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June 12, 2025

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UK GDP falls by 0.3% in April as services slump and US tariffs bite

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The UK economy shrank by 0.3% in April, a sharper-than-expected decline that has raised fresh concerns about the fragility of the recovery and the growing pressure on both households and businesses.

Figures released by the Office for National Statistics (ONS) on Tuesday showed that the fall in gross domestic product (GDP) was driven by a 0.4% drop in the services sector — the largest contributor to the overall contraction.

Production output also declined by 0.6%, while construction output offered a rare bright spot with a 0.9% increase.

The latest data underscores the challenges facing Prime Minister Keir Starmer’s Labour government, which took office after a landslide election victory last summer.

The April decline marked the sharpest monthly fall in GDP since October 2023 and the worst performance since Labour came to power.

Economists surveyed by Bloomberg had predicted only a 0.1% decline in GDP for April. The larger contraction may complicate the government’s fiscal plans ahead of the autumn Budget.

Chancellor of the Exchequer Rachel Reeves told Sky News:

“We know that April was a challenging month.”

“There was a huge uncertainty about tariffs, and one of the things, if you dig into those GDP numbers today, is exports weakening and also production weakening because of that uncertainty in the world around tariffs.”

She added that the figures for April were “disappointing, but also perhaps not entirely unexpected”, given global economic uncertainty.

Source: The Guardian

Exports fall by £2 billion amid Trump tariffs, pulling growth down

A significant drag on growth came from the collapse in exports to the United States, which fell by £2 billion in April.

The ONS said this was the largest monthly drop in US-bound goods exports since records began in 1997.

The decline followed President Donald Trump’s announcement on April 2 of a blanket 10% tariff on imports from the UK, part of a wider effort to reshape global trade.

The impact was felt across several sectors, with notable declines in car shipments, non-ferrous metals, and chemical exports.

While UK officials have since negotiated a new trade agreement with the US, the tariffs still applied during April and were cited as a major factor in the economic downturn.

“After increasing for each of the four preceding months, April saw the largest monthly fall on record in goods exports to the United States with decreases seen across most types of goods, following the recent introduction of tariffs,” said Liz McKeown, Director of Economic Statistics at the ONS.

Tax pressures, weak demand weigh on output

Domestically, the economic landscape in April was shaped by higher energy bills, increases to payroll taxes and the national minimum wage, and an overall tightening of household finances.

Retail sales fell as consumers pulled back after stronger spending earlier in the year.

Real estate and legal services experienced a sharp drop in activity, reflecting a slowdown in home sales amid tax-related transaction changes.

The latest figures contrast sharply with the stronger-than-expected performance in the first quarter, which Labour had touted as evidence that the UK economy was turning a corner.

However, economists have warned that much of that strength was driven by temporary factors, including a rush by exporters to ship goods ahead of anticipated tariffs.

“Weaker growth is a headache for the chancellor as it makes generating the revenue government needs to support its sizable spending plans more difficult, increasing the chances of further tax rises in the autumn Budget,” said Suren Thiru, economics director at the Institute of Chartered Accountants in England and Wales in a Bloomberg report.

Outlook dims for second quarter

The outlook for the second quarter remains muted.

Most analysts now expect growth of just 0.1% between April and June, significantly below earlier forecasts.

The fragile trajectory of the economy is further clouded by Trump’s escalating trade measures and ongoing global uncertainty.

While April’s construction growth offered a glimmer of resilience, the broader picture remains troubling for policymakers, businesses and consumers alike.

With mounting job losses and tighter financial conditions, the challenge of sustaining growth in the face of global headwinds and domestic constraints continues to loom large.

The post UK GDP falls by 0.3% in April as services slump and US tariffs bite appeared first on Invezz

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In World news

FireFly Metals to Add AU$95 Million to Coffers With Equity Raising

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FireFly Metals (ASX:FFM,TSX:FFM,OTC Pink:MNXMF) has attained firm commitments to raise up to about AU$95 million, giving it a total of AU$135 million for its multi-pronged growth strategy.

