UK News
Zelenskyy to talk with US negotiators about war with Russia after Easter ceasefire proposal – Europe live | Europe
Morning opening: Zelenskyy hopes for ‘results’ in talks with US over Easter ceasefire
Jakub Krupa
With most eyes still on the Middle East, and growing US frustrations with European Nato allies’ over their decisions to deny the use of their bases for offensive operations in Iran, there is often much less focus on Ukraine.
But the two universes will collide today, as the wartorn country’s president, Volodymyr Zelenskyy, will sit down for talks with the US negotiators to discuss the last steps to end the Russian invasion of Ukraine.
Speaking to EU foreign ministers visiting Ukraine yesterday, Zelenskyy brought up his proposal of a ceasefire over the Easter holidays, saying he wanted the US to support this idea.
“We are waiting for a response from Russia. Tomorrow I will speak with the American team, including on this issue. We hope for results,” he said.
I will keep an eye for the latest updates.
Meanwhile, Europe is increasingly thinking about how to soften the economic blow of the continuing Middle East war and energy disruptions, with growing concerns about what it could mean for several EU countries who are particularly vulnerable to any disruptions to imports from the Gulf. Gulp.
I will bring you all the latest here.
It’s Wednesday, 1 April 2026, it’s Jakub Krupa here, and this is Europe Live.
Good morning.
Key events
Starmer wants EU to get closer to EU on economy, defence, energy
During his press conference, Starmer also spoke about his intention to get closer to the European Union.
Replying to a question from the Guardian’s Jessica Elgot, he said:
“I do think that we should strengthen our cooperation on defence, security, energy, emissions and the economy. …
I’m ambitious that we can do more in relation to the single market, because I think that’s hugely in our economic interests.
Obviously, this is a matter of negotiation and discussion with the EU, but the summit we have this year will not be just be a stocktake summit where we look at actually the ten strands that we put in place last year. It will be a deliberate ambition on our part to go further than that and to cooperate more deeply, including in the economic sphere.”
Earlier on, he explained that “it is increasingly clear that as the world continues down this volatile path, our long-term national interest requires closer partnership with our allies in Europe and with the European Union.”
Again, more on that on the UK blog:
‘Whatever pressure on me and others, noise, … this is not our war,’ UK’s Starmer tells Trump
The UK’s prime minister, Keir Starmer, is the first one to react to Trump’s comments in The Telegraph, as he gets asked about it at his No10 press conference just now.
He defends Nato as “the single most effective military alliance the world has ever seen,” and while he doesn’t respond to Trump’s comments, he says:
“Let me say a number of things in response to that. Firstly, Nato is the single most effective military alliance the world has ever seen, and it has kept us safe for many decades. And we are fully committed to Nato.
Secondly, that whatever the pressure on me and others, whatever the noise, I’m going to act in the British national interest in all the decisions that I make. And that’s why I’ve been absolutely clear that this is not our war, and we’re not going to get dragged into it.”
For more lines from Starmer, check our UK politics live blog:
Trump’s frustration with Nato over its refusal to back his Iran war is clear – snap analysis
Trump’s latest comments come as he increasingly hardens his language against European allies, blaming him for difficulties in his Iran operation.
In last days, he specifically targeted European allies, calling them “cowards” and telling them to “build up some delayed courage” and take control over the strait of Hormuz.
He and his senior officials also criticised a number of specific countries, particularly Spain, which has been most vocally critical of the US-Israeli war against Iran, and France.
The US secretary of state, Marco Rubio, warned last night about the sharply escalating frustration with Nato, as he told Fox News:
“We are going to have to reexamine the value of Nato and that alliance for our country. Ultimately, that’s a decision for the president to make … but I do think, unfortunately, we are going to have to reexamine whether or not this alliance that has served this country well for a while is still serving that purpose or has now become a one-way street where America is simply in a position to help Europe but when we need the help of our allies, they deny us basing rights and overflight.
I think these are very legitimate questions that we need to be asking and these are going to have to be very carefully examined after this conflict is over.”
Italy is the latest country to risk the US administration’s anger, after it has denied the use of an airbase in Sicily to US military planes carrying weapons for the war in Iran after the US did not follow the required authorisation procedure.
US could review its Nato membership amid frustrations over Iran war, strait of Hormuz, Trump tells Telegraph
US president Donald Trump has suggested to the Telegraph newspaper that he is “strongly considering” pulling the US out of Nato, saying the alliance was “a paper tiger” amid his growing frustration with the European partners’s refusal to join the Iran war.
When he was asked if he would reconsider the US’s membership of the alliance after the conflict, he replied: “Oh yes, I would say [it’s] beyond reconsideration.”
“I was never swayed by Nato. I always knew they were a paper tiger, and Putin knows that too, by the way,” he told the paper.
