2025-06-25 23:05

LONDON, June 26 (Reuters) - Living standards in Britain look set to barely grow over the rest of the decade and poorer households are likely to suffer a drop, in part due to a welfare squeeze, according to a report published by a think tank on Thursday. Median household incomes after taxes, benefits including pensions and housing costs are on course to rise by a total of just 1% more than inflation by the 2029/30 fiscal year, the Resolution Foundation said. Lower-income families are expected to see a 1% fall. Sign up here. Typical households paying mortgages will see incomes fall by 1% as the impact of higher interest rates feeds through to more borrowers. By contrast, people who own their homes outright are set to see their incomes grow by 3%, the foundation said. The biggest winners are likely to be pensioners with their incomes forecast to rise by 5%. Families with children are set to have no income growth. Adam Corlett, principal economist at the think tank, said the forecasts could prove to be too gloomy if the economy grows more quickly than expected. Low-income households would benefit if the government scraps a two-child limit on some family benefits, he said. The limit was introduced by the previous Conservative government. Prime Minister Keir Starmer is considering ditching it. However, he has said he will not reverse plans to make it harder for people to claim long-term sickness and disability benefits which have run into opposition within his Labour Party. https://www.reuters.com/sustainability/sustainable-finance-reporting/uk-living-standards-set-stagnate-rest-2020s-think-tank-says-2025-06-25/

2025-06-25 23:03

LONDON, June 26 (Reuters) - Almost one third of small and medium-sized British employers have made staff redundant or are thinking about job cuts as a direct result of the increase in their social security bills, an industry group said on Thursday. The British Chambers of Commerce said 13% of more than 570 member firms it surveyed had cut jobs and 19% were actively considering such a move as result of April's hike in employers' National Insurance Contributions ordered by finance minister Rachel Reeves. Sign up here. "We were unprepared for the huge burden placed upon us, and it led many of us to rethink our growth plans," BCC Director General Shevaun Haviland said ahead of the group's annual conference. "As a result, our business confidence measures have fallen to their lowest levels since 2022." The Bank of England said last week that employers' hiring plans were "mildly negative" due to higher labour costs with the tax hike the biggest factor. The main response was to cut pay awards followed by headcount reduction and other measures. Reeves has said she does not plan further tax increases on the scale of last year's 40 billion pound ($54 billion) rise. But many economists say she might be forced into fresh revenue-raising measures later this year to remain on course to meet her own budget rules. ($1 = 0.7344 pounds) https://www.reuters.com/business/world-at-work/uk-employers-group-says-tax-hike-has-hit-hiring-hard-2025-06-25/

2025-06-25 22:20

BANGKOK, June 25 (Reuters) - Thailand's government is moving to recriminalise cannabis, plunging into limbo an industry estimated to be worth over $1 billion that has boomed since the substance was taken off the country's narcotics list in 2022. The push to impose new controls on recreational use of cannabis comes after the Bhumjaithai Party, which championed its legalisation, withdrew from the ruling coalition last week following Thai Prime Minister Paetongtarn Shinawatra's apparent mishandling of a border row with Cambodia. Sign up here. Late on Tuesday, Thailand's health ministry issued an order prohibiting the sale of cannabis for recreational use and making it mandatory for any retail purchase to require a doctor's prescription. The new rules will come into effect once they are published in the Royal Gazette, which could happen within days. "Cannabis will be classified as a narcotic in the future," Health Minister Somsak Thepsuthin said on Tuesday. Three years ago, Thailand became one of the first countries in Asia to decriminalise the recreational use of cannabis, but without any comprehensive rules to govern the sector. Since then, tens of thousands of shops and businesses selling cannabis have sprung up across Thailand, many of them located in the country's tourism hubs. Thai Chamber of Commerce previously estimated the industry, which includes medicinal products, could be worth $1.2 billion by 2025. Unregulated access to cannabis has created serious social problems, particularly for children and young people, said government spokesman Jirayu Houngsub. "The policy must return to its original goal of controlling cannabis for medical use only," Jirayu said in a statement. The recriminalisation push has left some cannabis industry members like Punnathat Phutthisawong, who works at the Green House Thailand dispensary in Bangkok, stunned. "This is my main source of income," Punnathat, 25, told Reuters. "Many shops are probably just as shocked because a lot of them invested heavily." The cannabis sector could have transformed Thai agriculture, medicine and tourism, but uncertainty and policy reversals have stymied any sustainable growth, said cannabis activist Chokwan Kitty Chopaka. "The cannabis industry has become a hostage to politics," she said. On Wednesday, there was still a steady trickle of customers - mainly tourists - coming into cannabis shops in Bangkok's Khao San Road area, among them Daniel Wolf, who is visiting from Australia. "There are shops everywhere, so how do they reverse this? I don't think they can," he said, " It's absolutely insane." https://www.reuters.com/markets/commodities/thailand-moves-recriminalise-cannabis-shaking-1-bln-industry-2025-06-25/

