UK Business News Today: 12 August 2026 | Economy, Markets & Insolvencies

Extreme weather has become a business issue as well as a weather story today, with UK electricity prices jumping, the power grid preparing for the impact of this evening’s solar eclipse and the Government convening an emergency meeting as the country experiences its fifth heatwave of the summer. At the same time, construction weakness is threatening UK growth and oil prices remain close to $90 a barrel, adding another potential source of inflation. There are brighter signals from consumers, while plans to shift thousands of professional jobs away from London could redistribute billions of pounds of spending into regional economies. For businesses selling on credit, the combination reinforces the need to watch customer costs, payment behaviour and creditworthiness closely.

James Salmon, Operations Director.

Key Developments

• Extreme heat is pushing UK electricity prices higher and threatening productivity, with the Government holding an emergency meeting over drought and wildfire risks.
• UK GDP is expected to have contracted by 0.1% in June as construction activity fell sharply.
• Consumer confidence reached a 21-month high in July, while consumer card spending rose 2%.
• Around 90,000 London white-collar jobs could move elsewhere in the UK over five years, potentially shifting up to £15bn of wider economic activity into the regions.
• Brent crude remains close to $90 as the Strait of Hormuz remains closed, keeping energy costs and inflation risks elevated.

Economy & Policy

Construction weakness threatens UK growth

The UK economy is expected to have contracted by 0.1% in June, reversing earlier progress as construction activity declined sharply. Pantheon Macroeconomics has highlighted weakness in construction alongside stagnation in services and production. Retail sales have provided some support and Deutsche Bank economist Sanjay Raja believes household consumption could deliver a modest boost during the second quarter, but business investment is expected to remain subdued.

Why it matters: Weak construction and investment can quickly affect suppliers, subcontractors and trade creditors through reduced orders, tighter margins and slower payment.

Consumer confidence climbs to a 21-month high

Barclays’ latest survey shows UK consumer confidence reaching its highest level for 21 months in July. Around 30% of respondents expressed optimism about the economy, six percentage points higher than in June. Consumer card spending rose 2%, while discretionary expenditure increased by 1.6%.

Why it matters: Stronger consumer confidence can support revenues throughout retail and service supply chains, although businesses should distinguish improving demand from customers’ actual ability to pay.

Long-term sickness problem may be smaller than previously thought

The Office for National Statistics says its new Transformed Labour Force Survey is showing lower levels of economic inactivity caused by long-term sickness than the existing Labour Force Survey. The ONS believes declining response rates during the pandemic may have contributed to an overly pessimistic picture of the labour market. It intends to move to the new dataset in November 2027.

90,000 London jobs could move into regional economies

Around 90,000 professional jobs currently based in London could move elsewhere in the UK over the next five years, according to analysis by Robert Walters. The relocation could transfer around £9bn of employers’ spending to cities including Manchester, Leeds and Birmingham, potentially rising to £15bn once spending on property and local businesses is included.

Manchester and the North West are expected to receive around 22,500 roles, with the Midlands attracting approximately 20% and Yorkshire 15%. Cost pressures, hybrid working and the Government’s devolution agenda are accelerating a trend already visible among banks, professional-services companies and public institutions.

Separate Employment Hero figures also suggest SME payrolls in northern England grew 6.3% quarter-on-quarter in July, around twice the pace reported in London.

Tax & Government

Property taxes offer no easy answer for Government

The UK already raises more from property taxation than any other OECD country, according to analysis highlighted by the Guardian’s Phillip Inman, yet the Government is examining how Britain’s estimated £5.5tn of privately owned property wealth might contribute more.

Options include council tax reform, a land value tax replacing council tax and residential stamp duty, or a flat annual charge based on property value. Each creates substantial political and practical difficulties, meaning there is no obvious route to raising significant additional revenue without creating winners and losers.

Debate builds over tax rises ahead of October Budget

Chancellor John Healey will deliver his first Budget on 28 October. Writing in the Telegraph, Adam Smith argues that, provided there is no further oil shock, the Chancellor should have enough fiscal headroom to avoid tax increases, helped in part by stronger receipts from rising equity markets.

However, significant uncertainty remains around public finances, energy prices and the Government’s wider economic programme, with regional devolution expected to feature prominently in the Budget.

Investment taxes blamed for Britain’s investment gap

Hargreaves Lansdown chief executive Matt Benchener argues that Britain needs more investors rather than higher taxes on investment. He says elevated capital gains taxation discourages investment and contributes to the UK’s long-standing investment gap.

