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Unlock the Editor’s Digest for freeRoula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.Investor jitters about the state of the US’s public finances spurred the dollar to its biggest weekly drop since President Donald Trump’s “liberation day” tariffs announcement rocked markets at the beginning of April.The US currency fell 0.9 per cent on Friday against a basket of peers including the euro and the yen. The move took its decline for the week to 2 per cent, the biggest drop for six weeks, as Trump’s tax bill added to concerns over rising US debt levels. That has come as some investors question whether to reduce their huge overweight positions in dollar assets, on concerns about erratic policymaking and the president’s trade war.“Lingering fears over the quality of US asset markets and the threat of de-dollarisation are continuing to weigh on the dollar,” said Chris Turner, global head of markets research at ING. He cited recent data indicating outflows from US assets, as well as a statement from G7 finance ministers on Thursday that mentioned “unsustainable global macro imbalances”. That “looked a clear reference to the large Asian trade surpluses with the US”, said Turner.US Treasury secretary Scott Bessent on Friday sought to play down investor concerns over the weakening of the dollar.“I think a lot of it is other countries strengthening, or other currencies strengthening, as opposed to the dollar weakening,” he said in a Bloomberg TV interview. A “fiscal expansion” in Europe was boosting the euro, Bessent said, while the Bank of Japan’s interest rate increases are supporting the yen.Bets that some Asian countries might make trade agreements with the US that include measures to strengthen their foreign exchange rates against the greenback have supported a string of currencies including the Korean won and Taiwanese dollar in recent weeks.“Renewed investor concerns over the US fiscal outlook, alongside speculation that the Trump administration is seeking to weaken the dollar in discussions with other countries, have contributed to the sell-off,” said Lee Hardman, senior currency analyst at banking group MUFG.Investor anxiety that Trump’s tax-cutting bill could worsen the US deficit has fuelled a sell-off in long-term US debt this week, dragging other markets lower. That has pushed the 30-year Treasury yield up 0.13 percentage points this week above 5 per cent.“Investors’ concern over the escalating US fiscal burden is slowly building,” said analysts at BBH.The dollar has slid this year as investors have grown concerned about the impact of Trump’s sweeping tariffs on the US economy. That has included periods of falling at the same time as US government bonds and stocks are dropping, which has been taken as a sign of investors shedding dollar assets. Typically, higher yields increase the attractiveness of dollar assets.“The thing that’s most troubling is how the dollar is reacting to high US rates,” said Michael Metcalfe, head of macro strategy at State Street Global Advisors. “When currencies and bond prices move in the same direction, that’s reflecting a dent in policy sustainability,” he added, saying the break in usual correlations “makes you think there is something more structural at play”.Analysts at RBC BlueBay Asset Management said they expected the dollar weakening to continue as investors look to hedge their exposure to the greenback in the short term and rethink a “structural overallocation” to the US in the longer term.Additional reporting by Steff Chávez More

Donald Trump’s threat to impose a 50 per cent tariff on all exports from the EU would deliver a hammer blow to key manufacturing sectors, including autos, aerospace, chemicals and other goods.The US is the EU’s largest single trade partner, accounting for just over 20 per cent of goods exports worth more than €530bn in 2024, according to figures from the European Commission.Germany, Ireland, Italy and France are the leading exporters by country. This includes more than €200bn of machinery and vehicles, €160bn of chemicals and €25bn of food and drink.Some content could not load. Check your internet connection or browser settings.Maria Demertzis, the head of the economy strategy centre at the Conference Board think-tank in Brussels, said the impact of a 50 per cent tariff would be “unsustainable”, particularly for exposed sectors where the US was a key market.Economic modelling conducted when Trump imposed a 20 per cent tariff last April estimated that the tariffs would hit the bloc’s GDP by 0.2 per cent. This would grow to 0.5 per cent if 50 per cent tariffs were imposed, Demertzis added.“It’s still a relatively small overall macroeconomic effect, although it will be large in some countries, like Ireland, [which] are more reliant on exports to the US,” said Demertzis. In terms of sectors, “the effects will be very big indeed”, she added. Some content could not load. Check your internet connection or browser settings.Pharmaceutical goodsMedicines were the most exported goods from the EU to the US in 2024, with almost €80bn drugs sold into the US market, according to Eurostat. Nathalie Moll, director-general of the European Federation of Pharmaceutical Industries and Associations, said the group was “deeply concerned” about increased trade tensions between Europe and the US. She warned tariffs would create shortages of medicines and urged the US and the EU to avoid them at “all costs”. “Tariffs on medicines would be nothing short of a disaster for patients and [the] industry on both sides of the Atlantic,” she said.So far, pharmaceuticals have been excluded from the so-called reciprocal tariffs launched at the start of April, though Trump has launched a Section 232 probe into the national security implications of relying on foreign production. This could lead to tariffs on the sector.  