2025-06-25 21:51

Trump signals US could ease Iran oil sanctions enforcement Trump: Iran will need money to put country into shape Witkoff: U.S. aims to work with China on oil sanctions THE HAGUE, June 25 (Reuters) - President Donald Trump said on Wednesday that the U.S. has not given up its maximum pressure on Iran - including restrictions on sales of Iranian oil - but signaled a potential easing in enforcement to help the country rebuild. "They're going to need money to put that country back into shape. We want to see that happen," Trump said at a news conference at the NATO Summit when asked if he was easing oil sanctions on Iran. Sign up here. Trump said a day earlier that China can continue to purchase Iranian oil after Israel and Iran agreed to a ceasefire, but the White House later clarified that his comments did not indicate a relaxation of U.S. sanctions. Trump imposed waves of Iran-related sanctions on several of China's independent "teapot" refineries and port terminal operators for purchases of Iranian oil. Steve Witkoff, Trump's Middle East envoy, told CNBC that Trump's comment on China's ability to buy Iranian oil "was a signal to the Chinese that we want to work with you, that we're not interested in hurting your economy." China is the top buyer of Iranian crude and has long opposed Trump's sanctions on the oil. "We're interested in working together with you in unison, and hopefully that becomes a signal to the Iranians," Witkoff said. https://www.reuters.com/business/energy/trump-signals-us-may-ease-iran-oil-sanction-enforcement-help-rebuild-country-2025-06-25/

2025-06-25 21:48

WLF co-founder says planning stablecoin audit, new app launch Hints firm's governance token could soon become tradable Trump family's foray in crypto has been lucrative but drawn criticism June 25 (Reuters) - Zak Folkman, the co-founder of U.S. President Donald Trump's cryptocurrency platform World Liberty Financial, said on Wednesday that the company will issue an audit of its stablecoin "within days" and that it planned a new app. Folkman also hinted that WLF's governance token, known as WLFI, could soon become tradable in an interview at the Permissionless conference on Wednesday, organized by crypto media company Blockworks in Brooklyn, New York. Sign up here. WLFI, which was launched two months before the U.S. presidential election in November by Trump and his business partners, has yielded hundreds of millions of dollars in revenue for the Republican president's family business. The business, along with other forays into crypto, has drawn a barrage of criticism from Democratic lawmakers, as well as government ethics watchdogs. Critics say it creates conflicts of interest as it is happening at the same time as the president is pulling back enforcement and easing regulations on the industry. The Trump Organization said in January that the president's investments, assets and business interests would be held in a trust managed by his children. The White House and the Trump Organization did not immediately respond to requests for comment. World Liberty has raised the money by selling so-called governance tokens, which give holders the right to vote on changes to the project’s underlying code and to signal their opinion on its direction and plans. They cannot be traded. During the interview on Wednesday, when Blockworks co-founder Jason Yanowitz asked whether the token would become tradable, Folkman said, "I don't want to give away too much, but if you pay attention over the next couple of weeks, I think everyone ... is going to be very, very happy." Folkman said WLF would also be launching an app that would make crypto seamless for everyday investors to use. He said the company's stablecoin recently just got its first attestation report from an accounting firm and that it would be posted on its website "within the next few days." "We're going to have very transparent auditing from a financial level," he said. https://www.reuters.com/business/finance/trump-backed-crypto-firm-is-planning-stablecoin-audit-new-app-2025-06-25/

