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Canada’s central bank has cut interest rates by half a percentage point to 3.25% in an attempt to boost its slowing economy ahead of looming tariffs from Donald Trump’s US administration.

The cut is the Bank of Canada’s fifth reduction since June, after it raised rates from record lows in 2023 to rein in inflation, which has fallen to its target level.

US inflation has risen slightly to 2.7%, in line with economists’ expectations.

The consumer prices index rose from 2.6% in October.

On a monthly basis, headline CPI rose by 0.3% in November, versus 0.2% in October.

The core rate of inflation, which excludes foods and energy, stayed at 3.3%, also as expected. On a monthly basis, core CPI rose 0.3% in November, the same gain as in October.

Despite the slight rise money markets still expect that the Fed will cut rates next Wednesday by a quarter-point, which would bring them down to 4.25% from 4.5%.

Ellen Zentner, chief economic strategist for Morgan Stanley Wealth Management, said: “The data have given the Fed the ‘all clear’ for next week, and today’s inflation data keep a January cut in active discussion.”

Expectations for a series of cuts to rates by the Fed have been one of the main reasons the S&P 500 has set an all-time high 57 times this year, with the latest coming in last week.

The cost of coffee is set to rise again as the price of beans hits a new record high.

Arabica beans, the world’s most popular bean variety, reached a 47-year high this week, having risen by more than 18% this year to top 3.44 US dollars (£2.70) a pound.

Robusta coffee is also seeing record price hikes, reaching 5,694 dollars (£4,460) per metric ton in late November.

Coffee commodity prices have surged this year on the back of weather concerns in major growing countries like Brazil and Vietnam.

Shares in Alphabet (GOOGL, GOOG) surged on Tuesday, closing the session more than 5% in the green, after Google unveiled a new quantum computing chip called Willow.

Hartmut Neven, founder and lead at Google Quantum AI, said in an announcement on Monday that the chip offers "state-of-the-art performance across a number of metrics".

He said the chip enabled two achievements, one of which that the chip "can reduce errors exponentially as we scale up using more qubits", which refers to a basic unit of information in quantum computing.

"This cracks a key challenge in quantum error correction that the field has pursued for almost 30 years," said Neven.

"Second, Willow performed a standard benchmark computation in under five minutes that would take one of today’s fastest supercomputers 10 septillion (that is, 1025) years — a number that vastly exceeds the age of the universe," he added.

Neven said that the Willow chip represented a "major step" in the company's journey in this space.

As the end of the year draws near, shopping season is in full swing and many will be wondering what gifts to get. For those who can't resist a good bargain or just need some ideas this Christmas, consumer body Which? has compiled a list of the 50 best products of the year.

At the top of the list is the Samsung (005930.KS) Galaxy A15 5G, priced at £169, which clinched the number spot as the best value tech product. It was praised for its good value and longevity as it is the cheapest phone tested by the consumer bod. Which? said this mobile makes for appealing choice for consumers looking for a reliable, budget-friendly smartphone, particularly those opting for SIM-only deals to avoid costly contracts.

Taking second place in the rankings is the Volkswagen (VOW3.DE) ID.7 electric car, priced at £51,550. Although it is one of the more expensive items on the list, it topped Which?’s automotive tests for 2024. The ID.7 was praised for its adaptive suspension system and spacious interior, marking a strong contender in the growing EV market. Despite its premium price, Which? said the vehicle’s performance and features position it as a leading option for eco-conscious consumers seeking a high-end, electric driving experience.

Read the full article here

The pound has hit its highest level in two and a half years against the euro, with the single currency dropping as low as as 83.35p. This was the lowest since 22 March, and and is now trading at 82.49p.

It comes amid political uncertainty in France and Germany, and as sterling remains supported by a relatively hawkish Bank of England.

Jane Foley, head of currency strategy at Rabobank, said:

However, the pound dipped against the dollar as US greenback strengthened against major currencies.

Train managers at Avanti West Coast are set to stage a walkout in a dispute over rest day working.

Members of the Rail, Maritime and Transport union plan to strike on 22, 23 and 29 December as union members voted overwhelmingly against the company’s proposals.

