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The Guardian - UK
The Guardian - UK
Business
Graeme Wearden

Bank of England must ‘stay the course’ fighting inflation; US keeps adding jobs; UK house prices fall – as it happened

United States Halifax Kim Kinnaird Interest Rates United Kingdom
The Bank of England in the City of London financial district
The Bank of England in the City of London financial district Photograph: Henry Nicholls/Reuters

Closing post

That’s all for the day, and indeed for the week.

Here’s our main stories so far:

We’ll be back on Monday. Have a lovely weekend. GW

Updated

Bank of England buys £786m of bonds in emergency intervention

Britain’s central bank has bought up £786m of long-dated bonds today to avoid financial turmoil following the mini-budget.

The purchases were made through the Bank of England’s intervention, launched last week, which allows it to buy up to £5bn per day of gilts.

The BoE also turned down £239m of offers in its reverse auction.

The scheme allows the Bank to prevent disorderly conditions in the market, after plunging bond prices threatened to drive some pension funds under. But so far, policymakers have only needed to spend a fraction of the £65bn firepower at its disposal.

Whitbread raises pay for third time this year

A Premier Inn Hotel in County Durham.
A Premier Inn Hotel in County Durham. Photograph: Lee Smith/Reuters

Back in the UK, the owner of Premier Inn is raising pay for the third time in a year with a 4% increase, my colleague Sarah Butler reports.

Whitbread said it was spending £15m on upping pay for over 30,000 people working in its hotels and restaurants which include Beefeater, Thyme Bar & Grill and Cookhouse.

Those working in Premier Inn and over 23s in the restaurants will get £10 an hour from 4 November, just ahead of the £9.50-an-hour legal minimum.

The company is also handing a £300 one-off cost of living payment to those workers and 4,000 more at its customer contact centre in Dunstable while 1,400 salaried hotel and restaurant managers will also benefit from salary increases to ensure a minimum differential is maintained.

Whitbread had previously given pay rises in April 2022 and October 2021, which combined with the latest rise represent an uplift of over 10%.

The Whitbread pay rises follow similar moves by major companies including Tesco, Aldi and Pret a Manger as high street businesses battle to attract and retain staff amid high employment levels ahead of the busy Christmas season.

Wall Street has opened with another bump, as traders anticipate further rate rises following the Jobs report:

The Dow Jones industrial average is down 1%, or 316 points, at 29,610.

Updated

The Fed will not like the look of this jobs report, agrees Seema Shah, chief global strategist at Principal Global Investors:

“Today’s job number is a hawkish reading, with almost all the elements of the report moving in the wrong direction for the Fed. Payrolls were broadly in line with expectations but, importantly in this good news is bad news, period: markets were hoping for a downside surprise today. Instead, the number only confirms that the Fed needs to hike rates by a fourth consecutive 0.75% in November.

“More significantly, with unemployment back down to 3.5% and participation falling again, where is the evidence that tighter Fed policy is having any impact on the US labour market? Job openings may be coming down, but if that isn’t combined with greater numbers of job seekers, wage pressures will remain still at their elevated level.

“With the Fed’s dot plot pointing to policy rates closer to 5% than 4% next year, we have a market that is wishing for the economy to slow quickly. That’s when you know there is only one path ahead: risk assets have further to fall.”

The September jobs report is unlikely to dissuade the Fed from further aggressive interest rate hikes over the next few months, writes Andrew Hunter, senior US Economist at Capital Economics.

Admittedly, the slowdown in jobs growth [from 315,000 to 263,000] largely reflected a 29,000 drop in state & local government education payrolls.

As in the past two years, that reflects a seasonal issue as fewer teachers than normal returned for the new school year – in which case employment gains will rebound over the months ahead. Private payroll growth actually picked up slightly to 288,000, from 275,000 in August, driven by stronger job gains in healthcare, leisure and other services.

As we had suspected, the 786,000 surge in the labour force in August was partly reversed last month and, with the household employment measure rising by 204,000, the unemployment rate fell back to 3.5%, matching the 50-year low seen before the pandemic. The upshot is that there is still little sign that worker shortages are going to be solved by much stronger supply, with the adjustment needing to come instead through weaker labour demand.

Pound drops towards $1.11 after US jobs report

The dollar is rallying, on expectations that September’s jobs report will spur on the US Federal Reserve to keep raising interest rates.