European pharmaceutical companies such as Novo Nordisk, the Danish maker of obesity and diabetes drug Ozempic, and Sanofi, the French drugmaker, have significant domestic manufacturing. But US pharmaceutical companies have also built large manufacturing bases in the EU, particularly in Ireland, where they have taken advantage of a lower tax rate. Trump has complained that Ireland has “got the entire US pharmaceutical industry in its grasp”. “We don’t make our own drugs, our own pharmaceuticals any more,” he said. “The drug companies are in Ireland and they are in lots of other places — China.”Aerospace Aerospace industry executives had already warned of higher costs as a result of Trump’s baseline 10 per cent tariff on almost all countries. The industry has since been lobbying the White House, arguing for a return to the tariff-free era that has largely been the status quo since 1979.Both Boeing and Airbus import parts for new aircraft from various regions around the world. The US plane maker, which sources parts for its planes from countries such as Italy and Japan, is seen as particularly exposed to the Trump tariffs. Even before Friday’s announcement, Ryanair — Europe’s largest low-cost airline and one of Boeing’s biggest customers — had warned it could delay deliveries of aircraft if tariffs made them more expensive. Michael O’Leary, Ryanair chief executive, said this month that the airline was locked in a “debate” with Boeing over which side would pick up tariff costs.Speaking on Friday before news of the tariffs broke, Guillaume Faury, Airbus chief executive, told an audience in London that “nobody wants to pay for tariffs”. AutosCar executives immediately lashed out at the failure of the EU to reach a deal with the US to lower the 25 per cent tariffs it has imposed on foreign-made vehicles and parts. “The EU is becoming more hated than China, which is mind-boggling. The EU needs to come to the negotiating table with great urgency,” said Lynn Calder, chief executive of off-roader manufacturer Ineos Automotive, which makes its vehicles in France. “Every other region in the world is mobilising, where is Europe? Their ‘do nothing’ strategy is failing.”The car industry had been hopeful in recent weeks that Brussels and Washington would reach an agreement on car imports, especially after US reached a deal with the UK for a 10 per cent tariff rate.The EU currently imposes a 10 per cent tariff on US car imports while the US only charges 2.5 per cent. “I don’t think the US government is interested in closing down trade between Europe and the US,” Volvo Cars chief executive Håkan Samuelsson told the FT’s Future of the Car summit last week, saying the EU should “level” the tariffs to the same level as the US. Oliver Zipse, BMW’s chief executive, also predicted earlier this month that Trump’s tariffs on foreign cars would be lowered from July. Some content could not load. Check your internet connection or browser settings.It is unclear whether Trump’s proposed 50 per cent tariffs would be in addition to the existing 25 per cent duties on car imports, or in place of them. Duties in excess of 25 per cent would make car exports unviable for European manufacturers. Higher tariffs would hit carmakers such as Audi and Porsche with no manufacturing footprint in the US, as well Volvo Cars, Mercedes-Benz and others that export vehicles sold in the US from Europe. The US is the second-largest market for exports of EU vehicles after the UK. The EU exported 757,654 new vehicles to the US last year, valued at €38.9bn. It imported just 169,152 new vehicles from the US, worth €7.8 billion, according to European car industry body Acea. Food and drink Although the EU’s €25bn food and drink exports to the US are small compared with major industrial sectors, they are loaded with political significance and likely to be the target of retaliatory measures on both sides.The two-way trade in agrifood raw materials, ingredients, and finished products is valued at €40bn. Many US-produced nuts, fruit and vegetables are on the list for possible retaliation by Brussels, while French champagne and Italian Parmigiano cheese are among the European products under threat from US countermeasures.Dirk Jacobs, director-general of Food Drink Europe, which represents the sector, called for “de-escalation” to avoid the industry getting caught in the crossfire of a full-blown transatlantic trade war. More