Repeating his increasingly strong criticism of the alliance, he added:
“We’ve been there automatically, including Ukraine. Ukraine wasn’t our problem. It was a test, and we were there for them, and we would always have been there for them. They weren’t there for us.”
Germany’s growth forecast halved on fears over impact of Middle East war
Over in Germany, leading economic institutes cut their growth forecasts for the country, warning that surging inflation resulting from the Middle East war and rising energy costs would hit Europe’s top economy hard.
The German economy should grow by 0.6% in 2026, the seven institutes said, down from a September forecast of 1.3%, while inflation is predicted to stand at 2.8%, up from 2.0%.
Ukrainian drone manufacturers to meet with Romania to discuss joint production using EU funds
Meanwhile, Ukrainian drone manufacturers are meeting Romanian defence ministry and army officials in Bucharest this week to discuss potential joint production under a new European Union rearmament funding mechanism, the ministry said in a statement quoted by Reuters.
Romania, an EU and Nato state, shares a 650-km land border with Ukraine and has had drones breach its airspace and fragments fall on its territory repeatedly since Russia began attacking Kyiv’s ports located across the Danube from Romania.
Reuters noted that the EU has allotted Romania €16.6bn under its new rearmament initiative SAFE, which will begin later this year, and defence minister Radu Miruță said the country wanted to spend 200 million euros for joint drone production.
Fifteen Ukrainian companies will continue discussing the project in Bucharest in the coming days, he added.
Morning opening: Zelenskyy hopes for ‘results’ in talks with US over Easter ceasefire
Jakub Krupa
With most eyes still on the Middle East, and growing US frustrations with European Nato allies’ over their decisions to deny the use of their bases for offensive operations in Iran, there is often much less focus on Ukraine.
But the two universes will collide today, as the wartorn country’s president, Volodymyr Zelenskyy, will sit down for talks with the US negotiators to discuss the last steps to end the Russian invasion of Ukraine.
Speaking to EU foreign ministers visiting Ukraine yesterday, Zelenskyy brought up his proposal of a ceasefire over the Easter holidays, saying he wanted the US to support this idea.
“We are waiting for a response from Russia. Tomorrow I will speak with the American team, including on this issue. We hope for results,” he said.
I will keep an eye for the latest updates.
Meanwhile, Europe is increasingly thinking about how to soften the economic blow of the continuing Middle East war and energy disruptions, with growing concerns about what it could mean for several EU countries who are particularly vulnerable to any disruptions to imports from the Gulf. Gulp.
I will bring you all the latest here.
It’s Wednesday, 1 April 2026, it’s Jakub Krupa here, and this is Europe Live.
Good morning.
The man said his home has been targeted three times in the last five months.
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UK News
European stock markets hit record high and oil price falls to three-month low after US-Iran peace deal – business live | Business
European stock markets hit record high
European stock markets have hit a record high at the start of trading, as relief over the US-Iran peace deal ripples across global markets.
The pan-European Stoxx 600 index has jumped by 0.9% to 639 points, over the previous record high set just before the Iran war started, with shares rising in London, Frankfurt, Paris, Madrid and Milan.
Mining and travel companies are driving the rally, while oil company shares are sliding.
That follows sharp gains in Asia-Pacific markets overnight, where Japan’s Nikkei surged by 5% on hopes that the strait of Hormuz will reopen within days.
Matt Britzman, senior equity analyst at Hargreaves Lansdown, says global equity markets are starting the week firmly on the front foot after President Trump announced that a deal with Iran had been reached, adding:
The move has given investors a clear reason to dial back some of the geopolitical risk premium that has hung over markets, especially as the Strait of Hormuz is expected to reopen and oil prices move sharply lower.
Energy prices have been one of the clearest transmission channels from Middle East tensions into inflation, bond yields and equity sentiment, and there is likely to be a concerted effort to get prices down even further once this deal is finalised.
There are still details to be ironed out before markets can fully trust the agreement, but for now the direction of travel is clear: lower oil, calmer nerves and a renewed appetite for risk.
Key events
Peace deal should keep mortgage rates down
Mortgage borrowers can breathe a sigh of relief at the news of a peace deal in Iran, says Adam French, head of consumer finance at Moneyfactscompare.co.uk.
While we are far from being out of the woods yet, a lasting peace deal should dramatically reduce the risk of the Bank of England’s worst-case scenario for inflation and interest rates becoming a reality.
“Under that scenario, Base Rate could have risen to 5.25%, potentially pushing typical rates on new mortgages towards 6.75%. Instead, today’s news means mortgages rates, which have already been slowly falling for several weeks, have likely already passed their peak – at least until the next unwelcome crisis.
“Borrowers can be optimistic but with a word of caution, as inflation and economic data will continue to influence the outlook. However, a lasting peace should remove one of the biggest risks to mortgage costs and may help restore a more stable environment for hard-pressed remortgage borrowers and prospective buyers.”
