In 1868, a British lawyer set up the first investment trust to pool together small sums of money to buy bonds issued by nations from Turkey to Egypt. A century and a half later, the sector it spawned — closed-end funds traded on stock exchanges — is now worth about £260 billion ($318 billion). It enjoyed a boom in the era of record-low interest rates, more than doubling in size, with a simple pitch: high yields for the masses. But now, central bank interest rates and bond yields are at multi-year highs and have ripped through markets around the world, Bloomberg News reported.

The British economy flatlined in the third quarter, entering what is expected to be a protracted period of stagnation on the cusp of a recession, the New York Times reported. Gross domestic product recorded no growth in July to September compared with the previous quarter, when it grew 0.2 percent. The economy was 0.6 percent larger in the third quarter than a year ago, when many businesses closed for the state funeral for Queen Elizabeth II, the Office for National Statistics said on Friday.

The Bank of England said on Friday it would start the second leg to its first system-wide stress test of how banks, insurers, pension schemes and clearing houses collectively cope with shocks involving interest rates and risky asset prices over 10 days, Reuters reported. The BoE announced in June it was launching its first sector-wide stress test or system-wide exploratory scenario (SWES), kicking off with information-gathering from over 50 firms.

The Bank of England held interest rates at the highest levels in 15 years on Thursday, though policymakers were again divided on the best course of action to stamp out high inflation, the New York Times reported. Six members of the central bank’s nine-member rate-setting committee voted to keep rates at 5.25 percent amid signs that inflation would continue to ease and the economy was weakening. But they said restrictive monetary policy would be needed for an “extended” period, a stronger stance than before, according to the minutes of this week’s policy meeting.

The Bank of England's decision to hold its policy interest rate steady on Thursday puts the world's three major central banks in a "higher-for-longer" holding pattern the length of which will hinge on how inflation behaves, the strength of U.S. growth and the depth of developing slowdowns in Europe and the UK, and whether bond markets sustain the higher borrowing costs that have attracted notice on both sides of the Atlantic, Reuters reported.

Leading AI developers agreed to work with governments to test new frontier models before they are released, to help manage the risks of the rapidly developing technology, in a potentially landmark achievement at the UK's artificial intelligence summit, Reuters reported. Some tech and political leaders have warned that AI poses huge risks if not controlled, ranging from eroding consumer privacy to danger to humans and causing a global catastrophe, and these concerns have sparked a race by governments and institutions to design safeguards and regulation.

England’s largest councils are “running out of road” with almost half saying they are unsure if they can balance their budgets next year, the Independent reported. The County Councils Network (CCN) warned on Wednesday that England’s 41 county and unitary councils face an estimated budget gap of £4 billion over the next three years which they will be unable to plug with more cuts. CCN vice-chairman Barry Lewis said the scale of cuts needed to fill the budget gap is “simply unsustainable” after “a decade of continuous cutbacks”.

A London judge ordered the shuttering of the UK unit of La Perla, a maker of luxury lingerie, over unpaid tax debts, underlining the pressure facing parent company Tennor Holding BV and its ultimate majority owner, Lars Windhorst, Bloomberg News reported. La Perla Global Management (UK) Limited was wound-up by a High Court judge in London on Wednesday, as the group faced £2.8 million ($3.4 million) of unpaid tax and a petition from His Majesty’s Revenue & Customs.

The number of companies going bust this year is on track to be the highest since the depths of the financial crisis in 2009. Insolvencies rose 10% from a year ago in the three months to the end of September, the latest official figures for England and Wales show, BBC.com reported. There has also been a sharp rise in the number of firms at risk of going bust. Firms in "critical financial distress" jumped 25% in the last three months, insolvency expert Begbies Traynor says. They are defined as having county court judgments exceeding £5,000 against them - often a precursor to going under.

The question of how Britain will respond to President Biden’s Inflation Reduction Act, the $369 billion landmark legislation offering deep subsidies for green investment, has followed Jeremy Hunt, Britain’s finance minister, for most of the past year, the New York Times reported. Mr. Hunt urged patience and promised an answer when he updates the country’s budget in a few weeks. But as that speech approaches, expectations that he will offer anything as generous as the American largess have been squashed.