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The UK stock market is rather staggering towards Christmas.<\/p>\n
The blue-chip FTSE<\/a> 100 shares inded is up a mere 2 points, or 0.02%, today at 9,839 points, less than 100 points off its alltime high.<\/p>\n Shares in UK housebuilders and retailers are falling through, suggesting some pessimism about the economic outlook after today\u2019s data.<\/p>\n AJ Bell head of financial analysis Danni Hewson says:<\/p>\n \u201cThe knife-edge nature of yesterday\u2019s rate decision by the Bank of England is keeping UK stocks in check and stalled the FTSE 100\u2019s push towards the 10,000 mark. Investors have responded to the reality that we could be approaching the end of the current rate-cutting cycle.<\/p>\n \u201cThis saw housebuilders lose momentum as hopes for a significant drop in mortgage costs in the coming months begin to fade away. An unexpected drop in retail sales only added to the gloom around the consumer backdrop in the UK.<\/p>\n Share<\/a>Russia cuts interest rates to 16%<\/p>\n Just in: Russia\u2019s central bank has cut its key interest rate by half a percentage point.<\/p>\n The Bank of Russia has lowered rates from 16.5% to 16%, and cautioned that economic growth was uneven across sectors, even though economic activity is growing at a \u201cmoderate pace\u201d.<\/p>\n The Bank of Russia says:<\/p>\n The economy continues to return to a balanced growth path. Underlying measures of current price growth declined in November. However, inflation expectations have edged up in recent months. Lending activity remains high.<\/p>\n The Bank of Russia will maintain monetary conditions as tight as required to return inflation to the target. This means that monetary policy will remain tight for a long period. Further decisions on the key rate will be made depending on the sustainability of the inflation slowdown and the dynamics of inflation expectations.<\/p>\n According to the Bank of Russia\u2019s forecast, given the monetary policy stance, annual inflation will decline to 4.0\u20135.0% in 2026. Underlying inflation will reach 4% in 2026 H2. In 2027 and beyond, annual inflation will stay on target.<\/p>\n Share<\/a><\/p>\n Germany\u2019s economic recovery from three years of stagnation will get only a subdued start next year, its central bank has warned.<\/p>\n However, the Bundesbank predicts growth will pick up pace later on the back of higher government spending.<\/p>\n In the latest update of its economic projections, Bundesbank president Joachim Nagel says:<\/p>\n \u201cWhile progress will be subdued initially, it will then slowly pick up.<\/p>\n \u201cStarting in the second quarter of 2026, economic growth will strengthen markedly, driven mainly by government spending and a resurgence in exports.\u201d<\/p>\n Share<\/a><\/p>\n Elsewhere in retail, the UK\u2019s financial services watchdog has launched an investigation into WH Smiths over the accounting error that wiped almost \u00a3600m off the company\u2019s stock market value<\/a> overnight this summer.<\/p>\n WH Smiths told the City this morning that the Financial Conduct Authority (FCA) has begun an investigation into the company over its compliance with UK stock market listing rules.<\/p>\n WH Smith also revealed it will try to take back as much as \u00a37m in bonuses from former executives\u2026.<\/p>\n Share<\/a>France in danger if 2026 deficit not contained, central bank chief warns<\/p>\n France\u2019s central bank governor has warned there could be market turmoil if the country can\u2019t bring its budget deficit down.<\/p>\n Francois Villeroy de Galhau has told Le Figaro that France could face a market backlash if it fails to bring its deficit within 5% of economic output next year.<\/p>\n Villeroy said:<\/p>\n \u201cBeyond a 5% deficit, France would clearly put itself in danger.<\/p>\n \u201cThe apparent calm of the markets can, in my experience, turn abruptly.\u201d<\/p>\n After another year of political turmoil, France\u2019s parliament is yet to agree a full budget for 2026.<\/p>\n Fourteen lawmakers from the French National Assembly and Senate are set to sit down in a joint committee on Friday to try to hammer out a deal on the state budget, Politico reports.<\/a><\/p>\n However, forging a consensus will prove difficult given the radical disagreements between political parties and the two chambers of the French legislature on budget priorities.<\/p>\n Share<\/a><\/p>\n One bright spot in the UK economy today is that consumer confidence has risen in the run-up to Christmas.