Closing summary
Annual energy bills will fall by £117 for millions of households from April after Rachel Reeves’s plan to cut £150 a year from bills was partly foiled by rising costs.
The energy regulator Ofgem’s quarterly cap will fall by 7% a year for the three months from April to £1,641 for the average combined gas and electricity bill in Great Britain, from £1,758 under the current January-March cap.
The cut, which will provide some relief to stretched household finances, follows the November budget, in which the chancellor shifted some green energy costs away from household bills and into general taxation.
However, the fall is smaller than the £150 cut in April promised by Reeves, as her cuts were partly offset by the increased cost of maintaining and upgrading the UK’s energy networks.
Our other main stories:
Thank you for reading. We’ll be back tomorrow. Take care (and enjoy the sunshine if you can!) – JK
US tariffs could rise to 15% or more after supreme court blow, trade representative says
The US tariff rate for some countries will go up to 15% or higher from the newly-imposed 10%, Jamieson Greer, the US trade representative, said on Wednesday, without naming any specific trading partners or other details.
“Right now, we have the 10% tariff. It’ll go up to 15 [%] for some and then it may go higher for others, and I think it will be in line with the types of tariffs we’ve been seeing,” Greer said in an interview on Fox Business Network’s Mornings with Maria programme.
The US president suffered a defeat at the hands of the US supreme court last week which struck down his sweeping “liberation day” tariffs imposed last year. But in response Donald Trump announced a 10% global tariff.
According to a notice from the US customs agency: “an additional 10% ad valorem duty on imported articles of every country” has been imposed for a period of 150 days from Tuesday, unless specifically exempt.
Trump has also previously threatened to raise the level to 15% via social media posts.
Separately, FedEx sued the US government on Monday, seeking a refund for the tariffs after the supreme court decision.
John Lewis pulls out of build to rent
The John Lewis Partnership said today that it is pulling out of its build to rent property business, blaming a “fundamental shift” in the economic conditions that underpinned the venture when it launched in 2020.
The UK’s largest employee-owned business, which runs John Lewis department stores well as the upmarket Waitrose supermarket chain, said the move is part of a broader strategic decision to refocus on its core retail brands.
Five years ago, John Lewis laid out bold plans to build 10,000 rental homes, as it aimed to generate 40% of profits from outside retail by 2030. In 2023, it filed planning applications for projects in west and south-east London, and prepared to manage tenancies at three sites built by other developers.
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German economy grows 0.3% in fourth quarter
The German economy grew by 0.3% in the fourth quarter of last year, as higher household and government spending outweighed weaker exports amid global trade uncertainty.
Gross domestic product rose 0.3% in Europe’s biggest economy after stagnating in the third quarter, final data from the Federal Statistical Office showed this morning, matching its preliminary estimate.
The statistical office confirmed that the economy grew 0.2% in 2025, after contracting 0.5% in 2024.
The statistics office’s president Ruth Brand said:
2025, a year of economic ups and downs, therefore ended with an increase in economic output.
Fourth-quarter growth was mainly driven by household spending and government expenditure, Brand noted. There was also a substantial increase in construction investment, of 1.6%, while overall investment was down 0.5%.
On the expenditure side, household spending increased 0.5% while government expenditure increased more sharply, by 1.1%.
Exports of goods and services were down 0.6% while imports dropped 0.3%. As a result, net trade was a drag on economic growth.
Trainline boss Jody Ford steps down after six years, rattling investors
The boss of Trainline, Jody Ford, is stepping down after more than six years at the company.
The news sent the London-based digital rail and bus ticketing platform’s shares down by nearly 7%.
Under the leadership of Ford, who succeeded Clare Gilmartin as chief executive in 2021, Trainline doubled net ticket sales and oversaw growth in new markets in France, Spain and Italy.
Ford will continue to lead the company as CEO through the transition period, until it finds a replacement.
Previously Trainline’s chief operating officer, Ford also served as chief executive of Photobox Group, which owns the Moonpig and Photobox brands, and led global growth at eBay.
Trainline’s chair Brian McBride said:
Under Jody’s leadership the group has undergone a period of exceptional growth. We have created Europe’s #1 rail app serving 27 million customers, doubling net ticket sales in the UK and international consumer businesses, more than doubling profits and growing new markets in France, Spain and Italy.
Russ Mould, investment director at AJ Bell, said:
The unscheduled departure of Jody Ford as CEO of Trainline has derailed shares in the ticketing platform. News of Ford’s exit intentions has wiped £51m off the company’s market value, implying investors are troubled by the sudden leadership change.
Shares in Trainline have been volatile in recent years amid fears of growing competition. The prospect of a UK government-run ticketing platform has troubled investors, while market transformation in mainland Europe is paving the way for new booking operators and apps.
