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AJ Bell: Bad day for markets, NS&I reputation bruised<\/p>\n
\u201cInvestors look like they\u2019re fed up with the hot and cold messages around Iran peace talks,\u201d says Dan Coatsworth, head of markets at AJ Bell.<\/p>\n
Summing up the day, Coatsworth says:<\/p>\n
double quotation mark\u201cThe fact the Vix fear index jumped 6% and oil prices rose by 5% would suggest recent market optimism about a resolution in the Middle East is fading fast.<\/p>\n
\u201cStock markets fell around the world as investors expressed their frustration. A gloomy economic outlook report from the OECD didn\u2019t help matters, flagging the impact of the Middle East crisis on inflation. Investors will have already been aware of the risk of costs going up but seeing it in black and white in the OECD report brought home the severity of the situation.\u201d<\/p>\n
And on the NS&I scandal, he adds:<\/p>\n
double quotation mark\u201cNS&I effectively competes with the banks as a savings brand and is extremely popular with individuals up and down the country.<\/p>\n
\u201cNews that thousands of bereaved families faced delays accessing their relatives\u2019 Premium Bonds will be bruising for its reputation.<\/p>\n
\u201cTrust is incredibly important in financial services and savers might not look so fondly at NS&I following operational failures in the business.\u201d<\/p>\n
Share<\/a>Closing post<\/p>\n Time to recap\u2026<\/p>\n The boss of National Savings and Investments has been forced out after it emerged that long-running operational errors at the bank had left it owing bereaved families close to \u00a3500m.<\/p>\n The state-backed savings institution is in discussions with the Treasury to repay about 37,500 people who collectively have \u00a3470m in deposits trapped in the bank.<\/p>\n The government has parachuted in a new chief executive and promised that those affected would be paid compensation \u201cwhere appropriate\u201d.<\/p>\n The pensions minister, Torsten Bell, told the House of Commons on Thursday that NS&I\u2019s chief executive, Dax Harkins, had been replaced on an interim basis by Jim Harra, who led HM Revenue and Customs for more than five years before leaving in 2025.<\/p>\n Bell told MPs that people\u2019s savings were \u201c100% safe and they are guaranteed by the government\u201d, and insisted there was \u201cno need for individuals to waste money on a claims management company or solicitor\u201d.<\/p>\n He said:<\/p>\n double quotation mark\u201cI want to reassure people that the onus is not on them but on NS&I to act, to contact estate representatives and to reconnect beneficiaries with the money they are due.\u201d<\/p>\n In other news:<\/p>\n Share<\/a>Explainer: What to do if you\u2019re affected by NS&I missing savings crisisShare<\/a><\/p>\n A woman has told how it took nearly six years to receive \u00a32,000 in Premium Bonds from NS&I after her father died.<\/p>\n Tracy McGuire-Brown, from Newbury in Berkshire, said she had a \u201cvery long and drawn-out\u201d experience dealing with NS&I, eventually receiving what she was entitled to last month.<\/p>\n She said her father died in 2020 and \u201cafter he died, obviously there were a lot of affairs to sort out and we knew he had some Premium Bonds\u201d.<\/p>\n The 61-year-old said NS&I was contacted several times but initially said there was no such account, \u201ceven though we gave all the details and more and explained the situation\u201d.<\/p>\n \u201cFinally in 2024, we started to get some movement that there was an account and eventually they said yes there was and then it started.\u201d<\/p>\n She told the Press Association she sent various documents by post, adding \u201cthere would be weeks in between\u201d and \u201cstill it went on\u201d.<\/p>\n The former care home manager said she eventually received a letter suggesting that before the money was used she should pay off any debts or funeral expenses. She added: \u201cMy father had been dead five years by then, I just found that was the final insult.\u201d<\/p>\n After complaining, she received \u00a3150 \u201cto say sorry for all the expenses that I\u2019d had, but that doesn\u2019t cover the distress, the time, you know, and it was \u00a32,000, we weren\u2019t talking hundreds of thousands… it was just ridiculous, it was a horrible time\u201d.<\/p>\n She added:<\/p>\n double quotation mark\u201cReally, should it be that difficult, that awful and that much of a trial?<\/p>\n \u201cIt\u2019s just frightening, really. To make it so difficult and so insensitive is just appalling, I think.<\/p>\n \u201cThe weeks that passed by in between and the hoops that you had to jump through.<\/p>\n \u201cEven when you have got all the information and you give them all the information, my experience was appalling… to the extent that I definitely would not invest in Premium Bonds now.<\/p>\n \u201cAnd that\u2019s a shame… when you are dealing with the bereavement of a close relative, to have this just keep going on, it just rakes stuff up as well, you just want to sort it, that\u2019s all.\u201d<\/p>\n She highlighted continuity issues in the process when she was speaking to NS&I staff, \u201cso if you did get to speak to someone you had to explain everything again and again and again, just really bad\u201d.<\/p>\n Share<\/a><\/p>\n Today\u2019s sell-off in UK government bonds has come as investors anticipate several interest rate rises from the Bank of England this year.<\/p>\n The money markets are now very nearly pricing in three quarter-point rises by December, which would lift Bank rate back to 4.5%.<\/p>\n Share<\/a><\/p>\n It\u2019s been another rough day for UK government bonds too.<\/p>\n Reuters has the details:<\/p>\n double quotation markBritish government bond yields surged by 10-11 basis points on Thursday, rising by more than U.S. and euro zone borrowing costs, as oil prices jumped following Iran\u2019s rejection of U.S. proposals to end four weeks of conflict.