:00:00. > :00:00.Those are the latest headlines from BBC World News.
:00:00. > :00:00.Now for the latest financial news with Sally Bundock.
:00:00. > :00:17.Battle stations at the Bank of England.
:00:18. > :00:20.Interest rates could be cut to a new record low as it scrambles
:00:21. > :00:33.America's biggest bank JP Morgan feels the pinch because of,
:00:34. > :00:52.China's appetite for chicken and pizza proves to be
:00:53. > :00:58.We start here in London, where in a few hours' time,
:00:59. > :01:01.the Bank of England will decide what action it will take to shore up
:01:02. > :01:04.the UK economy in the wake of last month's Referendum vote to leave
:01:05. > :01:08.The big news is likely to be cheaper borrowing costs.
:01:09. > :01:12.The bank's governor, Mark Carney, warned in the run-up
:01:13. > :01:14.to the Referendum of the risks of Brexit to the economy.
:01:15. > :01:17.Last week he said those risks "have begun to crystallise."
:01:18. > :01:20.One survey of consumer confidence has seen its biggest fall on record.
:01:21. > :01:22.Others on the service and construction sectors are also
:01:23. > :01:29.So, what can he and his committee do?
:01:30. > :01:32.Well, interest rates are already at a record low of half a percent,
:01:33. > :01:35.where they have been for the past seven years
:01:36. > :01:36.following the Global Financial Crisis.
:01:37. > :01:39.Most experts think they will be cut further today, by another quarter
:01:40. > :01:43.Some think the cost of borrowing could end up being cut to zero.
:01:44. > :01:45.Since the Referendum, the Bank of England has already
:01:46. > :01:47.eased capital requirements for banks, basically how much
:01:48. > :01:51.It hopes that will free up $200 billion for lending.
:01:52. > :01:53.But many economists think that won't be enough
:01:54. > :01:56.They see a return to Quantitative Easing or QE,
:01:57. > :01:59.printing billions of pounds of new money to pump
:02:00. > :02:09.That major step could be put off until next month though,
:02:10. > :02:27.as Mr Carney seemed to imply when he spoke at the end of June.
:02:28. > :02:30.Now, in my view, and I am not pre-judging the views of the other
:02:31. > :02:32.independent members of the MPC, the economic outlook has
:02:33. > :02:34.deteriorated and some monetary policy easing will likely be
:02:35. > :02:48.The MPC will make an initial assessment on the 14th of July,
:02:49. > :02:51.and a full assessment complete with a new forecast will follow
:02:52. > :03:03.Robert Wood is Chief UK Economist at Bank of America,
:03:04. > :03:16.Good morning. What you think the bank will do today? They will cut
:03:17. > :03:23.interest rates close to zero. As Mr Carney said, and as we can see in
:03:24. > :03:26.many surveys of consumers, there is a wait and see approach taken hold.
:03:27. > :03:32.People are uncertain about what will happen. That means the economy
:03:33. > :03:39.growth will turn down. The bank needs to take action and it will
:03:40. > :03:45.today. Action today? In your view, quite significant action? Yeah. The
:03:46. > :03:51.consensus is most people are expecting a 40 point cut of interest
:03:52. > :03:54.rates. May be slightly more. A would make a deal of how much bigger rig
:03:55. > :04:00.is. But it will be close to zero in this month or the month after. And
:04:01. > :04:07.when we'll quantitative easing take place? August, I think. The vote to
:04:08. > :04:12.leave the EU has brought a wait and see approach from consumers and
:04:13. > :04:18.firms. That requires monetary action from the Bank of England to help the
:04:19. > :04:22.economy. That will be interest rates and extra quota easing in August.
:04:23. > :04:31.Mark Carney is not the biggest fan of that, if he? There aren't that
:04:32. > :04:36.many fans of QE out there because it is unconventional. Central banks,
:04:37. > :04:41.until 2008, did not do it. It is hard to see how much it helps the
:04:42. > :04:45.economy. Evidence says it does. At the moment, it is the next tool the
:04:46. > :04:51.Bank of England have in their toolbox. Will it work? Will it stop
:04:52. > :04:55.the UK heading towards a recession? We also have a new chancellor,
:04:56. > :05:01.Philip Hammond. What will he do? A few things. The action taken by
:05:02. > :05:04.setting out a plan and following through with it and constantly
:05:05. > :05:11.explaining that land, that has already helped quite a lot. -- plan.
:05:12. > :05:14.They might find they don't have to do as much at they may have
:05:15. > :05:20.otherwise had to have done if they had not had that. It may help. Will
:05:21. > :05:23.there be a recession? I believe they will have one. But that is six
:05:24. > :05:27.months into the future, who knows exactly where the economy will go.
