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Philip Hammond is also expected to use his annual speech
to the City of London to guarantee billions of dollars
of EU spending on infrastructure projects.
Also in the programme, the United States raises interest
With the Bank of England meeting today,
And with lots for investors to digest this Thursday,
we'll run you through what's moving the numbers and why.
Hello, you heard Ben but you are seeing me!
Security at your fingertips - we'll meet the man who says
the key to online safety could be in your own hands.
And as digital video sales could overtake DVD
We want to know, do you still buy your movies on disc?
Sally Hodkin the limelight, I don't know! Welcome to the programme.
It's less than a week since the UK woke up to an election result
that plunged it into even deeper political and economic uncertainty.
Prime Minister Theresa May still hasn't finalised an agreement
with the Northern Irish Democratic Unionist Party which would allow her
But away from those talks, the pressure is mounting
on the Government to lay out a strategy for Brexit negotiations.
Tonight the Chancellor, or finance minister, Philip Hammond,
could give us some idea of what is planned.
He's expected to say that $61bn of funds from the
European Union's investment bank will not be put at risk.
It currently provides funding for major infrastructure projects
across the EU, including here in the UK
for the Crossrail train line in London,
and tram networks in Nottingham and Manchester.
He's also expected to signal there may be some room to negotiate
when it comes to keeping the country in the EU's customs union.
Staying in that union would allow businesses
to continue their existing two-way relationship
And that's vital because the EU is the UK's biggest export market.
Morning. Good morning, Sally. You have blogged about this, quite a
change in tone coming from the UK, how is this likely to go down in the
EU? Well, the EU will probably welcome this. The Chancellor in the
UK, Philip Hammond, is close to Wolfgang Schaeuble, the fine and
minister in Germany, and both sides of the fence on Brexit want a good
deal for the economy, and I think the worry in the UK has been, up
until the general election, as Ben said, when Theresa May was somewhat
weakened in a position in Britain, taking back control, sovereignty,
immigration will be the leading issues around Brexit. Philip
Hammond, I think, supported by Germany and France, once the
economy, jobs, business at the centre of the negotiations, which
some describe us as going towards a softer Brexit. Mist Hammond, in
Britain, does want a more porous relationship with the single market,
the possibility at least of some form of membership of the customs
union, although that is very complicated, and today he has sent a
big signal to businesses in the UK that the Government will stand
behind the European Investment Bank's investments in Britain. Some
people thought it was at risk because of our departure from the
EU. The EIB does fund projects outside of the EU, but 90% of the
funding is for member states, and there is a fear that the funding
could dry up in Britain. So presumably business leaders welcome
this news, some breathing a sigh of relief, in fact! It is a small step,
but a change of tone. Business as largely felt to have been locked out
of any approach to Brexit in the UK. I think now they hope there will be
a change of tone, I think the speech tonight will reveal something of
that change, if the EIB announcement reveals the first steps on that.
What does this say about the Chancellor and the Prime Minister,
and where they are both that? Because she has been quite different
in her stance, until the general election - I will be a bloody
difficult woman to deal with, looking at no dealers better than a
bad deal, all that rhetoric. It is a very different message from these
two Keely does. She is treading a very difficult line. -- two key
leaders. Others would argue for a clean Brexit, what some would
describe as a hard Brexit, Liam Fox for example, the Cabinet minister
responsible for international trade. He wants Britain to be able to sign
strong deals with countries like China, India and America. If we are
in the customs union, that could curtail Britain's ability to do that
type of deal. She has got Liam Fox, Michael Gove, Boris Johnson, who are
all pushing towards a clean Brexit. She has to balance those two things,
and that is the difficulty she finds herself in. Also, she does not have
the majority in the house of parliament. The EU know that, and
that has put more power, many people think, in the EU's hands, rather
than Britain's hands. We will see if we get that clarity later tonight,
we will be watching and listening, thank you.
Let's take a look at some of the other stories making the news.
The Chinese regulators have fined Emirates for two safety incidents
that took place over the western region of Xinjing.
The Gulf carrier was fined just over $4,000 and
banned from adding new routes or aircraft in China for six months.
