EU ministers are trying to head off a trade war with the US as Brussels and Washington lock horns over $369bn (£304.8bn) of green subsidies being pushed by Joe Biden.
Officials on the two continents have set up a taskforce to assess the impact of the US’s ambitious climate legislation - the Inflation Reduction Act - which has stipulations to "buy American", and European governments are growing frustrated.
Germany's economy minister Robert Habeck called for Europe to step up competition with the United States, saying the world's largest economic powers are going to compete over who will be able to create a lead market for a climate-neutral and green industry.
The amount of money Germany is pushing towards creating a green economy is competitive with the US, Habeck told the Bundestag lower house of parliament today, but the task is to become quicker and more decisive in applying the funds.
It comes as Jozef Sikela, the Czech minister who is chairing a meeting of EU trade ministers in Brussels today, said he wanted solutions over the US subsidies by the next meeting of a separate bilateral Trade and Technology Council (TTC) on December 5, according to the Financial Times.
"What is important for us is that the US is aware of our concerns and the taskforce has to work out a solution which will be acceptable for both parties," he added.
"We will focus on having certain solutions in place for the TTC on December 5."
The Inflation Reduction Act was signed into law by President Biden in August and aims to spend $369bn on tackling energy and climate change.
However it has caused anxiety with the EU as it could lead to a serious trade dispute just as the world tries to tackle energy supply problems caused by Russia’s invasion of Ukraine.
Europe’s largest electric car battery refinery given go-ahead in boost to UK industry
Plans to build the biggest lithium hydroxide refinery in Europe in Teesside have been given the go-ahead, paving the way for the creation of 1,000 jobs and a local supply of a key battery material.
Redcar and Cleveland Borough Council approved the plan for the plant, which is expected to produce the metal in refined form from 2025. The next step will be to raise $300m (£248m) to build the plant in the new year.
The news comes as doubts have been cast over the future of the nearby planned Britishvolt battery plant at Blyth, which struck a deal with investors last month to stave off collapse until it can sign concrete deals with buyers.
Ackman bets against Hong Kong dollar after mass exodus of finance firms
Hedge fund billionaire Bill Ackman has taken a large bet against the Hong Kong dollar as the city state struggles to rebound from severe Covid lockdowns and an exodus of Western financiers.
The Wall Street fund manager is the latest high-profile figure to take a public short bet as US interest rate rises hammer Hong Kong's currency system.
Mr Ackman said it is “only a matter of time” until the Hong Kong dollar’s peg to the US currency breaks as he revealed that Pershing Square, his hedge fund, had a “large notional short position against the Hong Kong dollar”.
The Hong Kong dollar has been pegged in a tight band - between HK$7.75 and HK$7.85 per US dollar - for nearly four decades and tends to face pressure every time the Federal Reserve puts up interest rates.
Hong Kong’s Monetary Authority maintains the peg by moving interest rates in lockstep with the Fed and by currency intervention.
Right, that's all from me for the day. Handing over now to Simon Foy, who will take you through the next few hours.
Billionaire German dynasty snaps up British sausage casings firm for £540m
A billionaire Gerrman sausage dynasty has bought the British casings manufacturer Devro in a £540m deal.
Our senior consumer and leisure reporter Daniel Woolfson has the details:
The Rethmann family is taking control of Devro through its subsidiary Saria, which already owns sausage casings and meat products business Van Hessen.
Saria pledged to invest in research and develop a wider range of products for Devro. It will retain all of Devro’s seven manufacturing sites across the world, along with its headquarters in Moodiesburn, Scotland.
Shares at the Scottish company soared to their highest level since 2015.
Tesco boss calls for 'more targeted' energy support
The boss of Tesco has said the Government should make cost-of-living support "more targeted" for the vulnerable as he warned over food poverty.
Ken Murphy, chief executive of the supermarket giant, said he has seen positive signs in shopping behaviour in Tesco stores since the Government introduced its energy price guarantee in October, limiting average household bills to £2,500 a year.