:05:28. > :05:34.We can be pretty sure it is going down. OK. Thank you so much. We have
:05:35. > :05:40.run out of time but there is so much to discuss. We will do it another
:05:41. > :05:44.day. Thank you for coming in, Robert. And as soon as we get any
:05:45. > :05:46.news from the Central Bank we will update you.
:05:47. > :05:48.Let's stay with those issues of interest rates and Brexit.
:05:49. > :05:50.They're a major concern for Wall Street's giant investment
:05:51. > :05:53.banks which report their quarterly results over the next few days,
:05:54. > :05:57.The UK referendum has derailed plans at the Federal Reserve
:05:58. > :06:00.Low rates cause problems for banks as they make
:06:01. > :06:16.Lower US interest rates are here to stay. At least for a lot longer than
:06:17. > :06:20.anyone expected. But that means revenues for banks like JP Morgan
:06:21. > :06:27.will suffer because all the low interest rates make money lending
:06:28. > :06:31.not very lucrative. Banks need to make money elsewhere. But with
:06:32. > :06:36.China's economy slowing and the price of oil and gas really low,
:06:37. > :06:40.markets are volatile. It means investors are more likely to wait on
:06:41. > :06:46.the sidelines and watch the storm passed. It also means banks will
:06:47. > :06:53.make less revenue from trading. When JP Morgan has another problem, it
:06:54. > :06:56.employs 60,000 people in Britain and has $8 billion in the UK. -- JP
:06:57. > :07:01.Morgan has. That means investors will be looking closely to see just
:07:02. > :07:05.how the bank will be affected by Britain's impending exit from the
:07:06. > :07:10.EU. That is a question investors will ask of all banks. And the
:07:11. > :07:15.effects of which, they will be dealing with four years to come. --
:07:16. > :07:34.for. Samira Hussain, BBC News. It is all abour Yum brands in China
:07:35. > :07:39.now. Don't talk about chicken and pizza! It is making me hungry. After
:07:40. > :07:47.this it is my lunch break. LAUGHING. Let's take a break from
:07:48. > :07:52.Brexit. The fast food chains made $3 billion in the second quarter of
:07:53. > :07:58.this year and have given an upbeat review of its business. New brands
:07:59. > :08:03.are beginning to spin off the unit later this year. China is a key
:08:04. > :08:10.market for Yum. That has got them to increase their profits broadcast to
:08:11. > :08:15.14%. Yum was on track to spin off its China unit, aiming for an
:08:16. > :08:23.October start. When you speak to analysts, the split will allow them
:08:24. > :08:27.to be more responsive and build up their presence in China. It also
:08:28. > :08:33.allows them to raise cash going forward. Analysts say it is a
:08:34. > :08:38.challenging future as the market is moving on from quick service
:08:39. > :08:43.restaurant is and people armed concerned about healthy food and
:08:44. > :08:55.safety. -- restaurants. Despite the concerns, look at the share price of
:08:56. > :08:58.young brands, it is up quite a lot! -- Yum.
:08:59. > :09:03.The number of UK homes being put on the market has seen its biggest
:09:04. > :09:06.fall in almost two decades, and demand from buyers has hit
:09:07. > :09:07.an eight-year low, according to the Royal Institution
:09:08. > :09:12.It's the first survey of the UK housing market since the vote
:09:13. > :09:16.Surveyors expect house prices to fall across the UK in the next
:09:17. > :09:19.three months, and still be lower in a year's time in London.
:09:20. > :09:27.Overall though they see UK prices 14% higher in five years.
:09:28. > :09:29.Shares of Nintendo have continued to soar,
:09:30. > :09:32.up more than 16% in Thursday trade on the runaway success
:09:33. > :09:34.of its new smartphone game Pokemon Go.
:09:35. > :09:37.Players have to track down virtual characters by moving around the real
:09:38. > :09:39.world in a system called "augmented reality,"
:09:40. > :09:41.experts say the technology could also be used for marketing.
:09:42. > :09:44.Nintendo's stock market value is up almost 60% since the game's launch
:09:45. > :09:54.That is the story we are covering today. Pokemon Go is great for the
:09:55. > :10:00.share price but not for some museums and places where people are sent to.
:10:01. > :10:02.The rally continues in Asia, as you can see. I have run out of time. I
:10:03. > :10:10.will see you soon. House prices in Britain are expected
:10:11. > :10:13.to fall over the next few months, following last months
:10:14. > :10:15.decision to leave the EU. That's according to the Royal
:10:16. > :10:17.Institution of Chartered Surveyors. The number of properties being put
:10:18. > :10:20.up for sale is also falling at the sharpest rate
:10:21. > :10:23.since records began.