China's Civil Aviation Administration says Emirates pilots
were found to have flown an aircraft at the wrong altitude
and temporarily lost contact with air-traffic control.
The International Civil Aviation Agency says it's reviewing
a request from Qatar to intervene in the dispute with its
Gulf neighbours after they closed their airspace to Qatari flights.
Saudi Arabia, the UAE, Bahrain and Egypt
have cut diplomatic and transport ties with Qatar,
accusing it of supporting terrorism.
Volkswagen says it will offer a two-year guarantee on cars that
were modified to remove a device designed to cheat emissions tests.
say the modifications affect performance and reliability.
The European Commission has been putting pressure on VW
to compensate customers over the scandal,
as they have done in the US, but the company has so far refused.
To Asia now, on what was supposed to be a big day
for struggling Japanese tech giant Toshiba.
It was due to announce who will buy its memory-chip unit.
Toshiba's been forced to sell off the business to raise money
and the near-collapse of its US nuclear division.
Rupert Wingfield-Hayes is in Tokyo with the details.
Rupert, talk us through this massive obstacle for Toshiba to go ahead
with the sale of the chip unit. Yes, Sally, getting increasingly
complicated. What was already a congregated story now has another
spanner in the works because Western Digital, a large US corporation that
makes computer memory and has a large joint venture with Toshiba in
Japan, that company's management has filed a court action in California
to block the sale of Toshiba's flash memory division. Toshiba say it is
still hoping to go air and and announce a preferred for that
division by its meeting at the end of this month. -- to go ahead. But
it now faces a legal obstacle because of this injunction filed by
Western Digital. Western Digital had already filed for arbitration, a
process that could take, I understand, up to two years, but
Toshiba wants to make this sale quickly, get it over and done with
as soon as possible, because it wants to pay off it's debt to the
United States, so it does not want to go through this process, but this
looks like another big barrier to them going out and selling that
memory division. A story that will run and run, Rupert, for now, thank
you very much, Rupert Wingfield-Hayes in Tokyo for you.
Staying in Japan, the stock market fell in pretty volatile trade
overshadowed the rise in interest rates
Also worries over those reports
that US President Donald Trump is being investigated for possible
In Hong Kong, authorities raised its base rate by 25 basis points -
In the UK, confirmation yesterday that wages
are lagging way behind inflation, so a further squeeze on incomes.
well below the inflation rate of 2.7% for that month.
In 45 minutes, we get the latest UK retail-sales figures for last month,
and at midday a decision on interest rates.
No change expected, with rates already at record lows of 0.25%,
given the looming uncertainty politically and economically.
More on that shortly, but first in the US,
has Samira has a look at the day ahead for US markets.
On Thursday, the chief executive of United Airlines
Oliver Munoz has had to grapple with some high-profile
public-relations fiascoes in the last few months,
including the forceful removal of a paying customer
Well, that incident prompted an industrywide conversation
on customer service and passenger rights.
In earnings news, Kroger will be reporting first-quarter results.
Now, the supermarket operator warned back in March that full-year
sales could fall by 1%, and that is because competition
Walmart continues to beef up its grocery offerings,
and new entrants, like German grocery chain Aldi,
are racing to offer the lowest possible prices.
That was Samira in New York for us. We have got Mike Amey, a managing
director and portfolio manager at Pimco, nice to see you. Let's start
by talking about the UK, because the Bank of England has got its meeting,
Mark Carney has not spoken for a month publicly, and a lot has
happened since he last met with his team. That is right, there has
obviously been the election result, quite a lot of political uncertainty
out there, and some of the data has been more mixed in the UK as well,
some of the activity data has been lower than expected, and
unfortunately inflation has been higher, so what they will tell us
that they don't really know, there is a lot of uncertainty out there, I
think their preference is to do nothing, to wait and see how things
develop. A lot of people saying that the UK economy needs attention now,
you know? Well, it has slowed, and as Benjamin Micra mentioned, there
is this challenge, we are all feeling the squeeze on wages. So
that is quite a challenge. The view is that the economy needs support.
