US Federal Reserve cuts interest rates

📍Top line: The US Federal Reserve has cut interest rates by 0.5%, marking its first reduction in over four years. The move follows a period of unprecedented rate increases during 2022 and 2023 when inflation hit its highest level in a generation. The Fed now projects another 50 basis point cut later this year, but future decisions will depend on economic data and labor market conditions.

The cut is aimed at countering a weakening economy and is a step-change from an aggressive bid to cool inflation. The move sparked a brief rally on Wall Street, though concerns about a potential recession remain. Lower US rates could impact the UK economy positively, particularly with regards to the strength of the pound.

The Bank of England is set to review its interest rates at midday today, with markets watching closely for any influence from the US decision. Economists and investors are currently predicting that interest rates in the UK will remain unchanged at 5%.

JP Morgan Chase appoints wellbeing chief for junior staff

📍Top line: JPMorgan Chase has appointed a senior executive to oversee its junior banker program, responding to concerns over the demanding working conditions for young employees on Wall Street and in the wider industry. In the newly created role Ryland McClendon will focus on supporting the wellbeing and professional development of entry-level staff, such as analysts and associates.

🔎 Behind the move: Banking and finance has long been associated with grueling work conditions, often requiring 100-hour weeks, especially during major deals. These conditions have come under renewed focus after the death of a junior banker, Leo Lukenas III, at Bank of America in May. While his death was due to a blood clot, it has intensified calls for a healthier work environment for junior staff.

Elsewhere in business:

🥫 Tesco plans to use its Clubcard data to alert customers about unhealthy food choices. By analysing shopping patterns, Tesco aims to promote balanced diets and provide recommendations based on previous purchases. The initiative comes as part of the retailer's broader strategy to support healthier lifestyles while maintaining customer engagement through personalised insights. 

🛒 Asda co-owner Mohsin Issa is stepping down from his executive role just months after his brother, Zuber Issa, sold his stake in the company. The billionaire Mohsin will focus on leading petrol station giant EG Group, while Asda’s chairman Lord Stuart Rose and TDR Capital executive Rob Hattrell will take interim leadership. 

One in 10 on sickness benefits as mental health claims surge

📍Top line: The number of working-age adults in the UK claiming sickness benefits has surged, largely due to a significant increase in mental health-related claims. New figures from the IFS reveal 3.9 million people are now claiming for incapacity or disability, up from 2.8 million before the pandemic.

Mental health conditions, such as anxiety and depression, now lead the list of new claims across all age groups. Younger adults, particularly those under 40, have seen a 150% spike in sickness benefit applications, which have risen from 4,500 per month before the pandemic to 11,500 per month currently.

This rise poses both a public health challenge and a financial strain. The cost of supporting people on disability and incapacity benefits has climbed 33%, from £36 billion annually to an estimated £48 billion.

Elsewhere in the economy:

🇬🇧 UK inflation remained unchanged at 2.2% in August, defying expectations of a rise. Inflation has significantly decreased from over 10% in early 2023, largely due to easing energy and food prices. Despite pressures on the Bank of England to cut interest rates to stimulate economic growth, officials are expected to maintain the current rates during their upcoming meeting.

📉  The era of high-interest savings accounts is “officially over” after the best Isa rates dipped below 5pc, experts have warned. The best easy access Isa now offers 4.93%, down from 5.07%. With banks trimming their offers amid falling interest rates, savers are facing dwindling returns. Only Junior and Lifetime Isas still provide over 5%. 

JP Morgan has opened applications to its 2025 Summer Internship in London. Successful applicants will monitor markets, develop trade ideas, conduct portfolio reviews and gain invaluable insight into financial markets. Completion of the 9-week scheme may result in offers of full-time employment. JP Morgan is hiring on a rolling basis so get your applications in quickly! Apply now here.

Public asked to help with ‘humanity’s last exam’

📍Top line: The public is being asked to help create "humanity's last exam," a test designed to challenge the peak intelligence of artificial intelligence. The Centre for AI Safety and Scale AI are inviting people to submit questions for what they call "the world's most difficult AI test," aiming to push the limits of current AI capabilities.

"Existing tests are too easy," say the quiz creators, highlighting how advanced AI models now easily defeat traditional reasoning benchmarks. Last week, OpenAI’s latest model "destroyed" popular reasoning exams, but AI still struggles with complex research questions, planning, and visual puzzles, according to Stanford University’s AI Index.

Question submissions should require abstract reasoning and deep expertise, with the creators advising that questions be crafted by those with significant experience, such as PhD students or industry professionals. Successful contributors could win part of a $500,000 prize pool, with individual prizes of $5,000 each!

Elsewhere in tech

📹 YouTuber MrBeast is facing legal action over claims that contestants were "shamelessly exploited" during his upcoming series Beast Games. Participants have sued production companies, including Amazon, alleging unsafe conditions, unpaid work, and sexual harassment. The series, set to feature 1,000 people competing for a $5m prize, was announced in March as the biggest live game show in the world.

🧑‍⚖️ Google scored a rare legal victory after a €1.49 billion fine imposed by the EU for blocking rival search advertisers was scrapped. Europe's second-top court ruled that the European Commission made errors in its assessment of Google’s practices. This marks a significant win for the tech giant, which welcomed the decision.

🚨 Exploding walkie-talkies have killed upwards of 20 people and injured over 450 more in Lebanon, according to the Lebanese health ministry. The UN Secretary General said that he was ‘deeply alarmed’ by the blasts as fears of escalation in the Middle East grow.

✈️ EasyJet is opening a new flight route from Luton to Tbilisi, Georgia. The twice-weekly route aims to boost tourism and trade links between the UK and the Caucasus region. Flights will avoid Russian and Ukrainian airspace, extending journey times to over six hours in both directions.

🐘 Zimbabwe will cull 200 wild elephants to help feed communities suffering from severe hunger due to the worst drought in four decades. The drought has devastated crops across southern Africa, impacting 68 million people. Similar measures are already in place in Namibia, where over 700 animals are being culled.