:00:03. > :00:07.Welcome to World Business Report. These are the headlines. At the
:00:07. > :00:13.mercy of the market. Spain's Finance Minister prepares to
:00:13. > :00:18.auction off billions of dollars worth of debt. Investors send stock
:00:18. > :00:26.flying. Another rise and the survey suggests business confidence is
:00:26. > :00:36.Japan intervenes in the currency market to weaken a strong yen
:00:36. > :00:38.
:00:38. > :00:44.against the US dollar. A debt crisis spotlight shines on
:00:44. > :00:50.Spain again this Thursday as the nation auctions of 3.5 billion
:00:50. > :00:54.euros or $5 billion worth of bonds. Investors have forced the country's
:00:55. > :00:59.costs to spike and EU stocks to tumble. This has prompted Spain's
:00:59. > :01:04.PM to cut short his holiday and the finance minister to one of the
:01:04. > :01:07.risks posed by a volatile August market.
:01:07. > :01:12.News that the interest Spain pays on its debt was again close to
:01:12. > :01:17.record levels caused the Spanish leader to interrupt his holiday
:01:17. > :01:21.plans for the second time in two days. He met with senior Cabinet
:01:21. > :01:26.colleagues after returning to Madrid from the south of Spain to
:01:26. > :01:29.discuss the market development. The country's borrowing costs rose to a
:01:29. > :01:35.fraction of 6.5% on Tuesday and bite back to the same level on
:01:35. > :01:39.Wednesday, not far off the 7% mark that led to Greece, Ireland and
:01:39. > :01:43.Portugal or requesting bail out. Under the circumstances, the bond
:01:43. > :01:47.auction Spain he should draw for Thursday will be under close
:01:47. > :01:50.scrutiny. The government points to the fact
:01:50. > :01:55.that all this is an unpredictable month for the markets as a main
:01:55. > :01:59.cause of the current turmoil. It blames consensus surrounding the US
:01:59. > :02:04.economy and delays in implementing a second bail-out for Greece. It
:02:04. > :02:09.once the uncertainty could last several more days. Spain's Prime
:02:09. > :02:16.Minister -- find the Finance Minister played down fears that it
:02:16. > :02:20.could soon request help from the European Union. TRANSLATION: I
:02:20. > :02:25.would not say the situation is serious. This is a reason for all
:02:25. > :02:29.EU countries to implement procedures as soon as possible.
:02:29. > :02:33.Spain has been fighting a speculation about its ability to
:02:33. > :02:38.finance its debt for months due to its high deficits low growth and
:02:38. > :02:42.21% unemployment rate. Austerity measures aimed at restoring Spain's
:02:42. > :02:46.credibility in the market have helped spark widespread protests
:02:46. > :02:52.over the past few months. The most recent of which took place in
:02:52. > :02:56.Madrid this week. Last week, supper to report for general elections to
:02:56. > :03:00.November, hoping the announcement would stabilise Spain's economic
:03:00. > :03:04.situation. For a while, the authorities did manage to clear the
:03:04. > :03:10.capital's main square about raged protesters this week. They are
:03:10. > :03:13.struggling to keep at bay talk of a bail-out.
:03:14. > :03:17.In related news, investors in Italian markets be their first
:03:17. > :03:21.chance to respond to Silvio Berlusconi's debt crisis speech
:03:21. > :03:25.this morning. The PM said on Wednesday that the markets had
:03:25. > :03:30.misjudged the financial strength of his country and promised to step up
:03:31. > :03:34.economic reforms. He will meet with the unions this Thursday to discuss
:03:34. > :03:38.changes to employment law and effort to boost competition.
:03:38. > :03:44.Opposition politicians renewed calls for his resignation saying he
:03:44. > :03:47.lacks a concrete agenda to tackle Italy's financial woes.
:03:47. > :03:51.Portugal's finance minister says he plans to tweak this year's budget
:03:51. > :03:55.for a second time to address a spending gap. The revision will be
:03:55. > :03:59.made in October to deal with a 3 billion dollar hole caused by the
:03:59. > :04:04.previous government paying salaries late and leaving bills unpaid. The
:04:04. > :04:08.move may involve further tax rises and the centre-right coalition seat
:04:08. > :04:12.to shrink its deficit and qualify for further bail out aid.
