Business news 15 July 2025
High inflation unlikely to halt rate cuts. Retail bounces. EV car grants. Recruitment stalled. Reeves repeats tax pledge. markets, insolvencies & more business news that we thought would interest our members.
James Salmon, Operations Director.
High inflation unlikely to halt rate cuts
Economists do not believe that high inflation will deter Bank of England officials from cutting interest rates. A Bloomberg poll of City analysts shows that inflation is expected to remain at 3.4% in June, holding at 1.4% above the Bank’s 2% target for the third consecutive month. Jack Meaning of Barclays said this rate of inflation would “not be sufficient to lead the Monetary Policy Committee to deviate from a quarterly rate-cutting path,” while RBC analysts said: “As long as services consumer price index inflation continues to fall in line with the MPC’s expectations, we think it is sufficient for it to continue to ease policy in its current, gradual, manner.” While Deutsche Bank’s Sanjay Raja said June’s data will show the beginning of an “ascent,” Cathal Kennedy at RBC Capital Markets believes the current trend marks a “blip.”
Retail bounces
The UK economy is showing more signs of bouncing back from its recent slump, with a leap in June retail sales adding to evidence of a strong pick-up in activity seen in other leading indicators. The British Retail Consortium said on Tuesday that total retail sales rose 3.1% in June from a year earlier as hot weather prompted Britons to stock up on electric fans and sports and leisure equipment.
EV car grants
The Department for Transport has announced up to £3,750 discounts (in the form of grants) for electric vehicles up to £37,000 with the most environmentally friendly vehicles seeing the biggest reductions. The grants are being introduced by the government to encourage drivers to move away from petrol and diesel vehicles. Carmakers can apply for funding from Wednesday, with the RAC saying discounted cars should start appearing at dealerships “within weeks”.
Recruitment stalled by taxes
Recruitment among UK firms is currently “static, stymied by the Government’s payroll taxes,” according to a British Chambers of Commerce poll of over 4,500 companies. Following the rise in National Insurance contributions in April, 60% of firms reported no change in staffing levels between April and June. It was shown that 23% did recruit, marking a slight increase from 20% in the previous quarter. Looking ahead, only a quarter of firms expect to expand their workforce, down from 27%.
AI disrupts hiring
Data from McKinsey & Co shows that online job postings fell 31% in the three months to May, compared with the same period in 2022. Analysis shows that the decline jumps to 38% in roles identified as highly exposed to AI, such as software engineering, finance, and consulting. Tera Allas, senior adviser at McKinsey, said: “The anticipation of significant – albeit uncertain – future productivity gains, especially as the technology and its applications mature, is prompting companies to review their workforce strategies and pause aspects of their recruitment.” Meanwhile, jobs platform Adzuna has found that postings for internships, apprenticeships, and junior positions have fallen by almost a third since late 2022, with the decline coinciding with the rise of generative AI tools. Elsewhere, data from PwC shows that job listings in the 25% of roles least exposed to AI have increased significantly since 2012, while those most exposed have remained flat or declined.
Reeves repeats tax pledge
Rachel Reeves has reiterated a pledge that the Government will not increase income tax, National Insurance or VAT, but declined to comment on whether Labour could introduce a new wealth tax. The Chancellor said ministers will honour manifesto commitments on the taxes that will not be hiked, “because I do recognise the struggle that ordinary working people have faced these last few years with the cost of living.” Ms Reeves comments come after Transport Secretary Heidi Alexander said the Government will not hike them for those on “modest incomes, working people.” Urged to offer a definition of “working people,” Darren Jones, Chief Secretary to the Treasury, told Sky News it was “anyone that gets a payslip, basically.”
First-time buyers boosted by relaxed loan rules
Chancellor Rachel Reeves is set to announce reforms that will see lower earners qualify for mortgages for the first time, with a significant relaxation of regulations designed to increase support for first-time buyers. The Treasury anticipates that these changes will result in an additional 36,000 mortgages being approved annually. The reforms will include a government-backed mortgage guarantee scheme allowing first-time buyers to secure homes with a minimum 5% deposit. David Postings, the chief executive of trade association UK Finance, said: “Easing the loan-to-income cap and introducing a permanent mortgage guarantee scheme will help more first-time buyers get onto the housing ladder. Increasing the number of people who can access mortgage finance is a key part of delivering economic growth.” Meanwhile, the Financial Conduct Authority is reviewing lending rules and may allow prospective buyers to secure a mortgage based on their record of paying rent on time.
Reeves vows to cut City red tape
Rachel Reeves is set to announce a significant reduction in regulation covering financial services, with the Chancellor vowing to cut “reams of financial red tape.” The reforms will look to abolish the certification regime affecting nearly 140,000 finance professionals and streamline senior management appointments, reducing regulatory review timelines from three months to two. A new concierge service will be introduced to attract overseas financial firms, providing tailored support for investment and growth in the UK. Ms Reeves believes that the measures – which the Treasury says will be the “biggest financial regulation reforms in a decade” – will have “a ripple effect that will drive investment in all sectors of our economy and put pounds in the pockets of working people.”
Markets
Yesterday, the FTSE 100 closed up 0.64% at 8998.06 while the Euro Stoxx 50 closed down 0.23% at 5370.85 as it took in the latest threat of tariffs against the EU.