The RMT general secretary, Mick Lynch, said:

Gold prices climbed to a two-week high of over $2,700 per ounce on Wednesday as traders rushed to the safe-haven metal ahead of US inflation figures and amid escalating tensions in the Middle East.

Spot gold rose 1%, trading at $2,690.83 per ounce, while US gold futures increased by 0.3%, reaching $2,728,40 at the time of writing.

"The spot gold price surged yesterday and has continued to recover from the higher low formed in November, and from the brief selloff on 25 November," Chris Beauchamp, chief market analyst at IG, said.

​"The past week saw the price consolidate around 2630, and this has resolved into a renewed push higher. Further gains target the $2720.00 high from 25 November, and then on to $2790.00, the late October peak," he added.

Gold could extend its record run into 2025 as further interest rate cuts from major central banks and the prospect of a weaker dollar will boost demand for the safe-haven asset, Heraeus Precious Metals said on Tuesday.

Heraeus expects gold prices to range from $2,450 to $2,950 per ounce in 2025, influenced by continued buying by major central banks, albeit in lesser quantities than in 2024, geopolitical risks in Ukraine and the Middle East.

The Bank of England (BoE) looks set to keep interest rates on hold next week. It comes as policymakers continue to monitor price pressures in Britain's jobs market that have subsided more clearly elsewhere.

Money markets predicts a 10% chance of Threadneedle Street cutting its Bank Rate from its current level of 4.75%.

Meanwhile, the European Central Bank (ECB), the US Federal Reserve and the central banks of Canada, Switzerland and Sweden are all expected to lower borrowing costs in the coming days.

The average cost of renting a newly let home in the UK is now £3,240 higher than at the end of the pandemic lockdowns, new research has revealed.

According to Zoopla, rents have risen by 27% since 2021, compared with a 19% increase in earnings. This takes the annual cost of renting a property to £15,240, up from £12,000 in 2021.

Rental costs for newly let properties have climbed by 3.9% over the past year, which is the lowest rate of growth since August 2021.

It comes as rents have been rising more slowly in places with high rental costs, such as London, where they are increasing by 1.3% annually, down from 8.7% a year ago.

This is compared with much higher rental growth in areas with lower rental costs, such as Northern Ireland, where rents are rising by 10.5%, and in the north-east of England, where they are climbing by 8.7%.

Average rental costs in the UK are expected to rise by 4% in 2025.

Rental costs began to soar as COVID lockdowns were lifted in 2021, which resulted in average private rents hitting record highs.

The increase in housing costs was blamed largely on demand for rental properties greatly outstripping supply, which led to intense competition among tenants.

Fundraising from London initial public offerings (IPOs) has fallen around 9% this year to $1bn, pushing the UK four spots lower to 20th place in a ranking of global IPO venues, according to data compiled by Bloomberg.

This means Britain has been overtaken by upstarts including Oman, a market that’s 1% the size of the UK, as well as Malaysia and Luxembourg.

Roughly a dozen firms have listed in London this year, with the largest raising just above £150m ($191m). The city didn’t have any listings among the top 100 globally, with Greece, Sweden and South Africa all hosting bigger offerings this year.

The latest analysis from Inventory Base has revealed that England’s landlords have benefitted from rental yield increases of up to 0.7% since the start of the year.

The analysis showed: -

• The average yield across all of England currently stands at 5.2%, marking an increase of 0.05% since the start of the year.

• On a regional level, landlords in London are benefiting from the highest yields, currently standing at 4.9%.

• London has also recorded the largest increase in yields since the start of the year, rising 0.19%.

• An analysis of local authority district data showed that some areas of England have seen significantly higher yield growth since January.

• The highest yield growth has been recorded in Brent, London, where the current average yield of 4.6% marks an increase of 0.7% since the start of the year.

• As of now, the local authority district with the highest average yields is Portsmouth, where landlords now see an average yield of 6.2%.

• In Burnley, the average yield is 6.1%, followed by Manchester (6%), the City of Bristol (5.9%), Newcastle-upon-Tyne (5.8%), Southampton (5.8%), Tower Hamlets (5.7%), and the City of Nottingham (5.6%).