However, he suggested that improvements could still be made to financial support.
Mr Murphy told the PA news agency:
It looks like the action by the Government has helped but I believe it can be more targeted in the form of who it helps, to help the vulnerable.
There should be a case for more means testing with support.
There is a certain responsibility that should be shared by businesses, government and communities to help those most at need.
Jaguar Land Rover forced to cut production as microchip shortage bites
Jaguar Land Rover is being forced to cut the production of cheaper models at at least one of its plants as it battles a worsening parts crisis.
Our industry editor Howard Mustoe has the latest:
The car maker (JLR) will move to one shift per day from two at its Solihull plant for its Range Rover Velar and the Jaguar F-Pace models for the first three months of the new year, while cuts at another factory in Halewood are also being considered. No jobs will be lost.
Sources said that in common with many other car makers, JLR will funnel the chips it can obtain into higher-priced vehicles like the Range Rover and Range Rover Sport, where production will increase.
Car makers are two years in to a global shortage of computer chips which has halved the output of UK factories.
Oil price increases as EU price cap talks to continue
Oil reduced its third weekly loss as the European Union continues to weigh up a higher-than-expected price cap on Russian crude, while concerns about an economic slowdown threaten the outlook for demand.
Brent crude reach $85.69 a barrel, an increase of 0.5pc, while WTI crude has risen by 0.8pc to $78.59.
EU diplomats are set to meet this evening to see if they can hammer out a final deal on a price level to cap Russian oil exports, a diplomat told Reuters.
The bloc has been locked in a fight over how strict the price cap should be.
Countries like Poland objected to the EU's proposal to set a $65 per barrel limit, saying it was too generous to Russia. Other nations, including Greece, do not want to go below that level.
The cap talks come before an Opec+ meeting early next month. Iraq and Saudi Arabia's oil ministers met on Thursday and said the group could take further measures if required to achieve stability in the market.
£17.50 to drop off at Heathrow under Sadiq Khan’s raid on drivers
Holidaymakers will be charged £17.50 to drop passengers off at Heathrow Airport under London mayor Sadiq Khan's latest raid on drivers.
Genevieve Holl-Allen and Will Kirkman have the details:
Mr Khan has confirmed the Ultra-low emission zone (Ulez) will be extended to the whole of Greater London by the end of August 2023. This includes Britain's most popular airport, where travellers will be asked to pay £12.50 to drive into the Ulez zone, plus Heathrow's existing £5 drop-off charge.
Unsuspecting holidaymakers risk fines of £180 if they drive into the Ulez and fail to pay the £12.50 charge.
The new Ulez will be 18 times larger than the current area, and all older vehicles driving in London that do not meet the Ulez standards will incur a daily charge to use their vehicle.
Aveva shareholders back £10bn takeover
Aveva, one of Britain's biggest tech companies, has survived a modest shareholder rebellion to vote through a £10bn takeover by Schneider Electric.
The agreement comes after a prolonged battle from investors who wanted a higher price for the software company. Some 16.5pc of shareholders rejected the deal.
However, 83pc of investors voted in favour, giving a green light for French industrial conglomerate Schneider to buy the roughly 41pc it does not already own of the Cambridge-based software supplier to utilities, oil and gas producers.
The acquisition now faces a final court hearing in the first quarter of 2023, after which the deal should conclude.
Schneider's offer is a 41pc premium to Aveva's share price on August 23, when news of a possible bid was first reported.
Primark to open four new stores, creating 850 jobs
Primark has unveiled new expansion plans that mean it will open at least four more UK stores which will create around 850 jobs.
The budget retail giant said it hopes to see thriving high streets and shopping centres as it pledged to invest £140m in its UK stores over the next two years.
The announcement comes at a time of significant pressure on the retail sector, with numerous retailers reporting that they have suffered from weakening consumer demand as shoppers cut back on non-essential spending.
But Primark said it is committed to offering customers good value across clothing, beauty and homeware products, and recently pledged to freeze its prices until next autumn.
