Money markets have pushed back their expectations for the first interest rate cut by the Federal Reserve after shock US employment figures.

Traders are not pricing in a first interest cut by the Fed until September, having earlier predicted the move would have certainly happened by July.

It comes after “blockbuster” US employment data came in much higher than expected.

The US economy added 303,000 jobs in March, up from a downwardly revised 270,000 in February and much higher than the 214,000 predicted by analysts.

The pound dropped sharply following the data, falling as much as 0.7pc against the dollar below $1.26.

However, markets on Wall Street moved higher in early trading as the data also revealed unemployment fell slightly to 3.8pc and wage growth slowed to 4.1pc.

A rate cut by the Federal Reserve in June is still given a roughly 50pc chance.

Paul Ashworth, chief North America economist at Capital Economics, said: “The blockbuster 303,000 increase in non-farm payrolls in March supports the Fed’s position that the resilience of the economy means it can take its time with rate cuts, which might now not begin until the second half of this year.”

Preston Caldwell, chief US economist at Morningstar, added: “There is no weakness in the job market which would impel the Fed to quickly cut, but no tightness which would prohibit a cut either.

“Fed decisions in upcoming meetings will hinge mainly on the inflation data. We continue to expect slowdown in job growth in the second half of 2024 in response to slowing economic growth.”

Read the latest updates below.

Thanks for joining us today. We’ll be back blogging on market news on Monday, but I’ll leave you with more about the report that Elon Musk has axed a planned entry-level Tesla:

Read the full story…

Civil servants at Britain’s official statistics body have voted to go on strike after being asked to work in the office for two days a week. Lucy Burton reports:

Read the full story…

The FTSE 100 closed down 0.8pc today. PaddyPower owner Flutter Entertainment rose the most, up 1.15pc, followed by BAE Systems, up 0.99pc. The biggest faller was Ocado, down 9pc, followed by St James’s Place, down 4.3pc.

The FTSE 250 fell 0.7pc. The biggest riser was Endeavour Mining, up 2.3pc, followed by investment company ICG Enterprise Trust, up 2.2pc. The biggest faller was Aston Martin, down 4.7pc, followed by investment manager Ashmore, down 2.54c.

Tesla has canceled the long-promised inexpensive car that investors have been counting on to drive its growth into a mass-market automaker, according to three sources familiar with the matter and company messages seen by Reuters.

The carmaker will continue developing self-driving robotaxis on the same small-vehicle platform, the sources said.

The decision represents an abandonment of a longstanding goal that Tesla chief Elon Musk has often characterised as its primary mission: affordable electric cars for the masses. His first “master plan” for the company in 2006 called for manufacturing luxury models first, then using the profits to finance a “low cost family car.”

He has since repeatedly promised such a vehicle to investors and consumers. In January, Mr Musk told investors that Tesla planned to start production of the affordable model at its Texas factory in the second half of 2025, following an exclusive Reuters report detailing those plans.

The now-defunct entry-level vehicle, sometimes described as the Model 2, was expected to start at about $25,000 (£19,800).

The Telegraph has approached Tesla for comment.

A German “robo-shop” has hit out at a court decision to prevent it opening on Sundays amid a row over whether federal laws enshrining weekend rest should apply to unmanned stores. Hannah Boland reports:

Read the full story…

Tesla is cutting prices in America after as it struggles with excess stock.

Bloomberg reported that the carmarker produced 46,561 more vehicles than it delivered in the first quarter of the year, and is now cutting prices of some cars by around $5,000 (£4,000).

Tesla shares are down 0.6pc in trading today, or 31.6pc since the start of the year.

Tesco is expected to reveal higher profits as sales have continued to grow despite a slowdown in food price inflation.

Investors have been in positive spirits in recent months, particularly after Tesco upgraded its profit targets in a post-Christmas trading update.

Its shares struck their highest level for almost two years as a result, with the retail giant’s investment in pricing helping to maintain growth despite competition from fast-growing discount rivals.

Shareholders in the business will be hopeful that this can translate to another positive trading outlook when it updates the market on April 10.

Tesco’s full-year results are expected to show adjusted operating profits of about £2.9bn for the year to February, according to a consensus of analysts, PA Media reported.