The fact Trainline doesn’t have someone else lined up to become its next CEO leaves investors wondering what’s going on. Ford’s comments imply it was a mutual decision for him to leave and at least he will stay in place until a successor is appointed. Investors hate uncertainty and this announcement poses more questions than answers.
Aston Martin to cut up to 500 more jobs
The luxury carmaker Aston Martin Lagonda is to cut another 500 jobs, reducing its workforce by a fifth.
It is looking to save about £40m, after reporting widening losses.
The group, which said earlier this month it was consulting on the latest redundancy programme, said it would reduce its workforce by up to 20%, after 170 job cuts at the start of last year.
The company, which is majority-owned by the Canadian billionaire Lawrence Stroll, said:
Having undertaken at the start of 2025 a process to make organisational adjustments to ensure the business was appropriately resourced for its future plans, we had to take the difficult decision at the end of 2025 to implement further changes.
This latest programme will ultimately see the departure of up to 20% of our valued workforce.
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Diageo cuts dividend and forecasts amid Guinness shortage
Diageo is the biggest faller on the FTSE 100 index this morning, down more than 5% in early trading, and now 3.8% lower on the day.
The world’s biggest spirits maker has slashed its dividend and cut its annual sales and profit forecast for the second time in four months, as the maker of Guinness warned of capacity constraints affecting drinkers of “the black stuff” in London pubs.
Diageo, which owns brands including Smirnoff vodka, Johnnie Walker whisky and Don Julio tequila, reported weak demand in the US and China in the first results released under the new chief executive, Dave Lewis.
The former Tesco chief executive, who earned the nickname “Drastic Dave” as a result of his cost-cutting during almost three decades at the conglomerate Unilever, took the reins at Diageo in January and wasted no time in cutting the company’s shareholder dividend in his attempt to turn around the drinks maker.
Describing his first seven weeks in the role as “pretty intense”, Lewis said in a results webcast it had not been a simple choice to reduce the dividend, halving it to 20 cents a share down from 40.5 cents a year ago.
This is not an easy decision to make, but we believe it is the right one. The North American market is challenged. Our portfolio needs some time and investment to make it more competitive. At the same time, we need to invest in our business, specifically in its capacity and capability.
HSBC boss signals overhaul of bank is almost over despite drop in profits
The chief executive of HSBC has signalled that his planned overhaul of Europe’s largest lender is drawing to a close despite a slide in annual profits.
The bank’s chief executive, Georges Elhedery – who took over in 2024 – said it was “becoming a simple, more agile, focused bank built for a fast-changing world”.
Buffeted by $4.9bn (£3.6bn) in one-off charges, HSBC’s pre-tax profit slipped 7% to $29.9bn last year. That was, however, about $1bn ahead of what City analysts had forecast and came after an unusually strong 2024.
HSBC said it was raising its target for return on tangible equity, a key measure of profitability for banks, to “17% or better” through 2028, up from its “mid-teens” target set for the three years through 2027. Last year it came in at 13.3%.
HSBC shares were leading gains on the FTSE 100 index earlier, up more than 5%, and are now 4.6% ahead.
GSK buys Canada's 35Pharma for pulmonary hypertension drug
GSK, Britain’s second-biggest pharmaceutical firm, has struck at $950m (£703m) deal to buy Canada’s 35Pharma to strengthen its respiratory drugs portfolio – its second major acquisition under new chief executive Luke Miels.
The Montreal-based biotech is developing a medicine for pulmonary hypertension, a life-shortening disease marked by high blood pressure in the lungs.
The drug, currently known as HS235, has completed initial clinical trials with healthy volunteers, with studies to start imminently in pulmonary arterial hypertension (PAH) and pulmonary hypertension due to heart failure.
Early symptoms are breathlessness, fatigue and chest pain leading to heart failure as the disease progresses. It affects about 82 million people worldwide across multiple disease forms, yet treatment options remain limited and the five‑year survival rate is only 50%.
By 2032, the global market for PH therapies is forecast to reach $18bn, with activin signalling inhibitors expected to account for half of this.
Given via injection, HS235 targets the activin (a protein) receptor signalling pathway, and potentially lowers the risk of bleeding, which is a key limitation in current PH treatment.
GSK said the underlying mechanism of HS235 also offers the potential for broad metabolic benefits, including fat-selective weight loss, preservation of lean mass, and improved insulin sensitivity, observed in early clinical studies. This could give it additional benefits over Merck’s blockbuster drug Winrevair.
The British drugmaker thinks HS235 could become a multi-blockbuster medication and be available to patients by the early 2030s, if trials are successful.
