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Chancellor Rachel Reeves Calls for Stronger Ties with China Amid Economic Struggles
Chancellor Rachel Reeves has argued that Britain has “no choice at all” but to engage with China as she seeks to bolster economic growth against the backdrop of rising borrowing costs and volatile financial markets. Reeves, who arrived in Beijing to finalise trade and investment agreements worth £600 million over five years, is the first UK chancellor to visit China in over five years.
The trip comes as the UK faces persistent inflation and growing concerns about how quickly the Bank of England can reduce interest rates. The yield on 30-year government debt remains at a 27-year high, and the pound continues to struggle against the dollar, reminiscent of last year’s financial turmoil.
Reeves has reaffirmed her “non-negotiable” fiscal rules, underlining the importance of economic stability in restoring market confidence. The Treasury’s upcoming spending review is expected to call for efficiency savings of at least 5% across government departments, a figure that may rise further due to increased debt-servicing costs. Although Reeves has pledged not to repeat the tax hikes seen last autumn, her options remain limited due to persistent inflationary pressures.
Paul Johnson, director of the Institute for Fiscal Studies, warned that breaching the Chancellor’s borrowing limits could trigger further market instability, raising yields even higher. With economic growth subdued and tax receipts underperforming, the cost of servicing government debt is becoming a growing concern.
In a bid to counter these financial pressures, Reeves is focusing on strengthening the UK’s trade and investment ties with China. She argued that the UK’s previous reluctance to engage with Beijing put the country at a disadvantage compared to France and Germany, both of which have significantly expanded their commercial relationships with China. As the world’s second-largest economy and the UK’s fourth-largest trading partner, China plays a vital role in supporting British jobs and exports.
Agreements reached with Chinese Vice Premier He Lifeng include enhanced cooperation in sectors such as financial services, cross-border investment, climate change initiatives, and agriculture. “Choosing not to engage with China is therefore no choice at all,” Reeves said, stressing that Britain should maintain “respectful and consistent” relations with China despite ideological differences.
In the financial markets, investors have become increasingly cautious about UK assets, with inflation remaining stubbornly above the Bank of England’s target of 2%. Although markets had expected interest rate cuts this year, the likelihood of those cuts happening is now in doubt, with potential implications for the 1.8 million households facing rising mortgage costs.
Reeves’s challenge is to strengthen trade ties abroad while maintaining fiscal discipline at home. As the UK navigates these turbulent economic waters, her trip to Beijing underscores a broader strategy to stabilise markets, foster growth, and build international alliances, even in politically sensitive areas.
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Amazon MGM Takes Creative Reins of James Bond Franchise Amid Casting Buzz
In a landmark shift for the James Bond franchise, Amazon MGM has partnered with long-time producers Michael G. Wilson and Barbara Broccoli to oversee the future of 007. While all three entities retain co-ownership of the Bond intellectual property, Amazon MGM will now lead creative decisions, marking a significant departure from its previously limited role.
The move follows Amazon’s $8.5 billion acquisition of MGM in 2021, which granted it partial ownership but little say in the franchise’s artistic direction. With Daniel Craig’s departure after 2021’s No Time to Die, speculation about the next James Bond has intensified. Jeff Bezos, Amazon’s founder and executive chairman, fueled the debate by asking his followers on social media platform X, “Who’d you pick as the next Bond?” The overwhelming response highlighted British actor Henry Cavill as a fan favorite. Known for roles in Superman, The Witcher, and Mission: Impossible – Fallout, Cavill previously auditioned for the role in 2006’s Casino Royale but lost to Daniel Craig. Director Martin Campbell praised Cavill’s audition but deemed him too young at the time. Now in his early forties, Cavill’s age could be a factor if long-term commitments are considered.
Daniel Craig acknowledged Wilson and Broccoli’s contributions, telling Variety, “My respect, admiration, and love for Barbara and Michael remain constant and undiminished.” With Wilson stepping back and Broccoli expected to reduce her involvement, Amazon MGM gains greater creative control, raising questions about the franchise’s future direction.
Fan speculation continues to swirl around Cavill, alongside other contenders like Taron Egerton, Tom Hardy, and Idris Elba. While Amazon MGM has yet to announce a timeline or reveal casting decisions, industry watchers anticipate a new era that may extend beyond traditional films, potentially including spin-offs, series, and streaming exclusives. As the studio reshapes Bond’s future, audiences worldwide eagerly await the next chapter in the iconic spy saga.
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Global Hiring Slump Marks Longest Downturn in Decades, Says Hays CEO
The global job market is experiencing its longest downturn in over 20 years, according to Dirk Hahn, CEO of Hays, Britain’s largest listed recruitment firm. Hahn attributes the slump to ongoing macroeconomic uncertainty, which is deterring both employers and job seekers from making moves.
Hays, which employs nearly 7,000 consultants worldwide, reported weaker demand for temporary workers in early 2025, while demand for permanent roles—particularly in Europe—remains sluggish following a pre-Christmas dip. Countries such as France, the UK, Ireland, and Germany, Hays’s largest market, are feeling the pressure most acutely.
In the six months leading up to December, Hays reported a 15% drop in group net fees, falling to £496 million from £583.3 million the previous year. Pre-tax profits fell sharply by 67% to £9.1 million, compared to £27.6 million during the same period the prior year. Hays’s share price, already down 25% over the past year, dipped a further 1.8% on Thursday, closing at 71¾p and placing the company’s market value just below £1.2 billion. Despite declining profits, the company will maintain its interim dividend at 0.95p per share.
While the broader UK labor market has shown resilience with limited mass layoffs, businesses remain cautious about expanding their workforce. “Most companies have enough work to retain their current staff, but they’re not looking to increase headcount,” said James Hilton, Hays’s chief financial officer. “Many employees who received pay increases in recent years are not seeking new roles, creating a stalemate. However, over time, people will seek promotions or fresh challenges.”
Recruiters had anticipated a market recovery earlier this year, but Hahn now warns that the rebound may not materialize until 2026. In the meantime, Hays is focusing on its technology recruitment division—its most profitable segment—as it navigates the prolonged global hiring slowdown.
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UK Government Reports Lower-Than-Expected Budget Surplus in January
The UK government reported a budget surplus of £15.4 billion in January, falling short of economists’ forecasts of £21 billion and the £19 billion predicted by the Office for Budget Responsibility (OBR). Despite January typically seeing a boost from self-assessment tax payments, the lower-than-expected figure has increased total borrowing for the financial year to £118.2 billion—over £11 billion more than the previous year.
The government’s debt-to-GDP ratio now stands at 95.3 per cent, a level last observed in the 1960s. With the OBR set to release updated forecasts on March 26, there are concerns that the government may struggle to meet its goal of reducing the debt ratio by 2029. This could lead to potential spending cuts or tax hikes in the autumn budget.
Reduced debt-servicing costs helped boost January’s surplus, dropping from £9 billion in December to £6.5 billion. However, this was partially offset by a £6 billion one-off expense related to the government’s repurchase of military housing from private firm Annington.
Darren Jones, chief secretary to the Treasury, emphasized the government’s commitment to “economic stability and meeting our non-negotiable fiscal rules.” He also noted that a comprehensive spending review—the first of its kind in 17 years—is underway to ensure that public funds are used efficiently and aligned with national priorities.
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