That’s nudged the pound down. It’s down a third of a cent at $1.113, the lowest since Tuesday.

Paul Craig, portfolio manager at Quilter Investors, explains:

“With the US jobs report coming in slightly better than expected and the unemployment rate going down, we remain in a search of a middle ground. In normal circumstances, a better-than-expected jobs report would be considered a good thing and a likely catalyst for rise in equity markets. But these days, we live in a parallel world where good news is bad, and bad news is good as investors try to anticipate the US Federal Reserve’s next move and whether or not they will temper their hawkish stance.

“With this jobs report it seems clear we are on course for another significant hike from the Fed, with the market pricing in a 75bps rise in interest rates at its next meeting.

Updated

There is a troubling irony that good news is bad news for the markets:

America’s leisure and hospitality firms added 83,000 jobs in September including 60,000 at restaurants and bars.

But, the sector still employs 1.1m fewer people than before the pandemic.

September’s solid jobs report means the US Federal Reserve is likely to hike interest rates by another three-quarters of a percent next month, the markets indicate.

The Fed will be disappointed that the labor force participation rate has dipped.

It wants more people to be looking for work, as this should cool inflationary pressures.

The good news is that the US jobs market looks to still be solid, despite a string of interest rate rises and a slowing global econony.

The bad news….. that will embolden the US Federal Reserve to keep raising borrowing costs to bring inflation down to target.

US unemployment rate drops

America’s unemployment rate has dropped to 3.5%, from 3.7% in August.

But that’s partly due to a small drop in the labor force participation rate – meaning fewer people were either working or looking for work.

Average wages remained stable too, with hourly earnings rising by 0.3% in September, matching August’s rise.

US economy added 263,000 jobs last month

Just in: The US economy added more than a quarter of a million more jobs last month.

September’s Non-Farm Payroll, the closely-watched measure of employment in America, has risen by 263,000 last month,.

That’s slightly more than expected, but down on August’s 315,000 increase.

Notable job gains occurred in leisure and hospitality and in health care, the Bureau of Labor Statistics reports.

More to follow….

Updated

The BBC’s Faisal Islam has written a neat reaction to Sir Dave Ramsden’s warning.

In his speech, Dave Ramsden also cited the jump in mortage costs, saying:

Quoted mortgages rates on two-year fixed rate mortgages increased by around 50bps between August and September and were up by nearly 300bps compared to last September and have been rising further into the start of October.

Recently lenders have also withdrawn a large number of mortgage products from the market because of the turbulent market conditions.

Those chances will drive up the cost of remortaging, as Keith Church, head of economic modelling at consultancy 4most shows:

Here’s Bloomberg’s take on Sir Dave Ramsden’s speech:

Bank of England Deputy Governor Dave Ramsden said last month’s mini-budget may add materially to inflation as he signaled that all nine rate-setters plan to act forcefully to tackle rampant price growth.

In a speech to the Securities Industry Conference, Ramsden said the impact of the chancellor’s £43 billion package of unfunded tax cuts was “likely to be material for the economic outlook over the next three years.”

The September vote, which was taken just ahead of the mini-budget, incorporated government plans to freeze energy bills but not the tax giveaways, Ramsden said. That means November’s rate decision and economic forecasts from the BOE will take full account of how that package impacts the outlook for inflation and growth.

More here.

A Marks and Spencer store

With rising interest rates squeezing households, high street retailer Marks & Spencer has launched a credit service that allows customers to borrow up to £500 in minutes.

But the move has attracted some criticism, as it could lure financially stretched families into debt.

Victoria Scholar, head of investment at Interactive Investor, has been looking into it, and tells us:

Marks and Spencer has launched The Sparks Pay credit account which gives credit access to around 16 million Sparks Loyalty members, allowing customers to borrow up to £500 within minutes. If the balance is repaid within 45 days, no interest is due, but the catch is that after that, an eyewatering interest rate charge of 23.9% is levied.

Critics argue that this is similar to a buy-now-pay-later service which arguably encourages consumers to take out unnecessary debts during the cost-of-living crisis when many households and individuals are struggling to cover the rising costs of food, petrol and gas bills.

However from the perspective of the retail sector, companies like M&S are grappling with pressures of their own from cost inflation, a weakening consumer, a looming UK recession and the slide in sterling. Arguably this is M&S’ attempt to lure shoppers to spend more and bolster sales.

