# Roundup of the week: 13 February 2026

_The Epstein saga rumbles on, AI is quietly reshaping the US labour market, and British Gas says your electricity bill in 2030 will be worse than during the Ukraine crisis. Another week of noise — here's what actually matters._

Neil Woodford · 13 February 2026 · 8 min read

![Roundup of the week: 13 February 2026](https://cdn.sanity.io/images/v3acfbvo/production/759fa6f8895c04d0007f6cac3715702201338641-2430x1620.jpg?w=1600&fit=max&auto=format)

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Thankfully, despite the ongoing political "crisis" in the UK following the latest Epstein disclosures, it has been a relatively quiet week geopolitically. Nothing headline-grabbing has emerged, although I did read about one or two interesting bits of news.

The first relates to a further buildup of US maritime strength in the Middle East, which, despite ongoing discussions with Iran, has led to a further spike in oil prices. There was also a story that the US was looking to seize Iranian oil tankers, just as it did with Venezuela some weeks ago.

Finally, a story that President Zelenskyy had agreed to hold presidential elections later this year to appease US demands in exchange for the security guarantees Trump is offering also caught my attention. Quite how that will be possible under an ongoing drone and rocket bombardment from Russia is beyond me. This might prompt Trump to insist on a longer, more prolonged ceasefire. Either way, my view is unchanged. Putin's maximalist demands will be unacceptable to Europe and Ukraine, and so the chances of peace look slim to me. The war will likely drag on, even though the Russian casualty numbers, featured in an FT article this week, are massive — apparently more than two times those on the Ukrainian side.

## Politics

Aside from the embarrassing latest disclosures in the Epstein files and the political theatre they have engendered in Westminster, there has not been much to report this week. On this particular subject, it remains my view that although Sir Keir Starmer has been weakened by the revelations about his friend and Labour fixer, Peter Mandelson, he will not be directly challenged as leader and PM. Some are arguing that these latest revelations about Mandelson and the PM's flawed judgement might trigger a general election as soon as next year. Although it's important to remember that the PM has the power to decide when to call an election (subject to the Monarch's agreement), I still think this is an outside bet.

It also seems that whilst the government, in an attempt to appease its backbenchers and mollify opposition to Keir Starmer, might think that a lurch to the left is the answer, recent polling by the National Centre for Social Research indicates that the country is marching in the opposite direction. Attitude surveys are showing clear signs of rising public frustration with the Establishment. For example, the proportion of those polled saying that the government should spend less on health, education, and welfare and cut taxes has risen to an all-time high of 19%. Since this question was first asked in 1983, an average of only 6% have answered yes.

Elsewhere, when asked whether the government should spend more on welfare benefits for the poor, even if it leads to higher taxes, respondents now say no by the greatest majority since that survey started back in the mid-80s — a level only matched once before, in the aftermath of the financial crisis.

As a footnote, I should mention that Sanae Takaichi won a landslide victory in Japan’s snap election, announced last Sunday. This conservative leader has an agenda that includes revising Japan's pacifist constitution, which also appears to be very popular with Japan's financial markets, which rallied strongly on the surprise result. (Not quite the disaster that many were forecasting for Japan's financial markets at the end of last year.)

## Economics

### US

In the US this week, the labour market data has attracted most attention. The latest report shows that in January, the US economy added 130,000 jobs—nearly twice as many as expected. The number came as something of a surprise, given that the market was braced for a weak report. Understandably, the immediate reaction was for bonds to fall and for equity markets to rise. However, on closer inspection, the labour market data was not quite so strong. In fact, the Bureau of Labor Statistics revised down the number of total job gains in 2025 from 584,000 to just 181,000 — in other words, a much weaker backdrop. (It seems that the ONS is not the only organisation struggling to measure the number of people in work.)

What this all means for interest rates and the health of the US economy is not completely clear. My guess is that the labour market is relatively weak, but that this doesn't reflect weak growth in a traditional sense. I think it reflects the growing influence of AI across US commerce, where widespread deployment of more sophisticated and useful tools is leading to job losses. In fact, my judgement is that growth remains good and may even be accelerating, which, of course, in turn poses a challenge for the Fed. Weaker labour market data might prompt cuts in rates, but stronger growth will worry those concerned about inflation. I think the answer lies in the twin influence of AI, which will drive faster growth and better productivity whilst also being profoundly deflationary.

