declines in prices for new and used cars, airfare and hotel bookings.
Although its economy slowed, as the Trump tariffs state to take their toll, it was not as drastic as anticipated. In Q2, China posted a 0.2% dip in quarterly growth to 5.2%. However, it would appear that if no government stimulus package is in the offing, then consumer demand will flatten even further and rising global trade will become even more turbulent and hit the country’s exports. The situation would have been more critical if it were not for China taking advantage of a US trade truce which allowed factories to front load shipments. However, H2 will see a different environment, with exports sinking because of the tariffs, falling prices and even lower consumer confidence. This is despite the administration ramping up infrastructure spending and consumer subsidies, along with the central bank cutting interest rates and injecting liquidity as part of broader efforts to cushion the economy. Although June industrial output rose 6.8%, on the year, retail sales growth lost 1.6% to 4.8%., as producer prices fell at their fastest pace in nearly two years. Furthermore, the country’s property downturn remained a drag on overall growth despite multiple rounds of support measures, with investment in the sector falling sharply in the first six months, while new home prices in June tumbled at the fastest monthly pace in eight months. Other worrying figures include H1 fixed-asset investment moving at a slower-than-expected 2.8% pace, from 3.7% in January-May, and the country’s crude steel output falling 9.2% from the previous year, as more steelmakers carried out equipment maintenance amid seasonally faltering demand. a meeting of the Public Accounts Committee, officials from HM Revenue and Customs were quizzed by MPs about how many billionaires there are in the UK – and how much tax they have paid. The surprising response was simple – the HMRC did not know even though there could only be a small number residing in the country. The committee was “disappointed” that HMRC could not offer any insights into the tax arrangements of billionaires from its own data base and told the agency that it “can and must” do more to understand how much the very wealthiest in society contribute to the public purse, as “there is a lot of money being left on the table”. The Sunday Times Rich List and AI could help in their quest just as the US Internal Revenue Service uses the Forbes 400 list of rich Americans. With the state of the UK economy in a perilous place, there are calls for the taxman to increase contributions from billionaires both domestically and offshore. With this in mind, the tax office is to increase the number of staff on the tax affairs of the UK’s wealthiest by 40% to 1.4k; its target is to “increase prosecutions of those who evade tax” and “to make sure everyone pays the tax they owe”.
Yet another unwelcome surprise for the UK economy with May unemployment rising unexpectedly to a fresh four-year high, as the jobless rate nudged 0.1% higher to 4.7%. With both employment figures and wage growth both heading south, these are sure indicators that the labour market is continuing to cool. Economists say a weaker labour market makes it more likely the Bank of England will cut interest rates in an attempt to boost the economy at its meeting next month. The Office for National Statistics reckons that the number of people on PAYE payroll has fallen in seven of the eight months since Chancellor Rachel Reeves announced the NICs rise in her October budget. In fiscal Q1, the quarter ending 30 June, the number of vacancies fell again to 727k, marking three continuous years of falling job openings – and is at its lowest level in a decade, notwithstanding the Covid period. Initial estimates for payrolls’ growth in June indicate a fall of 41k, after a 25k drop in May and over the year, by 178k – or 0.6%. In the period, weekly earnings, (excluding bonuses) slowed 0.3% to 5.0% and wages including bonuses by 0.4% to 5.0%.
On Tuesday, speaking at her second Mansion House event, Chancellor Rachel Reeves received further depressing news – June inflation rising 0.2%, on the month to 3.6% on an annual basis; this comes days after the UK economy had contracted in spring. Most analysts – and the BoE – expected that in May. Although fuel prices dipped slightly lower in the month, there had been a much bigger decrease posted last year in June 2024. The Chancellor noted that the economy’s recent performance “disappointing” after figures showed it shrank unexpectedly – by 0.1% – and that retail sales were ‘very weak’. These figures put even more pressure on the Starmer administration, which has made boosting economic growth a key priority. Although unlikely, these latest figures could convince the central bank’s MPC, having to balance the risk of an economic slowdown, with still persistently high inflation, to keep rates at 4.25% at their next meeting on 07 August. However, traders are betting on the Bank cutting borrowing costs by 0.25% to 4.0%.
At the annual white tie event, hosted by the City of London Corporation, and her second appearance, she started proceedings with “I am proud to stand here tonight and address you for a second time at Mansion House as the Chancellor of the Exchequer.” Her speech, short of detail, contained one sentence about fiscal rules hemming her in – “This government and I remain committed to our non-negotiable rules.” The only apparent way out for her is to raise taxes which may be the antithesis to her mantra- “growth”. This stubbornness could well be the raison d’être that she will no longer be the Chancellor by the end of this year.
A “cover-up” can be defined as ‘someone trying to hide a mistake or something embarrassing on purpose. It’s like trying to keep a secret about something that went wrong to avoid getting into trouble or to stop people from finding out’. It seems that successive UK governments have become global masters of constitutional cover-ups and have been involved in so many in recent times. Over the past forty years, they include the likes of the Hillsborough whitewash, the ongoing Post Office debacle, Windrush, Grenfell, multiple NHS concealments, grooming gangs, paedophile rings, the infected blood scandal, BBC, the Archbishop of Canterbury, PPE fraud by high-up officials during Covid etc. Many of these cover-ups would have remained unknown to all but the perpetrators if it were not for whistleblowers. They all have similar features – something goes wrong and those involved want to escape blame and choose to hide the problem. Many of these cover-ups would have remained unknown to all but the perpetrators if it were not for whistleblowers.
This week, the mother of all cover-ups hit the news – with the UK military being responsible for a data leak that put 100k Afghans at risk of death and successive governments having fought to keep it secret using an unprecedented superinjunction banning the media from publishing anything about it. It gave the Defence Ministry power to stop anyone speaking of data breach or restrictions. In August 2023, the Sunak government became aware of a leak of a vast and highly sensitive database and instituted a secret scheme to relocate 25k Afghans, at a potential US$ 9.42 billion cost. Only this week did the High Court finally lift the ban, with Mr Justice Chamberlain commenting that “there is no tenable basis” to extend restrictions further, citing “serious interference” in freedom of the press and the “right of the public to receive the information they wish to impart”. The question remains whether the government is hiding another Skeleton In The Cupboard?
howesdubai.com 