That is compared with profits of £2.63bn for the previous year.

Sophie Lund-Yates, lead equity analyst at Hargreaves Lansdown, said: “Investors will be looking for further proof of volume uplifts as price cuts continue as inflation tempers.

“With that in mind, it will be the outlook statement that holds the most weight where sentiment is concerned.”

Jefferies analyst James Grzinic said the supermarket giant “should confirm another impressive year” after industry data from Kantar showed Tesco continued to improve its market share over the past year.

Zimbabwe’s central bank has launched a new “structured currency” backed by gold, as it seeks to tackle sky-high inflation and stabilise the country’s long-floundering economy.

The ZiG – short for Zimbabwe Gold – will replace the Zimbabwean dollar which has tumbled in value over the past year, pushing inflation through the roof.

The governor of the country’s central bank, John Mushayavanhu, said:

He also announced a drastic cut in the bank’s main interest rate, from 130pc to 20pc.

The ZiG will be “fully anchored and fully backed” by a basket of reserves comprising foreign currency and precious metals – mainly gold, Mushayavanhu added.

The move is aimed at fostering “simplicity, certainty, [and] predictability” in Zimbabwe’s financial affairs, he said, presenting the new banknotes that come in eight denominations ranging from 1 to 200 ZiG.

The Zimbabwean dollar has lost almost 100pc of its value against the US greenback over the past year.

Its poor performance contributed to the southern African country’s high inflation rate, which after climbing well into the triple digits last year, was at 55pc in March, according to official data.

This has piled pressure on its 16 million people who are already contending with widespread poverty, high unemployment and a severe drought induced by the El Nino weather pattern.

European stocks have fallen to a more than two-week low today, tracking a global skittishness in sentiment following hawkish comments from some U.S. Federal Reserve officials and a spike in tensions in the Middle East.

The continent-wide STOXX 600 fell 1.1pc during trading, with the index on track for its worst day since mid-October 2023.

Benchmark indexes across all major continental economies such as Germany, France, Italy and Spain also fell over 1pc each.

Sparking caution on market expectations for an imminent rate cut, Minneapolis Fed president Neel Kashkari said if inflation continued to stall, an interest rate reduction may not be required by year-end.

However, trader bets were still largely pointing towards the first interest rate cut in June by the European Central Bank and the Fed.

Thomas Gehlen, senior market strategist at SG Kleinwort Hambros, said:

While the European economy lagged the US, European shares are much more attractively valued than American ones, he added.

Hold the front page: There has been an earthquake in New York.

There are reports that the tremors measure 5.5 on the Richter scale.

We will have the latest online soon. My colleague Alex Singleton will keep you up to speed from here.

Wall Street’s main stock indexes rose after stronger-than-expected March jobs data pointed to resilience in the labour market even as it meant the Federal Reserve would be in no rush to cut interest rates.

Analysts hailed the “beautiful” report from the Labor Department showing nonfarm payrolls increased by 303,000 jobs in March compared with expectations for an increase of 214,000.

The unemployment rate stood at 3.8pc compared with expectations that it would remain steady at 3.9pc, while average wages earned rose 0.3pc on a monthly basis, in line with estimates.

David Waddell, chief executive at Waddell & Associates, said:

Money markets are now pricing in about 56pc chance of at least a 25 basis point rate cut from the central bank in June, but have pushed back the point at which they price in the first cut.

Traders now think a first cut is guaranteed to happen by September, compared to July before the jobs report was published.

The Dow Jones Industrial Average was up 51.48 points, or 0.1pc, at 38,648.46, the S&P 500 was up 14.55 points, or 0.3pc, at 5,161.76, and the Nasdaq Composite was up 41.12 points, or 0.3pc, at 16,090.20.

Analysts set out why they think stocks are rising:

The main US stock indexes opened higher after stronger-than-expected March jobs data pointed to resilience in the labour market even as it meant the Federal Reserve would be in no rush to cut interest rates.

The Dow Jones Industrial Average rose 68.0 points, or 0.2pc, at the open to 38664.98.

