Rachel Reeves, the UK Chancellor, is approaching her Spring Statement supported by a set of better than expected economic data. According to the ONS report, the January budget surplus reached a historic record and retail sales climbed to their highest level in 20 months. At the same time, the S&P Global Purchasing Managers’ Index rose to 53.9, signaling a return of private sector activity to expansion territory. Despite the positive data, political pressures and the Labour Party’s weaker standing in polls continue to pose risks to Reeves’ political future.

The oil market has started 2026 with a price surge, with Brent climbing above 72 dollars, largely driven by geopolitical risks and supply disruptions. Traders are rapidly hedging through futures and options markets due to the possibility of conflict involving Iran and Donald Trump. Concerns about the security of oil transit through the Strait of Hormuz and reduced supply in some countries have turned expectations of surplus into a tighter market. As a result, volatility has increased and analysts believe the geopolitical risk premium could push oil prices even higher.

On the first trading day, markets turned risk averse amid uncertainty surrounding United States trade policy. US equity futures such as the S and P 500 and Nasdaq declined, and the dollar weakened against major currencies such as the yen and the euro. In contrast, gold and silver rose as safe haven assets, and Bitcoin fell by nearly 5 percent to below 65000 dollars. Asian markets, especially Hong Kong technology shares, performed positively on hopes of reduced tariff pressure on the region.

Based on rumors and reports from Axios, talks between the United States and Iran are expected to take place on Friday, with Iran set to submit its nuclear proposal. These discussions are occurring as Trump has set a 10 to 15 day deadline to reach an agreement, and his military deployments in the Middle East have been completed.