Tony Wood, the company’s chief scientific officer, said:
Pulmonary hypertension affects millions of people worldwide, yet patients are underserved. We’re delighted to add HS235 to our pipeline, a potential best-in-class medicine with a differentiated profile to reduce risk of bleeding and provide potential metabolic benefits clinically relevant to PH patients.
Ilia Tikhomirov, CEO of 35Pharma, said:
In recent years, we witnessed a revolution in our understanding of pulmonary hypertension and how this life-threatening disease could be reversed. We are pleased to be combining our efforts with GSK, a leader in respiratory and inflammatory drivers of disease.
GSK agreed to buy RAPT Therapeutics for $2.2bn in January, a Californian biotech which is developing a drug to protect against severe food allergies, including allergies to nuts, milk and eggs.
The British drugmaker earlier this week agreed to a $1bn deal to acquire global rights to develop Frontier Biotechnologies’ two small interfering RNA therapies targeting kidney diseases.
Haleon sees muted sales growth amid weak US confidence
Let’s have a look at today’s corporate news.
The British consumer healthcare compay Haleon, which makes Sensodyne toothpaste, Centrum vitamins and Advil and Voltaren pain relief, has forecast 2026 sales growth below its medium-term forecast because of weak consumer confidence in the US, its biggest market.
Its London-listed share price fell more than 5% earlier, and is now down 4%.
The company, which was spun off from GSK four years ago, is forecasting organic revenue growth of 3% to 5% this year, below its medium-term forecast of 4%-6% growth, and compared with analysts’ expectations of 4.4% growth. Revenues grew by 2.1% in the three months to December, down from 3.4% in the previous quarter.
A mild cold and flu season in North America and Europe weighed on sales, as did rising competition that pushed people towards cheaper alternatives, especially in Haleon’s struggling Smokers’ Health range.
Sales in both respiratory and smokers’ health fell in double digits.
The company is targeting annualised gross cost savings of between £175m and £200m over the next two years.
Chief executive Brian McNamara said:
While the consumer environment remains challenging near-term, we are even more focused on driving category growth and increasing our market outperformance.
Biggest savings will be for higher electricity users – Martin Lewis
The biggest savings will be for higher electricity users.
Martin Lewis, founder of MoneySavingExpert.com, said the biggest reduction affects electricity unit rates, while the rates of the cheapest fixes will fall too. Here’s his quick briefing:
New 1 April Price Cap average UK direct debit rates:
Electricity unit rate 24.67p/kWh (was 27.69p) DOWN 10.9%
Electricity standing charge 57.21p/day (was 54.75p) UP 4.5%
Gas unit rates 5.74p/kWh (was 5.93p) DOWN 3.2%
Gas standing charge 29.09p/day (was 35.09p) DOWN 17.1%
The price cap is only on firms’ standard variable tariffs (which over 60% of homes are), the default ones you’re on if you’ve never switched or your fix deal ended and you did nothing. If you’re fixed, or on a special tariff, you’re not on the price cap.
Q. Why is this happening? Most of the reduction is because two policy costs have been taken off bills (ECO scheme ended, and for three years 75% of Renewable obligation will be shifted to general taxation). This is the government’s ‘£150 off bills’ (though in reality it’s a reduction in unit rates so the exact amount saved depends on usage).
Q. What’s happening to fixes? Most existing fixed deals will also fall on 1 April with the cheapest dropping typically 7% to 9%, usage dependent. This unprecedented move is because the change is due to the policy costs which come off all bills.
It’s only ‘most’ because some smaller companies were exempt from the ECO scheme so the reduction on their fixes will be smaller (as they weren’t on it so scrapping it doesn’t change anything there).
Q. Is it time to fix if I’m on the price cap? That’s by far the simplest way to save. The cheapest fixes currently are 14% less than the current price cap. And as they will drop in April by in many cases more than the price cap that differential will remain.
Q. What’s the price cap prediction for the rest of the year? As the reduction of policy costs is ongoing, the April cap is new bench-line. While it’s still crystal ball gazing the further out you go, most analysts are predicting it will stay within a couple of percent of that level for the rest of the year.
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Here’s more reaction:
Angharad Hopkinson, political campaigner for Greenpeace UK, said:
Stripping out levies from our bills will help struggling households, but significantly less than it should, because the cost of electricity is still set by volatile global gas prices.
The government’s efforts to make energy more affordable could be wiped out by another gas price spike. People are crying out for lower energy bills, and the government must do more to help them by stopping gas from setting the price we pay for electricity.
Energy analysts Cornwall Insight said on X:
The price cap is falling in April, but will this trend continue?
