UK 2 August 2019 Five things you need to know today: Lib Dems triumph over Tories in Brecon by-election Plus, markets plummet after Trump’s new tariffs threat, US and Russia fail to renew nuclear arms treaty, UK to create 10 free ports. Getty Images The Liberal Democrats celebrate after winning the Brecon and Radnorshire by-election. Sign UpGet the New Statesman's Morning Call email. Sign-up Tories’ majority cut to just one after by-election defeat The Conservatives’ working parliamentary majority has been cut to just one seat after the Liberal Democrats won the Brecon and Radnorshire by-election. The Welsh constituency, which the Tories had held since 2015, was gained by the Lib Dems’ Jane Dodds with a majority of 1,425 on a swing of 11.96 per cent. Christopher Davies, the previous MP, restood despite having been convicted of expenses fraud. Labour narrowly avoided losing its deposit after winning just 5.3 per cent of the vote. Trump to impose new tariffs on $300bn of Chinese goods Global financial markets have plummeted after Donald Trump announced that he would impose a 10 per cent tariff on a further $300bn of Chinese imports. The new tariffs will be imposed from 1 September goods expected to include smart-phones, laptop computers and children’s clothing. A tariff of 25 per cent has already been imposed on $250bn of Chinese imports. US and Russia fail to renew nuclear arms treaty Fears have been raised of a new global arms race after the US and Russia failed to agree on the renewal of a long-standing nuclear treaty. The Intermediate-Range Nuclear Forces Treaty, which Ronald Reagan and Mikhail Gorbachve signed in 1987, banned ground-launched missiles with ranges between 500 and 5,500km. Earlier this year, the US and Nato accused Russia of violating the pact by deploying a new type of nuclear-capable cruise missile, prompting Donald Trump to announce that America would withdraw unless Vladmir Putin complied. Free port plans prompt warning of “race to the bottom” Up to 10 so-called free ports would be established in the UK after Brexit under plans announced by the government. Seaports and airports will be able to apply for free port status, which allows goods to be manufactured, imported and exported inside the zones without incurring tariffs. International Trade Secretary Liz Truss declared the move would create “thousands of jobs” but her shadow, Labour’s Barry Gardner, warned of “a race to the bottom that will have money launderers and tax dodgers rubbing their hands with glee”. Bank of England warns of rising recession risk The UK has a one in three chance of falling into recession at the start of next year, even if it leaves the EU with a deal in place, the Bank of England has warned. The bank’s Monetary Policy Committee voted by 9-0 to leave interest rates changed at 0.75 per cent after cutting its forecast for UK growth this year to 1.3 per cent from 1.5 per cent. Governor Mark Carney governor, warned that leaving the EU without a deal would create an “instantaneous shock” that the bank would struggle to manage. Follow today's politics on The Staggers blog › What should we expect from the Brecon and Radnorshire by-election? Subscribe For daily analysis & more political coverage from Westminster and beyond subscribe for just £1 per month!