Rachel Reeves will next week highlight figures showing a tougher picture than Osborne received in 2010

• Reeves expected to reveal £20bn shortfall

Rachel Reeves is preparing to announce Treasury analysis of Labour’s spending inheritance from the Conservatives in parliament on Monday to highlight why she will need to make “tough decisions” in her autumn budget.

The chancellor’s audit is expected to show £20bn in commitments left unaccounted for by the previous government , building on a narrative that the Tories have left Labour with the “worst set of circumstances since the second world war”.

Bank sets aside just £44m for bad debts and defaults in second quarter amid upbeat outlook

• Business live – latest updates

Fewer borrowers are likely to default on their loans and mortgages, Lloyds has said, as the banking group upped its forecasts for the UK economy.

In fresh estimates released as part of its second-quarter results, Lloyds said it expected the economy to grow 0.8% in 2024 – double the rate of growth forecasted in April, when it predicted a 0.4% rise.

The emergence of artificial intelligence has pushed the tech sector to all-time highs, but other assets have risen, too

The US stock market has been on a tear over the past two years. The S&P 500 has increased by roughly 40% since Joe Biden assumed office in January 2021 and, along with the Dow Jones and Nasdaq , is repeatedly setting new records. Moreover, the dollar has strengthened sharply against every major currency , while the price of gold soared to an all-time record of $2,470 an ounce earlier this month.

Economists and commentators have struggled to explain these trends. While the increase in gold prices could be attributed to elevated risk perceptions stemming from political and geopolitical uncertainties, this explanation does not account for the booming stock market. Conversely, the decline in the Vix volatility index since 2022 might explain the US stock market rally but not the increase in gold prices.

Institute for Fiscal Studies report says interests rate rises have inflicted differing levels of hardship

As many as 320,000 UK adults have been pushed into poverty by soaring mortgage costs after the sharpest increase in interest rates since the 1980s, a leading thinktank has said.

Highlighting the damage caused by Britain’s exploding mortgage timebomb , the Institute for Fiscal Studies (IFS) said individuals who needed to renew their home loans or take out new ones in the past two years had experienced a sharp fall in their disposable income.

S&P Global flash composite purchasing managers’ index shows July rise for manufacturing and services sectors

UK business activity expanded this month after a sharp rise in new sales to a 15-month high, giving a lift to the new government as it prepares to outline the state of the public finances next week, according to a survey of private-sector firms.

A fall in inflation across the services sector was also expected to ease concerns at the Bank of England about persistent price rises ahead of a meeting of the central bank’s policymakers next week.

The signs are clear that not everything is as rosy in Putin’s Soviet-style war economy as Moscow would have us believe

President Vladimir Putin and his authoritarian regime are peddling the false narrative that the Russian economy is strong, and that its war machine is unharmed by western sanctions. This is a lie that must be rebutted. In fact, there are many signs that the Russian war economy is deteriorating. The sanctions and other measures to weaken the Russian economy are effective, but even more can be done. We must continue to increase pressure on Putin’s regime and support Ukraine.

During the Nato summit in Washington DC , western leaders reaffirmed their commitment to Ukraine’s defence. But Russia’s war against Ukraine is not only being fought by soldiers on the ground. It is also a war of information, on which the Kremlin spends an estimated $1.5bn (£1.2bn) a year, and of economic strength. Putin and his authoritarian regime want us to believe that Russia stands unmoved by sanctions and other efforts made to support Ukraine, freedom and democracy. Thus, it is extremely important that politicians, the media and economic institutions in the west do not take the information coming out of the Kremlin at face value. When taking a closer look at the signals, it becomes clear that everything is not as rosy with the Russian economy as Moscow would have us believe.

Elisabeth Svantesson, minister for finance, Sweden

Stephanie Lose, minister for economic affairs, Denmark

Mart Võrklaev, minister of finance, Estonia

Riikka Purra, minister of finance, Finland

Arvils Ašeradens, minister of finance, Latvia

Gintarė Skaistė, minister of finance, Lithuania

Eelco Heinen, minister of finance, Netherlands

Andrzej Domański, minister of finance, Poland

Musk says Tesla will use and sell humanoid robots for manufacturing, while Israeli cybersecurity firm turns down a $23bn takeover offer from Google

European markets are open for trading, and unlike yesterday – when we saw broad gains – it’s a mixed picture this Tuesday morning:

FTSE 100 is down 0.3%

FTSE 250 is up 0.06%

Spain’s IBEX is down 0.09%

France’s CAC 40 is up 0.1%

Germany’s Dax is up 0.5%

Europe’s Stoxx 600 is flat

With extended life expectancy Britain has wound up an increasingly sick nation – and experts say that this is as bad for GDP as it is for our health

• UK must move towards disease prevention to save economy and NHS, says expert

The extension of life expectancy in the 20th century was supposed to be one of the greatest societal opportunities in modern Britain.

But although the longevity dividend bought valuable health and economic gains for individuals and societies, it has long ceased to pay out: instead of living longer, healthier lives, we are an increasingly sick nation where we live longer, but in worse health.

Cybersecurity firm CrowdStrike still working to restore services after global outage last week, while Ryanair was hit by cost-conscious travellers

All eyes are on market reaction to President Biden’s decision to pull out of the US election race. And we have positive prints from all major indexes at the start of the European trading day.

FTSE 100 is up 0.43%

Germany’s DAX is up 0.5%

France’s CAC 40 is up 0.5%

Spain’s IBEX is up 0.4%

Euro Stoxx 600 is up 0.3%

CrowdStrike continues to focus on restoring all systems as soon as possible. Of the approximately 8.5 million Windows devices that were impacted, a significant number are back online and operational.

Together with customers, we tested a new technique to accelerate impacted system remediation. We’re in the process of operationalizing an opt-in to this technique. We’re making progress by the minute.

While Q2 demand is strong, pricing remains softer than we expected, and we now expect Q2 fares to be materially lower than last summer.

No major scheduled data