New stores will be opened in Bury St Edmunds in Suffolk, Salisbury in Wiltshire, Teesside Park in Thornaby-on-Tees, and Craigavon in Northern Ireland.
Mixed open on Wall Street
US stock markets have opened broadly flat after a day off for the Thanksgiving celebrations.
The Dow Jones Industrial Average has begun the shortened half-day session up 0.1pc to 34,240.73.
However, the S&P 500 is has slipped 0.1pc to 4,024.36 while the tech-focused is down 0.5pc to 11,225.12.
Dividends worth £235m paid by 'monopoly' emergency services radio owner
The company behind the UK's emergency services radio network has paid out £235m to its owners over the last two years as regulators take aim at its monopoly status.
Our media and telecoms reporter James Warrington has the story:
Airwave Solutions, which is owned by US telecoms giant Motorola, paid dividends of £130m in 2021 and has declared a further £105m this year.
The payouts come amid a bitter dispute over the Airwave contract, which supplies encrypted radios for police forces, fire brigades and ambulance services.
The Competition and Markets Authority (CMA), which has described Airwave as a "monopoly provider", has threatened to impose price caps on the £11bn contract amid concerns about huge returns for Motorola.
Officials claimed the US company could make as much as £1.1bn in "supernormal profit" from the deal, which has been extended to the end of 2026.
Britain and Singapore aim to cut red tape for fintech
Britain and Singapore have agreed to encourage closer ties between fintech companies in a bid to reduce red tape.
The two countries will meet regularly with the fintech sector to work to remove regulatory barriers to trade, according to an emailed statement on a new memorandum of understanding.
The partnership will "deliver a strengthened framework for vital regulatory and policy discussions between the two countries," said Janine Hirt, chief executive officer of trade body Innovate Finance.
The agreement comes as Britain takes advantage of its regulatory freedoms since Brexit as the European Union pushes to bring more elements of traditional finance into the bloc.
Why Warren Buffet has donated more than £621m in shares
Legendary investor Warren Buffett has donated more than $750m (£620.9) in stock from his multinational conglomerate Berkshire Hathaway to four foundations this week.
The 92-year-old investor has given the stock to the charitable organisations with links to his family, and indicated part of the reason for giving away his wealth was to do with his children. He told CNBC:
I've got a personal pride in how my kids turned out.
I feel good about the fact that they know I feel good about them.
This is the ultimate endorsement in my kids, and it's the ultimate statement that my kids don't want to be dynastically wealthy.
Wall Street outlook unclear
US stock futures are largely subdued, with investors closely monitoring the major retailers as Black Friday sales begin across the Pond against the backdrop of stubbornly high inflation and worries about a potential recession next year.
US retail stocks, a barometer of consumer confidence as inflation bites, remain under pressure after a lull in October and November sales figures.
Target, Macy's and Best Buy have warned of steeper discounts this November and December than in the previous two years.
Wall Street's main indexes have rallied strongly since hitting their early October lows, with the S&P 500 up more than 12pc on a boost a from better-than-expected earnings season and more recently on hopes of less aggressive interest rates hikes by the US Federal Reserve.
US stock markets will only open for half a session until 1pm ET (6pm GMT), after being closed on Thursday for Thanksgiving.
Beer52 apologises for Google Advert
Craft beer delivery service Beer 52 has apologised profusely to customers and suppliers after running Google Adverts which suggested customers were being "robbed at the taps" by independent shops and breweries.
The beer subscription service, which enjoyed huge expansion during the pandemic while pubs and restaurants were closed, said the advert "should not have been published, as it does not reflect our views".
Glasgow-based independent shop Wee Beer Shop accused Beer52 of a "race to the bottom" while trade publication Ferment Magazine said it was "shocked and disappointed by the campaign.
Centrica criticises 'reckless' Ofgem plans
British Gas owner Centrica has criticised proposals to enforce capital requirements for the sector as reckless and misguided.
