Truss: ‘a reckoning is coming’ for central banks<\/p>\n
Former UK prime minister Liz Truss is backing Donald Trump in his fight with the Federal Reserve.<\/p>\n
Truss has told Bloomberg\u2019s Odd Lots podcast<\/a> that it is wrong that unelected central bankers can undermine (as she sees it) elected politicians.<\/p>\n Truss, who was briefly prime minister in September and October 2022, said:<\/p>\n \u201cI think the Bank of England needs to be accountable to politicians. I think the current system doesn\u2019t work. This is why I\u2019m very sympathetic to what Donald Trump is saying about the Fed.\u201d<\/p>\n In the interview, Truss explains that people who owned assets and capital had done very well from the easy money created by the Bank of England (BoE) since the financial crisis, while that loose policy also made it hard for young people to buy homes.<\/p>\n Given the importance of monetary policy of setting the allocation of assets within society, she argues that it\u2019s wrong that people who make those decisions aren\u2019t accountable to the electorate.<\/p>\n She says:<\/p>\n \u201cIt\u2019s also very difficult, as I found as prime minister, to combine fiscal and monetary policy if you don\u2019t hold one of the levers. So, I think it\u2019s got to change.<\/p>\n I think there is a reckoning coming for the central banks, not just in Britain but also in the United States, also the ECB.<\/p>\n The current system does not work.<\/p>\n Truss, who lost power after her mini-budget spooked the financial markets, crashing the pound<\/a> and driving up borrowing costs, also claimed the BoE had \u201csabotaged\u201d what she tried to do because she had been a critic of central banks, and wanted the Treasury to have a larger role setting the Bank\u2019s mandate.<\/p>\n \u201cThey didn\u2019t like their power being challenged.\u201d<\/p>\n Truss has previously blamed the Bank of England for failing to anticipate the market consequences of her budget. Governor Andrew Bailey has rejected that criticism<\/a>, pointing out that the Bank used its intervention tools to stabilise the bond market and protect pension funds.<\/p>\n In her Bloomberg interview, Truss argues that democratically elected leaders shouldn\u2019t \u201ccowtow\u201d, criticises the \u201cfailing economic orthodoxy\u201d and warns that Britain is heading for a \u201cvery, very serious crisis.\u201d<\/p>\n Truss, who lost her parliamentary seat in last year\u2019s general election, says the UK now faces an \u201ceconomic doom loop of higher taxes, lower growth, higher debt, and it\u2019s very difficult now to see the political way out of that.\u201d<\/p>\n Share<\/a><\/p>\n Updated at\u00a011.29 CEST<\/p>\n Key events<\/p>\n Show key events only<\/p>\n Please turn on JavaScript to use this feature<\/p>\n Closing post<\/p>\n Time to wrap up\u2026<\/p>\n Former UK prime minister Liz Truss has claimed that \u201ca reckoning\u201d is coming for central banks in the UK,, US and the eurozone.<\/p>\n Truss also backed Donald Trump\u2019s attempts to exert greater control over the US Federal Reserve, telling Bloomberg\u2019s Odd Lots podcast it was wrong that unelected central bankers could thwart elected politicians.<\/p>\n Trump\u2019s bid to shake up the Fed faces a legal battle, though \u2013 Federal Reserve<\/a> governor Lisa Cook<\/a> has filed a lawsuit claiming the US president has no authority to fire her.<\/p>\n But there was good news for the Trump White House today \u2013 US economic growth was faster than expected in April-June. The economy grew at an annual rate of 3.3% in April-June, lifted by investment in computer hardware for AI systems.<\/p>\n Tesla is still paying the price for Elon Musk\u2019s brush with politics. Its sales across Europe tumbled by 40% in July, at a time when Chinese rival BYD is growing its market share.<\/p>\n The power generator Drax has revealed it is under investigation by the City watchdog over \u201chistorical statements\u201d made about the sourcing of wood pellets for its biomass power station,, knocking its shares down almost 7%.