The S&P 500 rose 11.7 points, or 0.2pc, at the open to 5158.95​, while the Nasdaq Composite rose 46.3 points, or 0.3pc, to 16095.398 at the opening bell.

The pound has dropped sharply after the stronger-than-expected level of hiring in the US.

Sterling has slumped 0.5pc to below $1.26 after American employers added 303,000 workers to their payrolls and pushed back hopes of interest rate cuts.

The FTSE 100 reduced its losses slightly to 0.8pc after the nonfarm payrolls figures were published, having earlier been down as much as 1.1pc.

The dollar has strengthened after traders pushed back their expectations for interest rate cuts, with a first reduction now priced in by September, rather than July.

The Federal Reserve has been given another reason to “take its time” on interest rate cuts after “blockbuster” employment figures came in much higher than expected.

The US economy added 303,000 jobs in March, up from a downwardly revised 270,000 in February and much higher than the 214,000 predicted by analysts.

Paul Ashworth, chief North America economist at Capital Economics, said: “The blockbuster 303,000 increase in non-farm payrolls in March supports the Fed’s position that the resilience of the economy means it can take its time with rate cuts, which might now not begin until the second half of this year.”

Money markets have pushed back their expectations for the first interest rate cut by the Federal Reserve after the surge in hiring in March.

Traders are not pricing in a first interest cut by the Fed until September, having earlier predicted the move would have certainly happened by July.

Richard Flynn, managing director at Charles Schwab UK, said:

US investors turned more cautious in premarket trading amid fresh evidence of a tight jobs market could jeopardize the case for imminent interest-rate cuts by the Federal Reserve.

A Labor Department report showed nonfarm payrolls increased by 303,000 jobs in March compared with expectations for an increase of 214,000.

The unemployment rate fell to 3.8pc, down from 3.9pc, while average earnings rose 0.3pc on a monthly basis.

In premarket trading, the Dow Jones Industrial Average, the S&P 500 and Nasdaq 100 were all up around 0.1pc.

Unemployment in the US edged down last month in a sign the American jobs market remains strong in the face of interest rates at 23-year highs.

The unemployment rate fell to 3.8pc in March from 3.9pc in February, as the number of people out of work dropped by 29,000 to 6.4m.

Average hourly earnings increased by 4.1pc over the last year – well ahead of inflation which stood at 3.2pc in February.

The US economy added more jobs than expected last month in a blow to hopes of interest rate cuts.

Nonfarm payrolls grew by 303,000 in March, according to the Labor Department, which was ahead of forecasts of 214,000.

The US Federal Reserve’s policymakers have long said they consider an overly strong jobs market as a risk to inflation, and thus interest rate cuts.

Employees at the Office for National Statistics (ONS) have voted to strike in a dispute over workplace attendance.

Members of the Public and Commercial Services union (PCS) backed industrial action by around three to one in protest at being told to work from their office for two days a week after previously being allowed to work from home since the start of the lockdown.

The union said home and hybrid working has been successful since the start of the pandemic, adding that managers had reassured staff that these arrangements would remain in place.

Fran Heathcote, general secretary of PCS, said: “ONS bosses have seriously undermined the trust and goodwill of their staff by seeking to drive this policy through in such a heavy-handed way, heedless of the consequences.

“They now need to immediately pause implementation of the policy and talk to us about reaching a sensible resolution of this issue, which does not carelessly disadvantage staff.”

Away from Thames Water, the other potentially major news today will come from the US.

The American economy is thought to have added 200,000 jobs in March — which would mark a slowdown from February’s vigorous gain of 275,000 and last year’s monthly average increase of 251,000.

A modest downshift in hiring could reassure the Federal Reserve that the economy is not running too hot for interest rate cuts, especially if wage growth, a key driver of inflation, also slowed last month.

The Fed’s policymakers are tracking the state of the economy, the job market and inflation to determine when to begin cutting interest rates from their multi-decade highs — a move eagerly awaited by Wall Street traders, homebuyers and people in need of cars, household appliances and other major purchases that are typically financed.

The FTSE 100 is down 1pc ahead of the decision amid worries that the Fed could abandon its rate cut plans.