<\/p>\n Ten-year gilt yields increased to 4.95%, up 11 bps on the day and close to their second-highest close since 2008. Interest-rate sensitive two-year yields were up a similar amount to 4.52%.<\/p>\n Share<\/a>European markets fall as oil pushes higher<\/p>\n It\u2019s been another day of losses on Europe\u2019s stock markets, as yesterday\u2019s optimism over de-escalation in the Middle East has vanished.<\/p>\n In London, the FTSE 100 index has closed below the 10,000-point mark, ending the day at 9,972 points, a fall of 134 points or 1.33%.<\/p>\n Italy\u2019s FTSE Mib lost 0.75%, while Germany\u2019s DAX index was down almost 1.5% in late trading.<\/p>\n Donald Trump\u2019s claim today that Iran was \u2018begging to make a deal\u2019, after Tehran rebuffed his earlier claims of progress, has not cheered investors.<\/p>\n Oil is pushing higher too \u2013 Brent crude is now up 6.6% at $108.93 a barrel.<\/p>\n Share<\/a>BoE’s Taylor: Better to hold interest rates until impact of Iran war is clearer<\/p>\n Bank of England policymaker Alan Taylor is arguing today that it would be better to hold borrowing costs until there was greater clarity on the impact of the war in Iran on the economy.<\/p>\n Taylor, a normally dovish member of the Bank\u2019s Monetary Policy Committee, will tell a conference in New York later today:<\/p>\n double quotation mark\u201cGiven massive uncertainty around future energy prices, and our starting point, I currently see a high bar to hiking.<\/p>\n \u201cHolding policy steady is preferable until the impact becomes clearer.\u201d<\/p>\n Share<\/a><\/p>\n The number of Americans filing new claims for unemployment support has risen slightly.<\/p>\n There were 210,000 fresh \u2018initial claims\u2019 for jobless benefits last week, up from 205,000 a week earlier. That\u2019s still a low level in historic terms, though, suggesting US firms are holding onto their staff.<\/p>\n Nancy Vanden Houten, lead US economist at Oxford Economics<\/a>, says:<\/p>\n double quotation markThe latest jobless claims figures are consistent with our view that while labor-market conditions have stabilized and layoffs remain low, the US\/Israel war with Iran has made the labor market more vulnerable. We think downside risks to the labor market leave the Fed on track to lower rates twice this year with the first cut coming in June.<\/p>\n Share<\/a><\/p>\n The head of the European Central Bank has warned that the world economy is facing \u201ca real shock\u201d from the Iran war, that is \u201cprobably beyond what we can imagine at the moment.\u201d<\/p>\n In an interview with The Economist<\/a>, Christine Lagarde said the financial markets may be being \u201coverly optimistic\u201d, hoping that the world will return to normality quickly. That, though, is not what the technical experts are predicting.<\/p>\n Lagarde says:<\/p>\n double quotation mark\u201cMost people are actually talking about years. I think might also happen, because we\u2019ve experienced it, is that you understand the actual consequences gradually as you read through the facts, the supply chain consequences, the kind of raw materials that is critically important for a particular manufacturing. I\u2019ll give you an example, helium, which transits through the Strait of Hormuz, is critically for microchips. Well, unless you figure that out, you figured that out.<\/p>\n \u201cYou\u2019re not certain that there will be instant or relatively quick consequences on the cost of microchips because of the rarity that will result from not having available one of the raw materials. And I think this is a crisis where we are learning almost bit by bit, day by day, what the actual consequences will be, what countries will be most affected, what of the commodities will be the most in demand. And, I think that… Leads to a sort of a delayed assessment of how serious this current crisis is.\u201d<\/p>\n Share<\/a>Diesel hits its highest price since Christmas 2022<\/p>\n The Iran crisis has driven the price of diesel in the UK to its highest price since Christmas 2022.<\/p>\n The RAC has reported that diesel is now averaging 177.66p a litre – a price last seen on Christmas Day 2022, 10 months after Russia invaded Ukraine.<\/p>\n A litre of petrol is set to break through the 150p mark tomorrow, the RAC predict, for the first time since May 2024.<\/p>\n RAC head of policy Simon Williams says:<\/p>\n double quotation mark\u201cOur analysis of wholesale fuel data points towards petrol continuing to rise to 152p a litre and diesel to 185p, possibly higher. While soaring costs at the pumps are putting a strain on drivers, as long as the cost of oil remains around $100 prices should begin to stabilise.<\/p>\n Share<\/a> Photograph: Jeenah Moon\/Reuters<\/p>\n Back in the financial markets, shares have fallen on Wall Street in early trading as hopes of de-escalation in the Middle East appear to fade.<\/p>\n The Dow Jones industrial average is down 113 points at 46,315, a dip of 0.25%.<\/p>\n The broader S&P 500 share index is down 0.65%<\/p>\n Investors will be watching a cabinet meeting, where Donald Trump has insisted that Iran is \u201cbegging to make a deal\u201d.<\/p>\n He said:<\/p>\n double quotation markJust so we set the record straight, because I\u2019ve been watching the Wall Street Journal\u2019s fake news and all these stories that get printed like, oh, I want to make a deal. They are begging to make a deal. Not me. They\u2019re begging to make a deal.<\/p>\n Trump added that \u201cThey are begging to work out a deal. I don\u2019t know if we\u2019ll be able to do that\u201d\u2026.<\/p>\n Our Middle East crisis liveblog has full details:<\/p>\n
![\"Hilary](\"https:\/\/www.newsbeep.com\/uk\/wp-content\/uploads\/2026\/03\/Hilary_Osborne,_L.png\")
Hilary Osborne<\/p>\n