The high street retailer has had a torrid time this year faced with a slew of analyst price target cuts on the slock lately and a 60% slide in its share price since January. Not long ago, investors were upbeat towards M&S, cheering its turnaround strategy but 2022 has been tough and sentiment has turned sour as it grapples with the challenging macro environment.

Updated

You can read Dave Ramsden’s speech here.

Former Treasury permanent secretary Nick Macpherson has given an approving verdict.

Updated

Ramsden: Gilt market selloff driven by UK-specific factors

The Bank of England’s Sir Dave Ramsden also insists that domestic factors caused the slump in UK government bonds that forced the BoE to intervene.

Government ministers have tried to blame international factors for the market mayhem.

But Ramsden singles out the mini-budget as one of four shocks hitting the UK this year.

Recently lenders have also withdrawn a large number of mortgage products from the market because of the turbulent market conditions. UK-specific factors also have had a particular effect on the price of long-dated UK government debt, which fell very sharply over a very short period, leading to dysfunction which, had it continued or worsened, would have been a material risk to UK financial stability.

The Bank started intervening in this segment of the gilt market on 28 September, in a time-limited and temporary way.

Deputy governor Ramsden adds that the operation, to buy up to £5bn of long-dated bonds each day, is “designed to buy time”.

The other shocks he cites are Russia’s invasion of Ukraine, the fall in UK labour market participation, and financial market turbulence.

BoE's Ramsden: We must keep fighting inflation despite pain caused by rate rises

The Bank of England should “stay the course” and keep raising interest rates to cool inflation, despite the pain this will cause to households and firms, a senior policymaker at the Bank says.

Deputy governor Sir Dave Ramsden says the BoE is “acutely concious” that its interest rate rises this year are adding to the difficulties cause by the cost of living crisis, with “millions of households and businesses experiencing real hardship”.

Bu in a speech this morning, Ramsden insists there would be deeper damage if high inflation persists.

He told the Securities Industry Conference:

However difficult the consequences might be for the economy, the MPC must stay the course and set monetary policy to return inflation to achieve the 2% target sustainably in the medium term, consistent with the remit given to us.

Bank of England Deputy Governor Dave Ramsden at the BoE in London
Bank of England Deputy Governor Dave Ramsden at the BoE in London Photograph: Toby Melville/Reuters

The Bank has raised UK interest rates by half a percent at its last two meetings (the biggest rises in 27 years).

Ramsden was one of three policymakers who pushed for an even larger, 75bp, hike last month, but were outvoted.

Today he argues a larger hike would have helped get inflation under control.

At the time the three of us highlighted that the recent data outturns had already registered more persistent inflationary pressures and that medium-term measures of inflation expectations remained high.

We welcomed the reduction of the near-term peak in inflation which will result from the Energy Price Guarantee but noted that the additional support it is providing to households will add to demand pressure.

The Bank is due to next set rates on 3rd November, and Ramsden says the Monetary Policy Committee will also assess whether the “recent repricing of UK assets” reflects a changed assessment by markets of the UK macroeconomic policy mix between fiscal and monetary policy.

Updated

More companies could collapse as business confidence slumps and the economy falls towards recession.

Inga West, restructuring and insolvency counsel at Ashurst LLP, says there has been a “steep trend upwards” in company insolvencies since the end of the pandemic – and the situation is likely to worsen.

By sector, the highest number of insolvencies in Q2 were recorded in construction, wholesale and retail trade, and accommodation and food services. All of these businesses were heavily affected during the pandemic and many of them have been struggling to survive the lifting of pandemic government support, as well as high energy prices.

Rising energy prices have so far been the single biggest pressure for these three sectors, and others, but that may change in Q3, when the recent interest rate increases, rising inflation and the low pound against the dollar will contribute to the causes of failure.

Companies whose debt is approaching maturity and which are looking to refinance will find it a lot harder. Business confidence is falling. It seems likely to get worse before it gets better.”

Updated

Company insolvencies in England and Wales hit highest since 2009

Company insolvencies in England and Wales have hit their highest level since the aftermath of the financial crisis, as soaring energy bills hammered the economy.

The Office for National Statistics reports that 5,629 companies collapsed across England and Wales in the second quarter of 2022, the most since the third quarter of 2009.

Persistently high energy prices, difficulties in meeting debt obligations, rising costs of raw materials, and supply chain disruption all contributed to the jump.

Construction firms made up 20% of all the insolvencies, followed by the wholesale and retail trade industries at 14%.