The UK regulator Ofgem has outlined regulations today requiring energy suppliers to hold a minimum amount of capital to ensure they can withstand volatility in power and gas markets.
The firms would have to ring-fence money to buy renewable energy, but customer credit balances would not have the same protection.
Ofgem has been blamed for allowing more than two dozen firms to go bust after surging natural gas prices exposed companies that were not protected by buying energy in advance.
Customer cash balances were lost when many of these suppliers collapsed because they were not kept separate from day-to-day working capital.
However, Centrica chief executive Chris O'Shea said:
The failure to protect customer balances has already ended up costing consumers hundreds of millions.
This feels like an abdication of responsibility by a regulator not focusing on the right things.
Ofgem will consult on the proposals, with the intention to bring them into force in spring 2023, it said in a separate statement.
Pound plateaus after days of increases
The pound has halted its gains against the dollar over the last few days, down 0.2pc to just below $1.21.
Investors have been assessing prospects for less-aggressive central bank tightening and weighed China's latest move to stimulate its economy as Covid-19 infections rise.
Traders perhaps believe the dollar has fallen a touch too far over the last three days after US Federal Reserve minutes published Wednesday showed that officials concluded the central bank should soon moderate the pace of interest-rate increases to mitigate overtightening risks.
Germany's bond yields indicate incoming recession
Germany's bond yield curve traded at its deepest inversion since 1992 today in a potentially worrying sign for Europe's biggest economy.
It came as German 10-year bond yields, seen as a benchmark for the currency bloc, rose but remained on track for their third consecutive weekly fall. Yields move inversely to prices.
Germany's curve inversion extended late on Thursday, with the gap between the 2-year and 10-year government bond yields falling to -27 basis points (bps) and hovering there today before rising to -23 bps. The drop to -27 bps was the widest gap since October 1992, Refinitiv data showed.
An inversion is uncommon and is seen by many economists as a precursor to a recession.
Russia makes Facebook owner Meta 'extremist organisation'
Russia's justice ministry has reportedly added Facebook-owner Meta to its register of extremist organisations.
A Russian court earlier this year ruled Meta had engaged in "extremist activity".
Moscow has restricted access to Facebook and Instagram as part of a campaign against Western social media platforms.
London City Airport to relax checks on liquids next year in UK first
London City Airport is to drop tougher checks on liquids in travellers' hand luggage from next April, ahead of an expected ripping up of curbs on the size of bottles they can take on board planes.
Retail editor Hannah Boland has the details:
The airport said it was replacing its X-ray machines with new CT scanners which will mean holidaymakers will no longer have to take liquids out of their hand luggage, making it quicker for people to pass through security.
The £12m upgrade, expected to be completed by next summer, will see London City Airport be among the first to install hi-tech CT scanners, amid reports airports have been given until the middle of 2024 to make the changes to their security technology.
Earlier this week, it emerged that the Government was considering ripping up all security restrictions on liquids and laptops, thanks to the new scanners which could differentiate between materials.
Black Friday marks huge day for retailers
Today is Black Friday and therefore a hugely important trading day for retailers who embrace the chance to entice shoppers with discounted items before the Christmas shopping period kicks off in earnest.
Department store group John Lewis, consumer electricals retailers Currys and AO World, and Argos are all taking part this year.
"We're seeing a significant change to behaviour, we're seeing people prioritise things like essential domestic products... things like microwave ovens, air fryers," Currys chief commercial officer Ed Connolly told the BBC, noting strong demand for other energy saving products such as heat pump tumble dryers.
Some major retailers, including Marks & Spencer, largely shun the event.
More than a decade since being brought to Europe by Amazon, Black Friday's worth to retailers still divides opinion.
Supporters say carefully planned promotions in close co-operation with global suppliers allow retailers to boost sales and maintain profit margins.
Naysayers argue the discounts suck forward Christmas sales with reduced profits and undermine consumers' willingness to pay full price again before the festivities.