Unlock the Editor’s Digest for freeRoula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.The policy choices of the Trump administration have emphatically put the dominance of the dollar’s global reserve status in doubt. The big question is whether anything else is ready to take up the slack.A few months ago, talk of the US torching its own haven status was the wild-eyed stuff of old-school gold bug Twitter accounts. (The gold bugs, it turns out, were on to something.) Now the topic has shifted from taboo to perfectly reasonable, and the evidence to support it just keeps on cropping up — the latest being the downgrade to US government debt from Moody’s.In 2011, when S&P Global Ratings became the first of the three big agencies to downgrade Uncle Sam, it came as a huge shock to markets. But the dollar and US government bonds rallied as haven assets then as they usually have done during shocks, even the homegrown ones. Fourteen years later, Moody’s took the plunge, stripping the US of its coveted triple A rating on startlingly similar grounds — a political inability to tame fiscal incontinence. This time, though, the haven function stumbled. The downgrade from Moody’s added more pressure to already creaking Treasuries, sending 30-year yields back above 5 per cent although Friday’s suggestion from Donald Trump that he might slap 50 per cent tariffs on the EU lent a little support. These bonds are in worse shape now than in the chaotic scenes witnessed around the time of the US President’s tariffs announcements in early April.US downgrades are sufficiently rare that it is hard to be sure of a pattern here. (Fitch’s, in 2023, was more lost among other market forces.) But it is clear bad news is no longer good news for the dollar and US bonds in the way it once was. Other countries are now eagerly expected to exert greater magnetic force in times of market stress, particularly the euro.Investors tell me they are ready. People in the plumbing of Europe’s bond markets tell me they are ready. European officials say they are at least aware of the opportunity. But making it actually happen is difficult.In a recent paper, two academics, Jens van ’t Klooster at the University of Amsterdam and Steffen Murau, now at Berlin’s Global Climate Forum, sketched out something like a “how to build a reserve currency” guide. This drew heavily on an under-appreciated related issue: the role of the euro in global trade and payments. Right now, they wrote, Europe displays a “puzzling lack of clout” in this area. As their paper points out, as long ago as 2018, the then European Commission president Jean-Claude Juncker was lamenting the slow progress in this regard. “It is absurd that Europe pays for 80 per cent of its energy import bill — worth 300 billion euro a year — in US dollar when only roughly 2 per cent of our energy imports come from the United States,” he said.Some content could not load. Check your internet connection or browser settings.This is an important point. Joint borrowing is hard, for sure. But van ’t Klooster and Murau argue this is only part of the challenge. Instead, various European authorities should, to their mind, be much more proactive in pushing the euro as a unit of global trade, and much more willing to encourage the use of the euro far beyond its borders.They urge Europe to make euro invoicing part of trade agreements and to do more to facilitate its use in supply chains. European companies can now easily borrow dollars created offshore to pay for, say, oil from Saudi Arabia. That oil turns into euros only at the petrol pump. Sowing the use of euros more liberally across clean energy exports or imports of technology services, for example, would embed the currency more firmly in the guts of the world’s financial system. Euro swap lines to enhance the flow of the currency in times of crisis should also, van ’t Klooster and Murau think, be more generous, as part of a patchwork of measures to enhance its global role.All this should, they argue, run alongside more obvious efforts to increase the sheer amount of safe, tradeable euro instruments. German government bonds, the backbone of the European debt system, are not yet anywhere close to plentiful enough to fill the void that is opening up. The bonds of France and Italy lack Germany’s perceived safety as a borrower.Building an easily tradeable bond market denominated in euros that pools risk across a range of different member states sounds great. But doing this at a scale that would provide a meaningful alternative to US Treasuries is hard.As a warning, it would also involve industrial amounts of arguing. A massive rise in joint borrowing between EU member states would be peppered with complications due to the bloc’s fragmented tax policies and varying priorities. Germany would probably balk at any arrangement that lifted its borrowing costs and enabled weaker euro states to piggyback on its perceived status. Rows would break out over how the proceeds were distributed and used.None of this is easy but, as van ’t Klooster and Murau write, “the combined activities of European actors have discouraged rather than incentivised the expansion of offshore euro creation and thus undermined the objective of euro internationalisation”. The authors urged policymakers to step up and show more political will. The potential prize on offer is [email protected] More