Worryingly, more than 1 in 10 UK businesses said they faced a “moderate-to-severe” risk of insolvency in August.

Over a fifth (22%) of businesses said energy prices were their main concern, up from 15% in late February 2022.

Thirty percent of small firms (with 10 to 49 employees) cited energy as their top worry.

Last month, the government pledged to cap non-domestic energy costs for six months, which should help firms through the winter.

But there are worries about a cliff-edge next spring when the support ends – and firms will still face higher bills than a year ago, even with the cap.

Updated

Mortgage rates keep rising over 6%

Average fixed mortgage rates are continuing to climb to the highest levels in over a decade, the latest data from Moneyfacts shows.

The average new two-year fixed rate – which was 4.74% on the day of the mini-budget – has climbed to 6.16%, having started the week at 5.75%.

It is a similar story with five-year fixes, with the average rate now standing at 6.07%, from 6.02% yesterday.

Updated

FT: London’s most expensive home ‘owned by Evergrande founder’

The Financial Times have a great tale this morning, that London’s most expensive house is actually owned by the head of Evergrande, the indebted Chinese property group.

The 45-room mansion overlooking Hyde Park was sold by the estate of the former Saudi Arabian crown prince Sultan bin Abdulaziz for a record-breaking £210mn in January 2020, just before the pandemic.

The FT says:

The public face of the acquisition of 2-8a Rutland Gate was Cheung Chung-kiu, a Chinese property developer whose company CC Land owns London’s “Cheesegrater” skyscraper.

However, according to five people familiar with the matter, Hui Ka Yan, the founder and chair of Evergrande and once China’s richest man, was ultimately behind it.

Given Evergrande’s plight, several people familiar with the situation have said the London property was also in effect for sale, although there was no formal process.

Here’s the full story: London’s most expensive home ‘owned by Evergrande founder’

And here’s what £200m gets you in London:…

Updated

A UN-chartered ship loaded with 23,000 tonnes of Ukrainian wheat which landed in Djibouti on August 30, 2022.
A UN-chartered ship loaded with 23,000 tonnes of Ukrainian wheat which landed in Djibouti on August 30, 2022. Photograph: Hugh Rutherford/WFP/AFP/Getty Images

World food price have continued to drop back from their record highs hit after the Ukraine war began.

The United Nations food agency’s world price index fell for a sixth month in a row in September, down around 1%.

The drop was driven by a 6.6% month-on-month fall in vegetable oil prices, with sugar, dairy and meat prices all dipping.

Cereal prices rose, though, partly due to heightened uncertainty about whether the Black Sea Grain Initiative, under which Ukraine is exporting wheat, will continue beyond November.

The drop in food commodities will help the developing world.

But worryingly, there are 45 countries around the world which are in need of external assistance for food, including 33 in Africa, nine in Asia, two in Latin America and the Caribbean and one in Europe.

Updated

Over in France, strikes by refinery workers are hitting supplies of fuel to some petrol stations.

Reuters has the latest:

Around 10% of petrol stations in the Paris region are having problems regarding getting enough supplies of fuel, said French government spokesman Olivier Veran today, although he reiterated that France had enough supplies of petrol overall.

Veran told BFM TV and RMC Radio.

“There are temporary problems regarding distribution.”

He said that 90% of petrol stations in the Paris had no problems in this area, although 15% of petrol stations in France overall were experiencing these “temporary difficulties.”

The French government said earlier this week that France had tapped its strategic fuel reserves to resupply petrol stations that have run dry, amid strikes by workers at refineries and depots that have stunted production and blocked deliveries.

Meanwhile in Germany, import prices rose at the fastest pace in nearly 50 years, intensifying its inflation squeeze.

Import prices in August surged by 32.7% year-on-year, the highest reading recorded since March 1974, with gas prices quadrupling.

Britain’s housing sector could soon shift from being a seller’s market to a buyer’s market, predicts Karen Noye, mortgage expert at Quilter:

Rising interest rates will simply make mortgages less affordable. This will precipitate more people to put their houses on the market so they can downsize and achieve lower monthly payments. When more houses hit the market there is naturally more choice and crucially more room for bargaining. The seller’s market, we’ve been witnessing for the past few years quickly becomes a buyer’s market.

The problem is buyers are also struggling massively with the cost-of-living crisis so demand is also set to soften, therefore those that can still afford to move will have more choice and more leverage to put in lower offers and house prices drop.