Even before this morning’s drop in UK bond yields (see earlier post), average mortgage rates have dipped slightly.
Moneyfacts reports:
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The average 2-year fixed residential mortgage rate today is 5.61%. This is down from 5.62% the previous working day.
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The average 5-year fixed residential mortgage rate today is 5.58%. This is down from 5.59% the previous working day.
Why it may take months for oil flows to return to normal
Donald Trump excitedly declared: “Ships of the World, start your engines. Let the oil flow!” last night, but the reality is that it will take some time for oil flows through the strait of Hormuz to return to pre-war levels.
One reason is that many oil tankers are simply in the wrong place, after the long closure of the strait.
Another is that some production and refining facilities have been damaged by the conflict, while others were mothballed after storate facilities filled up to the brim.
A third factor is that insurers could still be wary of the conflict reigniting, and price their cover accordingly.
Neil Shearing, group chief economist at Capital Economics, explains:
Even if ships now have safe passage, tankers are in the wrong place, oil production/refining facilities need to get up to full capacity, and questions over the cost and availability of insurance for ships traversing the Strait will remain.
Our current working assumption is that ~80% of energy flows will resume by the end of Q3. Natural gas flows will be slower to return, following the damage to Qatari facilities earlier in the conflict, which according to local officials has put 17% of production offline for two to three years.
US crude drops below $80
US crude oil has dropped to its lowest level since the second week of the Iran war.
The cost of a barrel of West Texas Intermediate (WTI) light sweet crude has dropped by 6% today to $79.72 per barrel, the first time since 10 March that it has been under $80/barrel.
That could help to pull down US gasoline prices, which climbed after the conflict began, hitting consumer confidence.
UK bond yields fall
Today’s relief rally is also driving up government bond prices, pushing down the cost of borrowing.
The yield (or interest rate) on 10-year UK government debt has dropped by 6.5 basis points (0.065 of a percentage point) to 4.775%.
Two-year bond yields are down 8bps to 4.16%.
Lower bond yields indicate that that the cost of issuing new government debt has fallen, which will be a relief for the UK Treasury after the Iran war drove up borrowing costs.
Copper mining company Antofagasta is now the top riser on the FTSE 100, up almost 8%.
Trader will be concluding that an end to the Iran war will boost the world economy, leading to more demand for raw materials such as copper.
European stock markets hit record high
European stock markets have hit a record high at the start of trading, as relief over the US-Iran peace deal ripples across global markets.
The pan-European Stoxx 600 index has jumped by 0.9% to 639 points, over the previous record high set just before the Iran war started, with shares rising in London, Frankfurt, Paris, Madrid and Milan.
Mining and travel companies are driving the rally, while oil company shares are sliding.
That follows sharp gains in Asia-Pacific markets overnight, where Japan’s Nikkei surged by 5% on hopes that the strait of Hormuz will reopen within days.
Matt Britzman, senior equity analyst at Hargreaves Lansdown, says global equity markets are starting the week firmly on the front foot after President Trump announced that a deal with Iran had been reached, adding:
The move has given investors a clear reason to dial back some of the geopolitical risk premium that has hung over markets, especially as the Strait of Hormuz is expected to reopen and oil prices move sharply lower.
Energy prices have been one of the clearest transmission channels from Middle East tensions into inflation, bond yields and equity sentiment, and there is likely to be a concerted effort to get prices down even further once this deal is finalised.
There are still details to be ironed out before markets can fully trust the agreement, but for now the direction of travel is clear: lower oil, calmer nerves and a renewed appetite for risk.
BP and Shell’s shares slide
Shares in oil companies are falling, though – BP and Shell are both down 3.7%, as investors anticipate an end to their earnngs boost from the Iran war.
FTSE 100 index hits eight-week high
Boom! Britain’s stock market has hit a near-two month high at the start of trading, as investors welcome the breakthrough between the US and Iran to end the Middle East conflict.
The FTSE 100 blue-chip share index has jumped by 99 points, or almost 1%, at the start of trading to 10,570 points, its highest level since 21 April.
Engineering firm Rolls-Royce, which makes and services jet engines, is the top riser on the FTSE 100, up 5.5%, followed by British Airways parent company IAG, up 4.8%.
UK house prices dip in June
Gwyn Topham
Two bits of good news for Britons who don’t own their homes have been revealed, with data showing a drop in house prices in June as well as fewer tenants facing rent hikes last month.
Figures from Rightmove showed the average price of property coming on the to market fell by 0.6% or £2,113 to £376,191, the biggest June fall in fourteen years, with prices 0.5% below this time in 2025. The biggest drops were seen in southern England and Wales, and in asking prices for flats rather than houses.