Unlock the White House Watch newsletter for freeYour guide to what Trump’s second term means for Washington, business and the worldDonald Trump has warned of plans to impose a 50 per cent tariff on imports from the EU from next month, adding that talks with the bloc are “going nowhere” as he increases his threat to upend global trade. The move escalates the trade war with the EU barely two weeks after the US agreed with China to slash tariffs in a pact that comforted global investors. It also highlights the animosity that the Trump administration has shown towards Brussels since the US president’s return to the White House in January.In a post on his Truth Social platform on Friday, Trump attacked the bloc for “Trade Barriers, VAT Taxes, ridiculous Corporate Penalties, Non-Monetary Trade Barriers, Monetary Manipulations, [and] unfair and unjustified lawsuits against Americans Companies”.He added: “Our discussions with them are going nowhere! Therefore I am recommending a straight 50% Tariff on the European Union, starting on June 1, 2025.”Such a level would be more than double the tariff rate the US president announced for the EU on his self-styled “liberation day” on April 2.Stock markets sank following Trump’s post, with S&P 500 futures down 1.6 per cent ahead of the New York market open. The Stoxx Europe 600 index fell 2.1 per cent.Equity markets had recovered from April’s rout, helped by moves such as Trump’s climbdown on China, but were rocked by his latest trade salvo.The president’s move “puts a dent in the view that markets will rein in Trump”, said Andrew Pease, chief investment strategist at Russell Investments. US trade representative Jamieson Greer is due to talk to EU trade commissioner Maroš Šefčovič later on Friday.The US imposed a 20 per cent “reciprocal” rate on most EU goods in April, but halved it until July 8 to allow time for talks. It has retained 25 per cent levels on steel, aluminium and car parts and is promising similar action on pharmaceuticals, semiconductors and other goods.The bloc must now choose whether to retaliate with counter-tariffs or accede to US demands to make concessions.Member states have approved a €21bn package of up to 50 per cent tariffs on items such as maize, wheat, motorcycles and clothing — measures that at present are not due to take effect until July 14 but could be quickly deployed.The European Commission is still consulting on a bigger €95bn list of possible measures, which includes Boeing aircraft, cars and bourbon whiskey.As European markets were by hit by Trump’s latest threat, exporters and stocks linked to the health of the economy such as banks were particularly affected.Carmaker Stellantis dropped 5 per cent while Deutsche Bank shed more than 6 per cent. Traders moved to price in faster interest rate cuts from the European Central Bank to support a tariff-hit economy. The chance of a third quarter-point rate cut by the end of this year rose to more than 40 per cent compared with roughly 15 per cent earlier on Friday, according to levels implied by swaps markets.US officials have been frustrated by the EU’s failure to offer the kind of concessions other countries have, with Howard Lutnick, US commerce secretary, saying on Thursday that Brussels was “impossible” to negotiate with. Washington wants Brussels to reduce import barriers to diminish the size of the US’s trade deficit in goods with the bloc, which totalled $192bn in 2024.The Trump administration considers EU food and product standards protectionist and wants the bloc to unilaterally drop tariffs. The EU has proposed that both sides scrap tariffs on all industrial and some agricultural products.Brussels has also offered to help tackle Chinese overcapacity in sectors such as steel and cars, and to discuss restrictions on exporting technology to Beijing. But it has refused to discuss scrapping national digital taxes or VAT, key US demands, or weakening EU regulation of US tech companies. The European Commission said it would not comment ahead of the call between Greer and Šefčovič. Trump’s post on Friday contrasted with his administration’s moves to defuse trade tensions with Beijing this month. The US has also recently sealed a trade deal with the UK. But negotiations with other countries have since proceeded slowly, and Trump officials have signalled recently that they would be taking a tougher approach again, warning that countries that were not negotiating in “good faith” would again face maximum tariffs. Additional reporting by Emily Herbert More

Unlock the White House Watch newsletter for freeYour guide to what Trump’s second term means for Washington, business and the worldPresident Donald Trump has threatened Apple with a 25 per cent tariff on iPhones unless the company shifts production of its best-selling product to the US, escalating a stand-off with chief executive Tim Cook. Cook said this month that Indian factories would supply the “majority” of iPhones sold in the US in the coming months, as Apple tries to avoid the tariffs on Chinese-made goods imposed by Trump as part of his trade war. “I have long ago informed Tim Cook of Apple that I expect their iPhone’s that will be sold in the United States of America will be manufactured and built in the United States, not India, or anyplace else,” Trump wrote in a Truth Social post on Friday.“If that is not the case, a Tariff of at least 25% must be paid by Apple to the U.S.”Apple sells more than 60mn iPhones in the US a year. The Financial Times previously reported that the company planned to source all of those devices from India by the end of next year. Foxconn, a key Apple supplier, is investing $1.5bn to expand iPhone production in India with a display module facility near Chennai, the FT reported earlier on Friday. Apple shares fell 3 per cent in pre-market trading following Trump’s post. The company did not immediately respond to a request for comment. The company’s stock lost more than $300bn in a single day last month, after Trump threatened huge new tariffs on dozens of countries, including all of Apple’s biggest manufacturing hubs around the world. The US subsequently granted an exemption from many of those tariffs for smartphones and other electronics, and earlier this month Trump agreed to temporarily reduce levies on imports from China.Trump’s latest threat comes a week after he complained about “a little problem with Tim Cook” over Apple’s plans to expand iPhone manufacturing in India. He claimed at the time that Apple would be “upping their production in the United States” following a discussion with the big tech company’s boss.“We are treating you really good, we put up with all the plants you built in China for years,” Trump said during a visit to Qatar during a Middle East tour. “We are not interested in you building in India.”Cook has been in regular contact with Trump and his administration since attending the president’s inauguration in January. Apple has pledged to spend hundreds of billions of dollars in the US over the next four years, including by buying chips and artificial intelligence servers made in America. But the challenges of replicating its Asian supply chain and production facilities for a product as complex as the iPhone in the US are significant. Before Trump put his China tariffs on hold, Apple had said it expected to face hundreds of millions of dollars in extra costs due to the new duties, warning that the ultimate impact was hard to predict.“What we learned some time ago was that having everything in one location had too much risk with it, and so we have over time, with certain parts of the supply chain . . . opened up new sources of supply,” Cook told analysts earlier this month. More

This article is an on-site version of our FirstFT newsletter. Subscribers can sign up to our Asia, Europe/Africa or Americas edition to get the newsletter delivered every weekday morning. Explore all of our newsletters hereGood morning. Today I’ll be covering:Investor anxieties about the US Treasury marketApple’s supply chain expansion in IndiaTrump’s ban on international student enrolment at Harvard UniversityAnd why record numbers of Americans are moving to BritainInvestors are diversifying their bond portfolios away from the US as the country’s growing debt burden and the Trump administration’s trade war erode the appeal of the world’s biggest debt market.What happened: Donald Trump’s “big, beautiful” tax bill, passed by the House of Representatives yesterday, threatens to sharply increase US public debt. Long-dated Treasuries sold off sharply in the run-up to the passage of the legislation.The bill would extend the president’s sweeping 2017 tax cuts, which Trump officials have suggested will accelerate economic growth. However, the non-partisan Committee for a Responsible Federal Budget estimates it would increase the debt-to-GDP ratio from 100 per cent today to a record 125 per cent. Why it matters: Traders worry the US Treasury market will lose its safe-haven status. Fund managers are increasingly eyeing European, Japanese and Australian debt, which offer stronger yields and more optimistic economic narratives. Here’s what else I’m keeping tabs on today and over the weekend:How well did you keep up with the news this week? Take our quiz.Five more top stories1. Elias Rodriguez, the man accused of killing two Israeli embassy aides in Washington, has been charged with two counts of first-degree murder, the murder of a foreign official and several firearms felonies. The FBI said it was investigating the shooting as a hate crime and act of terrorism. More details here.2. Exclusive: Washington is pushing the EU to unilaterally cut tariffs on US goods, criticising the bloc’s offer of mutual reductions instead of pledging to lower them alone as some other trade partners have done. Trump’s negotiators say that without concessions, the bloc will not progress in talks to avoid additional 20 per cent “reciprocal” duties.3. Exclusive: German Chancellor Friedrich Merz is “actively” backing a proposed EU ban on the Nord Stream pipelines connecting Russia to Germany in a bid to stop any US and Russian efforts to reactivate the gas links. Here’s more on the bloc’s upcoming round of sanctions against Russia for its war in Ukraine.G7 summit: Ministers threatened more sanctions against Russia, but made little progress on how to respond to Trump’s trade war.4. The Trump administration has barred Harvard University from enrolling international students “effective immediately”, in a major escalation of its attacks on one of the US’s most prestigious schools. The decision comes amid a deepening crackdown on elite institutions, which the president accuses of promoting “woke” ideology and failing to tackle antisemitism.5. Exclusive: Apple’s key contractor is moving ahead with building a $1.5bn component plant in Chennai, further expanding the iPhone-maker’s supply chain in India even as Trump demands it return manufacturing to the US. The new facility would help Foxconn supply its main customer and bolster Apple’s latest tilt away from China.Join us for a subscriber-only webinar next Wednesday for insights into the most consequential geopolitical rivalry of our time: the US-China showdown. Register now and put questions to our panel.The Big Read© FT montage/Katie Adkins/FT/Getty Images/BloombergDrilling companies are now piloting direct lithium extraction from underground brines, a new technology that has been compared to the shale revolution. Can it turn the US into a key player in the battery metals race?We’re also reading . . . Syria’s gold hunt: In a country ravaged by war and poverty, citizens have emerged from the repression of the Assad regime — and taken up metal detecting. Slapdown diplomacy: Public Oval Office altercations with foreign leaders are undermining the US’s global influence, warn policy experts.Artificial intelligence: Large language models are unconcerned with truth because they have no concept of it — and therein lies the danger, writes John Thornhill.Chart of the dayUS applications for British citizenship hit a record high during the first few months of Trump’s presidency. “People are leaving because of fear, frustration and financial security”, said Ono Okeregha, director at the law firm Immigration Advice Service.Some content could not load. Check your internet connection or browser settings.Take a break from the newsWe are getting dumber, writes Simon Kuper, as smartphones sap our attention spans, reading skills and ability to reason. How can you buck the trend? Here are seven habits to live by to become a great thinker.© Harry Haysom More

Unlock the Editor’s Digest for freeRoula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.British retail sales rose 1.2 per cent in April, significantly overshooting analysts’ expectations as warm weather encouraged consumers to spend more, particularly on food.Economists polled by Reuters had expected the volume of goods sold to rise 0.2 per cent in the month, after a revised increase of 0.1 per cent in March.Friday’s monthly data from the Office for National Statistics showed that sales in food stores grew 3.9 per cent, which retailers attributed to the good weather, according to the ONS.The Met Office said that last month was the sunniest April since records began in 1910.ONS senior statistician Hannah Finselbach said the weather had helped to boost sales across most retail sectors.“After a poor couple of months, food sales bounced back, with supermarkets reporting robust sales, while it was also a positive month for butchers and bakers, alcohol and tobacco stores,” she said.However, clothing sales fell in the month, despite “a brighter picture for department stores and household goods shops”. The figures give some reassurance about the health of consumer demand, in a month that saw sharp rises in uncertainty over US trade tariffs and rising utility bills and taxes, such as UK road tax and stamp duty.Neil Birrell, chief investment officer at Premier Miton Investors, said: “The retail sales data for April shows that the UK consumer is out and about consuming. Any concerns over energy price increases and council tax hikes don’t seem to have had an immediate impact on spending habits.”Rob Wood, economist at the consultancy Pantheon Macroeconomics, said the rise “challenges the idea of a cautious consumer”. The gain in retail sales will add about 0.1 percentage points to April GDP growth, “which sets the stage for solid quarterly performance”, he added.The economy grew by 0.7 per cent in the first quarter, but household consumption was a small contributor. Most economists, including those at the Bank of England, expect growth to slow in the second quarter, with the consensus of only 0.1 per cent in the three months to June. Some consumers benefited from the increase in the national living wage last month while mortgage rates had also declined in April on expectations that the BoE would cut interest rates. As expected, the central bank lowered borrowing costs by a quarter point to 4.25 per cent earlier this month.Sales volumes, which are adjusted for seasonality and different timings of Easter, rose 1.8 per cent in the three months to April compared with the previous quarter, the largest three-monthly growth in nearly four years, the ONS said. Sales volumes reached pre-pandemic levels, rising 0.3 per cent above the February 2020 figure, for the first time since July 2022.Separate data from the research company GfK on Friday showed that UK consumer confidence rose 3 points to minus 20 in May, after US President Donald Trump’s tariff blitz resulted in a four-point drop in April.Millions of British households will see lower energy bills from July after regulator Ofgem said on Friday its domestic price cap would fall 7 per cent to reflect lower wholesale energy prices.However, inflation rising more than expected to 3.5 per cent in April and expected to last at elevated rates until September, “could cast a long shadow over spending”, warned Sagar Shah, associate partner at McKinsey & Company. More