Trump-Iran Tensions Eased, But UK Economy Shows Signs of Struggling
Oil prices continued their downward trend for a sixth consecutive session following comments from US President Donald Trump, who described talks with Iranian officials as 'very productive'. This development was seen as a potential step towards easing restrictions on Iranian oil supply, although the White House also issued stern warnings.
In a separate development, Saudi Arabia appears to be gradually restoring flows through its East-West pipeline, which could further alleviate near-term supply concerns. However, the UK economic data presented a mixed picture. The OECD raised its 2026 growth forecast for the UK to 1.1%, but also predicted that headline inflation would remain at 3.1% that year.
The S&P Global flash purchasing managers' index (PMI) fell to 51.7 in September, which is consistent with just 0.1% quarterly growth, according to Chris Williamson of S&P Global. This slowdown in activity without a corresponding decline in inflation could leave UK interest rates in a precarious position.