Whole of London to be hit by Ulez expansion ordered by Sadiq Khan
Sadiq Khan has declared war on London drivers by expanding a low-emission zone across all of the capital, writes Oliver Gill.
Hundreds of thousands of motorists will be slapped with a £12.50 daily charge to drive in London in a "hammer blow for desperate drivers".
The mayor’s Ultra-low emission zone (Ulez) is already in force to the north and south circular roads. This followed Mr Khan’s expansion of the scheme last autumn.
Ulez will be expanded across all of Greater London from August 29. Mr Khan said it was "one of the toughest decisions I've taken".
Tackling pollution in the capital has become the flagship policy of Mr Khan’s time in office. His book, "Breathe: Tackling the Climate Emergency", is due to be published in May.
He said that air pollution is making Londoners "sick from cradle to the grave", with illnesses such as cancer, lung disease, dementia and asthma.
But his plans have failed to resonate with Londoners with widespread opposition against Ulez expansion registered during a public consultation on Mr Khan’s plans.
Hong Kong demand for British visa plunges
The number of Hong Kong residents applying for a route to UK citizenship tumbled by 44pc in the third quarter, showing that demand for the programme is waning almost two years after it was created.
Some 10,100 British National (Overseas) passport holders applied for the special long-term visas between July and September, according to Home Office data.
That's the smallest number in a single quarter since the UK began taking applications in January 2021.
The UK has so far received 150,600 visa applications under the system – slightly less than halfway to the 320,000 that the Government estimated would apply in the first five years. Around 98pc of applications received have been approved.
The billionaire lieutenant helping Elon Musk fight the culture wars
David Sacks and Elon Musk are two members of the so-called PayPal mafia, with their ties dating back to the tech scene of the late 1990s.
Today they are back together, battling against the ‘woke’ class as the world's richest man continues to drive through big changes at Twitter.
Germany's yield curve most inverted since 1992
Germany's bond yield curve traded at its deepest inversion since 1992 this morning in a potentially worrying sign for Europe's biggest economy.
German bond yields, seen as a benchmark for the currency bloc, edged higher but remained on track for their third consecutive weekly fall. Yields move inversely to prices.
An inversion is uncommon and is seen by many economists as a precursor to a recession.
Germany's curve inversion extended late yesterday, with the gap between the two-year and 10-year government bond yields falling to -27 basis points, before trading at -25 bps today. That was the widest gap since October 1992, Refinitiv data showed.
When longer-dated yields are lower than those on shorter-dated bonds, it suggests investors expect the central bank to raise interest rates in the short-term before cutting them later to deal with slowing growth.
Jaguar Land Rover 'to cut UK production until March'
Jaguar Land Rover is reportedly cutting production at its UK factories until the spring amid a global shortage of semiconductors.
The car maker's Solihull factory will move from two shifts to one in the parts of the plant that produce the lower-price Range Rover Velar and the Jaguar F-Pace. An extra shift will be added to produce Range Rover body panels.
The Halewood plant in Merseyside will also drop to one shift, the Guardian reports.
A spokesman for JLR said the company continues to "actively manage the operational patterns" of its manufacturing plants amid ongoing chip shortages.
Pound holds near three-month high
Sterling held near a three-month high against a sluggish dollar this morning, while hawkish signals from the bank of England also provided some support.
The pound is on track to end the week nearly 2pc higher – its third straight week of gains.
The UK currency has benefited from a sell-off in the dollar this month amid growing signs US inflation may be peaking. Meanwhile, two BoE officials yesterday said the central bank must continue raising interest rates even as a recession looms.
The pound was little changed against the dollar at $1.2115. Against the euro it slipped 0.1pc to 86.05p.
Mike Ashley snaps up troubled tailor Gieves & Hawkes
Mike Ashley's Frasers Group has snapped up struggling Savile Row tailor Gieves & Hawkes, adding one of Britain's best-known suitmakers to its portfolio of brands.