Interesting in light of the squeeze on incomes, inflation rising more
than wages, we will get retail sales figures, and they are backward
looking, retrospective, but it will give us an idea of what is happening
in that predicted slowdown. That is right, retail sales have been
slowing for a while now, the volume of retail sales spending growing at
about 2% a year, having been running at 3-4%. So you are seeing in the
data the fact that people are feeling the squeeze. A quick word on
the US Federal Reserve, delivering what most people predicted, but
interesting that it will start getting the US economy of the drip
of quantitative easing. Indeed, that is better news, the US is ahead of
us in the cycle, and they are saying is on reducing the amount of money
they pumped into the system, so they cut interest rates previously,
printing money, and now the message is a bit more positive. Thank you,
Mike, we shall see later, have a think about the last DVD you bought!
Lots of comments from you about the seal of DVD sales expecting to fall
significantly in the next few yes. Contrasting that with streaming
services, more of us streaming movies, downloading, not buying
physical DVDs, keep your comments coming.
keeping you safe online, without passwords or fingerprints.
We'll meet the man who says his firm can detect whether
just by how you use your smartphone or keyboard.
It is pretty clever stuff, we will talk about that a little later!
You're with Business Live from BBC News.
It might be too early for a glass of frying, pens, maybe you think it is
the right time! Majestic is porting about how well it has done. ?1.5
million of losses. -- it might be too early for a glass of wine,
dependence. -- depends. What we can speak with you about this
interesting set of figures, direct marketing in the US, last year, tell
us about this year, are things looking up? Things are looking up,
the second half tells the story, profits up 51%, you mentioned the
profits for the year, reported accounting profits are showing a
loss. The key reason for that, there is a big purchase of naked wines,
which is an asset that is appreciating in value. -- Naked
Wines. Look at the operating profit level, they are up for the second
half significantly, that is a good predictor of what is the potential
to the business. To what extent were you affected by the weakness of
sterling in these numbers? The impact of Brexit, the immediate
impact of Brexit has been fiercely weaker currency, leading through
into higher wine prices, those prices have filtered through to the
markets. I think we see the trading picture today reflects the current
exchange rate environment. The bit of Brexit that nobody really
understands, the impact on consumer behaviour. As your previous speaker
was saying, if inflation runs ahead of wages, it is impossible to expect
it will be positive. Very briefly, how is the English wine industry
doing from your point of view? Are you selling a lot of it? Probably
doing its best since Roman times! Which just completed our first
crowdfunding of an English winemaker, Charles Simpson, I think
English wine is certainly a respectable thing to drink, that is
a good thing. Good to talk with you, the boss of Majestic wines. Breaking
story while we have time. News of another failure at Heathrow Airport.
Terminal three and five, people heading out of Heathrow facing
flight without their luggage. Full details on the BBC business life
page. Top story today, UK Chancellor,
finance minister, Philip Hammond, is to set out his vision for a
business-friendly Brexit, in a speech in London this evening. He's
likely to guarantee more than $60bn of investment in infrastructure
projects. -- ?6 billion. keeping an eye on. A busy day for
corporate data, particularly in the UK. Interest rate decision at
midday. In 40 minutes, the latest retail sales figures. Expected to
show another slowdown in consumer spending as we have discussed a
little earlier. Last month, a ransomware cyberattack
hit business all around the world. The Wannacry infection caused
disruption in 99 countries with health services, energy companies
and mobile phone operators all affected by the software. And
Cybercrime is estimated to have cost the global economy around 450
billion dollars last year alone. So tackling these online threats is big
business. And there's a new technology that could stop the
hackers in their tracks. "Behavioural biometric
technology" as it's known, tries to identify unusual behaviour
on smartphones using information such as typing speed the force
applied to the touch-screen and the angle at which
the smartphone is held. Neil Costigan, Chief Executive
of BehavioSec joins me now. Your company comes as a great relief
to the banking sector because actually, when we find we have
financial fraud, the banks have to reimburse us, they carry the weight
of the cost and the fraud but your technology is helping. No silver
bullet, the industry uses every tool in its arsenal, and more and more,
trying to get into the frictionless way of doing it. So you are not
asking the user to a member complex passwords or carry tokens. From the
point of view of the bank, if I use an app on my smartphone to do my
