The ongoing conflict in the Middle East may push the UK towards recession if oil prices rise significantly. According to Oxford Economics, a jump in Brent Crude Oil prices from $97 to $140 – and lasting a couple of months – could lead to a 0.7% decline in global GDP by year-end. Inflation in the UK would rise to 5.1% prompting the Bank of England to increase interest rates by 25 basis points. The analysis comes as Iran continues to strangle flows through the Strait of Hormuz leading the International Energy Agency to release a record 400m barrels of reserves to help curb a potential supply shortage. However, this move sent a “negative signal to markets” that world leaders see little room for quick de-escalation, according to Francesco Pesole at ING.

British exporters report a significant lack of support from the Government, according to a survey by the British Chambers of Commerce. None of the nearly 1,000 firms surveyed felt they received adequate assistance to navigate changing trade policies. William Bain, head of trade policy, said: “Our research is clear – UK exporters are navigating trade policy changes largely alone.” Iain Walker, a director at global standards organisation GS1 UK, which helped compile the report, said Britain “risks falling behind” in the global trade landscape.

Ed Miliband, the Energy Secretary, has been warned that businesses face significant energy price increases due to the ongoing conflict in the Middle East. During meetings with business leaders, he learned that a third of companies will renew energy contracts in April, raising concerns about future costs. Oil prices have surged above $100 per barrel, and natural gas prices have risen by 60% since the conflict began. Following the talks, Miliband said the Government “will keep working with the sector closely in the coming weeks and months.”

The UK tax office is considering a tax exemption for over 160,000 British nationals fleeing the Iran and US conflict in the Gulf. Many may not have been tax residents in the UK, risking tax bills if they stay longer than 183 days. Those affected by “exceptional circumstances” can disregard up to 60 days. Robert Salter from Blick Rothenberg warned of the risk of becoming UK tax residents for those returning. He said: “People need to be very careful about how this will apply to them; nobody knows how long this problem in the Middle East will go on. It’s possible people will be here three to five months or even longer.” An HMRC spokesman confirmed existing rules account for such circumstances.

IG is urging the UK Government to reform the £100,000 tax cliff, which they claim is harming families’ financial stability. According to a recent survey, 48% of workers earning between £90,000 and £125,000 struggle to invest due to tax pressures. Among those with nursery-age children, this figure rises to 92%. Michael Healy, UK and Ireland Managing Director at IG Group, said: “The UK’s brutal tax cliff-edge system is weighing down the very households who are most able to fuel growth in UK capital markets.” IG proposes several reforms, including adjusting childcare thresholds for inflation.

Unions are advocating for an increase in the surcharge on banks to generate between £23bn and £55bn amid the cost of living crisis. The Trades Union Congress (TUC) argues that banks must contribute to stabilising the economy amid geopolitical strife. The TUC highlighted that bonuses in the City reached a record £23.6bn in 2025, with an average of over £20,000 per employee in the financial and insurance sector.

The CEO of John Lewis has urged the Government to fulfil its manifesto promise to reform the business rates system. Jason Tarry described recent changes as a “short-term” fix that still disadvantages physical retailers compared to online competitors. Tarry said: “After employment costs, it’s the second biggest cost in any retailer’s P&L and over the years the growth in business rates has been disproportionate.”

Western banks in the Gulf have mandated remote work for employees following threats from Iran. The Iranian military’s spokesman, Ebrahim Zolfaqari, indicated that banks could be targeted after a rocket attack on Bank Sepah in Tehran. Citibank has closed most of its UAE branches, while HSBC has temporarily shut its three branches in Qatar. Other banks, including Goldman Sachs and JP Morgan, have also instructed staff to work from home.

More than 1,500 employers were stripped of their sponsor licence between October and December, up from 541 in the previous three months as the Home Office tightened its enforcement of immigration rules.

The Financial Conduct Authority (FCA) has issued a warning regarding second charge mortgages, which allow homeowners to borrow against their home equity. These loans often attract higher rates and are typically taken by individuals already in significant debt. The FCA’s review highlighted vulnerabilities among consumers, including inadequate affordability assessments and unclear fees. David Geale, executive director at the FCA, commented: “The second charge market is relied on by people often already heavily in debt. It’s vital it works well, but we’ve found that standards are not always where they need to be.” The FCA urges firms to improve practices and consumer understanding.

The UK DIY investment market grew by 19% last year, reaching £772bn in assets under administration, according to Boring Money. Approximately 18.4m Brits are now managing their own investments, with 13.4m DIY accounts established. The rise is attributed to low-cost platforms attracting first-time investors, as over 50% prioritised low fees. Holly Mackay, CEO of Boring Money, noted: “We are now entering the third wave of DIY investors.” The trend is also supported by a growing number of investors aged 35 to 44, as they accumulate wealth and seek investment opportunities.

PwC plans to increase its graduate recruitment next year, according to Marco Amitrano, the firm’s UK boss. He dismissed concerns that artificial intelligence (AI) is affecting hiring, attributing last year’s reduction in graduate roles from 1,500 to 1,300 to economic factors. Amitrano noted a significant rise in applications, with 60,000 vying for 2,000 entry-level positions. He stressed the value of university education for life skills, saying: “I personally would still go to university.”