Wednesday 25/06/25

US strikes only delayed Iran’s nuclear progress, says intelligence report (Financial Times, James Politi and Demetri Sevastopulo) cites an early assessment by the Defense Intelligence Agency (DIA) which suggests that the US air strikes on Iran’s most important nuclear sites did not “obliterate” the programme – it just set it back by less than six months. Obviously, the White House and the Pentagon rejected this assessment as fake news and Trump maintained on Truth Social that the sites were “COMPLETELY DESTROYED”. The DIA is part of the US Department of Defense. Does Iran’s nuclear programme have a future? (Financial Times, Gary Samore) outlines a few different potential scenarios wherby Iran could continue its nuclear programme – but with limits – or the country could withdraw from the non-proliferation treaty (NPT) in a “race” to acquire nuclear weapons in order to deter future attacks like the ones we’ve just seen. Withdrawing from the NPT would mean that the country would no longer have to submit to international inspections, meaning that it could develop its capability away from prying eyes. Either way, Iran still has the know-how to rebuild its nuclear programme although its infrastructure has clearly suffered a body-blow. Iran also remains in possession of a large quantity of enriched uranium – the International Atomic Energy Agency (IAEA) reckons it has about 5,000kg of low enriched uranium and 400kg of 60% enriched uranium that could be turned into enough weapons grade 90% enriched uranium for about 10 nuclear weapons. Meanwhile, Gulf expat bubble punctured by missiles (Financial Times, Chloe Cornish and Simeon Kerr) looks at the reaction of expats – it seems that newbies have been most shocked but the veterans have seen it all before. * SO WHAT? * FWIW, I think it’s still early days here and it wouldn’t take take much for Iran to perhaps use terrorist tactics to disrupt the region. This will surely affect tourism in the first instance (paying money to take flights through “missile alley” to get there doesn’t sound all that appealing) but it could also stem the influx of expat professionals. On that front, it seems to me that governments in the region have been pushing for higher percentages of local hires versus expats, so perhaps recent events could accelerate this. Also, where are all those YouTube influencers going to go next?? Amidst all the uncertainty, I am sure that lawyers, tax advisers, financial advisers etc. will see an uptick in business from skittish expats…

Co-op to stop sourcing goods from Israel, Iran and 15 other countries (The Guardian, Sarah Butler) highlights one retailer ostensibly taking a stand by boycotting around 100 goods from a number of countries. * SO WHAT? * This might be a bit of a token gesture as it sources most of its products from western Europe anyway and maybe the real reason behind this is that it wants to minimise the risk of its supply chains breaking down. Still, it has a reputation for doing ethical business (remember they have banged on in the past about not investing in anything to do with fossil fuels etc.?) so I guess this makes sense.

Donald Trump signals sanctions relief for China to buy Iran’s oil (Financial Times, Demetri Sevastopulo and Myles McCormick) shows that Trump is now making a big thing about “letting” China purchase oil from Iran after months of sanctions to punish Chinese refineries for buying Iranian crude. * SO WHAT? * I’m probably being cynical here, but maybe he knew this was happening anyway so he thought he could claim a “victory” by claiming credit for it…

Then in Federal Reserve chair defends holding interest rates after fresh Trump attacks (The Guardian, Callum Jones) we see that Fed chief Jerome Powell is refusing to cave to renewed pressure from Trump to cut interest rates and says that the Bank wants to wait to see how tariffs affect US prices. The president said on Truth Social that “We will be paying for his incompetence for many years to come” but Powell maintained that “increases in tariffs this year are likely to push up prices and weigh on economic activity”. * SO WHAT? * Remember, the Fed is supposed to be independent. Trump is obviously entitled to his opinion but he should not be telling Powell how to do his job.

Closer to home, UK to purchase US jets capable of carrying nuclear weapons (Financial Times, Charles Clover) shows that Britain will buy 12 US-made F-35 stealth fighter jets that are able to carry nuclear weapons as part of a major defence strategy overhaul. Britain will join NATO’s airborne nuclear mission as the region shifts towards meeting the growing threat from Russia. Lockheed Martin of the US makes the F-35 but crucial components are made here. * SO WHAT? * This purchase will significantly increase our nuclear deterrent and it means that the RAF will now have an atomic role for the first time since the cold war.

I thought that Most Britons view US as security threat after Trump’s election (Financial Times, Amy Borrett) was quite interesting given what’s going on at the moment because it cites the results of the latest British Social Attitudes (BSA) survey which shows that 72% of Britons believe that America posed a “very” serious or “quite serious” risk to global peace in April – double the 36% of people saying the same thing last autumn before Trump got the keys to the Oval Office. Only Russia, at 90%, was seen as a bigger threat. The US is ahead of both Israel and Iran. The annual BSA survey started in 1983 and was conducted between September and October 2024 – so you would have thought that 72% will be somewhat higher now!

Stablecoins threaten global financial stability, central banks warn (The Times, Mehreen Khan) cites the Bank of International Settlements (the BIS – aka “the central bank of central banks”) as saying that the growing use of stablecoins could destabilise global finances and threaten the monetary sovereignty of countries. The BIS said that although stablecoins, a form of digital currency pegged to traditional assets such as the dollar or commodities, have “some attributes of money”, they “perform poorly when assessed against the three tests for serving as the mainstay of the monetary system”. This criticism from the BIS came just after the US Senate passed a bill known as the “Genius Act” that creates a legal framework for digital assets. * SO WHAT? * Although stablecoins are thought to be less volatile and safer than cryptocurrencies like bitcoin, there have been big failures in the past – like the collapse of terraUSD in 2022. Terra was pegged to the US dollar and saw around $50bn of its market cap evaporate. The BIS warned that “if stablecoins continue to grow, they could pose financial stability risks, including the tail risk of fire sales of safe assets”. On the other hand, you could say that banks are so against this because they stand to lose substantial amounts in transfer fees.

