Brighter UK economy gives Reeves a springboard for March statement

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The economic backdrop to Rachel Reeves’s upcoming spring statement appeared to brighten on Friday after a trio of reports painted a better-than-expected picture of the UK economy.Record monthly public finances, a surge in retail spending and accelerating business activity offered the most coherent picture of recovery since last autumn, economists said, and provided the chancellor with a more positive narrative before her 3 March statement.“It’s been a hat-trick of good economics news for once for the UK,” said Sandra Horsfield, a senior economist at Investec bank.“We had a disappointing end to last year, but as things look, we may be starting 2026 on a much brighter note.”Public sector finances posted their biggest monthly budget surplus since records began in 1993, of £30.

4bn in January, according to the Office for National Statistics,The figure comfortably beat the forecast of £24bn made by the Office for Budget Responsibility, the government’s official forecaster, and was driven by a large increase in self-assessment and capital gains tax receipts,It was double the surplus recorded in January 2025,Retail sales in Britain surged by 1,8% in January, the largest monthly increase in almost two years and partly driven by sales of artwork and antiques sales in January, alongside continued strong sales from online jewellers.

Rounds of heavy discounting and post-Christmas sales drew customers back to bigger-ticket purchases, with furniture and tech among the biggest-selling categories over the past three months.On both fronts there were caveats.January is traditionally a strong month for self-assessed tax receipts, potentially flattering the public finance numbers, while retail sales got an artificial bump from jewellers seeing “unprecedented” levels of demand, the ONS said, amid soaring gold prices.But the figures were further boosted by polling that showed momentum across the UK’s private sector, with a survey showing the fastest rise in activity since April 2024.The flash poll of UK purchasing managers by S&P Global found there was “a robust and accelerated upturn in new work” at UK companies this month, with companies in the manufacturing and services sectors reporting solid rates of business activity expansion.

That work upturn followed a fall in inflation to 3% in January from 3.4% in December, fuelling expectations that the Bank of England will soon cut interest rates again.“The economy started the year looking a lot healthier and will give the chancellor something positive to point to in her fiscal statement on 3 March,” said Paul Dales, chief UK economist at Capital Economics.It adds up to give Reeves more headroom at the spring statement, with government borrowing running about £8bn below the OBR’s full-year forecast and government borrowing costs having fallen since November.Rob Wood, chief UK economist at Pantheon Macroeconomics, said the chancellor could “probably bank on having a bit more headroom than she had in the autumn budget” as a result.

But Wood cautioned that the economic outlook beyond the spring statement was less certain, amid plans to raise fuel duty later this year for the first time in 15 years, with the revenue impact difficult to predict.The government will also have to navigate the Gorton and Denton byelection in Greater Manchester on 26 February, in what will be a significant test for Keir Starmer.“Politically, the situation is still difficult,” said Horsfield.“There are plenty of hurdles yet to be overcome.”While the cooling of inflation has raised hopes of further interest rate cuts from the Bank of England, analysts also cautioned that any cuts would themselves be a product of an economy still struggling for momentum.

Unemployment rose to a five-year high of 5,2% in the final quarter of last year, particularly among young people, while Friday’s PMI data showed job losses continuing for the 17th consecutive month in February as firms responded to higher employment costs,“One swallow does not make a spring,” said Danni Hewson, head of financial analysis at AJ Bell,“Fundamentally the UK economy remains weak and vulnerable and the high levels of unemployment, particularly amongst the young, hint at a difficult future ahead,”
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How to turn any leftover fruit into curd – recipe

You can make curd with almost any leftover fruit, as long as you add a little lemon juice for acidity and blend it to that familiarly special smooth textureI love ingenious recipes like curd that have the superpower to turn a tired piece of fruit or a forgotten offcut into something utterly decadent. Lemon curd is the original and a classic, but you can make curd with almost any fruit, as long as you add a little lemon juice for acidity. Each version is intense, indulgent and dreamy. So, please approach with caution: this spread is deeply moreish, in the best possible way.When testing this recipe, I had some leftover frozen mango that had been accidentally defrosted on the counter, a sad golden kiwi and some wrinkled grapes, so I split the recipe and made three small batches of different curds

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‘Food porn’: are sexy meal pics ruining the restaurant industry?

Name: Food porn.Age: Entered common parlance around the 1980s – Rosalind Coward used the term in her 1984 book Female Desire (one of its earliest documented uses).Appearance: A total restaurant killer.Your thesis is that nice-looking food is destroying the restaurant industry? Yes, and I’m sticking with it.Why? Because if you make your food look nice, it attracts the wrong sort of customers, that’s why

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In a taste-test battle of supermarket mite-y bites, which will win? (Spoiler: it isn’t Vegemite)

At the end of most taste tests, I have a clear idea of winners and losers, and I’m usually confident enough in the findings that I’d bet if I repeated it 100 times, with a different set of testers, the results would be similar. This is not a normal taste test.After blind tasting eight yeast spreads, readily available at Australian supermarkets, I don’t even know what my favourite is, let alone which are the best and worst.In Australia it is impossible to taste yeast spreads without comparing them with Vegemite, for better or worse. So this isn’t really a yeast spread taste test, it’s a taste test of Vegemite and things that taste like it

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The secret to perfect roast chicken | Kitchen aide

What’s the best way to roast a chicken?Nicola, by email “Fundamentally, people overcomplicate it,” says Ed Smith, who has, rather conveniently, written a new book all about chicken, Peckish. “Yes, you can cook it at a variety of temperatures, use different fats, wet brine or dry brine, etc etc, but, ultimately, if you put a good chicken in the oven and roast it, you will have a good meal.”To elaborate on Smith’s nonchalance, he has three key rules: “One, start with a good chicken: free-range, ideally slow-reared and under the 2kg mark – small birds just roast better, I think.” Second, it doesn’t need as long in the oven as you might think. “Whatever it says on the packet will be too long,” says Smith, who roasts his chicken for about 50 minutes in a 210C (190C fan) oven

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Cabbagecore: why are fashionable people going wild for the green vegetable?

It’s on handbags, in flower arrangements and is even being used in a Burberry campaign. Just how did this humble brassica become the hottest new trend? Name: Cabbagecore.Age: Ready for 2026.Appearance: Red, green or white – your choice.When you say cabbagecore, are you referring to the tough central stem of the familiar leafy cultivar? No, I’m alluding to the idea that cabbage is having a moment

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Rukmini Iyer’s quick and easy reccipe for crispy baked gnocchi puttanesca | Quick and easy

Puttanesca purists, look away now. This dish takes the classic elements of a puttanesca – that is, anchovies, capers, olives, tomatoes – and combines them into a rich sauce for gnocchi, which are then covered in mozzarella, breadcrumbs and parmesan, and flashed under the grill. It’s exactly what you want on a rainy night. In fact, my sauce-averse toddler thought it smelled so good that she stole half of my plate – a win all round. (Although her pretty decent suggestion was that next time I use it as a pizza sauce, rather than on pasta or gnocchi