Heathrow airport said it is prepping for its busiest Christmas Day ever, expecting the number of passengers travelling through its terminals to be 21% higher than on the same day last year.

Europe’s busiest airport also predicted that travellers for the month as a whole will exceed the previous record of 6.7 million in 2023.

It come as Heathrow saw 6.5 million passengers last month, up 6.1% last year, and marking its busiest November on record.

The total volume of cargo handled by Heathrow in the first 11 months of the year was 11.2% higher than in the same period in 2023 thanks to an increase in the cargo capacity of modern aircraft and strong demand.

Thomas Woldbye, Heathrow's chief executive, said:

Tui (TUI1.DE) saw its annual earnings rise by a third thanks to surging demand for package holidays and increased prices.

Europe’s largest tour operator said some 20.3 million people travelled in 2024, compared with 19 million the year before, while revenues climbed by 12% to €23.2bn.

Underlying profits rose by a third to €1.3bn from €977m and profit is expected to rise by between 7% and 10% next year.

Winter bookings have risen by 4% year-on-year with 62% of holidays sold, it said. Tui raised its prices by 5% and sold more package holidays and dynamically packaged trips, where travellers can book individual components with dynamic pricing.

Sebastian Ebel, chief executive of Tui, said:

Zara owner Inditex (ITX.MC) posted a rare miss on quarterly sales and profit on Wednesday, although it said the holiday shopping season had got off to a good start.

Shares in the world's biggest listed fast-fashion retailer, which have risen about 30% this year, fell 6% in early trading as investors digested the news.

It blamed currency fluctuations and severe floods in Spain, which is the company's biggest market, on the weaker results.

Third-quarter sales of €9.36bn ($9.84bn) came in below the €9.51bn expected by analysts. An 8.5% rise in nine-month net profit to €4.44bn also lagged the €4.52bn expected by analysts.

A strong dollar and weak euro also hurt the result, analysts said, as Inditex makes most of its sales in euros.

British American Tobacco (BATS.L) reiterated full-year expectations on Wednesday after revenues growth accelerated in the second half of the year.

The FTSE 100 (^FTSE) firm, which owns the Dunhill, Kent, Lucky Strike and the vaping brand Vuse, said it benefited from factors including the phasing of innovation in newer categories.

The company’s 2024 forecasts showed a 2% decline in global tobacco industry volumes and for its constant currency revenues, and adjusted profits to deliver growth in the low-single digits.

BAT continues to target mid-term guidance of 3-5% revenue growth and mid-single digit adjusted profit growth from operations by 2026.

Tadeu Marrocom, chief executive, said:

Investors are looking ahead to US inflation figures due out this afternoon which could cement the path for interest rate cuts from the Federal Reserve.

Analysts are expecting the annual rate of the consumer prices index to rise to 2.7% from 2.6%, while the core measure, which strips out volatile items like food and energy, is forecast to remain at 3.3%.

The data will be followed by a further reading on Thursday at the wholesale level.

Richard Hunter, head of markets at interactive investor, said:

Stocks in Asia were mixed overnight with the Nikkei (^N225) flat on the day in Japan, while the Hang Seng (^HSI) fell 0.8% in Hong Kong. The Shanghai Composite (000001.SS) was 0.3% up by the end of the session.

Seoul extended Tuesday’s rebound rally, though political uncertainty after South Korean president Yoon Suk Yeol’s brief imposition of martial law kept the won under pressure around two-year lows against the dollar.

There were also gains in Wellington and Jakarta while Sydney, Singapore, Taipei and Manila fell.

Across the pond on Wall Street, markets diverged on Wednesday ahead of US inflation data that could play a key role in the Federal Reserve’s interest rate decision next week, while traders were also keeping tabs on Beijing hoping for more economic support measures.

The S&P 500 (^GSPC) slipped 0.3%, and the tech-heavy Nasdaq (^IXIC) was also 0.3% lower. The Dow Jones (^DJI) ended 0.35% lower in New York.