In premarket trading, US stock markets were higher, with the Dow Jones Industrial Average up 0.3pc, the S&P 500 up 0.4pc and the Nasdaq 100 up 0.5pc.

Before the announcement by Kemble, the bonds were already trading at 17p in the pound, having fallen from 88p as recently as June last year.

It means that bondholders were already expected to receive only 17pc of the value of the loan if the bond was redeemed.

Kemble, the owner of Thames Water, sent a formal notice of default to the holders of its £400m of bonds due in 2026 as it did not pay the interest that had been due on Tuesday.

The company is now seeking talks with creditors over its debt structure and has hired consultants Alvarez & Marshall to advise on its next move.

The company has requested that its bondholders “take no creditor action” over the default so that it can have the stability to explore “all options”.

It said it would provide a further update in the coming weeks.

The owner of Thames Water is a step closer to insolvency after it issued a notice to lenders that it has defaulted on £400m of bonds.

Kemble Water had already revealed that it would be unable to meet the repayment of a separate £190m loan.

The cash crunch comes after Thames Water shareholders this month decided to abandon plans to inject £500m into the utility company, which supplies a quarter of England’s water.

Kemble is funded entirely through dividends received from Thames Water.

It emerged on Thursday that two Chinese banks are to determine the fate of the troubled supplier as it scrambles to avoid nationalisation.

A consortium of lenders to Kemble is made up entirely of foreign banks, including the Bank of China and the Industrial and Commercial Bank of China – both of which are owned and controlled by the Chinese state.

Apple is cutting more than 600 jobs after abandoning its decade-long efforts to build an electric car.

Our senior technology reporter Matthew Field has the details:

Read on for details of the project launched in secret in 2014.

Administrators who have taken control at the Body Shop are looking at whether a controversial restructure tactic could save the high street beauty chain.

The administrators at FRP said in a report this week they have been liaising with the company about how could propose a creditors voluntary arrangement, known as a CVA.

The tool is used to renegotiate rents with landlords, while allowing the closure of struggling stores.

FRP said: “We have been provided with trading forecasts which are based on ongoing discussions with key suppliers, landlords and other relevant stakeholders.”

It added: “Once we are satisfied that we are in receipt of a workable CVA proposal we will revert to creditors.”

The Body Shop collapsed into administration in February, putting 2,000 jobs at risk, and it has already closed about 80 stores across the UK with the loss of around 500 jobs.

The pound has slipped slightly against the dollar despite figures indicating that Britain is moving past its recession.

Sterling dropped 0.1pc to $1.26 despite PMI data showing the construction sector returned to growth in March for the first time in seven months.

Investors are waiting to see what the latest US nonfarm payrolls figures show, with a sharp increase in employment risking delays to the Federal Reserve’s plans to cut interest rates.

The BBC is to launch a video game starring Gary Lineker as it scrambles to win over young audiences.

Commodity trader Trafigura Group has announced the departure of two senior executives in a second leadership shake-up in seven months.

Chief financial officer Christophe Salmon will retire in June, while its executive director and long-time head of oil Jose Larocca will retire in September.

Mr Larocca was a protege of late founder Claude Dauphin and has been one of the company’s top trio for the past decade.

Mr Salmon joined the business in 2012 and has served in his present role for nearly 10 years. He will be replaced by Stephan Jansma, currently the company’s chief financial officer for Asia Pacific.

It comes after a period of turmoil at the privately-held trading house, in which it has reported record profits but been hit by trading missteps and charges of wrongdoing.

It emerged in December that senior traders and partners would share a $5.9bn (£4.7bn) dividend after the energy crisis triggered a surge in profits.

The company’s 1,200 staff, which are all shareholders, each received an average $5m each, with some employees receiving significantly more.

However, it last week agreed to pay about $127m to resolve a US Department of Justice investigation into bribes paid to Brazilian officials to secure oil contracts.

The latest boardroom changes come amid a restructuring of management which began in September last year ahead of the departure of longtime chief operating officer Mike Wainwright, who retired last month.

Experian shares fell 1.6pc after the credit data group agreed to acquire peer Illion for up to 820m Australian dollars (£427.2m).

