Iran seized two container ships in the Strait of Hormuz yesterday, just hours after Donald Trump announced his extension of the two-week ceasefire, making the truce look increasingly theoretical. The White House insists the attacks don’t count as a breach because the vessels weren’t American or Israeli, though the US naval blockade of Iranian ports remains in place and Tehran continues to call that a violation of its own. Only a handful of tankers made it through the strait overnight. Brent crude settled above $100 a barrel on Wednesday and is holding those gains this morning.
That backdrop gives today’s economic calendar unusual weight. Flash purchasing managers’ index (PMI) readings for France, Germany, the eurozone, the UK and the United States all land between 08:15 and 14:45 BST. They offer the first clear picture of how businesses are coping with the war’s energy shock, and they arrive exactly a week before the Bank of England, the European Central Bank and the Federal Reserve all decide on interest rates.
Before any of that, UK public sector borrowing figures are released at 07:00 BST. February came in nearly £7 billion over the Office for Budget Responsibility’s forecast, and another miss this morning would put immediate pressure on gilts and make next week’s Bank of England decision even harder to call.
At Britain’s permanent joint headquarters in Northwood, north London, military planners from more than 30 countries are meeting for a second and final day. They’re drawing up a joint plan to protect merchant shipping and reopen the Strait of Hormuz once a lasting ceasefire is in place. A readout is expected this afternoon, though nothing can deploy while the US blockade continues.
There was a notable development out of Washington overnight. DC attorney Jeanine Pirro confirmed that the Justice Department will appeal the court ruling which had blocked subpoenas in the investigation into Jerome Powell. That keeps alive the very issue that led Senator Thom Tillis to threaten Kevin Warsh’s confirmation vote, and without Tillis the Senate Banking Committee splits and the vote fails. Powell’s term expires on 15 May, and with the Banking Committee vote now pencilled in for the week of 11 May, a confirmation in time looks a stretch. Powell has said he will stay on in an acting role if Warsh isn’t in place by then.
Back in Westminster, the Olly Robbins affair is moving into an uncomfortable new chapter. Reports from Wednesday’s Cabinet meeting put David Lammy, Rachel Reeves and Wes Streeting among senior ministers unhappy with how the episode has been handled. Morgan McSweeney, the prime minister’s former chief of staff, is expected to give evidence on the Mandelson vetting process imminently. With local elections on 7 May and Parliament being prorogued on 28 April, Starmer’s position is only getting harder.