The company highlighted on Tuesday (June 10) that the equity financing will be completed via the issuance of approximately 94.7 million fully paid ordinary shares; it will receive around AU$1 per new share.

The funds will be raised via three transactions, with the first being an AU$11.2 million charity flow-through placement to Canadian investors. This will be followed by a AU$54.9 million two-tranche institutional placement, as well as a AU$28.8 million fully underwritten Canadian bought-deal offering with BMO Capital Markets.

Alongside the equity raising, FireFly is inviting shareholders to participate in a non-underwritten share purchase plan (SPP) that can potentially raise up to AU$5 million before costs.

Proceeds of the equity raising and the SPP will collectively be allotted to advance the Green Bay copper-gold project in Canada, including transaction costs and working capital.

Located in the Baie Verte district of Northeast Newfoundland on Canada’s east coast, Green Bay was acquired by FireFly in August 2023. Green Bay includes Ming underground mine, which was mined between 1972 and 1982, with activity restarting in 2012. Historic production totaled 6.7 million metric tons (MT) at 2 percent for 134,000 MT of copper.

Measured and indicated resources at Ming are at 21.5 million MT at 1.8 percent for 307,000 MT of copper equivalent, while inferred resources are at 28.4 million MT at 2 percent for 576,000 MT of copper equivalent.

FireFly began drilling at Ming in October 2023, completing 79 drill holes across 37,110 meters within a year.

“The overwhelming demand for the raising reflects the quality and growth outlook at Green Bay, our commitment to a multi-rig exploration campaign and the demand among global investors for top-shelf copper-gold projects,” said FireFly Managing Director Steve Parsons in the company’s press release.

He called the asset, alongside FireFly’s exploration team and AU$135 million in funding, “the ideal recipe for growth.”

FireFly states on its website that it will continue with its low-cost rapid resource growth strategy, with the underground exploration drill drive at the Ming deposit to be extended during this year.

The company debuted on the Toronto Stock Exchange in December 2024.

Securities Disclosure: I, Gabrielle de la Cruz, hold no direct investment interest in any company mentioned in this article.

This post appeared first on investingnews.com

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In Business

U.S. online stores put ‘out of stock’ signs as Nintendo Switch 2 sales hit record highs

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Nintendo sold more than 3.5 million units of its flagship Switch 2 gaming system in the four days following its launch, with online stores of major U.S. retailers putting up “out of stock” signs.

The record-breaking start for the company’s first new console in eight years, puts Nintendo on the path to realizing its aim of selling 15 million units of the Switch 2 console in the fiscal year ending March 2026.

However, analysts continue to believe that those expectations are modest, and forecast the strong initial demand to sustain.

“The market expected a record from Nintendo, and as it turns out, Nintendo delivered,” Serkan Toto, CEO and founder of gaming industry consultancy Kantan Games, told CNBC.

“All signals prior to launch pointed to significant demand, and I believe we will see further records broken over the next weeks or months,” he added.

Toto has maintains that the Switch 2 will sell over 20 million units in its first 12 months. David Gibson, senior research analyst at MST Financial told CNBC that he expects 20 million sales for the year ending March 2026.

The Switch 2, which was released on June 5, has been met with much fanfare, with people lining up for hours ahead of midnight releases at Nintendo stores.

“Fans around the world are showing their enthusiasm for Nintendo Switch 2 as an upgraded way to play at home and on the go,” Nintendo of America President and Chief Operating Officer Doug Bowser said in a statement, adding the company was thankful for the response.

Tokyo-listed shares of Nintendo, which have gained nearly 30% so far this year, were down 3.5% on Wednesday, LSEG data showed. The company has seen its shares rise nearly fivefold since the original Switch debuted in early March 2017.