The agency said it would fund the deal, which is expected to be completed in the second half of this year, from “cash resources”.

It said it expects the acquisition to add revenues of about 175m Australian dollars, compared to its current expected revenues in the region of about 115m Australian dollars.

Chief executive Brian Cassin said:

The FTSE 100 and the FTSE 250 remain down 1pc and are both on track to record weekly losses.

It comes after words of caution from US Federal Reserve officials on Thursday about the need to keep interest-rate cuts in check until inflation clearly slows.

Minneapolis Fed President Neel Kashkari said that if inflation continues to stall, no cuts may be required at all by year end.

US inflation stood at 3.2pc in February, rising from 3.1pc in January. It has remained close to that level since falling to 3pc in June.

Investors globally are also unnerved by Israel bracing for the possibility of a retaliatory attack after its suspected killing of Iranian generals in Damascus this week.

Prime Minister Benjamin Netanyahu said the country would harm “whoever harms us or plans to harm us,” raising the risk of a wider conflict which could disrupt global supply chains.

Danni Hewson​​​​, head of financial analysis at AJ Bell, said: “Investors are having to seriously consider the potential that what’s going on in the Middle East will get worse before it gets better and comments from the Israeli Prime Minister have stoked fears that there is going to be a much wider impact.”

Later in the day, investors will analyse the US non-farm payrolls report for fresh insights into the trajectory of interest rates.

Wholesale gas prices have gained for a second day amid the escalating tensions in the Middle East.

Europe’s benchmark contract has risen as much as 2.2pc towards €27 per megawatt hour amid growing concerns that Iran could retaliate after the Israeli strike on its embassy in Syria, risking wider conflict.

It comes as the price of Brent crude is trading around $91 a barrel – its highest since October.

Ole Hansen, head of commodity strategy at Saxo Bank, said:

The UK equivalent gas contract has gained as much as 2pc to about 66p per therm.

Britain’s construction sector returned to growth for the first time in seven months amid signs the UK economy is recovering, according to economic data.

The S&P Global UK Construction PMI – rose from 49.7 in February to 50.2 in March, rising above the 50 mark separating expansion from contraction for the first time since August.

The survey showed new orders expanded at the fastest pace since May last year while input price inflation eased to a three-month low.

Tim Moore, economics director at S&P Global, said:

The eurozone construction sector remained firmly in contraction territory in March as activity fell sharply again, according to a closely-watched survey.

The HCOB Eurozone Construction PMI stood at 42.4 in March, down slightly from 42.9 in February and well below to 50 mark that separates growth from contraction in the sector.

It said the decline in activity across the eurozone was driven by marked contractions in France and Germany, both of which recorded quicker declines on the month.

Tariq Kamal Chaudhry, economist at Hamburg Commercial Bank, said: “The performance of the construction sector in the eurozone remains bleak. The eurozone has been enduring a downturn for almost two years now.”

Disney is to crack down on password sharing as the Hollywood giant races to boost subscriber growth and turn a profit from its streaming service.

Our media reporter James Warrington has the details:

It comes as its Disney+ service remains loss-making.

Large parts of the country have no train services because of a fresh strike by drivers in a long-running pay dispute.

Members of Aslef at Avanti West Coast, CrossCountry, East Midlands Railway, West Midlands Railway and London Northwestern walked out today, mounting picket lines outside stations.

Aslef’s general secretary has said the British public supports striking train drivers “more than you might think” as the union began its three-day series of rolling strikes.

Speaking in front of striking train drivers at Euston station, Mick Whelan said:

He said “there isn’t a household in the country with someone in the public sector or private sector” that has not had someone go on strike or “fight for a cost-of-living (pay) increase”.

Mr Whelan added: “There’s far greater empathy and sympathy from the travelling public than you might believe.”

The FTSE 100 dropped sharply amid signals from a Federal Reserve official that the US might not cut interest rates after all this year.

Britain’s blue-chip stock index fell 1pc as trading began in London after Minneapolis Fed President Neel Kashkari said he is questioning the need to reduce borrowing costs.

Mr Kashkari had previously pencilled in two cuts to interest rates this year – with the Fed officially forecasting three cuts before the end of 2024.