<\/p>\n Share<\/a><\/p>\n Updated at\u00a016.32 CEST<\/p>\n Nvidia shares dip after earnings report<\/p>\n Stocks have opened calmly on Wall Street, despite some disappointment with Nvidia after its financial results last night.<\/p>\n The S&P 500 share index has dipped by just one points, or 0.026%, in early trading while the tech-focused Nasdaq index is 0.2% higher.<\/p>\n Nvidia\u2019s shares have dropped by around 2% in early trading, after it missed forecasts for data center revenue but also beat expectations for adjusted earnings per share.<\/p>\n Overall, revenues were up 56% compared with a year ago, which might calm concerns that the AI boom was fading.<\/p>\n Kathleen Brooks, research director at XTB, reports that there is disappointment that Nvidia didn\u2019t report any sales of its H20 chip to China last quarter, even though China export restrictions were eased.<\/p>\n Brooks adds:<\/p>\n Ultimately, the market does not know how big the China market is for Nvidia, or the impact of the Chinese government encouraging a move away from Nvidia\u2019s chips, especially for government systems.<\/p>\n Thus, this earnings report does not give us too much information on future sales growth to China, and it also fails to deliver what analysts want to know: the potential sales growth for Nvidia\u2019s chip that has been designed specifically for the Chinese market.<\/p>\n Share<\/a><\/p>\n Updated at\u00a015.55 CEST<\/p>\n Share<\/a><\/p>\n The upward revision to US growth in April-June was partly due to the hi-tech investment boom as companies race to build artificial intelligence data systems.<\/p>\n Capital Economics explain:<\/p>\n That revision was partly a consumption story \u2013 with consumer spending now estimated to have rebounded to 1.6% in the second quarter from 0.5% in the first. Even more encouraging, however, is the increasingly concrete signs of an AI-related boom in tech investment. Investment in computer hardware increased by 61.2% annualised, slightly more than in the initial estimate.<\/p>\n But the big revision came in software investment, which is now estimated to have expanded at a 26.4% annualised pace \u2013 the biggest quarterly gain since at least 2007.<\/p>\n Share<\/a><\/p>\n Just in: Federal Reserve Governor Lisa Cook filed a lawsuit challenging President Donald Trump\u2019s attempt to fire her over claims she lied on mortgage applications, Bloomberg reports.<\/p>\n The move, which was expected, kicks off a historic fight over independence of the US central bank.<\/a><\/p>\n Cook filed the suit Thursday in federal court in Washington, according to court records.<\/p>\n Donald Trump<\/a> announced he was firing Cook on Monday night, over unconfirmed allegations of mortgage fraud<\/a>.<\/p>\n Share<\/a>US GDP revised higher<\/p>\n Over in the US, economic growth last spring was stronger than first estimated.<\/p>\n The latest assessment of US GDP, just released, shows the economy expanded at an annualised rate of 3.3% in April-June, up from the initial estimate of 3% growth.<\/p>\n That confirms that the world\u2019s largest economy returned to growth after shrinking by 0.5%\/year in January-March, when a surge of imports dragged down GDP.<\/p>\n MACRO: \ud83c\uddfa\ud83c\uddf8 US GDP for Q2 was revised upwards with inflation revised down.<\/p>\n \u2023 Q2 GDP 3.3% vs 3.0% Initial \u2014 LuxAlgo (@LuxAlgo) August 28, 2025<\/a><\/p>\n The US Bureau of Economic Analysis reports that the upturn in real GDP in the second quarter primarily reflected a downturn in imports and an acceleration in consumer spending that were partly offset by a downturn in investment.<\/p>\n Today\u2019s revision is due to the BEA lifting its estimate for investment and consumer spending in the last quarter, though this was partly offset by a downward revision to government spending and an upward revision to imports.<\/p>\n Share<\/a>Sportscar manufacturer Lotus to cut 550 jobs<\/p>\n Back in the UK car industry, Lotus has said it plans to cut 550 jobs in Britain.<\/p>\n The job cuts will affect almost half the 1,300 staff at the company\u2019s UK headquarters in Hethel, Norfolk.