Gieves & Hawkes was put up for sale in July after it Hong Kong-listed owner Trinity Ltd collapsed into administration last year.
It has five UK stores including the flagship outlet on Savile Row.
Frasers, which owns Sports Direct and House of Fraser, has become of the most acquisitive retailers on the high street. Its brands now include Jack Wills, Evans Cycles, Game, Agent Provocateur and Missguided, while it also owns a stake in Hugo Boss.
Amazon workers to strike around world on Black Friday
Workers at Amazon sites around the globe are expected to go on strike today, targeting the ecommerce giant on one of the busiest shopping days of the year.
A global call for strike action came from the Make Amazon Pay initiative, which listed industrial action planned in over 30 countries across the globe.
Germany's Verdi union said work stoppages were planned at 10 fulfilment centres in that country. Walkouts are also expected in the US and France.
Monika Di Silvestre at Verdi said:
This is the first time that Amazon has had an international strike day. This is very important, because a major global corporation like Amazon cannot be confronted locally, regionally or nationally alone.
FTSE risers and fallers
It's a quiet start to the day for the FTSE 100, which is struggling for direction in early trading.
The blue-chip index inched marginally into the green.
SSE was the biggest riser, gaining as much as 1.1pc after it agreed a $1.5bn deal to sell a 25pc stake in its transmission business.
Blue-chip staples including Imperial Brands, British American Tobacco and BT also rose.
Housebuilders were the biggest drag, with Segro, Persimmon and Taylor Wimpey all in the red. Companies this week hit back at the Government's plans to push ahead with a £3bn levy to pay for fire safety repairs.
The domestically-focused FTSE 250 fell 0.5pc, with Asos falling 4.4pc.
British Gas owner brands new Ofgem rules reckless
British Gas owner Centrica has taken aim at proposed rules on capital requirements for the sector, describing them as reckless and misguided.
Ofgem has outlined new rules requiring energy suppliers to hold a minimum amount of capital to ensure they can withstand volatility in power and gas markets.
The firms would have to ring-fence money to buy renewable energy, but customer credit balances wouldn’t have the same protection.
Ofgem has been blamed for allowing more than two dozen firms to go bust after surging natural gas prices exposed companies that weren’t protected by buying energy in advance.
Customer cash balances were lost when many of these suppliers collapsed because they weren’t kept separate from day-to-day working capital.
Chris O'Shea, chief executive of Centrica, said:
The failure to protect customer balances has already ended up costing consumers hundreds of millions. This feels like an abdication of responsibility by a regulator not focusing on the right things.
Musk says Twitter will launch verified service next week
Elon Musk has said Twitter will "tentatively" launch its verified service on Friday next week.
In a tweet he explained how the new system will work:
Home working is essential to cut our gender pay gap, Treasury mandarins claim
The Treasury has claimed that working from home is an essential part of its battle to cut the gender pay gap amid growing criticism of civil servants' refusal to return to the office.
Szu Ping Chan has more:
Mandarins vowed to continue to “promote flexible working hours and hybrid working policies” as they take “targeted action to reduce and close the gender pay gap”, despite fears that the rise in remote work is fuelling poor decision making and a productivity crisis.
It came as separate figures showed hundreds of Treasury civil servants continued working from home even during the week of the Autumn Statement.
Jacob Rees-Mogg, the former Business Secretary, said there was a correlation between poor productivity and home working in Whitehall.
He said: “There's been poor service from DVLA, the Passport Office, HM Revenue and Customs, and the Land Registry. All of them had high levels of working from home.”
FTSE 100 opens higher
The FTSE 100 has edged into the green at the open following another increase in the energy price cap.
The blue-chip index rose 0.1pc to 7,474 points.
Ofgem outlines proposals to reduce risk of supplier collapse
Ofgem is introducing a new package of reforms today designed to boost consumer protection and ensure energy suppliers are more resilient to market shocks.
The proposals include the introduction of capital adequacy requirements, which will help reduce the risk and cost of supplier failures.