It remains to be seen how far house prices might drop but some of the housebuilders are pricing in a 20% drop, which could be an overreaction, but it is certainly not out of the question. House prices have become bloated in recent years having benefited from government policies such as the stamp duty holiday during the pandemic at a time when borrowing was very cheap.

Now the cost of borrowing is on the rise, the stamp duty cut recently brought in by Truss may serve to steady a sinking ship but it’s still likely to take on a huge amount of water.

UK economy predicted to be weak till 2024 despite Truss growth agenda

Britain’s economy is expected to take until 2024 to recover to pre-Covid levels amid a slowdown for hiring and business investment, as households and businesses struggle with soaring costs.

Business leaders have said that there has been a significant decline of key economic indicators in recent weeks, with confidence among company bosses over the growth outlook collapsing to the lowest level since the depths of the Covid crisis.

Knight Frank: House prices have probably peaked

Tom Bill, head of UK residential research at Knight Frank, predicts that house prices will fall over the next two years, following the drop in prices in September.

“It’s a fairly safe bet that UK house prices have now peaked. The impact of rising mortgage rates will begin to hit demand and spending power in coming months, which we believe will lead to a fall of 10% over the next two years for UK prices.

We may see mortgage rates fall to some extent if financial markets become more reassured by the government’s economic plan but the events of the last fortnight have been a reminder that the era of ultra-low rates is coming to an end.

Updated

UK recruitment slowed in September as economic problems mount

The latest survey of the UK labour market also shows that the economy may be on the turn.

Growth in demand for permanent and temporary staff weakened in September, to the lowerst since February 2021, according to KPMG and the Recruitment & Employers Confederation.

The weaker economic outlook led some firms to be more cautious about hiring, and also discouraged some people from changing jobs.

A generally low unemployment rate, skills shortages and Brexit also weighed on candidate availability, the survey adds.

A survey showing the growth in recruitment

Claire Warnes, head of education, skills and productivity at KPMG UK, says some firms are bracing for a downturn.

Some employers, even those who anticipate that the recession may be short, are taking steps now to contain costs, including hiring freezes.

Those employers who continue to invest in their workforce, particularly upskilling, may find they weather the recession better and will be in a stronger position to benefit from the upturn as and when it comes.”

London saw the biggest rise in permanent staff appointment, while the South of England saw the first reduction in 19 months.

September’s house price fall is probably a sign of things to come, says EY ITEM Club

House prices are likely to fall by at least 5% over the next year, the EY ITEM Club says.

Martin Beck, chief economic advisor to the EY ITEM Club, says rising interest rates will push down demand, and restrict what lenders will offer.

“Weakness in prices in September is likely to be a sign of things to come, reflecting cost of living pressures and the recent rise in market interest rate expectations and mortgage rates. Granted, current market expectations for Bank Rate to rise to 5.5% by mid-2023 look too high.

“Raising rates to that level would likely prompt a substantial decline in the housing market, a deep recession and inflation eventually falling well below the Bank of England’s 2% target and potentially into negative territory. Instead, the EY ITEM Club expects Bank Rate to peak at 4%.

However, rates at that level would still significantly reduce demand for properties and decrease the size of loans that lenders can offer. Combined with the weakening economic outlook and squeezed household incomes, the EY ITEM Club expects property values to fall by 5% or more over the next year or so.

You’d think that falling house prices would help people to get onto the housing ladder.

But if mortgage rates do keep climbing, prospective first time buyers may find they’re stilll priced out of the market.

The Bank of England has already raised interest rates six times in a row, from 0.25% at the start of the year to 2.25% in September, with a very sizeable increase experted in November.

Avinav Nigam, cofounder of real estate investment platform, IMMO, says these rising borrowing costs have already had an effect on the market, and are hitting affordability.

The slowdown in house price growth for September was expected as higher interest rates in May and June kicked in, which feed through to transactions data now due to the time lag of conveyancing.

We are seeing property listings falling by 15 to 20 per cent in some parts of the UK, as uncertainty encourages property owners to delay transaction decisions.

‘The rapid pace of growth we have seen in recent years is coming to an end, partly due to recent interest rate hikes by the Bank of England and the crash of the pound following the government’s mini budget.

‘It’s predicted that house prices could correct by as much as 7 to 10 per cent in coming months. However, we don’t expect a house price growth reversal to improve the affordability of housing much due to fast rising interest rates. Mortgage lenders are starting to require consumers prove they can afford 7% interest rates, as an indication of where rates could go.