— Cornwall Insight (@CornwallInsight) February 25, 2026
Ofgem has confirmed exactly what we forecast - the price cap for April-June 2026 will be falling to £1,641 per year for a typical dual-fuel household, a saving of £117, or 7%, on current bills. This will bring… pic.twitter.com/T7GcVPUHLp
Starmer says 'more to do' to bring down cost of living
The UK prime minister and chancellor have both commented on the drop in the UK energy price cap. Keir Starmer said:
Energy bills are at the front of everybody’s mind, and I know they’ve been too high for too long.
I promised to bring bills down and I meant it. And today – because of the actions this government took at the last budget – the price cap on energy bills has come down by £117.
That means lower energy bills for millions across the country, but I know there is more to do and my government is pulling every lever to bear down on the cost of living and protect the pound in the pockets of working people.
The cut, which will provide some relief to stretched household finances, follows the November budget, in which the chancellor, Rachel Reeves, shifted some green energy costs away from household bills and into general taxation.
She shifted the levies used to support renewable energy projects into general taxation, and scrapped a bill payer-funded energy efficiency scheme.
Reeves said:
Cutting the cost of living is this government’s number one priority and I know energy bills are one of the biggest concerns, that’s why at the budget I said we would bear down on energy bills.
We are cutting the cost of living, cutting the national debt and creating the conditions for growth and investment in every part of the country.
It is the right economic plan to build a stronger and more secure economy.
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It is the lowest price cap rate since October 2024, but experts are saying that some fixed tariffs are better.
However, energy prices remain more than £500 (44%) higher than when the price cap was first introduced in 2019.
Experts at MoneySuperMarket are warning customers not to fall for the “price cap trap,” saying that several fixed deals on the market are still cheaper than the new cap rate, and calling the cut a “sticking plaster”.
Their analysis shows there are already several better fixed tariffs on the market, with a number of fixed deals beating both the current and April cap rate.
Kara Gammell at MoneySuperMarket Energy said:
Today’s announcement will come as welcome news for families across the country and represents a significant cut to household energy bills. However, much of this reduction comes from adjustments to green levies, rather than energy costs themselves getting cheaper for customers.
In fact, some energy bosses are predicting that by 2030 UK electricity costs could be even higher than the peak of the energy crisis in 2022. This makes today’s news something of a sticking plaster and doesn’t necessarily mean energy prices will continue trending downwards.
It’s important to remember that the energy price cap isn’t a deal, it’s the maximum suppliers can charge for a standard variable tariff.
Right now, there are fixed deals available that may offer savings compared with the current price cap, depending on your usage and circumstances. So, don’t fall for the ‘price cap trap’, be vigilant, shop around and switch if you find a better deal that works for you.
Updated
Introduction: British energy bills to fall by £117 a year
Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.
Energy bills in Great Britain will fall by £117 to a typical annual bill of £1,641 from April, the regulator Ofgem announced this morning.
It announced a 7% reduction of the energy price cap for the period covering 1 April to 30 June.
This change amounts to a reduction of about £10 a month for the average household using both electricity and gas, Ofgem said. This is more than £200 lower than a year ago.
Tim Jarvis, director general in charge of markets at Ofgem, said:
Today’s announcement will be welcome news for many households. Wholesale energy prices have fallen in recent months, and we’re investing in our network to safeguard the future energy system. The main driver of today’s reduction is the change to policy costs announced by the chancellor in the budget.
We’re also seeing encouraging signs of greater engagement and competition, with switching increasing by almost 20% year on year. More households are choosing time‑of‑use tariffs that offer cheaper off‑peak rates, and suppliers are offering a wider range of products, including deals with savings at evenings or weekends.
Gold prices climbed 1% as investors sought out out safe-haven assets amid continued uncertainty over new US tariffs. Donald Trump ’s new global tariffs took effect at 10% for 150 days on Tuesday, but Washington was working to raise it to 15%, according to a White House official, as the US president had threatened on Saturday.
Spot gold rose to $5,198 an ounce, after closing more than 1% lower on Tuesday when investors locked in profits.
Iran is edging closer to a deal with China to buy anti-ship cruise missiles, Reuters reported, as Tehran and Washington are set to hold a third round of nuclear talks in Geneva on Thursday.
Trump proclaimed his first year in office a success at the State of the Union address on Tuesday night, even as his presidency is dogged by low public approval ratings before November’s midterm elections in which voters could hand control of Congress back to his Democratic opponents.
He gave the longest-ever State of the Union speech, lasting almost 1 hour and 50 minutes – a speech that was interspersed with falsehoods and exaggerations but light on new policy proposals.
The president briefly set out his case for a possible attack on Iran, saying he would not allow the country to have a nuclear weapon.
The Agenda
10am GMT: Eurozone inflation (final) for January
2.15pm: Treasury committee to question former OBR chairs Richard Hughes and Sir Robert Chote
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