:04:12. > :04:17.The European Central Bank is expected to leave its key interest
:04:17. > :04:20.rate of 1.5% this Thursday. Inflation is above target but weak
:04:20. > :04:26.manufacturing data and falling business confidence is expected to
:04:26. > :04:30.stay its hand. At the press conference, the Bank's president is
:04:30. > :04:35.likely to be quizzed about whether he has any plans to reactivate a
:04:35. > :04:40.bond purchased -- purchase scheme, previously used to stabilise the
:04:40. > :04:45.financial markets. Efforts to combat the weakness of
:04:45. > :04:48.the dollar continued in the past few hours. Japan's government
:04:48. > :04:52.concerned that it sold off the end for the first time in five months
:04:52. > :04:58.to stem the currency's rise. The move follows on from Switzerland's
:04:58. > :05:06.surprise rate hike on Thursday -- rate cut on Wednesday to offset the
:05:06. > :05:14.strength of the banks. What kind of difference to Japan's action make?
:05:14. > :05:20.It has had an impact. On Monday, it was at the lowest, 6.29 yen. The
:05:20. > :05:24.yen is now trading above the 79 m double due to the intervention. The
:05:24. > :05:29.Bank of Japan is rumoured to have sold about $1 billion worth of the
:05:29. > :05:32.end. Intervention has been the talk all week. Finally, Japan made the
:05:32. > :05:37.move. Financial a authorities said they initiated the move because a
:05:37. > :05:41.strong yen was hurting the economy and contributed to the slow
:05:41. > :05:44.recovery from the March earthquake and a tsunami. It is the second
:05:44. > :05:48.time this year the government has intervened and the finance minister
:05:48. > :05:56.said Japan acted alone in the market and without the help of
:05:56. > :05:59.other central banks. It has cut short its two-day meeting to just
:06:00. > :06:05.one and is expected ease monetary policy further to consolidate the
:06:05. > :06:12.yen's fall. Despite the retreat of about 79 yen, this is about 5%
:06:12. > :06:15.stronger than the 82.5 average in private forecast in a Bank of Japan
:06:15. > :06:25.survey released last month. A strong yen is painful for Japan
:06:25. > :06:26.
:06:26. > :06:31.because it reduces the belly of earnings for companies. Thank you.
:06:31. > :06:34.Shaky business confidence expected to be one reason the European
:06:34. > :06:41.Central Bank and Bank of England leave their interest rates on hold
:06:41. > :06:45.today. The latest evidence was a survey of over 2000 Chief Executive
:06:45. > :06:49.by AV young President organisation. It suggested a year business
:06:49. > :06:52.leaders had become the world's most pessimistic that over 40% of those
:06:52. > :07:02.quizzed expecting their sales to a decline remain fight over the next
:07:02. > :07:09.12 months. -- remain a fight. Why do you think business
:07:09. > :07:14.confidence in Europe is so low? have to compare it principally to
:07:14. > :07:20.Asia as the high watermark. The US is not overly optimistic. Within
:07:20. > :07:29.the eurozone, to have members in countries like Greece that are
:07:29. > :07:39.affected by massive' economic troubles. What are CEO the Roar
:07:39. > :07:45.worried about? I think they tend to be internal optimists. I would
:07:45. > :07:55.argue that 40% of people expect sales to increase over the next 12
:07:55. > :07:55.
:07:55. > :08:01.months. Another 40% fat. I would interpret that as not so bad.
:08:01. > :08:08.still means 40% are pessimistic. What is behind that? I would argue
:08:08. > :08:13.that 40% are optimistic. That is imported in the context of sales or
:08:13. > :08:17.underlying revenue of companies, but they will not invest in people
:08:18. > :08:25.and they will not invest in capital goods. Those are the results of a
:08:25. > :08:30.serve way -- survey. The individual companies will outperform. We will
:08:30. > :08:35.not hire a lot more people are invest in a lot more capital.
