More good news: the UK’s business activity posted its biggest growth in a year this month, led by a solid upturn in the service sector, according to a closely-watched survey.The ‘flash’ reading from the S&P Global PMI survey showed improvement across the private sector, despite employment remaining a weak spot, with companies cutting hiring for an eleventh month.The headline index rose to 53.0 in August from 51.5 in July, indicating faster expansion in business activity.

Input cost inflation edged up to its highest since May.Chris Williamson, chief business economist at S&P Global Market Intelligence,The flash UK PMI survey for August indicated that the pace of economic growth has continued to accelerate over the summer after a sluggish spring, the rate of expansion now at a one-year high.The services sector has led the expansion, but manufacturing also showed further signs of stabilising.He cautioned that order books show that demand remains “uneven and fragile”.Companies report concerns over the impact of recent government policy changes, as well as unease emanating from broader geopolitical uncertainty.

Goods exports are still falling especially sharply.Payroll numbers also continue to be cut at an aggressive rate by historical standards as firms cite weak order books and concerns over rising staff costs due to the policies announced in the autumn Budget, which also contributed to persistent inflation pressures.While the rise in business activity signalled by the PMI alongside the uplift in inflation to 3.8% in July lower the chances of further rate cuts this year, more data are required to assess both the sustainability of robust economic growth as well as the stickiness of the upturn in price pressures.Among a divided Bank of England rate setting committee, the perceived need for any future rate cuts will be very much data dependent.

The latest monthly PMI surveys have showing stronger business activity in the UK, eurozone and the US, with inflationary pressures hitting a three-year high stateside on the back of Donald Trump’s trade tariffs.Washington will not lower steep tariffs on European cars until Brussels has introduced legislation to reduce its own tariffs on US exports, maintaining pressure on the EU’s automotive industry.While the Trump administration has agreed to lower the current 27.5% US tariffs on European cars and car parts to 15%, details of a framework trade deal published on Thursday revealed the terms and conditions.The US president and European Commission president Ursula von der Leyen announced the deal on 27 July at Trump’s luxury golf course in Turnberry, Scotland after an hour-long meeting that followed months of negotiations.

WH Smith shares have plunged almost 40% as the retailer cut financial forecasts and launched an independent review after discovering an accounting blunder that led it to overstate profits by £30m.Investors wiped almost £550m off the retailer’s market value on Thursday morning as it reported the multimillion-pound accounting error, sending the stock price down to £6.76 a share.The group discovered the mistake, which related to its North American business, while preparing its year-end results.The stationery to sweets retailer said it was “largely” because it had logged some of its income too early.

The mistake relates to arrangements it has with suppliers, which offer rebates if the retailer hits sales targets on certain items and payments for marketing and promotions.It is understood, however, that income should have been logged in accounts for the next financial year rather than for the 12 months to 31 August.Our other main stories today:Many thanks for reading – we’ll be back tomorrow.Take care – JKUS business activity hit an eight-month peak in August, while selling price inflation rose to a three-year high on the back of Donald Trump’s tariffs.The PMI survey from S&P Global, a monthly snapshot, showed that the headline output index rose to 55.

4 from 55,1 in July, indicating faster growth in the private sector,Business confidence improved but remained much weaker than at the start of the year, as companies reiterated concerns over the impact of government policies, especially in relation to tariffs,Tariffs were again widely cited as the main cause of sharply higher costs, which in turn fed through to the steepest rise in average selling prices recorded over the past three years,This tariff impact has yet to show up in the official inflation readings.

Chris Williamson, chief business economist at S&P Global Market Intelligence, said:A strong flash PMI reading for August adds to signs that US businesses have enjoyed a strong third quarter so far.The data are consistent with the economy expanding at a 2.5% annualized rate, up from the average 1.3% expansion seen over the first two quarters of the year.Companies across both manufacturing and services are reporting stronger demand conditions, but are struggling to meet sales growth, causing backlogs of work to rise at a pace not seen since the pandemic-related capacity constraints recorded in early 2022.

Stock building of finished goods has also risen at a survey record pace, linked in part to worries over future supply conditions.While this upturn in demand has fueled a surge in hiring, it has also bolstered firms’ pricing power.Companies have consequently passed tariff-related cost increases through to customers in increasing numbers, indicating that inflation pressures are now at their highest for three years.What does this mean for interest rates? He said:The resulting rise in selling prices for goods and services suggests that consumer price inflation will rise further above the Fed’s 2% target in the coming months.Indeed, combined with the upturn in business activity and hiring, the rise in prices signaled by the survey puts the PMI data more into rate hiking, rather than cutting, territory according to the historical relationship between these economic indicators and FOMC policy changes.

The trade deal between the US and the EU does not include wine and spirits, according to the EUs trade commissioner Maroš Šefčovič, but he said the European Commission would try to negotiate tariff reductions for the sector and others not included in the agreement,His remarks came after the two sides released details of the commitments made in a deal reached last month that includes a 15% US tariff on most imports from the bloc, including autos, pharmaceuticals, semiconductors and lumber,Referring to wines and spirits, Šefčovič said:This one we didn’t get in,But I can tell you that there is clear commitment from the European Commission to put it on the table,The Distilled Spirits Council of the United States expressed disappointment.

Without a permanent return to zero-for-zero tariffs on spirits, American distillers do not have the certainty to plan for future export and job growth without the fear of retaliatory tariffs returning.It added that it was “determined to continue engaging with the Trump administration to urge for additional negotiations”.Getting started in the world of work was not easy for Rose Green.Having experienced half a dozen children’s homes from the age of 13 while growing up in care in north London, finding a career was the last thing on her mind.“Having that corporate parenting, it can be difficult,” she says.