Overnight in the US the S&P 500 rose 0.14% to 6268.56 and the NASDAQ rose 0.27% to 20640.33. Financials stocks were one of the biggest advancers as credit card companies and payments firms rallied from a selloff on Friday.
Trump said the US Federal Reserve should lower US rates to 1%. Looking to undermine the current FED chair, Jerome Powell, The Trump Administration is escalating its criticism of the $2.5bn renovation project at the Federal Reserve campus overlooking the National Mall which will add a visitors centre. US 10 year bond yields rose as a result.
Sterling fell after Bank of England governor Andrew Bailey said that ‘slack’ was beginning to open up in the UK economy commenting that ‘I really do believe the path is downward for interest rates’.
Chinese growth topped forecasts at 5.2% (annualized) for the second quarter of 2025, giving it strength heading into negotiations with the US on trade.
The EU has drawn up a second list of countermeasures to target US imports worth €72 billion, including Boeing planes, cars and bourbon if talks stall in the US trade war.
Nvidia plans to resume sales of its H20 AI chip to China after securing Washington’s assurances that such shipments would get approved, a dramatic reversal from the Trump administration’s earlier stance.
This morning on currencies, the pound is currently worth $1.345 and €1.151.
On Commodities, 
Oil (Brent) is at $68.85 & 
Gold is at $3359.
On the stock markets, the FTSE 100 is currently up 0.05%, breaking the 9000 milestone at 9003 and the Eurostoxx 50 is up 0.48% at 5397.
The value of Bitcoin rose above $120,000 for the first time, climbing by more than 10% in the past week.
US firms’ unpaid tax bill climbs
Analysis by UHY Hacker Young shows that almost half of all underpaid tax from overseas territories relates to US firms. HMRC data suggests that up to £8.8bn in tax was underpaid by US companies in the last tax year, marking a 57% increase compared to the previous year. US firms now account for 46% of the £19bn that remains outstanding. Amid ongoing concern over President Donald Trump’s punitive tariff regime, Phil Kinzett-Evans, head of tax at UHY Hacker Young, said HMRC “needs to tread carefully as it faces the challenge of ensuring the UK keeps a good relationship with the current US administration whilst also investigating US companies for underpaying tax.”
London among the most expensive cities for the super-rich
The UK has overtaken Hong Kong and is now the second most expensive city in the world for ultra-net worth individuals after Singapore, according to an annual ranking by Julius Baer. Researchers from the Swiss bank said that London has managed to “hold its position as one of the most appealing global cities for the wealthy,” despite the Government introducing tax raids including the abolition of non-domiciled residency status and changes to inheritance tax.
House prices more affordable than 20 years ago
According to the latest figures from Nationwide Building Society, house prices in the UK are more affordable than they were two decades ago, with the average house price now 5.8 times the average annual salary, down from 5.9 in 2005. Over the past 20 years, house prices have risen by 73%, while earnings have increased by 76%. However, the current ratio remains above the long-term average of 4.8. The report highlights that affordability varies significantly across regions, with London seeing the house price to earnings ratio climb from 7.1 to 9.2. Rising rental prices have also made it challenging for first-time buyers to save for deposits, complicating the path to homeownership.
Economist: Wealth tax ‘extremely difficult’ to implement
Deutsche Bank economist Sanjay Raja has warned that the introduction of a wealth tax would be “extremely difficult to implement effectively, efficiently and equitably.” With Chancellor Rachel Reeves looking to restore the Government’s £9.9bn fiscal headroom, ministers including Prime Minister Keir Starmer have refused to rule out a wealth tax. However, Mr Raja says such a levy would take years to set up and require substantial investment in personnel and tools to track assets. He also suggested that a tax rate of 0.25% on private pensions on the top 10% of wealth would raise £5bn, while targeting net property wealth could bring an additional £5bn. He added that a taxable threshold of £1m per household could pull in £7bn.
Wealthy families beat IHT with insurance
Wealthy families are increasingly turning to life insurance policies to mitigate the impact of inheritance tax (IHT) changes announced by Chancellor Rachel Reeves. Cover Direct and Risk Assured have both seen a surge in the number of inquiries, saying they have doubled. The reforms, effective from April 2026, will impose a 20% IHT on assets exceeding £1m, previously exempt for certain businesses. Chris Etherington from RSM highlights the appeal of these policies for businesses with illiquid assets, saying that many are now considering life insurance to address potential liabilities from unused pension pots, which will also be subject to IHT from April 2027.
Experian
Experian left its financial outlook unchanged on the back of a “strong” first quarter. The provider of consumer credit score checking, fraud detection and credit application processing said revenue in the quarter to June 30 rose 12% on-year. At constant currency, growth was also 12%. Organic growth was 8% at constant currency. The strongest organic revenue came in North America, at 9%. In Latin America, organic revenue growth was 5%, while in the Europe, the Middle East & Africa and Asia Pacific grouping, it 7% higher.
Thames Water
Thames Water will “take at least a decade to turn around”, according to its CEO, as it posted yet more annual losses of £1.65bn for the year to March, increasing its debt to £16.8bn. The water company raised doubts over the likelihood of a successful overhaul of its finances, saying temporary nationalization may be in the cards. “There exists a material uncertainty” over whether a court-implemented restructuring can be completed during the agreed period, Thames said Tuesday. “The company would need to consider all options available to it at the time, but a possible consequence would be a special administration.”
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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!