OK, let’s start with the slightly gloomy news that inflation has jumped back up. It’s déjà-vu all over again with quite a lurch above the Bank of England’s 2% threshold to 2.3%. That’s the biggest month-on-month pickup since October 2022, when we were thick in the Liz Truss era of lettuces and rotten tomatoes. There is now an expectation that inflation will get close to 3% next year.

It’s no surprise. It had been predicted earlier in the year, here in the Readout and elsewhere, that inflation could go up again this autumn as energy prices rose in colder weather. 

But could it get even worse? Our reporting team note the Bank of England governor’s worry about the twin inflation threats from the Labour government’s first budget and Donald Trump’s election victory – which “will keep them cautious on policy regardless of the data in the coming months.” Today our live blog quotes investors who are now expecting a “first cut fully priced in March, and a second fully priced in August.”

Equally, there are voices saying that Trump’s tariffs could be disinflationary – if they cause the global economy to cool and trade to drop.

All in, there actually isn’t much to budge economists from the view that the Bank will be bringing us out of the longest run of interest rate increases at a walk, not a sprint. Here’s Ana Andrade and Dan Hanson of Bloomberg Economics: “The larger-than-expected rise in CPI inflation and stickiness of price pressure in the service sector are the most eye-catching parts of October’s CPI release. But a look beneath the surface suggests that domestically generated inflation is easing, albeit slowly. That should give the Bank of England confidence to continue lowering interest rates gradually over the course of 2025.”

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The stories you need to know about this evening

• Accused of going too far, the FCA plots where to go next.
• Nvidia traders brace for potential $300 billion earnings move.
• Ukraine fires British Storm Shadow missiles at Russia for first time.
• Trump’s Treasury search gains steam with fresh meetings.
• Bloomberg Opinion: Productive knowledge workers are fuelled by curiosity.

The most optimistic reading of this time of nuclear threats and trade wars is that politicians are “escalating to de-escalate”: mooting aggressive moves to scare people into making progress.

But if that’s geopolitics as seen from a private jet, what about the geopolitical moves playing out far below — including the snipping of cables on the seafloor? Just this week, we reported that German Defense Minister Boris Pistorius has said that damage to two undersea data cables in the Baltic Sea must be assumed to be “sabotage.” The Danish military is currently staying close to a Chinese ship which might be linked. 

If you’re as fascinated by cable cuts as I am, then this Bloomberg Originals film on another similar case from 2021 is worth your time – it is Scandi-noir-meets-investigative-journalism.

Our reporter tells a tale that opens with researchers at a Norwegian marine life monitoring station (“the humpback is a personal favorite” says a black turtleneck-wearing scientist). One morning they found their data flow of whale sounds from a cable in the Norwegian Sea stopped. I will not spoil how that ended, but 10 minutes into the film, he uncovers a second snapped cable – this time off the coast of Svalbard.

The police detective assigned to the case, whose area of responsibility encompasses the Norwegian coast up to the North Pole, says: “In the area of the Svalbard cable you can see tracks on the seabed, deep tracks – definitely man-made.” Two Russian fishing trawlers can be connected to the areas in question – in the case of the second vessel, the Russian trawler had passed over the area of the damaged cable more than 130 times.  

As an analyst in the film puts it: “The inability to prosecute...shows to me the capability that Russia has and the difficulty of dealing with this kind of asymmetrical warfare. The Russian doctrine is quite clear that in a potential confrontation, this kind of infrastructure will be attacked in the very early stage of a conflict.” It is, she says, particularly attractive as a tactic because Russia’s military is rusty.

Elsewhere analysts disagree about whether these snips are drills for a far bigger operation, or simply Russian warnings of the havoc they could inflict if they wanted to. If you are reading this on your commute home, this is perfect watching should you have 17 minutes left until your stop…and a sturdy disposition.

One key story, every weekday

Forty miles east of the Malaysian peninsula sits the world’s largest gathering point for dark fleet tankers. Aging ships, often operating under flags of convenience and without insurance, come here daily to transfer cargo away from prying eyes. It’s how billions of dollars of sanctioned Iranian oil finds its way to China annually — even though the country, officially, hasn’t imported a drop in more than two years.

A Bloomberg analysis of nearly five years of satellite images from the hotspot shows the vast size of the shadow industry that’s developed as the US has tightened its sanctions on Iran.

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Allegra Stratton worked for former Prime Minister Rishi Sunak when he was chancellor and runs an environmental consultancy, Zeroism.

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