:08:35. > :08:40.you see these times as big opportunity for equity? In the
:08:40. > :08:45.context of what we do and own, this year, compared to the first half of
:08:45. > :08:50.last year, away earnings were up 42%. Consistent with the survey,
:08:50. > :08:55.I'm an optimist and expect that to continue to happen going for it. In
:08:55. > :08:59.the context of the survey, I'm reticent about authorising a
:08:59. > :09:03.divisional managers to employ a more people and invest in more
:09:03. > :09:07.capital unless they can justify we will and superior returns. It is
:09:07. > :09:12.dangerous out there. My job is to make sure capital goods allocated
:09:12. > :09:17.appropriately. It is not too indiscriminately invest. Thank you
:09:17. > :09:22.for joining us. A look at the markets. The Nikkei
:09:22. > :09:27.is bucking the trend. It is up. The rest of Asia is down. Worries over
:09:28. > :09:31.the US and eurozone debt crisis playing an investors' minds. We saw
:09:31. > :09:41.markets closing on a high despite and some difficult service sector
:09:41. > :09:46.
:09:46. > :09:50.figures. That is the latest business.
:09:50. > :09:55.Now for more news from the UK. It has emerged that fewer young people
:09:55. > :10:03.are taking their driving test. The number of 17 to 22-year-old getting
:10:03. > :10:06.behind the wheel has dropped by 19% since 2005.
:10:06. > :10:10.20-year-old Chris started driving less than a few years ago but had
:10:10. > :10:17.to stub because he could not afford it. Living in rural Suffolk, he
:10:17. > :10:22.says it can be a long way for -- a long way for a bus. It affects work
:10:22. > :10:27.not being able to drive because it means I can only do a few hours in
:10:27. > :10:30.a day. I have to time at around the buses. According to a recent
:10:30. > :10:34.government survey, almost two- thirds of young people who can't
:10:34. > :10:38.drive said they were put off by the cost of learning. It is not just
:10:38. > :10:44.the cost of lessons and the test that has increased, running a car
:10:44. > :10:49.has become more expensive. There are car taxes, petrol, and car
:10:49. > :10:56.insurance. Five years ago, a 35- year-old would have paid around
:10:56. > :11:03.�245 for car insurance. That has risen to �325. A 17-year-old would
:11:03. > :11:06.have paid around �2,500. That is now at least �4,000. Significantly
:11:06. > :11:10.more if you are male. Have we got to the point where young drivers
:11:10. > :11:16.are effectively being priced out of the market? The number of people
:11:16. > :11:19.applying for a provisional licence has dropped by 15 to 20% this year.
:11:19. > :11:23.There are signs the cost of insurance is starting to fall for
:11:23. > :11:33.young drivers. For now at least, crews will have to rely on the
:11:33. > :11:40.
:11:40. > :11:43.buses and his mother to get around. Coming up,Breakfast. They will
:11:43. > :11:53.discuss smartphones and if they are taking over a wall lines. Nearly
:11:53. > :11:55.
:11:55. > :11:58.half of all teenagers and a quarter of all adults now have one.
:11:59. > :12:03.This is BBC World news. The headlines. At the UN Security
:12:03. > :12:07.Council has condemned a Syria for its ongoing violent crackdown on
:12:07. > :12:11.protesters. It accuses President Assad's in administration of
:12:11. > :12:19.committing widespread violations of human rights. The UN Secretary
:12:20. > :12:28.General called on him to end his use of violence. I urge President
:12:28. > :12:32.Assad, please listen more attentively. They have been many
:12:32. > :12:40.calls from the international community's, including from myself,
:12:40. > :12:45.that to continue like this is not sustainable.. You cannot continue
:12:45. > :12:52.killing your people. France's Court of Justice is to
:12:52. > :12:57.rule on whether to open an inquiry into Christine Lagarde over her
:12:57. > :13:02.handling of a high profile financial scandal.
:13:02. > :13:06.US enforcement agencies say more than 70 Americans, allegedly part
:13:06. > :13:11.of a -- and on my child pornography network, have been charged.
:13:11. > :13:14.Heather Mills, former wife of Sir Paul McCartney, has claimed in a
:13:15. > :13:24.BBC interview that a senior Mirror Group journalist admitted to
:13:25. > :13:32.