2025-06-25 21:03

ORLANDO, Florida, June 25 (Reuters) - TRADING DAY Making sense of the forces driving global markets Sign up here. By Jamie McGeever, Markets Columnist After two days of strong gains in world stocks amid the widespread relief over cooling Middle East tensions, relative stability was the hallmark of trading on Wednesday, with major asset classes moving in much narrower ranges. In my column today I look at U.S. foreign direct investment - was the sharp decline in the first quarter an anomaly, or a warning of what's to come in the brave new tariff world? More on that below, but first, a roundup of the main market moves. If you have more time to read, here are a few articles I recommend to help you make sense of what happened in markets today. Today's Key Market Moves Whirlwind fades, calm returns The MSCI All Country index and Nasdaq 100 touched new record highs for a second session, and Asian and emerging market stocks posted solid gains earlier in the day. But the Dow, U.S. small caps and benchmark European indexes all fell. The euro's march higher is taking its toll, and European stocks have underperformed since the brief Israel-Iran war broke out on June 13. The euro on Wednesday rose for a fifth straight day to $1.1665, its highest since October 2021. Sterling hit its highest since February 2022 at $1.3670, and Britain's FTSE 100 slipped to its lowest this month. Bank of England policymakers may be secretly cheering the pound's rally, however, if it helps tame inflation pressures. The latest Citi/YouGov survey of UK consumers' inflation expectations on Wednesday showed that long-term inflation expectations among the British public rose to the highest since September 2022. One sector faring better in Europe on Wednesday, though, was defense, after NATO leaders agreed big increases in defense spending, especially from Europe. U.S. defense stocks have moved in the other direction this week following the Iran-Israel ceasefire. On the policy and macro front, Fed Chair Jerome Powell's second day of congressional testimony passed off without fireworks, although there were sparks in his exchanges with some lawmakers. He reiterated his view that the central bank is right to wait and see what the impact is from tariffs before considering further rate cuts. U.S. foreign investment slump - anomaly or warning? Much of the 'de-dollarization' debate has focused on foreign exposure to U.S. securities like stocks and bonds. But investors shouldn't ignore foreign direct investment flows, the traditionally sticky capital that may also be sending out warning signals. Foreign direct investment typically involves an overseas entity acquiring the assets of a company in another country or increasing its holdings, often via the purchase of machinery, plants or a controlling stake. FDI is therefore considered a longer-term investment compared to portfolio flows, which can be more volatile. U.S. President Donald Trump says he has attracted record foreign investment into the country. Indeed, the White House has a page on its website with a "non-comprehensive running list of new U.S.-based investments" since Trump's second term began. The running total is in the trillions of dollars and includes pledges from several foreign countries. Included are more than $4 trillion in U.S.-bound investments pledged by the United Arab Emirates, Qatar, Japan and Saudi Arabia. During Trump's trip to the Middle East last month, he said the U.S. is on track to receive $12-$13 trillion of investments from countries around the globe, which includes "projects mostly announced ... and some to be announced very shortly." These flows may emerge in full, in time. But official figures on Tuesday showed that FDI in the first quarter actually fell to $52.8 billion, the lowest total since the fourth quarter of 2022. That's well below the quarterly averages of the past 10 and 20 years. The Commerce Department figures also showed that the U.S. current account deficit widened to a record $450.2 billion in the quarter, or 6% of U.S. GDP, meaning FDI inflows barely covered 10% of that shortfall. Should the Trump administration be worried? TARIFF DISTORTIONS The short answer is probably not, at least not yet. FDI flows are typically far smaller than portfolio flows into equity and fixed income securities, so from the perspective of funding the current account deficit, the drop in FDI is not as pressing a concern. On the other hand, if foreign investors are also buying fewer U.S. securities, capital from elsewhere will be needed to fund that deficit. Additionally, America's balance of payments data in the first quarter was hugely distorted by domestic consumers and businesses front-running Trump's tariffs, loading up on imports before the duties kick in later this year. Trump's bet is that the deficit will shrink this year and beyond as his 'America First' policies spur more "onshoring" from domestic firms as they bring production back home and the weakening dollar helps U.S. manufacturing by making exports more competitive. The subsequent boom will attract investment from companies and governments overseas. In theory. However, these dynamics work both ways. For example, the European Union is by far the largest provider of U.S. FDI, accounting for 45% of the total in 2023, according to Citi. The combination of the continent's German-led fiscal splurge, U.S. tariffs and 'de-dollarization' concerns could easily crimp that flow, perhaps significantly. Another potential risk to U.S.-bound FDI is 'Section 899' - the possible tax of up to 20% on foreigners' U.S. income that could be part of Trump's budget plans. A Tax Foundation report in May found that Section 899 would "hit inbound investment from countries that make up more than 80 percent of the U.S. inbound FDI stock." Industry pushback may water down Section 899, but it remains a cloud on the U.S. investment horizon. The U.S. is the world's biggest recipient of FDI, with a 25% share of global volumes in 2023, up from around 15% before the pandemic, according to Citi. Its economy is the largest in the world, a thriving hub of innovation, pioneering technology, artificial intelligence and money-making potential. That will always attract FDI. Whether it attracts as much in this new environment remains to be seen. What could move markets tomorrow? Want to receive Trading Day in your inbox every weekday morning? Sign up for my newsletter here. Opinions expressed are those of the author. They do not reflect the views of Reuters News, which, under the Trust Principles , opens new tab, is committed to integrity, independence, and freedom from bias. https://www.reuters.com/business/aerospace-defense/global-markets-trading-day-graphic-pix-2025-06-25/