The property site said the number of homes for sale was still at historically high levels for summer, making it more of a buyer’s market. Mortgage affordability has also improved slightly this month, with the average two-year fixed rate deal dropping about 0.1 percentage points to 5.07%, it said.
Meanwhile, figures suggest that the introduction of the Renters Right Act may already be seeing results in terms of keeping rents down for tenants.
The new law came into force at the start of May and means landlords can only increase rents for sitting tenants once a year. According to Hamptons monthly lettings index, the number of tenants who saw their rent rise was down 23% from the same month last year. Hamptons said if the rest of the year saw similar change, it would expect only 31% of sitting tenants to face increases, compared to 40%-50% in previous years.
However, the agency warned that rent rises in Scotland, where landlords have been operating under a similar system for longer, exceeded the national average. Sitting tenants who faced rent rises had an average increase of 5.4% in May, but the figure reached 7.7% in Scotland, albeit for a lower absolute rent – £952 – than the Great Britain average of £1375.
Speaking of the ECB, their president Christine Lagarde has been warning that inflation pressures are spreading in the euro area.
In an intervew with broadcaster France Culture, Lagarde warned that high energy prices are starting to feed through to other parts of the economy, saying:
“Indirect effects of inflation, we have absolutely started to see that more or less everywhere in recent weeks.”
The US-Iran agreement is well-timed for the Bank of England, which is due to set UK interest rates on Thursday.
If the strait of Hormuz does reopen, and oil flows return towards pre-war levels, there will be less inflationary pressure – and thus less need for interest rate rises.
The European Central Bank raised its interest rates last week, but this week is the turn of the BoE, the US Federal Reserve and the Bank of Japan.
Kathleen Brooks, research director at XTB, says:
Over the past month, the price of oil is down by more than a fifth, and the Brent crude price is now back at levels from early March. This is good news for inflation, which should start tumbling monthly from June, and it could ease concerns about price pressures as we lead up to some major central bank action this week. The decline in the oil price also raises questions about whether the ECB was too hasty in raising rates last week.
European stock markets are on track to jump when trading begins, in just over 20 minutes.
Germany’s DAX share index is up 1.65% in the futures market, Reuters reports, with the UK’s FTSE 100 0.75% higher.
The US dollar is weakening, as investors shift into riskier currencies.
The pound is its highest in over a week, at $1.3438.
Markets rally across Asia
There are strong gains across Asia-Pacific markets today, as investors welcome the deal between the US and Iran.
Japan’s Nikkei share index has leapt by 5%, as has South Korea’s KOSPI, while China’s CSI300 index is 1.9% higher.
Jim Reid, market strategist at Deutsche Bank, says:
Whilst the deal is very good news for markets it looks like tough conversations will have occur in the 60-day window to ensure the peace is sustainable. As an example, the Senate needs to approve any extensive sanction relief for Iran.
For now the can kicking exercise has been very well received by markets even after a strong US close on Friday where hopes were raised of a weekend signing
Introduction: Oil falls to three-month low
Good morning, and welcome to our rolling coverage of business, the financial markets, and the world economy.
The peace deal agreed between Iran and the US is sending a wave of relief through the markets today.
Oil has tumbled 4%, and markets across the Asia-Pacific region have jumped, as investors anticipate the reopening of the strait of Hormuz.
Although it is unclear exactly what has been agreed – with the final text of their memorandum of understanding unpublished – Donald Trump’s claim that “oil will flow on both ends again for the region, and the world” is pushing down energy prices – a relief for busineses, consumers, politicians and central bankers alike.
Brent crude has fallen as low as $83.04, its lowest since 10 March, after the prime minister of Pakistan announced the US and Iran will sign a memorandum of understanding in Switzerland on Friday.
That still leaves Brent above its pre-war price of $72.48 a barrel, though.
Trump has indicated that the opening of the strait is contingent upon the signing of the peace deal, scheduled for Friday.
Iran’s Mehr state news, though, reported that the agreed memorandum of understanding calls for the reopening of the strait within 30 days under “Iranian arrangements” – an indication that Tehran hasn’t surrendered its control of the waterway.
Chris Weston of IG points out that there are still obstacles to overcome:
The probable reopening of the Strait of Hormuz later this week would represent a significant positive development. Markets had increasingly questioned how long inventory draws could offset supply disruptions and whether physical dislocations would begin weighing more heavily on risk assets. The focus now shifts towards understanding what normalisation of logistics could realistically look like, and how quickly shipping volumes can return to pre-conflict levels of 120 to 140 commercial vessels transiting eastbound and westbound each day.
There are still obstacles to overcome. Mines may need to be cleared, and there may be structural damage to refineries and export facilities around the region that will take time to repair and come back to pre-conflict capacity.
The agenda
Paying tribute, Sir Keir Starmer said Lord Hattersley “was a giant of the Labour movement”.
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