Rolling coverage of the latest economic and financial news
3m agoCiti: This is a brave plan from VW
24m agoVolkswagen to slash another 50,000 jobs
24m agoUK car sales log strongest August since 2018
25m agoIntroduction: Data splurge ahead, and a Bailey speech
Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.
After a week of bond market jitters, today we’re going to get some fresh insight into central bankers’ thinking, and the health of the UK and US economies.
Bank of England governor Andrew Bailey is due to speak in London this morning – a day after his chief economist called for higher UK interest rates. Will Bailey – among the majority who voted to leave rates on hold in July –push back?
Opponents of rate rises point out they hurt growth, and won’t tackle the oil supply shock caused by the Iran war.
This morning, a survey of UK builders will show how they’re coping, while the UN’s latest food price index will show if stables such as dairy, cereals, sugar, and meat are getting even pricier.
Then this afternoon, the Non-Farm Payroll will show how many jobs America added last month. Back in July, the NFP showed a shock fall in employment – economists expect a rebound in August, with forecasts for around 56,000 new jobs.
The agenda
9am BST: UN’s FAO Food Price Index
9am BST: SMMT car sales
9.30am BST: UK construction PMI
9.30am BST: Bank of England’s Monthly Decision Maker Panel data - August 2026
9.30am BST: ONS Economic activity and social change in the UK, real-time indicators
9.50am BST: Andrew Bailey gives keynote speech at LSE TRIUM Anniversary Conference, London
1.30pm BST: US non-farm payrolls jobs report
Financial analysts are applauding Volkswagen for reaching agreement on its 50,000 job cuts.
Citi have congratulated VW management, the VW workers council and the representatives from the State of Lower Saxony for appoving the company’s Future Plan 2030.
This is a brave plan and a realistic decision for all concerned. As we have highlighted, given VW’s German plant competitiveness and lack of global revenue opportunities, VW simply had no other choice. The plan will allow VW to cut costs, to cut the number of models (and complexity), and to sharply cut investment spend by a further €6bn p.a. (per year) This decision should further allow VW to continue to move capital to its highest-return brands and models, without the need to maintain excess capacity utilisation. Whilst VW’s LT EBIT targets remain ambitious, VW has once again proved its progress in recent years.
This is a brave plan and a realistic decision for all concerned. As we have highlighted, given VW’s German plant competitiveness and lack of global revenue opportunities, VW simply had no other choice. The plan will allow VW to cut costs, to cut the number of models (and complexity), and to sharply cut investment spend by a further €6bn p.a. (per year)
This decision should further allow VW to continue to move capital to its highest-return brands and models, without the need to maintain excess capacity utilisation. Whilst VW’s LT EBIT targets remain ambitious, VW has once again proved its progress in recent years.
Elsewhere in the car sector, Volkswagen’s supervisory board has agreed to back a sweeping overhaul that will cut another 50,000 jobs and could lead to plant closures.
VW announced last night that “after intense and constructive discussions”, the Supervisory Board has unanimously approved the comprehensive Future Plan 2030 drawn up by chief executive Oliver Blume.
“The Supervisory Board has unanimously approved the Executive Board’s Future Plan presented today. This is a strong signal for the future of the Volkswagen Group. We are taking responsibility for our entire workforce, for our partners and for industrial jobs worldwide. Over the coming years, we will invest a three-figure billion sum to make our iconic brands even more attractive, stronger and more competitive.”
The VW Supervisory Board includes employee and shareholder representatives, and it wasn’t clear that they would approve Blume’s plans.
These cuts are on top of 50,000 already agreed, as VW battles with competition from China, weak sales in Europe, and automobile tariffs set by Donald Trump.
Registrations of new cars in the UK rose about 13% to more than 90,000 in August, preliminary industry data showed on Friday.
If confirmed at 9am, when the final data is issued, that would be the highest number for an August in eight years.
The latest data from the Society of Motor Manufacturers and Traders is also expected to show that the market share of battery electric vehicles rose to about 30% in August.
Yesterday, data from New AutoMotive showed a 17.5% jump in overall new car registrations in August.
