Business news 8 August 2025
BoE cuts interest rates to 4%. Chancellor prepares for tax rises. House prices up, markets, AI, insolvencies & more business news that we thought would interest our members.
James Salmon, Operations Director.
🏦BoE cuts interest rates to 4%
The Bank of England has cut interest rates to 4%, with the cut from 4.25% marking the fifth reduction since August 2024. Bank Governor Andrew Bailey said that while interest rates “are still on a downward path … any future rate cuts will need to be made gradually and carefully.” The Bank expects inflation – which rose to 3.6% in June – to peak at 4% in September, with this an increase on the 3.8% it predicted in May and double its 2% target. Mr Bailey told the BBC that while he did not expect higher inflation to persist, “we have to watch this very carefully.” The Bank’s nine-member Monetary Policy Committee (MPC) was split on the decision to cut rates, with four backing the 0.25% cut, four voting to hold the base rate and one – Alan Taylor – calling for a steeper reduction of 0.5%. This led to a second vote, with Mr Taylor then backing the move to 4%. Chancellor Rachel Reeves said the lower rate was “welcome news, helping bring down the cost of mortgages and loans for families and businesses.” Thomas Pugh, chief economist at RSM UK, said the Bank’s announcement “raises the chances that the MPC chooses to ‘skip’ a cut” in the final months of the year. Investors interpreted the rate cut as ‘hawkish’ along with the meeting at which Governor Bailey said ‘future cuts would be gradual and careful’ saying that recent gains in food inflation were notable. Governor Bailey praised Chairman Jerome Powell calling him a friend with ‘utmost integrity’.
💼Chancellor prepares for tax rises
The Guardian says Chancellor Rachel Reeves and Prime Minister Keir Starmer will start to prepare the country for tax rises and reforms ahead of the Budget. While no date has been set for the Budget, sources say it is likely to take place in November, giving the Chancellor more time to “roll the pitch” for tax rises or spending cuts as advisers believe that a “no surprises” approach will help prevent a negative market reaction. While Treasury sources say that the Chancellor will stick to an election pledge not to raise income tax, National Insurance or VAT, levies on gambling are likely. This comes after the National Institute of Economic and Social Research said “moderate but sustained” tax rises would be needed to overcome a deficit of £41.2bn and restore fiscal headroom of almost £10bn.
🏘 House prices up 0.4% in July
House prices rose 0.4% month-on-month in July, according to data from Halifax, with the average property price climbing to £298,237. On a yearly basis, prices were up 2.4%, with this a slowdown on the 2.7% annual growth recorded in June. Amanda Bryden, head of mortgages at Halifax, said falling mortgage rates and rising wages – as well as “more flexible affordability assessments” – mean “the picture on affordability is gradually improving,” adding that the housing market “continues to show resilience, with activity levels holding up well.” Looking ahead, she said the lender expects house prices “to follow a steady path of modest gains through the rest of the year.” Recent figures from Nationwide found that house prices rose by 0.6% in July to an average of £272,664.
📈Markets
📈Yesterday, the FTSE 100 closed down 0.69% at 9100.77 and the Euro Stoxx 50 closed up 1.31% at 5332.07.
London ran into heavy profit taking in the afternoon as defence related companies gave back some recent gains, coupled with the ex dividend factor which cost the index about 20 points. BAE fell 85p, Babcock was off 52p leading the defence decliners. The Bank Of England rate cut had the hawks dominating sales across the market.
Overnight in the US the S&P 500 was down 0.08% to 6340.00 while the Composite NASDAQ rose 0.35% to 21,242.70. Health-care stocks underperformed the market, with Eli Lilly having its worst day in almost 25 years weighing on the sector amid disappointing data on its new weight-loss pill.
🦅 Of concern was a new US President Trump threat to impose a 100% tariff on imported semiconductors from companies not manufacturing in the USA. This would impact manufactured semiconductors from China and the Philippines specifically Huawei. President Trump also demanded the immediate resignation of the Intel CEO Lip-Bu Tan on the grounds that Intel has made investments in Chinese firms. This demand apparently is a first.
Shares in Crocs plunged by 29% to their lowest level in nearly three years after the shoemaker said it expects revenue to fall by around 10% year on year in the third quarter.
💱This morning on currencies, the pound is currently worth $1.344 and €1.1544 .
On Commodities, 🛢️Oil (Brent) is at $66.65 & 💰Gold is at $3397.
📈On the stock markets, the FTSE 100 is currently up 0.05% at 9105 and the Eurostoxx 50 is up 0.04% at 5334.
🅰️ℹ️ Chat GPT 5
OpenAI has launched GPT-5, the latest in its line of large language artificial-intelligence models. They say it raises it to PhD levels. The US company said the model was better at coding and “agentic tasks” than its predecessor, GPT-4, which it released over two years ago. Tests also showed that the new model also experienced fewer hallucinations. Open AI added that ChatGPT, its AI chatbot, now has nearly 700m weekly active users.
🔌 Energy
The UK confirmed plans to offer discounts on energy bills to people living near new electricity pylons as it seeks to ease opposition to essential grid upgrades. Britain’s electricity generation capacity is growing faster than the grid’s ability to send the power where it’s needed. The country needs to add twice as much network infrastructure in the next five years as was built in the last decade to meet 2030 targets. But that requires efforts to keep local communities on board.
