The UK economy grew by just 0.1% in the final quarter of 2025, according to the Office for National Statistics (ONS), matching the rate recorded in Q3. Analysis of the data shows that Q4 marked the first time in over two years that the services sector showed no growth. Manufacturing provided a slight boost, while construction faced its worst quarterly performance in four years, declining by 2.1%. Growth in December itself was also 0.1%, following a 0.2% advance in November. Liz McKeown, director of economic statistics at the ONS, said overall growth had been “subdued” in Q4, while Ruth Gregory, chief UK economist at Capital Economics, said the “disappointing” increase suggested the economy “still has very little momentum.” Suren Thiru, economics director at the ICEAW, said the ONS figures “confirm that the UK economy ended 2025 with a whimper.” Looking ahead, Yael Selfin, chief economist at KPMG UK, said: “Despite the uncertainties, activity appears to have accelerated in the first quarter of 2026 – Overall, we forecast the UK economy to grow by 1%.”

Schroders has announced a £9.9bn acquisition by asset manager Nuveen, which manages $1.4trn in assets. The deal ends nearly 200 years of independence for Schroders and the acquisition is expected to create a major player in asset management, with nearly £1.8trn in assets under management. Susannah Streeter, chief investment strategist at Wealth Club, commented: “With yet another big name turning private, it will be a blow to the London Stock Exchange,” adding: “With global whales swallowing big fish in the UK pond, it limits the availability of listed assets for funds.”

The Financial Conduct Authority (FCA) is considering easing capital requirements for large electronic trading firms, arguing that because they do not take deposits, their failure poses less systemic risk than banks. Options proposed by the FCA include replacing the current European approach with a net capital rule and streamlining requirements for firms wishing to use their own internal risk models. The Association for Financial Markets in Europe (AFME) argues that a blanket reduction of capital requirements “does not reflect the systemic risks posed by large investment firms,” with Jeanie Watson, its director for capital and risk management, saying: “Market risk standards should be calibrated to the activities and systemic footprint of a firm, rather than the legal form or the presence of retail deposits.” Banks contend that even without depositors, the collapse of a major trading firm could harm retail investors and destabilise key markets, including UK government bonds and ETFs.

Scottish retailers have seen a promising start to 2026, with sales and footfall reaching a nine-month high in January. Total sales increased by 3.3% year-on-year, translating to a real-terms rise of 1.7%, according to the Scottish Retail Consortium and KPMG. Non-food sales rose by 4.4%, while food sales improved by 2%. Footfall in shops grew by 5.1%, the highest in the UK, with Edinburgh and Glasgow leading the way.

Savers are losing significant interest due to tax and inflation, according to Standard Life. A higher-rate taxpayer with £30,000 in a savings account earning 4.5% interest could see a real return of only £410 after losing £340 to tax and £600 to inflation. With inflation at 3.6%, the situation is worsening. From April 2027, income tax rates on savings will rise by 2 percentage points, and the cash ISA limit will drop from £20,000 to £12,000 for under-65s. Mike Ambery of Standard Life said: “Frozen income tax thresholds are already pushing more people into higher tax brackets each year, while the amount of interest lost to tax could come as quite a surprise, especially with inflation to consider too.”

Angela Rayner has acknowledged that Labour’s tax increases have severely impacted pubs and restaurants, highlighting the “challenges” faced by the hospitality sector. Speaking at a night-time economy summit, the former Deputy Prime Minister highlighted the challenges posed by hikes to business rates and VAT, as well as the increase in the minimum wage. Ms Rayner called for a dedicated minister to support the struggling sector, saying: “More needs to be done.” However, Shadow Business Secretary Andrew Griffith accused her of hypocrisy, citing her role in enforcing new regulations.

Nearly 7,000 high street firms will see their business rates more than double due to recent reforms, according to Treasury Minister Dan Tomlinson. He said that about 1% of the UK’s 767,000 retail, hospitality, and leisure businesses will be affected. Critics, including Conservative MP Andrew Griffith, have hit out at the policy, which he labelled a “political disaster.” Helen Dickinson, chief executive of the British Retail Consortium, says the business rates system is “broken” and in need of “root and branch reform.”

Labour’s proposed visitor levy could impose an additional £100 on families for two-week holidays, according to Richard Tice, deputy leader of Reform UK. He suggested that the levy “is simply another tax on working families and British businesses at a time when people already face mounting pressures on their household budgets.” Over 200 industry leaders have written to Chancellor Rachel Reeves to voice their concerns over the impact of the proposed levy.

The Tony Blair Institute (TBI) has called for the Government to abandon certain green policies, particularly the goal of decarbonising the electricity system by 2030. The report, authored by senior energy policy adviser Tone Langengen, argues that current policies are outdated and economically unviable. The TBI also says the Government should do more to encourage drilling in the North Sea, including dropping the windfall tax on oil and gas companies. Critics, including Labour sources, maintain that transitioning to clean energy is essential for reducing reliance on fossil fuels. The TBI supports the net zero target by 2050 but urges a more pragmatic approach to energy production.

According to a HSBC UK survey, only 4% of individuals aged 55 and above considered investing before 18. In contrast, 56% of 18 to 24-year-olds are already investing. The survey revealed that 34% of young adults began contemplating investments between 16 and 18, while 16% did so under 16. Xian Chan, head of wealth at HSBC UK, said: “Our research shows that young people are highly engaged with investing.” The survey also highlighted the importance of family guidance, with 54% of young investors valuing input from loved ones compared with an average of 41% across all age groups.