It remains to be seen if the Switch 2 can recapture the magic of its predecessor, which had set the bar with 15 million unit sales in its first year. It went on to sell more than 152 million units to become the second-highest selling Nintendo device ever, behind the Nintendo DS.

The record initial sales of the Switch are in line with the strong demand analysts had predicted. However, the rush has put into question Nintendo’s ability to meet demand.

Retailers including Walmart, GameStop, Target and Best Buy were out of stock of the consoles, their online stores showed Wednesday.

In April, Nintendo’s Bowser told CNBC that the company had been working with “retail partners to ensure there’s ample supply for not only the launch weekend, but well beyond.”

However, Nintendo President Shuntaro Furukawa stated the same month that 2.2 million people in Japan had entered the lottery to purchase the Switch 2 on launch day, exceeding expectations and what the company had initially planned to deliver to stores.

Kantan Games’ Toto said shortages in Japan were expected to persist, but would be less impactful elsewhere.

“Except for Japan where demand for Switch 2 is extraordinarily high, it looks like fans who really want the console and invest time in trying to secure one actually can get one,” he said. “It might take a while, but as far as can be monitored, supply seems to be more robust than around the launch of the original Switch in 2017.”

President Donald Trump’s “reciprocal tariffs” on most countries around the world also present headwinds for the Switch 2.

In April, the company announced that it would delay preorders of the Switch 2 in the U.S. while it considers the impact of tariffs.

The Switch 2 retails for $449 in the U.S., which makes it Nintendo’s priciest console to date.

Nintendo’s Bowser said in April the company was going to “monitor where tariffs are going” before making any further decisions on price hikes.

MST Financial’s Gibson said that a resolution to Trump’s tariffs and lower duty rates could see the Switch 2 prices drop in the U.S.

The Switch 2 builds on the success of the original Switch, featuring a larger screen and improved performance. The system also introduces the new GameChat2 feature, which allows players to voice or video chat with friends online and share game screens.

This post appeared first on NBC NEWS

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In Politics

Trump says he is open to extending trade deal deadline for other countries: ‘I would’

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President Donald Trump said Wednesday he was willing to extend the deadline for countries to reach a trade deal with the United States, but he doesn’t think it will be necessary.

At the same time, he also indicated that in one to two weeks his administration would be sending out letters telling countries ‘what the deal is.’ 

Trump made the remarks ahead of a performance of ‘Les Misérables’ that he attended at the Kennedy Center in Washington with the first lady.

‘I would,’ Trump said when asked if he would be willing to extend the July 8 deadline for countries to negotiate a trade deal or else face steep tariffs. ‘But I don’t think we’re going to have that necessity,’ the president added, telling reporters ‘we’re rocking in terms of deals’ right now.

Shortly after announcing sweeping tariff policies on April 2 for virtually every U.S. trading partner, the Trump administration chose to institute a 90-day pause to give countries a chance to make a deal with the United States. 

Trump noted during the gaggle with reporters ahead of Wednesday’s Kennedy Center performance that the United States remains in talks with about 15 countries with whom it is still trying to cement a deal. But the president said that he intends to send letters to these partners setting unilateral tariff rates if a deal is not reached.   

‘We’re dealing with Japan. We’re dealing with South Korea. We’re dealing with a lot of them. We’re dealing with about 15 countries. But as you know, we have about 150-plus, and you can’t [make a deal with all of them]. So we’re going to be sending letters out in about a week and a half, two weeks, to countries and telling them what the deal is.’

‘At a certain point, we’re just going to send letters out … saying this is the deal, you can take it or leave it,’ Trump added.

Highly anticipated trade talks with China held in London this week led to a preliminary agreement between the world’s two biggest economic powers, but the ‘framework’ is still pending final approval from Chinese President Xi Jinping and Trump.

‘We made a great deal with China. We’re very happy with it,’ Trump told reporters at the Kennedy Center on Wednesday evening. ‘We have everything we need, and we’re going to do very well with it. And hopefully they are, too.’

This post appeared first on FOX NEWS

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