“Sometimes things like completing school, or uni, you’re faced with so much trauma that you haven’t really got the time to finish all of that.“You’re kind of parenting yourself, raising yourself.But you’re a child.You’re just cracking on doing what you think you’re supposed to do.Even today, I’m still figuring it out.

”Despite those challenges, the 26-year-old from Camden has found work as an employment and training officer at the local council.After completing a care leaver internship, she now helps others to overcome the same hurdles.Tesco has put up the price of its meal deal by 25p, its third increase since 2022, in a sign of the times as food prices in the UK race higher again.The meal deal now costs £3.85 for Clubcard holders, increasing from £3.

60.Customers who do not have a Tesco loyalty card will find themselves shelling out £4.25, up from £4.The new rate will be charged from 21 August.It comes as the latest inflation figures show the price of food and non-alcoholic beverages rose 4.

9% year on year in July, an increase from 4.5% in the 12 months to June.For retailers, this often means passing on the soaring cost of ingredients to consumers.A summer of heatwaves and droughts in parts of Spain, Italy and Portugal, where the UK sources a lot of its fresh fruit and vegetables, have pushed up prices this summer, at a time when they would usually fall.Beef, orange juice, coffee and chocolate were among the worst-hit products.

Some shoppers have described the price hike as “truly devastating”.On X, one user wrote: “Discovering that a Tesco meal deal will be £3.85 *with* a Clubcard from Thursday was truly devastating.Another questioned whether it can still be called a “deal”.“Tesco meal deal now £4 not sure of the deal part,” they wrote.

Tesco’s sandwich, snack and drink deal had cost £3 for 10 years before prices jumped in October 2022.However, Tesco is not the first of the major retailers to frustrate customers after upping the cost of it’s meal deal.In June, Sainsbury’s increased the price of it’s standard offering by 5%, going from £3.75 to £3.95.

It was the second time it had increased the price in under a year, after raising the price by 25p in July 2024,The US and the European Union have locked in a framework trade deal that was reached last month,It includes a 15% US tariff on most imported goods from the EU, including cars, pharmaceuticals, semiconductors and lumber,In a 3 1/2 page joint statement, the two sides listed the commitments made, including the EU’s pledge remove tariffs on all US industrial goods and to provide preferential market access for a wide range of US seafood and agricultural products,Washington has pledged to reduce the current 27.

5% US tariffs on cars and car components – a huge burden for European carmakers – once Brussels introduces legislation needed to enact the promised tariff reductions on US goods.The joint statement also noted the EU’s intention to source $750bn in US liquefied natural gas, oil and nuclear energy, and an additional $40bn of US-made artificial intelligence chips.It included the plan for EU companies to invest an additional $600bn across US strategic sectors through 2028.A senior US administration official told Reuters that Euroepan carmakers could see the current 27.5% tariff reduced within “hopefully weeks”.

As soon as they’re able to introduce that legislation – and I don’t mean pass it and fully implement it, but really introduce it – then we will be in a position to provide that relief.And I will say that both sides are ver interested in moving quickly.Donald Trump and European Commission president Ursula von der Leyen announced the deal on 27 July at the US president’s luxury golf course in Scotland after an hour-long meeting, and months of negotiations between officials.At the time, the French prime minister, François Bayrou, said the EU had capitulated to Trump’s threats of ever-increasing tariffs, as he labelled the framework deal struck in Scotland as a “dark day” for the EU.The sell-off has intensified after WH Smith’s £30m accounting blunder and profit downgrade, and its shares are now down by 40%, at 668.

5p,They slumped as much as 40,9% to 656p, their lowest level since March 2020,The broker Peel Hunt has cut its recommendation on the stock to ‘hold’ from ‘add’, and slashed its target share price to 755p from 1400p (£14),The retail analyst Nick Bubb said the profit warning had “gone down like a lead balloon with investors”, adding that it was “reviving unhappy memories of the Tesco accounting scandal a few years back”.

In 2014, Tesco admitted it had overstated profits by £326m because it had incorrectly booked payments from suppliers relating to issues such as marketing costs or reaching sales targets.The UK’s biggest retailer took years to recover from the black hole in its accounts.There is no suggestion WH Smith’s accounting mistake relates to the same issues that hit the supermarket chain.Here’s some analysis of today’s UK public finance figures:Despite a good month for the public finances, the Treasury won’t be putting in any champagne orders.Higher self-assessment tax receipts and an increase in national insurance payments by employers filled the government’s coffers by more than expected in July.

The result was that Rachel Reeves’s spending deficit fell to £1.1bn, down by £2.3bn from the same month a year earlier.That would be cheery news in normal circumstances, but hemmed in by tight fiscal rules, jittery financial markets and a restless public, the chancellor knows not to be complacent.There is every likelihood that the Office for Budget Responsibility (OBR) will downgrade its outlook for economic growth when Reeves presents her autumn budget, forcing the government to take further action to balance the books.

James Bailey, the boss of Waitrose, is to exit the upmarket supermarket next month after just over five years.His departure comes a year after the arrival of former Tesco executive Jason Tarry as chairman of the grocer’s parent company the John Lewis Partnership.Tarry said:James has done an outstanding job, overseeing significant transformation and growth during a period of change.He’s a great colleague and has been a highly valued member of the executive team.We will be sad to see James go but understand and respect his decision to step down after five and a half years at the helm