However, he warned “if we continue to see inflation moving sideways, then that would make me question about whether we need to do those rate cuts at all”.

The comments sent stocks sharply downwards, even though Mr Kashkari is not a voting member on the interest rate setting Federal Open Market Committee this year. The FTSE 250 also dropped 1pc.

Investors are anxious ahead of US employment figures due later, which could raise doubts about interest rate cuts if the number of payrolled employees is stronger than expected.

Sophie Lund-Yates, lead equity analyst at Hargreaves Lansdown, said the FTSE 100 has “gone backwards” as a result of the “downbeat tone over in the US”.

She added: “The narrative around the potential for interest rate cuts has been slightly contradictory this week, so there’s a lot resting on this data to help steady the ship. A looser labour market could help back the argument that the economy is returning to more stable footing.”

German factory orders edged up by less than expected in February in a sign Europe’s largest economy remains in the doldrums.

Demand increased by 0.2pc from January, which was below economists forecasts of a rise by 0.7pc.

Factory orders are down 10.6pc compared to the same time a year ago amid poor performance from its metals, cars and machinery sectors.

The FTSE 100 dropped sharply as trading began after a US Federal Reserve official said policymakers might not cut interest rates at all this year.

The UK’s blue chip index slumped 1pc to 7,898.71 while the midcap FTSE 250 sank 0.7pc to 19,727.72.

Oil has reached a fresh five-month high as Israel prepared for potential retaliation from Iran to its strike on Tehran’s embassy in Syria.

Global benchmark Brent crude has risen 0.6pc in early trading above $91 a barrel, its highest level since October. US-produced West Texas Intermediate was up 0.5pc to more than $87.

Crude has risen by 18oc this year amid geopolitical tensions in the Middle East and Ukraine, just as the Opec cartel and its allies implement cuts to supplies in a bid to increase prices.

Israel has increased preparations for potential retaliation by Tehran after Monday’s strike on an Iranian diplomatic compound in Syria, stoking fears of a wider regional conflict.

The conflict between Israel and Hamas had led to Houthi attacks on shipping in the Red Sea, pushing up transport costs.

Majestic has completed a rescue deal to buy wine bar chain Vagabond from administration.

The UK’s largest specialist wine retailer confirmed talks over a potential move last month after Vagabond Wines went into insolvency.

Majestic confirmed it has completed the acquisition, which will secure the future of nine Vagabond venues and 171 workers.

The bar company’s “underperforming” site in Canary Wharf and its bars at Gatwick Airport are not included in the deal.

John Colley, chief executive of Majestic, said:

Shell has revealed that trading in its gas division in recent months is set to drop, after an “exceptional” end to the year for the energy giant.

The company saw its annual profits fall in 2023 compared with the previous year, when soaring oil prices drove profits to an all-time high.

But its performance picked up in the final quarter with underlying earnings, including taxes, boosted by 17pc compared with the previous three months.

In the latest update to shareholders, Shell said it expects trading in its integrated gas division over the first quarter to be “strong but significantly lower than an exceptional” final quarter.

Estate agents said the latest fall in house prices show that mortgage affordability has become “absolutely pivotal” to buyers.

Oliver Fish, director at estate agent Oliver & Co, said: “Affordability is a real issue at present. The cost of borrowing is making buyers think whether they should buy something smaller, in a cheaper area or wait to see if borrowing gets cheaper.”

James Mason, managing director at Hawksman Real Estate, said: “Affordability is absolutely pivotal in the property market right now. While rates were so incredibly low for so long, it was less of a concern, but with higher mortgage rates and significantly increased monthly repayments, it is now key.”

Ben Perks, managing director at Orchard Financial Advisers, said:

House prices stalled after an increase in average mortgage rates since a price war between lenders in January.

The average two-year fixed deal fell as low as 5.55pc in January as lenders clamoured for customers amid expectations that the Bank of England would cut interest rates five times this year.

However, as money markets reduced their expectations for rate cuts amid persistent inflation – now pricing in about three cuts before the end of the year – the average mortgage rate has since risen to 5.81pc on Thursday, according to Moneyfacts.

A typical five-year fixed rate has risen from 5.18pc to 5.39pc over the same period.

Imogen Pattison, assistant economist at Capital Economics, said:

With house prices still 0.3pc higher compared to last year, Halifax Mortgages director Kim Kinnaird said:

Northern Ireland remains the strongest performing nation or region in the UK – with house prices up by 4.3pc on an annual basis, according to Halifax.

Properties in Northern Ireland now cost an average of £194,743, which is £7,972 more than a year ago.

In Wales annual property price growth slowed to 1.9pc in March, from 3.9pc in February, with the average home now costing £219,213.

Meanwhile Scottish house prices rose +2.1pc year-on-year to stand at £204,835.

The survey indicated there is a north/south divide in England when it comes to house prices.

The North West saw the strongest growth, up by 3.7pc on an annual basis to £232,315.

Properties in Eastern England recorded the biggest decline of 0.9pc, with homes selling for an average of £330,627, a drop of £2,878 over the last year.

London continues to have the highest average house price in the UK, at £539,917. Prices in the capital have increased by 0.4pc over the last year.

House prices fell for the first time in six months in March amid rising mortgage rates, according to a lender.

Property values declined by 1pc last month when compared to February, the Halifax house price index showed.

The survey found that the average house price in Britain dropped to £288,430, around £2,900 less than last month.

Compared to the same month last year, house prices have risen by 0.3pc.

Halifax Mortgages director Kim Kinnaird said: “Financial markets have also become less optimistic about the degree and timing of Base Rate cuts, as core inflation proves stickier than generally expected.

This has stalled the decline in mortgage rates that had helped to drive market activity around the turn of the year.”

Purplebricks chief executive Sam Mitchell added: “The blip in house prices was caused by a small increase in rates at the start of March, since then we have seen banks compete more aggressively, rates reduce further, inflation come down ahead of expectations, and both viewings and offers levels are ahead of expectations.”

A separate survey by rival lender Nationwide also showed a decline in monthly house prices by 0.2pc between February and March.

Ms Kinnaird added:

Thanks for joining me. House prices fell in March, according the latest survey by Halifax.

The average property was worth £288,430, down £2,900 – or about 1pc – compared to February.

1) British stock market lags behind France and Germany as companies ditch London | Dearth of listings casts long shadow over the Square Mile’s future prospects

2) Mini-nukes to be built in Hartlepool under multimillion-pound proposal | Engineering group Babcock wins funding to build small modular reactors in Teesside

3) Why the threat of a ‘nightmare’ Chinese supercomputer just got a step closer | Investigation into US State Department hack lays bare fears over quantum advances

4) Chinese restaurant replaces tips with 15pc ‘brand charge’ that goes to owners | Change comes ahead of fresh legislation that will force bosses to pass tips to workers

5) Ben Marlow: We are all at the mercy of Thames Water’s foreign ownership | Revelation comes amid concerns over foreign involvement in British infrastructure

Asian shares mostly declined after a US Federal Reserve official said the central bank might not deliver any of the interest rate cuts that Wall Street has been banking on this year, citing concerns about inflation.

Japan’s benchmark Nikkei 225 fell 2.4pc to 38,812.24. Sydney’s S&P/ASX 200 slipped 0.8pc to 7,756.20.

South Korea’s Kospi dropped nearly 1pc to 2,714.84. Hong Kong’s Hang Seng lost 0.8pc to 16,594.79.

Tensions in the Middle East added to the sense of pessimism. But some analysts suggested the Fed may cut rates at least once later this year.

American stocks on Thursday tumbled Minneapolis Fed President Neel Kashkari said he is questioning the need to cut rates if so many areas of the economy look to be solid despite high interest rates.

The S&P 500 dropped 1.2pc for its worst day in seven weeks. Earlier in the day, a gain of nearly 1pc had brought it to the cusp of its record set last week.

The Dow Jones Industrial Average swung 1.4pc lower, after reversing a rise of nearly 300 points. The Nasdaq Composite fell 1.4pc.

The yield on benchmark 10-year Treasury bonds fell to 4.30pc from 4.35pc late on Wednesday.

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