BT and the US mobile company Verizon are to combine their international businesses, ending the British telecom group’s more than 18-month search for a buyer.

Verizon will pay a $625m (£473m) “equalisation” fee to BT to guarantee equal voting rights in the new 50/50 joint venture, the companies announced on Monday. The deal is expected to create a company with more than 3,000 customers across about 180 countries and $4bn in combined annual revenue.

It marks the end of BT’s long search for a buyer of its international business, as its chief executive, Allison Kirkby, works to refocus the company on the UK market.

She said the deal marked an “important step forward for BT as a whole, as we deliver on our UK-focused strategy”.

British American Tobacco has just become the latest company to cut jobs as it uses AI to boost productivity.

BAT has announced it will cut 5,500 jobs globally by the end of this year, through its Fit2Win transformation programme.

Fit2Win is expected to cut costs by £600m by the end of 2028, by reducing complexity, building closer partnerships with technology and business services companies, and streamlining the business.

Those partnerships include a tie-up with Accenture, to give access to “advanced AI solutions”.

Tadeu Marroco, chief executive of BAT, said:

“We are building a future-ready organisation that is more agile, cost disciplined and technology enabled.

“Fit2Win is central to this ambition, strengthening how we operate and our ability to compete in a rapidly evolving environment.

“These changes affect many of our colleagues, and we are focused on supporting them through this transition with care and respect, as we position the business for the future.

In addition, around BAT 3,500 roles have been moved to “strategic partners”.

Over in Korea, two of the country’s chipmaking giants and the Seoul government have announced a massive manufacturing expansion costing more than half a trillion dollars, to address the shortages of AI chips.

President Lee Jae Myung pledged to cement South Korea’s leadership in the industry with investments worth more than $576bn over several years covering semiconductors, AI data centres and robotics.

Under the plan, Samsung Electronic and SK Hynix will build a total of four fabrication plants in South Korea’s southwest region.

Lee said:

“We must secure the core elements of AI faster than any other country.

Semiconductors, physical AI, and AI data centres are the triple axis for our great leap forward.”

South Korea’s stock market has more than doubled in value so far this year, thanks to the surge in demand for chips to power AI systems.

At the end of last week, Samsung’s share price has jumped 183% so far this year, while SK Hynix had risen 310% since the start of January.

The oil price is nudging higher, after the latest tit-for-tat military strikes between the US and Iran.

Brent crude is up almost 1% at $72.61 a barrel, having fallen to its lowest level since just before the confict began on Friday.

Oil prices are pushing. up after Tehran launched drone and missile attacks against Bahrain and Kuwait on Sunday after new US strikes on sites in southern Iran.

Last night, a US official said both sides had agreed to “stand down”, which is probably helping the oil price from rising more sharply.

Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.

The Bank of England’s chief economist is warning against complacency in the fight against inflation, after finding himself in a minority at this month’s BoE interest rate vote.

Huw Pill has told the Press Association that policymakers “should not be complacent” about the current rate of inflation, after the Consumer Prices Index (CPI) remained over the Bank’s 2% in May, at 2.8%.

Pill argued that in the past, inflation running around one percentage point above target would have been seen as “problematic”, adding:

“I think it should be seen as problematic, because our mandate is very clear; inflation at 2% at all times.”

“I do fear a little bit that, because we saw inflation go to 11%, policy discussion becomes, ‘oh inflation at 3% is not so bad’.”

Two week’s ago, the Bank’s monetary policy committee split 7-2 when it voted to leave borrowing costs on hold, with Pill and Megan Greene the lone voices for a hike in Bank rate.

Pill also appeared to criticise the six cuts in interest rate since August 2024, arguing that on balance monetary policy “hasn’t been restrictive enough over the last few years.”

City economists have been cutting their forecasts for UK interest rate rises in recent weeks, as tensions in the Middle East have cooled somewhat, and the oil price has fallen.

The City money markets are now only fully pricing in a rise in interest rates by next February – earlier this year, as many as three rises this year were priced in.

But the latest round of escalating strikes between Iran and the US last weekend has shown that the peace deal will not be easy to secure.

As Pill puts it:

“The world is becoming more uncertain and becoming more complex,” Mr Pill concluded.

“What we can guarantee is that monetary policy is not adding to uncertainty, and I think that is where we should keep the focus.”

The agenda

• 9.30am BoE mortgage approvals and consumer credit data

• 18.30pm BST: Christine Lagarde, president of the European Central Bank, gives speech at the ECB Forum on Central Banking 2026