🅰️ℹ️ HMRC told to reveal whether it used AI in judgements
HMRC must disclose if it used AI to make decisions after a court ruled in favour of tax advisers who claim the technology has been used when processing tax credit applications.
⚖️FOS complaints fall
Complaints to the Financial Ombudsman Service (FOS) fell to their lowest in more than a year in the April to June quarter. Figures show that the FOS received 68,000 new cases in the period, with this down from 74,600 complaints seen a year ago. Complaints about motor finance were the most common grievance but the total dropped to 21,500 cases from 36,000. Complaints regarding fraud and scams fell to 6,800 from 8,800. The data covers a period that saw a series of FOS reforms that introduced tighter restrictions on complaints from professional representatives. As of April, banks are not charged for the first three complaints they receive in the financial year. A case fee of £650 is applied to subsequent complaints, with this reduced to £475 if a complaint is dismissed, withdrawn, abandoned, or found to be outside the FOS’s jurisdiction. The figures show that 30,800 cases were brought by professional representatives in the first quarter of the 2025/26 financial year, compared to 36,600 in the same period last year.
💷FCA tightens rules for payment firms
The Financial Conduct Authority (FCA) has announced that stricter regulations for electronic payment firms will come into force in May 2026. The new rules say companies must separate customer funds from their own, ensuring refunds in case of firm failures. The City watchdog says firms will face annual audits by qualified auditors, monthly reporting, and daily checks on safeguarded funds. The rules will apply to payment institutions, e-money institutions and credit unions that issue e-money. UK Finance said it backed a “robust and effective safeguarding regime that protects customers without placing unrealistic demands on businesses, particularly smaller firms,” adding that “getting the balance right means having rules that are practical, proportionate, and internationally competitive.”
🚨Latest Insolvencies
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➕Why you should become a member of CPA!
The Credit Protection Association (CPA) has been assisting thousands of UK businesses to get paid, since 1914. We have supported our members through all sorts of difficult trading environments. With high interest rates and a struggling economy and elevated insolvencies, our services can help your business navigate these difficult waters.
Unlike other credit management and debt collection companies, we offer a range of services to our members that are all included as part of a fixed annual subscription, tailored to your needs.
Under your annual subscription you will have access to our main services:
- Our Creditcare credit reports provide credit ratings and limits along with a host of detailed information on your potential customers to enable you to trade with confidence and set appropriate credit policies for new customers.
- Our monitoring service will alert you to any significant changes in the status of those customers.
- ️Our Overdue account recovery service can be used to chase up payment on any invoices to those customers that have not been paid on time. Unlike other debt collection companies, this service directs your customer to pay direct to you and allows you to maintain your goodwill with them, rather than inserting ourselves into your relationship with you customer and insisting they pay CPA instead. Our Overdue account recovery service resolves over 80% of accounts referred to us.
All of the above services and other complimentary services such address verification, are included in your subscription!
And for the small minority of debts not resolved through our Overdue account recovery service, you can refer the debt to our collections department to escalate the late payment collections process.
CPA eases cash from tardy debtors – Efficiently, Effectively, Economically and Ethically. And we provide credit information so you can monitor and assess your key customers and be warned of any potential risks. CPA has been improving business cash flow for over 100 years, by tackling late payers and campaigning against the late payment culture in the UK.
Unlike other credit management companies, we offer our members a fixed annual subscription regardless of how high the value of their debts maybe!
Rather than to borrowing more money to improve your cashflow, CPA suggests that business owners tackle the problem at its source. If late payments are a strain on your cashflow, then talk to CPA about how we can help you reduce those late payments.
Just ☎️ call Peter Uwins, CPA’s National Sales Manager, on 020 8846 0000 (business hours) or 💻 email nsm@cpa.co.uk today.
When you see your money come in, you will be so glad you used CPA.
️ The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections
Do you have a commercial late payer that is causing you grief? Use CPA’s no-win, no-fee, commercial debt recovery service!
If you have a particular business customer who is late paying and causing you sleepless nights, why not offer it to CPA’s collection department for purchase on recourse?
CPA’s collection department will then pursue the debt. We will be liable for any costs incurred and then when we have recovered the debt, we will pay you the net principle debt recovered less our percentage.
Once you have enjoyed that success then you can consider the more cost effective membership which includes our Overdue Account Recovery service and Status/Credit reports as well as a range of other complimentary services.
Just call ☎️ 020 8846 0000 and ask for Godfrey Nelson or Cris Shirley (business hours) or 💻email debtpurchase@cpa.co.uk today.
️ The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections.
Get compensated for previous late payments
Have you been paid late by business customers in the last six years?
Maybe you no longer work with them. Under ⚖️ legislation, you are entitled to compensation you for those late payments you have suffered.
You put up with the PAIN – now claim the GAIN!
Claim late payment compensation (LPC) from former business customers who paid you late in the last six years!
CPA (LPC) Recoveries is using our bespoke software and decades of experience to do just that for our clients
Check our compensation calculator to see how much your business could be owed!
Discover NOW the potential value of late payment compensation hidden in your sales ledger!
️ The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections.