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Global financial markets have been on a rollercoaster ride over the past few days, but now, with President Donald Trump having paused his “retaliatory” tariffs, the situation should stabilise.

Here, we outline how the pound in your pocket has been affected.

Stock markets, bonds and currencies moved sharply after Mr Trump put a 90-day pause on tariffs other than the base 10% tax slapped on almost all imports to the US. China still faces a levy of 125% on the goods it exports to the US.

But there have still been some impactful changes since his so-called “liberation day” tariff announcement last week.

So, what’s happened?

Well, last week two more interest rate cuts were expected by the end of this year, but now traders are pricing in three cuts by the Bank of England.

Borrowing will become cheaper as the interest rate is now anticipated to be brought down more than previously thought, to 3.75% by the end of 2025 from the current 4.5%.

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It’s not exactly for a good reason, though. The trade war means the UK economy is forecast to grow less.

This lower growth is what’s making observers think the Bank will cut rates sooner – making borrowing cheaper can lead to more spending. Increased spending can stimulate economic growth.

What does this all mean for you?

Some debts, like credit card bills, will become a bit cheaper.

Mortgages

Crucially for anyone soon to re-fix their rate, this means mortgage costs are falling.

Already, the typical two and five-year fixed rate deals are coming down, according to data from financial information company Moneyfacts.

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Trump’s tariffs: What you need to know

After weeks where the average rate would fall only once or twice, there have been larger and daily falls, the data shows.

As of Thursday, the typical rate for a five-year deal is 5.14%, and 5.29% for the average two-year fixed mortgage.

If the interest rate expectations remain, by the end of the year, the average two-year fixed mortgage rate will fall to 4.3% if a person is borrowing 75% of the property’s value, according to analysts at Pantheon Macroeconomics.

Filling up your car

Another positive that’s motivated by a negative is the reduced fuel cost to the motorist of filling up their vehicle.

The oil price fell due to rising fears of a recession in the world’s biggest economy. Now that those concerns have somewhat subsided, the oil price has remained comparatively low at $63.75 for a barrel of the benchmark Brent crude.

It’s far below the average price of $80 from last year.

This lower cost is likely to filter down to cheaper prices at the pump within days as the sharp oil price drops hit at the end of last week.

Lower oil costs could help bring down costs overall, lowering inflation, as oil is still used in many parts of the supply chain.

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Savings

Lower interest rates mean falling savings rates, so savers can expect to get less of a return in the coming months.

Anyone with a stocks and shares ISA (Individual Savings Account) is likely to get a shock when they see the decline in their returns.

A display shows the sharp rising of the Nikkei average stock price on the rebound in Chuo Ward, Tokyo on April 10, 2025. U.S. President Donald Trump announced that it would suspend the "reciprocal tariffs" imposed on the 9th for 90 days, causing a sharp rebound after the previous day's sharp drop. ( The Yomiuri Shimbun via AP Images )
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A display shows the sharp rise of the Nikkei stock index in Tokyo. Pic: AP

Holidays

It’s not the best time to be heading off on a trip to a country that uses the euro. The pound hasn’t strayed far from buying €1.16, a low last seen in August.

It means your pound doesn’t go as far, as you’re getting less euro.

Against the dollar, however, sterling has risen to $1.29.

The exchange rate had been higher in the immediate wake of Mr Trump’s tariff announcement as the dollar value sank. At that point, you could briefly have bought $1.32 for a pound.

Supermarket shopping

Helpfully, the UK’s biggest and most popular UK supermarket, Tesco, updated us that it expects tariffs will have a “relatively small impact”.

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Woman and three teenagers arrested over M&S, Co-op and Harrods cyber attacks

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Woman and three teenagers arrested over M&S, Co-op and Harrods cyber attacks

Four people have been arrested by police investigating cyber attacks targeting M&S, Co-op and Harrods.

A 20-year-old woman and two males, both aged 19, and a male aged 17, were detained in London and the West Midlands this morning as part of a National Crime Agency (NCA) operation.

They were arrested at their homes on suspicion of Computer Misuse Act offences, blackmail, money laundering and participating in the activities of an organised crime group.

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Electronic devices were seized from the suspects and are currently being analysed by forensic experts.

M&S halted online orders, and shelves were empty in shops after the cyber attack on the retailer earlier this year.

The initial hack into the retailer’s systems took place in April through “sophisticated impersonation” involving a third party.

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Disruption is expected to continue at the retailer until the end of this month.

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Mickey Carroll in May answered why M&S cyber attack was so bad.

The Co-op and Harrods were also subsequently targeted by hackers.

Paul Foster, head of the NCA’s National cybercrime unit described the arrests as a “significant step” in their investigation, which remains “one of the Agency’s highest priorities”.

He added: “…our work continues, alongside partners in the UK and overseas, to ensure those responsible are identified and brought to justice.”

The National Crime Agency is keen to “signal” to “future victims” the “importance of seeking support and engaging with law enforcement”, stating that “the NCA and policing are here to help”.

The NCA has also thanked M&S, Co-op and Harrods for their support in their investigations.