The regulator will also be requiring suppliers to ringfence Renewable Obligation receipts and closely monitoring the use of credit balances.
Jonathan Brearley, chief executive of Ofgem, said:
These proposals will provide protections, checks and balances for consumers, suppliers and the entire sector to create a more stable market.
Gas prices head for weekly gain as cold weather approaches
Natural gas prices in Europe are heading for a weekly gain as low winter temperatures approach, potentially increasing heating demand across the continent.
Benchmark prices are up nearly 9pc in the week. Temperatures below seasonal norms are expected to persist across Europe in the next two weeks, and traders and watching how quickly demand for heating will respond.
Gas prices have declined from their highs in August as mild weather has limited gas use and a strong supply of liquefied natural gas has helped to fill up storage sites.
But a rapid increase in demand could quickly deplete stocks, leaving the market exposed to any further supply disruption.
SSE sells stake in grid business for £1.5bn
SSE has agreed to sell a 25pc stake in its electricity transmission grid business to the Ontario Teachers' Pension Plan Board for about £1.5bn.
The network helps transport renewable resources in the north of Scotland to areas further south. SSE is also selling a stake in its electricity distribution business.
The sale forms part of a strategic plan unveiled by SSE after it rejected a proposals from activist investor Elliott Investment Management to split the company it two by separating the renewables business.
Rob McDonald, managing director of SSEN Transmission, said:
With significant growth forecast in transmission, bringing in Ontario Teachers' as a minority stake partner will help fund out ambitious investment plans.
Musk says Twitter will offer 'amnesty' to suspended accounts
Elon Musk has said Twitter will offer a "general amnesty" to some suspended accounts from next week.
The world's richest man had started a poll on Wednesday asking whether accounts that had "not broken the law or engaged in egregious spam" should be let back on the platform.
More than 3.1m Twitter users responded to the poll, with 72.4pc of them voting "Yes".
Musk, who has already reinstated the accounts of some users such as Donald Trump, used a Latin phrase which translates to "the voice of the people is the voice of God".
The pound looks "vulnerable" to further falls and the ensuing recession could have a serious impact on British society, the hedge fund of billionaire Chris Rokos has warned.
Rokos Capital Management, which has about $14.5bn of assets under management, warned investors that the UK had suffered a bigger shock than other developed countries because of Brexit, de-globalisation and the pandemic.
The darkening outlook made it harder for policymakers to keep inflation under control, the company warned in a letter seen by the Financial Times.
"The recession that is required to tame inflation in the UK is deeper than that needed elsewhere, with potentially serious societal implications," it said. "Sterling looks vulnerable."
Rokos said it would have to see signs of a "quietly engineered softer Brexit" or higher immigration to be more optimistic on the UK's outlook.
5 things to start your day
1) Boris Johnson and Liz Truss in planning rebellion challenge to Rishi Sunak Former PMs join fellow Tories in demanding end to onshore wind farm ban
2) Home working is essential to cut our gender pay gap, Treasury mandarins claim Claim comes as hundreds of civil servants worked remotely during Autumn Statement
3) JPMorgan sued over Epstein links by lawyer who challenged Prince Andrew Lawsuit focuses on role of former Barclays boss
4) Ambrose Evans-Pritchard: Putin has another gas shock for us: the deindustrialisation of Europe It is the President's bet that he can break Europe before it breaks Russia
5) Hundreds of buyers at risk of missing out on Help to Buy Whitehall moves deadline for properties to comply with rules by three months
What happened overnight
A gauge of Asian equities fell amid a subdued tone in markets this morning after Thanksgiving in the US. Treasuries rose as trading resumed after the holiday.
Hong Kong-listed technology stocks led declines in Chinese shares as investors weighed recent gains against an upswing in Covid-19 infections and lockdown-like restrictions affecting swathes of Beijing.
US stock futures advanced following commentary from Federal Reserve officials that supports the case a slower pace of interest-rate increases. The dollar headed for a fourth day of losses.