Grocery prices rise at fastest pace in more than a year (The Times, Jack Barnett) cites the latest figures from Kantar which shows that grocery prices rose by 4.7% in the four weeks to June 15th versus the same period last year thanks to sharp rises in prices for chocolate (noooooooo!), butter and meat. Shoppers buying fewer groceries amid surge in weight-loss drugs (Daily Telegraph, Hanna Boland) cited the same set of numbers which also showed that grocery sales were down by 0.4% thanks to more people being on obesity drugs. Apparently, 4% of households in Great Britain include at least one GLP-1 drug user, a number that’s doubled from last year. Although that number is still low, the appetite suppressing qualities of the drugs is translating into people buying fewer unhealthy snacks because people on the treatments tend to eat up to 30% fewer calories. * SO WHAT? * This is something that food producers like Nestlé have been concerned about for some time now. According to research by Morgan Stanley, those on the treatments cut back particularly dramatically on alcoholic and sugary non-alcoholic drinks! The fat loss treatments are more widely used in the US and Walmart said back in 2023 that it had seen a “slight pullback” in how much customers were putting in their baskets as a result.

Asda nears rock bottom as weeds take over unopened new stores (Daily Telegraph, Hannah Boland) portrays a sorry picture of the ailing supermarket as former retail hero Allan Leighton continues to try to turn things around with little apparent success (at the moment anyway). Hilariously, he said that he was not concerned about Kantar’s figures last month which showed Asda losing market share, adding that “we don’t really care what anybody else does”. Yeah right. You can bet your bottom dollar that he’ll be shouting such figures from the rooftops if they turn around in his favour 🤣! That being said, Kantar said that it could see signs of things turning around and that there was a good chance of it returning to growth “over the summer months”. I still think a complete overhaul is necessary but that’s going to cost a lot and the company doesn’t have unlimited funds.

In a quick scoot around some of today’s other interesting stories, Air India crash tests Narendra Modi’s ambition to get his country flying (Financial Times, Krishn Kaushik and John Reed) shows that India is still floundering in the wake of the recent Air India crash. The country had only, just weeks prior, launched its first ever lab to analyse “black boxes”. This was all part of a broader initiative by PM Modi to upgrade air travel with a swathe of new airports, airlines and infrastructure but now the priority is finding the cause of India’s worst air crash in almost thirty years. The Indian investigation team is now looking at sending the black box to the US National Transportation Safety Board, which itself would suggest that India’s civil aviation sector ambitions currently fall short of its capabilities at the moment.

In bank-related news, Spain blocks BBVA from merging with Sabadell for at least three years (Financial Times, Barney Jopson) shows that the government has now got involved in BBVA’s €11bm hostile bid for rival lender Sabadell by forbidding a merger for at least three years! * SO WHAT? * BBVA now has to decide whether it will just take it, challenge them in the courts or just drop the bid. The BBVA chair said that it would be “illegal” for the government to impose extra conditions. This development may also cause friction with the European Commission, who could potentially scupper the Spanish government’s attempt at intervention. You do wonder what impact this will have on Sabadell and its decision to sell its TSB UK banking business…

Then in Saga plans NatWest deal to expand banking products for over-50s (The Times, Patrick Hosking) we see that the over-50s insurance and travel group Saga is on the verge of signing a deal with NatWest to offer new products to its audience. It is hoping to start with a new Saga-branded savings account before rolling out others. * SO WHAT? * I think that this is a good idea, strategically. You would have thought that the company’s audience and demographic will have a decent amount of money to play with so if Saga can get the right partners in place they

can do pretty well. They might need to be a bit creative though, as we all know how hard it is to prize people out of their bank accounts! Other than this, the company’s insurance and cruise businesses continue to put in solid performances.

There were some good articles on the law today – Soaring pay rates fuel the rise of the superstar lawyer (Financial Times, Sujeet Indap), which highlights rising pay for top US lawyers – and sometimes the teams of associates they bring with them – while Trump chaos breeds opportunity for lawyers (Financial Times, Joe Miller) shows what’s happening to the lawyers who resigned from firms who “bent the knee” to Trump – they are setting up their own businesses to fight back. * SO WHAT? * This is great to see but I would have thought that you need scale to take on the big boys – and therefore I would expect there to be consolidation among the new players as time goes on.

Back home, UK graduate job openings at lowest level since 2018 (Financial Times, Delphine Strauss) cites the latest data from Indeed which shows that job openings for new grads hit a new low as nervous employers hold off on hiring and cut costs by using AI. Indeed said that the number of job ads for recent grads was 33% lower than where it was a year ago and such roles had fallen to 12% as a share of all job postings. Tough times…

Then in Aston Martin resumes car exports to US after Trump trade deal (The Times. Robert Lea) we see that the sports car company had restarted the shipment of vehicles to the US following a three month pause that came in response to Trump’s tariffs. The tariffs to the US are now 10% versus the 2.5% level they were at before (and the 27.5% that they could have been!) but the trade deal announced recently is going to come into effect from next Monday.

This guy has some impressive knife skills! Not sure what he’s going to do with the end product though – perhaps potato mille feuille? Yes, I know. I can be fancy sometimes 😁