banking, that comes with your security embedded, that provision
embedded, you would not... As a user I would not necessarily even know it
is there, but it might save the bank money. That is the case, the
application of it, they don't want to burden you with security, they
want many people to be using it, if security is seen as a friction, that
is a problem for them. Transparency is the keyword, user experience is
the keyword. That shift in mindset, from complexity and cost into more
user-friendly things. Talk us through how it works, this is not
just a case of putting in a password or scanning your fingerprint, this
is constantly working out that I am who I say I am while using it. A lot
of competition in the back end, it sounds like buzzword bingo but
breakthrough in AI and big data has got us to the point where this is
viable. You would hear rhythm, that idea has been around since the days
of Telegraph, it is about how hard you hit the screen, how you swipe,
how you move. The angle you hold it out, how you type, all that it is
already available in devices we have. Yes, sensors, they are all
there, all part of the operating system, and it is the power of the
computer and the consistency that has helped. You provide this
service, your clients are banks across Scandinavia, other parts of
Europe. Up to 35 million users across north-western Europe, digital
banks, digital platforms. This start, it was not your idea. I am a
veteran of the industry, I have done it 25 years, I have taken innovation
from Sweden to California before, I was back in Sweden working at a
university and undergraduate, working inside the university, had
the idea, and they said, we think we can verify people who they are by
their typing. What are they doing now? They are the founders. They
were on their way to New York yesterday, new office there, and the
guy is running the deal at the University. The reason this is so
useful, if you are hacked or suffer a breach, somebody knows your
password, this is able to stop them further down the process, it is not
once they are in they are in. This extra layer, it is more about
catching the individuals, or the knowledge thing. It is about the
person themselves. That is the level we have taken this to. As far as the
conversations you have with big financial institutions, I suppose it
is a cost, they will have to pay for it, but it may be... They do not pay
and a! LAUGHTER You want them to pay more, but it is
a trade-off, either they will pay it in compensation or upfront like
this. Security has been around forever, you'd like insurance
policies, you have to have it, otherwise other repercussions. What
was the last DVD that you bought? Or Blu-ray? I'm putting you on the
spot. Something for my daughter, when you are travelling. This is
what we are saying, apart from Ben, who did not have kiddies. It was a
DVD for my needs. Yes, something high quality, Pixar where you think
this is going to be a high-quality experience for you all, where you
think that it would not be as good if you downloaded.
Staying with technology, today is a good day for European Union mobile
phone customers. After years of negotiations, no longer, those
annoying extra fees to usual device in EU companies. But for phone
companies, it means the loss of a lucrative revenue flow. Dave Dyson
is CEO of the mobile network Three UK. He has been telling us how they
will make up the difference. Some operators make a lot of money out of
international roaming, that profit will be lost because of the new
regulation coming in. Critics of the scheme suggest that it is possible
that those companies will look to read group profits elsewhere within
the business. For my business, three, we have been offering
free-roaming for five years, we have not built up huge profits that we
now need to protect in some other way. Overseas companies, their
customers will come to the UK. One negotiating tactic is to say, if you
give us a great rate, we will offer you a reciprocal right when
customers come to the UK. We try lots of different techniques to
reduce the costs, whatever we do, we pass them the customer 's. David
Dyson, the boss of three. Netflix and Amazon are overtaking
the UK box office according to some research, your thoughts? Price war
-- this is a PricewaterhouseCoopers report. Blu-ray and DVD is going to
be the big loser. With streaming up 30%, ?1.4 billion every year, and
DVD sales will go down from 1.2. Our viewers are not convinced DVDs are
cheaper. Toby says, I like disks, I'm not painful pixels. I buy them
because the broadband companies stress me for using unlimited...
Internet access not good enough... This is reliant upon having a good
provider and network. If you have a good network, streaming is fine, if
it is intermittent, the buffering, then DVDs, certainly. Often the cost
of downloading a movie is more than in the supermarket and you have it
for only one week. It is not much of a gift, either, here is a
download... Last DVD you bought? The Star Wars boxed set. Mine was a
frozen DVD, that is a much better choice. You said that was for your
needs, but it was for you, wasn't it! Let it go! Let it go LAUGHTER
We will see you soon.