<\/p>\n The closely watched Consumer Confidence Index from GfK has improved by two points in December, to minus 17.<\/p>\n The research showed that all five of the survey\u2019s measures increased for the month, bouncing back from a weak November which had been impacted by pre-Budget caution.<\/p>\n Neil Bellamy, consumer insights director at GfK, said:<\/p>\n \u201cIt\u2019s tempting to see festive cheer in December\u2019s two-point improvement in consumer confidence.<\/p>\n \u201cThis is a surprise finding for the UK high street because it contrasts with the Black Friday sales slump we reported on earlier this month.\u201d<\/p>\n Share<\/a>AI likely to displace jobs, Bank of England governor warns<\/p>\n The governor of the Bank of England has warned that the widespread adoption of Artificial Intelligence (AI) is \u201clikely\u201d to displace people from jobs in a similar way seen during the Industrial Revolution.<\/p>\n Andrew Bailey has told Radio 4\u2019s Today programme:<\/p>\n \u201cAs you saw in the Industrial Revolution, now over time, I think we can now sort of look back and say it didn\u2019t cause mass unemployment, but it did displace people from jobs and this is important.<\/p>\n \u201cMy guess would be that it\u2019s most likely that AI may well have a similar effect. So we need to be prepared for that, in a sense.\u201d<\/p>\n Back in October, the governor argued that the emergence of AI would not lead to a wave of job losses in the UK, but would require workers to be retrained<\/a>.<\/p>\n Now, he points out that younger, inexperienced professionals are finding it difficult to secure entry-level roles due to AI.<\/p>\n Bailey explained:<\/p>\n \u201cWe do have to think about, what is it doing to the pipeline of people? Is it changing it or not?\u201d<\/p>\n \u201cI think if it\u2019s people working with AI, I\u2019m not sure it will change the pipeline, but I think we\u2019re right to have a have an eye on that point.\u201d<\/p>\n Share<\/a><\/p>\n Updated at\u00a004.55 EST<\/p>\n This morning\u2019s borrowing figures show that the UK\u2019s net debt-to-GDP ratio remains at levels last seen in the early 1960s:<\/p>\n Photograph: Office for National Statistics<\/p>\n The net debt-to-GDP ratio at the end of November 2025 was provisionally estimated at 95.6%, which is 0.3 percentage points more than a year ago.<\/p>\n Share<\/a><\/p>\n Updated at\u00a002.57 EST<\/p>\n November\u2019s retail sales and public finances data reveal some tentative signs of improvement, says Paul Dales, chief UK economist at Capital Economics<\/a>.<\/p>\n However, both are coming too late to make much difference to retailers in the so-called \u201cGolden Quarter\u201d and for the Chancellor after she tightened policy in the Budget in late-November, Dales adds.<\/p>\n Share<\/a><\/p>\n Non-food retailers, such as department stores and clothing shops, bucked the downward trend last monh with a 1% rise in sales volumes.<\/p>\n The ONS says:<\/p>\n Department stores\u2019 sales volumes rose, which some retailers attributed to longer Black Friday discounting, while retailers of footwear and leather goods also did well. Sales of automotive fuel recovered from last month\u2019s fall, returning to just above September 2025 levels.<\/p>\n Share<\/a>Retail sales fall as Black Friday effect fades<\/p>\n Retail sales across Great Britain fell in November, as cautious consumers cut back on their shopping ove the Black Friday period.<\/p>\n Retail sales volumes are estimated to have fallen by 0.1% in November, the Office for National Statistics reports, which may intensify fears that uncertainty ahead of the budget on 26 November cooled the economy.<\/p>\n Spending at non-store (online) retailers fell, while supermarket sales volumes fell for their fourth consecutive month, the ONS says, with retailers reporting low footfall. It suspects the \u201cBlack Friday effect\u201d on the retail sector was was slightly weaker than usual.<\/p>\n ONS senior statistician Hannah Finselbach said:<\/p>\n \u201cRetail continued to grow in the three months to November, helped by a strong performance from clothing and tech shops.<\/p>\n \u201cThis year November\u2019s Black Friday discounts did not boost sales as much as in some recent years, meaning that once we adjust for usual seasonality, our headline figures fell a little on the month.<\/p>\n November\u2019s drop follows a fall of 0.9% in October and a rise of 0.8% in September.<\/p>\n