The arrests, which took place early on Thursday morning, were supported by officers from the West Midlands Regional Organised Crime Unit and the East Midlands Special Operations Unit.

Earlier this week, the chairman of M&S told MPs that the hack had been “traumatic” and like an “out-of-body experience”.

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Archie Norman, however, refused to be drawn on whether the retailer had paid any ransom.

“We are not discussing any of the details of our interaction with the threat actor, including this subject, but that subject is fully shared with the NCA,” he said.

It is estimated that the cyber attack will cost M&S up to £300m this year.

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Days after M&S was attacked, the Co-op was targeted and forced to shut down some internal systems.

Harrods was then hacked, and also had to shut some systems despite its website and shops continuing to operate.

Of those arrested, a 17-year-old British male and a 19-year-old Latvian male were from the West Midlands.

A 19-year-old man was from London and a 20-year-old woman from Staffordshire.

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US-listed Ulta Beauty swoops on high street chain Space NK

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US-listed Ulta Beauty swoops on high street chain Space NK

A New York-listed company with a valuation of more than $21bn is to snap up Space NK, the British high street beauty chain.

Sky News has learnt that Ulta Beauty, which operates close to 1,500 stores, is on the verge of a deal to buy Space NK from existing owner Manzanita Capital.

Ulta Beauty is understood to have registered an acquisition vehicle at Companies House in recent weeks.

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The exact price being paid by Ulta was unclear on Thursday morning, although one source said it was likely to be well in excess of £300m.

Manzanita Capital, a private investment firm, engaged bankers at Raymond James to oversee an auction in April 2024.

The firm has owned Space NK for more than 20 years.

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Manzanita has also owned the French perfume house Diptyque and Susanne Kaufmann, an Austrian luxury skincare brand.

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Founded in 1993 by Nicky Kinnaird, Space NK – which is named after her initials – trades from dozens of stores and employs more than 1,000 people.

It specialises in high-end skincare and cosmetics products.

Manzanita previously explored a sale of Space NK in 2018, hiring Goldman Sachs to handle a strategic review, but opted not to proceed with a deal.

None of Ulta, Manzanita, Space NK and Raymond James could be reached for comment.

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Royal Mail to scrap second-class post on Saturdays and some weekdays

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Royal Mail to scrap second-class post on Saturdays and some weekdays

Royal Mail is to be allowed to scrap Saturday second-class stamp deliveries, under a series of reforms proposed by the communications regulator.

From 28 July, Royal Mail will also be allowed to deliver second-class letters on alternate weekdays, Ofcom said.

The post will still be delivered within three working days of collection from Monday to Friday.

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The proposals had already been raised by Ofcom after a consultation was announced in 2024, and the scale back was proposed early this year.

Royal Mail had repeatedly failed to meet the so-called universal service obligation to deliver post within set periods of time.

Those delivery targets are now being revised downwards.

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Rather than having to have 93% of first-class mail delivered the next day, 90% will be legally allowed.

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The sale of Royal Mail was approved in December

The target for second-class mail deliveries will be lowered from 98.5% to arrive within three working days to 95%.

A review of stamp prices has also been announced by Ofcom amid concerns over affordability, with a consultation set to be launched next year.

It’s good news for Royal Mail and its new owner, the Czech billionaire Daniel Kretinsky. Ofcom estimates the changes will bring savings of between £250m and £425m.

A welcome change?

Unsurprisingly, the company welcomed the announcement.

“It is good news for customers across the UK as it supports the delivery of a reliable, efficient and financially sustainable universal service,” said Martin Seidenberg, the group chief executive of Royal Mail’s parent company, International Distribution Services.

“It follows extensive consultation with thousands of people and businesses to ensure that the postal service better reflects their needs and the realities of how customers send and receive mail today.”

Citizens Advice, however, doubted whether services would improve as a result of the changes.

“Today, Ofcom missed a major opportunity to bring about meaningful change,” said Tom MacInnes, the director of policy at Citizens Advice.

“Pushing ahead with plans to slash services and relax delivery targets in the name of savings won’t automatically make letter deliveries more reliable or improve standards.”

Acknowledging long delays “where letters have taken weeks to arrive”, Ofcom said it set Royal Mail new enforceable targets so 99% of mail has to be delivered no more than two days late.

Changing habits

Less than a third of letters are sent now than 20 years ago, and it is forecast to fall to about a fifth of the letters previously sent.

According to Ofcom research, people want reliability and affordability more than speedy delivery.

Royal Mail has been loss-making in recent years as revenues fell.

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In response to Ofcom’s changes, a government spokesperson said: “The public expects a well-run postal service, with letters arriving on time across the country without it costing the earth. With the way people use postal services having changed, it’s right the regulator has looked at this.

“We now need Royal Mail to work with unions and posties to deliver a service that people expect, and this includes maintaining the principle of one price to send a letter anywhere in the UK”.

Ofcom said it has told Royal Mail to hold regular meetings with consumer bodies and industry groups to hear their experiences implementing the changes.

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