Interest rate rises are putting off new buyers

Fears of rising interest rates are cooling the markets, reports North London estate agent Jeremy Leaf:

‘New buyers are pausing for breath while they consider the likely pace and size of future interest rate hikes, so activity is reducing. The question is whether worries about rising mortgage payments outweigh the benefits of the recent stamp duty reduction, particularly for first-time buyers.

‘The mini Budget sparked a chain reaction of unintended consequences raising buyer concerns that any savings in stamp duty and other taxes would be more than offset by mortgage rates rising much more quickly and higher than expected.’

Property buying agent Emma Fildes of Brickweaver points out that annual house price inflation is now back in single figures (for the first time since January). Could the long run of growth be approaching a dead end?

Rising mortgage rates are the main blocker for buyers seeking to get on the property ladder and those hoping to move up it, agrees Myron Jobson, senior Personal Finance Analyst at interactive investor:

“Mortgage affordability is a mushrooming pain point for buyers. Mortgage rates have been on the up in line with increases to the Bank of England’s base rate, but rates have typically spiked by between one and two percentage points two weeks on from the mini-Budget.

The difference amounts to hundreds in pounds and pence terms, and it means that buyers can’t afford as much house as they could 14 days ago.

Wales sees fastest house price rises, but London lags

Wales remains at to the top of the table for annual house price inflation with a rate of +14.8%, down from +15.8% in the previous month, Halifax says.

The average property in Wales now costs £224,490.

London still has the slowest rate of annual growth amongst the UK nations and regions, with house prices rising by +8.1% over the last year. But properties in the capital are still the most expensive, with the average costing £553,849.

Halifax house prices
Halifax house prices Photograph: Halifax

Introduction: UK house prices dropped in September

Good morning, and welcome to our rolling coverage of business, the world economy and the financial markets.

The UK housing market is slowing, and the crisis caused by the government’s mini-budget will make it worse.

That’s the verdict from Halifax this morning. It reports that the average house prices dipped in September, by 0.1%, leaving the average property now costing £293,835.

The annual house price inflation rate slowed for the third month in a row, to 9.9% from 11.4%, the lowest rate since January.

UK house price inflation

Kim Kinnaird, director at Halifax Mortgages, reports that house prices have been largely flat since June, as the markets entered “a more sustained period of slower growth”.

Kinnaird warns that house prices will come under heavier downward pressure in the months ahead, from rising borrowing costs and the cost of living crisis:

While stamp duty cuts, the short supply of homes for sale and a strong labour market all support house prices, the prospect of interest rates continuing to rise sharply amid the cost of living squeeze, plus the impact in recent weeks of higher mortgage borrowing costs on affordability, are likely to exert more significant downward pressure on house prices in the months ahead.

Kinnaird adds that “this will undoubtedly be a cause of some concern for homeowners”, but points out that recent property price inflation has been unprecented.

It’s important to look at slower growth in this context – since the start of the pandemic average property values have risen by around +23% (almost £55,000) with detached house prices up by more than £100,000 over the same period.”

Interest rate expectations soared during the market panic following the mini-budget, with the Bank of England expected to raise rates towards 6% by next summer.

The average rate on two and five-year fixed mortgages rose over 6% this week, and is expected to keep rising. That is pricing some people out of the market, and leaving others facing a jump in repayments when they remortage.

Yesterday, UK bank bosses raised concerns over the state of the UK’s mortgage market at a high-level meeting at No 11 Downing Street.

Kwasi Kwarteng is now considering extending the government’s mortgage guarantee scheme to help the market. That scheme lets banks and building societies buy a guarantee from the government on the slice of the mortgage between 80% and 95% of the property’s value, to protect them if a property is repossessed.

Also coming up today

The main event for the markets today should be September’s Non-Farm Payroll report, which will show how many jobs were created in America last month.

Economists predict that hiring slowed, to around 250,000 from 315,000 in August, as rising US interest rates slow economic growth. A weak jobs report could encourage the US Federal Reserve to slow its interest rate rises, which might weaken the dollar.

The agenda

  • 7am BST: Halifax house price index

  • 7.45am BST: French trade balance for August

  • 9.30am BST: UK labour productivity for Q2

  • 1.30pm BST: US Non-Farm payroll report

Updated

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