Energy & Costs

Fifth heatwave triggers emergency government meeting

Prime Minister Andy Burnham is due to hold an emergency government meeting over the response to extreme weather as Britain experiences its fifth heatwave of the summer. Large parts of the country are affected by drought and heightened wildfire risk, with government support already being deployed for wildfire response and water conservation.

The Met Office says temperatures could reach around 37°C in parts of England on Thursday, with an Amber Extreme Heat warning covering areas of southern and eastern England and the Midlands.

Heatwaves estimated to have cost UK economy billions

Analysis from WPI Strategy’s Martin Beck estimates that repeated heatwaves could have cost the UK economy around £3bn through lost productivity and weaker retail activity, although he stresses there is considerable uncertainty around the calculation.

Britain is also importing more electricity from Europe. The value of electricity imports reached £439m in May, reportedly the highest monthly total outside the period of the Ukraine energy crisis.

Electricity prices jump ahead of hottest weather

UK day-ahead electricity prices have risen to £133.24 per megawatt-hour, their highest level since 23 June, as hotter weather lifts electricity demand and puts pressure on generation across Europe.

London and the South East are forecast to reach around 34°C today, with temperatures potentially climbing to 37°C on Thursday.

Eclipse adds an unusual challenge for the electricity grid

National Energy System Operator has warned electricity-market participants that supply margins could be tight this evening as the solar eclipse temporarily reduces solar generation during exceptionally hot conditions.

NESO has sought additional spare generation capacity as a precaution. The operator has emphasised that this does not mean customer electricity supplies are expected to be interrupted. Britain’s growing dependence on solar means weather and daylight conditions now play an increasingly important role in managing the electricity system. NESO’s summer outlook also highlights the growing influence of solar irradiance on grid conditions.

London set for spectacular partial solar eclipse

The eclipse begins in London at approximately 6:17pm, reaches its maximum at around 7:13pm and ends at approximately 8:06pm. The eclipse magnitude in London will be about 0.925, making this an unusually substantial partial eclipse for the capital. The Sun will be very low in the west-north-west by the end of the event.

Current forecasts are favourable, with the Met Office expecting a dry, sunny and very warm day across London and South East England. Anyone viewing the eclipse should use appropriate solar viewing protection rather than looking directly at the Sun.

Industry & Investment

UK shareholders push back against low takeover offers

Major shareholders in London-listed businesses are increasingly challenging takeover bids where they believe buyers are exploiting depressed UK valuations. There were 154 bids for UK companies worth more than £100m in 2023, accounting for around £165bn of market capitalisation.

Companies including Segro and Intertek have seen shareholders encourage boards to seek better terms, although other businesses have accepted contested offers.

Shein reportedly preparing Hong Kong flotation

Fast-fashion group Shein is reportedly considering an IPO in Hong Kong as early as next Wednesday. The Singapore-based business is seeking a valuation of around $30bn, although the eventual figure could be lower.

That would be dramatically below the near-$100bn valuation achieved during a private funding round in 2022. Shein previously explored flotations in both New York and London but encountered political resistance.

Retail, Hospitality & Consumer

Mayfair hotel faces HMRC winding-up petition

The Stafford London, a luxury Mayfair hotel owned by BHL Global, has received a winding-up petition from HMRC over unpaid tax debts. The development follows the departure of managing director John McLean.

Turnover fell 5% to £30.5m in the year to December 2024, with its owner pointing to higher costs and intense competition as contributors to financial pressure.

International & Trade

France bans unsolicited telemarketing

France has banned unsolicited telemarketing calls unless the communication relates to an existing contract or the consumer has previously consented. Research published in 2025 found that 38% of French consumers received at least one telemarketing call every day.

The reform also has international consequences, particularly for Morocco’s large call-centre industry, which depends heavily on French customers.

Hormuz remains closed as US-Iran tensions continue

Iran’s new Supreme National Security Council leadership says the Strait of Hormuz will remain closed until the US changes its position and accepts Iranian conditions for ending the conflict.

The continuing standoff is one of the main forces behind the latest rise in energy prices. The IEA has doubled its estimate of the third-quarter oil supply deficit to around 1.8 million barrels per day, while Brent has been trading close to $90.

Global Market Summary

Financial markets are balancing two very different forces this morning: continued enthusiasm around artificial intelligence and renewed inflation fears caused by rising energy prices.

European markets opened cautiously. The FTSE 100 was at 10,835.90, down 0.08%, while the STOXX Europe 600 stood at 660.44, virtually unchanged. The Euro STOXX 50 was at 6,551.59, up 0.01%, Germany’s DAX was 0.19% higher at 26,440.43, and France’s CAC 40 was down 0.26% at 8,692.48.

