Good morning and welcome back to the City AM liveblog. Markets experienced significant volatility yesterday as the United States initiated a blockade of the Strait of Hormuz, introducing a new dimension of tension to the ongoing conflict in the Middle East that has persisted for weeks.
US Accuses Iran of Economic Terrorism
Vice-President JD Vance has publicly accused the Iranian government of engaging in what he termed an "act of economic terrorism" through its actions related to the strait. Traffic through this critical waterway has been nearly halted since the war erupted at the end of February. In an interview with Fox News, Vance stated that President Donald Trump is demonstrating "two could play at that game" with the US enforcement of the blockade.
Vance, who was in Pakistan over the weekend for peace talks, departed after just 21 hours as negotiations collapsed. He emphasized, "The ball is in Iran’s court," urging Iran to show flexibility and accept key US demands. These demands include US control over Iran's enriched uranium and the establishment of a verification mechanism to prevent the development of nuclear weapons.
IMF Summit and Economic Outlook
In other developments, Chancellor Rachel Reeves is traveling to Washington today to participate in an International Monetary Fund (IMF) summit. The IMF is scheduled to release its world economic outlook at 2pm, which could deliver a significant blow to the UK if it faces a downgrade. This event is closely watched by investors and policymakers alike.
Top Headlines This Morning
- JCB heir warns that an inheritance tax raid might force the company out of Britain.
- Thousands of taxpayers are set to miss out on rebates as HMRC continues to send cheques.
- Rachel Reeves' wealth fund injects £600 million into Rolls-Royce SMR.
- UK fintech Wise plans to downgrade its London listing this quarter.
- Firms are cutting jobs at the fastest pace this year, with pay growth slowing.
- A Meta trial lawyer is set to advise the UK as scrutiny of social media design intensifies.
- Tech executives are lining up for Cabinet positions under new Whitehall initiatives.
The liveblog has concluded for now, with no further updates available at this time. Stay tuned for more developments throughout the day.
