Andrew Bailey, the governor of the Bank of England, has softened his position on stablecoins, conceding that they could drive innovation in domestic and cross border payments, and could allow for non-banks to provide more credit into the economy. “It is possible, at least partially, to separate money from credit provision,” he writes in the FT, pointing to a shift away from fractional reserve banking and the “transition to a future financial system.” Bailey went on to add that the BoE will publish a consultation on its plans to regulate stablecoins later this year.

Rachel Reeves, the Chancellor, is under pressure not to raise taxes for businesses ahead of the upcoming Budget. The British Chambers of Commerce (BCC) and Confederation of British Industry (CBI) warn that higher taxes could lead to a ‘doom loop’ of reduced growth. The BCC’s report reveals the UK has fallen from ninth to 29th in global competitiveness rankings since 1997. BCC director general Shevaun Haviland commented: “If the UK economy is not competitive then it cannot grow.” Both organisations urge the Government to focus on supporting businesses and avoiding further tax increases.

Nearly 700,000 Britons are now paying 60% tax on some income, a significant increase from 336,000 six years ago. This “tax trap” affects those earning between £100,000 and £125,140, where the loss of the personal allowance leads to higher tax rates. Data from HM Revenue & Customs shows that the number of taxpayers in this bracket rose by 203,000 from 2022-23 to 2024-25. Rachel Reeves, the Chancellor, plans to maintain the freeze on income tax thresholds until at least 2028, exacerbating the issue.

The UK manufacturing sector is experiencing a significant downturn, with the S&P Global purchasing managers’ index (PMI) dropping to 46.2 in September, indicating a five-month low. This decline is attributed to a sharp fall in orders and a halt in export work, exacerbated by a cyber-attack on Jaguar Land Rover. Rob Dobson, a director at S&P Global Market Intelligence, stated: “Manufacturers are facing an increasingly challenging environment, with intakes of new business and levels of production hit by weak market sentiment, a dearth of new export work and a high-cost environment exacerbated by tax and labour cost rises.” Employment has also decreased for the eleventh consecutive month.

Investment platform IG has received a crypto asset licence from the Financial Conduct Authority (FCA), becoming the first UK-listed company on the FCA’s crypto asset register. The milestone allows IG to enhance its crypto offerings, enabling customers to transfer assets and access new features. Michael Healy, UK managing director at IG, said: “This marks a significant step forward for IG as we continue to broaden our offering for UK investors.”

Catherine Mann, a member of the Bank of England’s Monetary Policy Committee, is advocating for maintaining the current interest rate at 4% for an extended period. She cites rising consumer inflation expectations, particularly due to food price increases. Mann said: “I prefer a longer hold…and make a bigger cut when you do.” This approach contrasts with other MPC members who believe recent price shocks are temporary. Mann also expressed concerns about potential disruptions from ongoing political uncertainty in the US affecting the UK economy.

Labour is considering reintroducing tribunal fees for workers, a move condemned by unions. TUC chief Paul Nowak commented: “Reintroducing tribunal fees would be a gift for bad bosses and price many low-paid workers out of justice.” The proposal, initially suggested by the Conservatives, aims to alleviate budget pressures in the Ministry of Justice. However, critics argue it would deter workers from seeking justice. The tribunal backlog currently stands at 45,000 cases.

eBay has launched a £3m initiative called ‘AI activate’ to support UK small businesses in utilising AI technology. The programme aims to provide up to 10,000 small enterprises with free access to OpenAI-powered tools and tailored training for a year. Eve Williams, general manager of eBay UK, commented: “The issue is no longer whether businesses should adopt AI. It is how quickly they can start before their competitors do.” The initiative addresses common challenges faced by small businesses, such as time constraints, and aims to enhance productivity and growth.

Fewer boards are planning to enhance diversity, equity, and inclusion, according to a recent survey by PwC. Only 9% of directors intend to increase gender diversity, a significant drop from 21% last year. Racial diversity plans are even lower, with just 6% of respondents indicating intentions to add racial diversity, down from 13% in 2024. The survey included responses from 638 public company board directors.

According to the ‘Accounting in the Age of AI’ report by Ravical, 64% of businesses now consult public AI chatbots like ChatGPT before their accountants. The survey of 500 senior decision-makers revealed that over half of accounting firms had to correct misleading advice from AI tools. Additionally, 39% of accountants reported clients using AI to validate their advice. Joris Van Der Gucht, CEO of Ravical, commented: “The research highlights the mounting pressure on accountants as client expectations rise.” Many accountants feel stretched, with 87% citing challenges in meeting these expectations.