### UK

In the UK, GDP data released on Thursday was the "highlight" of the week. The December and Q4 2025 data showed that the economy grew by only a provisional 0.1% in the last three months of the year. Although this was lower than the expected 0.2%, it was not surprising given all the pre-budget nonsense catalysed by the Chancellor and the gaggle of economic forecasters that were determined to peddle the false fiscal black hole narrative — one that sucked the confidence out of the business and household sectors. My guess is that this 0.1% number will be revised up, but for now it means the economy grew by 1.3% for the year as a whole. Excluding the oil and gas sector, which is being hollowed out by successive government energy policies, growth was 1.4%.

Although the headline is a little disappointing, it's still better than was forecast at the start of the year. But once again, the detail of the data reveals a more interesting picture and one which is more aligned with my more upbeat view. Taken together, the three key sectors of the domestic economy — government consumption, household spending, and investment spending — grew by 1.7% in 2025. What dragged down the overall number was net trade, which reduced GDP by 0.9%, having produced a negative contribution of 0.5% in 2024. I have commented many times on the impenetrable, arcane, and volatile trade data before, but in the ONS release, again, attention is drawn to that volatility — and in particular to the weird and wonderful non-monetary gold and other precious metals data, which appear to have had a more distorting influence on the overall trade data towards the end of last year than they usually do.

In fact, the ONS suggests that due to the erratic nature of this series of data, "it can be useful to exclude it." My guess is that if we do — and ignore the idea that this series appears within investment spending and is effectively cancelled out — a more believable picture of how the economy is performing emerges.

One other thing I should mention is that there is considerable variability among the expenditure, income, and output measures of GDP, which has left me wondering which one to believe.

Either way, my conclusion is that the overall picture the data presents is one of a domestic economy that is improving, but whose underlying improvement is to some extent masked by government-imposed headwinds that are disabling the UK's oil and gas industry, and by impenetrable and volatile trade data, which is about as reliable as a chocolate teapot.

I am pretty confident this Q4 data will be revised upward, but nothing I have seen today persuades me that my more upbeat assessment of what lies ahead for the UK economy in 2026 is wrong.

I should also mention something else which drew my attention today. Apparently, there is an important EU heads-of-state gathering in Bilzen, Belgium, today to discuss how to revitalise the moribund EU economy. The French plan, unsurprisingly, is focused on a new form of protectionism, whilst another group, led by the Germans and Italians, wants a bonfire of regulations and reform of the EU's energy policy. I know which camp I would be in given that choice, which leads me to a report published today by British Gas on the UK's energy policy. In it, BG states that electricity prices are on track to be higher in 2030 than at the height of the Ukraine crisis. It suggests that a third of these costs will be the wholesale cost of energy, whilst two-thirds will be "system costs" related to the costs needed to build, integrate, and connect increased renewables. This should be sounding very loud alarm bells in government, whose Secretary of State for Energy seems determined to drive energy prices in the UK to even more absurd levels, regardless of their ongoing impact on British industry and consumers. I wonder if anyone is listening?

## Markets

It's been a relatively quiet week in financial markets, characterised by small declines in equities and modest gains in government bonds. That said, there have been quite a few sets of results, especially in the UK, relevant to the companies I follow. Of note were good numbers from NatWest and Barclays, which, although they were met with share price declines, were nonetheless very encouraging. Barratt Redrow's first-half numbers were neither good nor bad and reflected the difficult trading conditions over the last six months in the housing market. I suspect that as interest rates continue to decline this year, starting in March, trading will pick up significantly. In this context, I also found it interesting that, for the first time in a very long time, a leading UK bank, in this case, Santander, has just launched a 98% LTV mortgage product.

Elsewhere, Mercedes-Benz's full-year numbers were disappointing, especially for margins in the car division, but the confidence expressed in its future margin and cash return targets was well received.

Finally, Alphabet launched its 100-year bond this week. This is the first such issue since Motorola did the same in the late 90s, and so this is a somewhat rare event. It was a complicated, multi-currency, multi-maturity issue, but suffice it to say that it attracted $100 billion in bids in total — potentially reflecting not just widespread confidence in the issuer but also in the assets the money will be used to build.

## What to Look Out for Next Week

Next week once again contains a busy economic calendar. UK labour market and wage data on Tuesday will be closely watched, especially by the MPC. Inflation data will then follow this on Wednesday, and retail sales and PMI data on Friday. In the US, most attention is likely to focus on durable goods orders and industrial and manufacturing production on Wednesday, and Thursday's labour market data. This will inevitably further inform the "will they, won't they" debate on interest rates, and the views not only of the incumbent Fed chair but also of his replacement. Once again, there will be a number of announcements from December year-end companies, including a number in the UK resources sector.