<\/p>\n The Lotus production line in Norfolk Photograph: Darrin Jenkins\/Alamy<\/p>\n Lotus put some of the blame on Donald Trump\u2019s trade war, saying:<\/p>\n \u201cWe believe this is necessary in order to secure a sustainable future for the company in today\u2019s rapidly evolving automotive environment, which is seeing uncertainty with rapid changes in global policies including tariffs.<\/p>\n \u201cThe brand remains fully committed to the UK, and Norfolk will remain the home of the Lotus\u2019 sports car, motorsports and engineering consulting operations.<\/p>\n \u201cIt is actively exploring future growth opportunities to diversify Lotus Cars\u2019 business model, including through third-party manufacturing.\u201d<\/p>\n Back in June, there were reports that Lotus was planning to end production of its sportscars in the UK<\/a>. But after holding meetings with the government, Chinese owner Geely insisted it had no intention of shutting its Norfolk<\/a> factory<\/p>\n Share<\/a><\/p>\n Updated at\u00a015.10 CEST<\/p>\n Crown Prosecution Service brings charges related to provision of gambling services in Turkey<\/p>\n Eleven people, including former directors of Entain, the gambling company that owns Ladbrokes and Coral, have been charged with offences including bribery, fraud, cheating the public revenue, tax evasion and perverting the course of justice.<\/p>\n The Crown Prosecution Service said this morning that it had authorised the prosecution of 11 individuals for seven offences, in relation to the provision of gambling services in Turkey between 2011 and 2018.<\/p>\n Those charged include Kenny Alexander, the former chief executive of Entain, its former chairman, Lee Feldman, former legal director Robert Hoskin, and James Humberstone, who held several roles with the company.<\/p>\n Ten of the individuals were charged with offences allegedly committed between 2011 and 2018, while one person was charged for an offence relating to the investigation by HMRC.<\/p>\n Richard Las, director of HMRC\u2019s Fraud Investigation Service, said:<\/p>\n \u201cThis has been a complex and international investigation. These are serious charges that relate to conspiracy to defraud, bribery, cheating the public revenue, evasion of income tax and perverting the course of justice among others.<\/p>\n \u201cWe remind everyone that proceedings are now active and we won\u2019t be adding anything further.\u201d<\/p>\n Share<\/a><\/p>\n Updated at\u00a014.45 CEST<\/p>\n These are difficult times at the Treasury, as speculation swirls that the UK could be in a race with France to agree an IMF bailout.<\/p>\n But there is something for Number 11 to celebrate, though. Neil Amin-Smith, special advisor to chancellor Rachel Reeves, has topped a list of the 100 sexiest Londoners.<\/p>\n Before becoming a top SPAD, Amin-Smith (Westminster School, Cambridge) was known for his role in music group Clean Bandit.<\/p>\n Milan Neil Amin-Smith of Clean Bandit performing at the Glastonbury Festival in 2015 Photograph: Tabatha Fireman\/Redferns\/Getty Images<\/p>\n This isn\u2019t really our area, so we\u2019ll defer to the Evening Standard, which reports:<\/p>\n Spotted tie-less by the Chancellor\u2019s side, he turns Treasury heads like hungry owls. With broad shoulders, tousled chocolate hair, statement earrings, and a smile that could melt decades of geopolitical tension, it\u2019s no wonder Reeves keeps Amin-Smith close (how she manages to cry at work with him on her team is unbeknownst to us).<\/p>\n The full list is here<\/a>. It\u2019s light on other names from the the world of business and finance, apart from banker Frederick Windsor and Phillips principal auctioneer Henry Highley.<\/p>\n Share<\/a><\/p>\n The financial markets aren\u2019t convinced that the Bank of England will be able to cut interest rate again this year.<\/p>\n After five quarter-point cuts since last summer, the Bank may struggle to agree a sixth until 2026.<\/p>\n
\u2023 PCE Price Index 2.0% vs 2.1% Initial pic.twitter.com\/2Va81Qatfz<\/a><\/p>\n