ISSUE NO. 2 · TUESDAY 4 AUGUST 2026

Britain's forecast, easyJet's exit, and an 11% hole in the Nasdaq

EY has lifted its UK growth forecast to 0.9% for this year, which sounds like good news until you read the condition attached to it. The whole number assumes the Strait of Hormuz reopens. Keep it shut and the same forecast becomes a 0.2% contraction next year, with inflation running at 6.4% rather than 3.5%. Britain's year, in other words, is being decided several thousand miles from Westminster.

The same pattern turned up twice more. easyJet's board is still recommending Apollo's £7.15 a share while extending Castlelake's deadline to Friday, and whichever envelope opens the airline leaves London. Over in New York, Meta's second quarter put revenue up 28% and free cash flow down almost 91% — which is what the argument about the cost of artificial intelligence looks like once it reaches an actual balance sheet.

Below in full: what EY's 0.9% really rests on, why easyJet leaves the market whoever wins it, and what the Nasdaq's correction is and is not telling you. After those, the numbers, tomorrow's diary, and one calculator worth five minutes.

Lead

Britain's economy just got an upgrade, but it comes with a condition you could skim past.

EY has revised UK growth up to 0.9% for this year, and the baseline assumes the Strait of Hormuz reopens. In the adverse scenario growth slows to 0.5% and the economy contracts by 0.2% next year, with inflation skimming 3.5% by December on the baseline and as high as 6.4% if the disruption drags on. This is not really a forecast about Britain. It is a forecast about a shipping lane and a president's mood. Read the full story →

More News

easyJet's board has already picked its winner. Yet on Monday it extended the loser's deadline to 5pm on 7 August.

Directors still intend to recommend Apollo's £7.15 a share, but Castlelake now has until Friday afternoon to match it. Pre-tax profit slumped 70% to £85m in the three months to June, after a £200m hit from energy costs and weaker travel demand. Whichever bidder wins, easyJet leaves the London Stock Exchange, on an exodus now set to pass well over £40bn this year. The interesting question stopped being the price some time ago. Read the full story →

The Nasdaq-100 closed on 29 July just over 11% below the all-time high it reached in early June.

That is a correction by the conventional definition, and not the index's first lately — it was down more than 10% at the end of March, and came close to 20% in the first half of 2025. Every past drawdown has eventually been recovered, a 100% record. The catch is how long: the tech wreck that opened the 2000s took fifteen years. The first number is the one that travels. The second is the one that matters. Read the full story →

The Numbers

Nothing in the official data moved today — the same four readings as yesterday. That is worth saying plainly: the gilt is still a quarter point above June, and it is the gilt, not Bank Rate, that reprices a fixed mortgage.

On the Diary

• Tomorrow, 9.30am — S&P Global UK Services PMI, July final. Services is roughly four-fifths of the economy, so this is the cleanest single read on whether growth held through July. It also lands straight into the EY question above: a soft number makes the 0.9% look generous before the Gulf is even settled.

The Toolbox

One tool from the site each issue, picked to fit what has just happened. Free, no sign-up, and it shows its workings.

Inflation purchasing power calculator

"EY's bad case has inflation at 6.4%. Here is what that does to what you already have."

The Close

Two of today's three stories are the same story: prices set somewhere else. A shipping lane decides Britain's growth forecast, and a New York index decides what your pension did this quarter. The Bank meets on 17 September with very little control over either. Worth remembering when the commentary starts blaming Threadneedle Street.

If something here is wrong, or there is something you want dug into this week, just reply. It comes straight to me.

MJB