US shares had finished Tuesday broadly subdued ahead of today’s inflation figures. The S&P 500 closed at 7,728.20, the Dow Jones at 53,791.85 and the Nasdaq 100 at 29,525.48. Sentiment improved after the close, however, after CoreWeave jumped around 16% and Super Micro Computer around 7.6% following strong AI-related results. S&P 500 futures subsequently moved above Tuesday’s cash close.

Asia was stronger overall. Japan’s Nikkei 225 rose 0.83% to 67,524.06, while the broader Topix reached a record high. South Korea’s Kospi surged roughly 4% as Samsung Electronics and SK Hynix rallied on optimism around AI demand and shareholder returns. Hong Kong moved the other way, with the Hang Seng down 0.98% at 25,401.80, while China’s Shanghai Composite edged higher.

Market drivers

The principal market event today is the US July CPI report, due at 13:30 BST. Markets are assigning roughly a 50% probability to a Federal Reserve rate rise in September, making today’s inflation figures particularly important for bonds, currencies and equities. Consensus in the supplied market briefing expects core monthly inflation of 0.2%.

Energy remains the other major concern. Brent crude has risen for six consecutive sessions as negotiations over the Strait of Hormuz remain deadlocked. The IEA now estimates a Q3 oil supply deficit of around 1.8 million barrels per day.

Currencies

Sterling remains relatively firm as the dollar trades close to a two-month low ahead of US inflation data. At the latest available reading, GBP/USD was around $1.351, while GBP/EUR was around €1.171. Sterling was approximately 0.05–0.06% firmer against the euro on the day.

For UK importers, a stronger pound offers some protection against overseas costs, but movements in oil and commodity prices remain large enough to outweigh modest currency gains in some sectors.

Commodities

Brent crude was trading around $89.5–$89.6 a barrel, close to the psychologically important $90 level. WTI crude was around $83.9 a barrel in morning trading as the Hormuz dispute continued to create fears of supply disruption.

Gold was around $4,439.80 an ounce in the supplied market data, supported by geopolitical uncertainty and inflation concerns. Copper was around $14,152.50 per tonne, while wheat futures rose around 3% following a drone attack at Russia’s Novorossiysk port.

For business owners, the key market message is less about daily share movements and more about costs. Oil approaching $90, elevated electricity prices and continuing geopolitical uncertainty could feed through into transport, logistics, energy and supplier pricing at a time when many SMEs have limited room to absorb further increases.

Insolvency Watch

Today’s formal notices contain seven administrations, six liquidations and two winding-up petitions.

Administrations (7)

• AVON HOUSE SCHOOL LIMITED
• JACKSON DISTRIBUTION LIMITED
• PERRIN MYDDELTON LIMITED
• PHILADELPHIA STRUCTURES LTD
• PREMIER CARE PARTNERS LIMITED
• RENGEN CROWN LIMITED
• SAUNDERS SCOTT LIMITED

Liquidations (6)

• DARDILAUN LTD
• DECAN CONSULTANTS LTD
• DREWLEC LIMITED
• FICKLING MEDICAL LIMITED
• ITOCHU FIBRE LIMITED
• KHEMIA CONSULTING LIMITED

Winding-up Petitions (2)

• FLAXLEY CONVENIENCE LIMITED
• GREENACRES RESIDENTIAL PARK LTD

The Stafford London winding-up petition reported separately in today’s news is also a reminder that financial distress can emerge in apparently established and prestigious businesses. Suppliers should treat HMRC petitions, repeated late payment and unexpected changes in management as reasons to review credit exposure promptly.

Keeping cash moving as costs rise

Today’s news illustrates how quickly external pressures can feed into customer cashflow. Energy costs can rise in a matter of days, a heatwave can reduce productivity, weaker construction activity can affect an entire supplier chain, and a customer that appeared secure a few months ago can suddenly face an insolvency petition.

Strong credit management is therefore about recognising changes early.

CPA Members can use CreditCare credit reports and debtor monitoring to assess customers before extending further credit and identify changes in risk. Where invoices become overdue, CPA can support the credit-control process and pursue payment professionally and ethically, helping Members improve cashflow without unnecessarily damaging valuable customer relationships.

The earlier a payment problem is identified and addressed, the more options a creditor generally retains.

Call CPA on 020 8846 0000 during business hours, Monday to Friday, 9am to 5pm.
Email PaidQuick@cpa.co.uk
Visit cpa.co.uk/contact-us/

Just call 020 8846 0000 (Monday to Friday, 9am to 5pm) or email PaidQuick@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.

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