:00:00. > :00:17.OK, time, now, for World Business Report, with Rachel.
:00:18. > :00:21.After the disappointing growth outlook the UK received from the IMF
:00:22. > :00:30.last week, today we get some real numbers for the British economy.
:00:31. > :00:35.And, after "emmissionsgate" is a new scandal brewing or VW?
:00:36. > :00:39.If so this time it's not alone, all the main German car-makers
:00:40. > :00:41.are accused of having operated a cartel.
:00:42. > :00:53.Sharanjit will tell us what to expect from the gamemaker's
:00:54. > :00:59.later this morning the UK will unveil its latest growth
:01:00. > :01:02.numbers for the three months to the end of June.
:01:03. > :01:04.Earlier this week, the International Monetary Fund
:01:05. > :01:08.economic activity means both the US and UK will expand more slowly
:01:09. > :01:15.However, in the numbers due out this morning,
:01:16. > :01:18.economists are expecting the UK's growth rate will have risen slightly
:01:19. > :01:29.Following the Brexit vote, the pound fell.
:01:30. > :01:32.This put pressure on prices - last month inflation stayed
:01:33. > :01:34.above the Bank of England's 2% target rate.
:01:35. > :01:36.And higher prices, partly from imported goods,
:01:37. > :01:38.are having an impact on consumer spending.
:01:39. > :01:40.According to Visa, household expenditure fell 0.3%
:01:41. > :01:42.month, the lowest figure in almost four years.
:01:43. > :01:44.But government figures suggest uncertainty
:01:45. > :01:47.The UK continues to be the top investment location in Europe,
:01:48. > :01:50.with more than 2,200 new foreign direct investment projects announced
:01:51. > :01:55.in the last year - that's 2% up on the year before.
:01:56. > :02:00.And on Tuesday BMW announced it had chosen Oxford as the location
:02:01. > :02:04.of where it will build its new fully electric Mini.
:02:05. > :02:07.With me is Dean Turner, an Economist at UBS Wealth
:02:08. > :02:15.Thank you for coming in. If we get that 0.3% figure that many are
:02:16. > :02:19.predicting, how does that set in the context of how the UK has grown over
:02:20. > :02:24.the last couple of years, and how the rest of the world is going now?
:02:25. > :02:28.If we get to positive numbers, it would mark the 80 consecutive
:02:29. > :02:32.quarter of positive growth. That is a good outcome. But you need to put
:02:33. > :02:36.that in the context of the four years at the start of this year. The
:02:37. > :02:42.quarter on quarter growth rate was averaging at 0.6%. So it a slowdown.
:02:43. > :02:48.And what about Europe? Compare to the UK, how is it doing? This is an
:02:49. > :02:52.important point. What we are seeing globally with the IMF upgrading
:02:53. > :02:55.forecasts of the globe, and with the sentiment numbers coming out of
:02:56. > :03:01.Europe, this suggests strong activity over there. A small economy
:03:02. > :03:06.like the UK, we expect to be doing better this time of the cycle. --
:03:07. > :03:10.smaller. So you are saying we should be expecting the UK to do better? A
:03:11. > :03:15.couple of trends are following the Brexit vote and are coming through
:03:16. > :03:18.now. We saw in the first quarter numbers in the all-important service
:03:19. > :03:23.sector, which makes up 80% of the economy, that is where we saw a big
:03:24. > :03:30.slowdown in Q1. I think that will continue into the current quarter as
:03:31. > :03:33.we see the effect of inflation on households, squeezing consumers.
:03:34. > :03:35.There are other areas that we will look out, and that is what is
:03:36. > :03:40.happening to business investment, now. As you pointed out already,
:03:41. > :03:43.business investment is not in decline, but it is the rate of
:03:44. > :03:47.change and growth that is important here. And I don't think we will seep
:03:48. > :03:54.particularly positive numbers here as that data comes through. As you
:03:55. > :03:59.said, the services sector is important, with 80% of our growth
:04:00. > :04:04.based on services. So that is a part that you are specifically be looking
:04:05. > :04:08.at, today? Absolutely. It is what is there to be happening in the service
:04:09. > :04:12.sector. We have had some data recently suggesting that the
:04:13. > :04:17.manufacturing sector is doing well. We expect a decent number they're
:04:18. > :04:21.showing that manufacturing output is probably expanding. But ultimately,
:04:22. > :04:27.it is services that are going to have the biggest role. But we have
:04:28. > :04:32.the bank Bank of England inflation result coming up. Remind us what
:04:33. > :04:40.that is and what it could do? Will next Wednesday -- bon Expose, it is
:04:41. > :04:44.super Thursday. There has been speculation in the market is given
:04:45. > :04:49.the hawkish rhetoric we've had from the Bank of England of late that we
:04:50. > :04:55.could see a rate hike. My sense is that barring a strong upset in
:04:56. > :05:02.today's numbers, that is unlikely to happen. Growth of .2% or .3% is
:05:03. > :05:06.below the Bank of England's expectations as they printed in
:05:07. > :05:09.their last inflation report. It will be also important to look at what
:05:10. > :05:14.the Bank of England's expectations are for the rest of the year. That
:05:15. > :05:16.will give us a clue as to what would happen with policy further down the
:05:17. > :05:21.line. But think any immediate concerns about an interest rate hike
:05:22. > :05:27.next week are overdone. So you think if it is .3% as expected, we will
:05:28. > :05:30.not see a high? Exactly. Thank you very much for joining us, Dean.
:05:31. > :05:35.The Japanese gaming giant will release quarterly earnings later.
:05:36. > :05:38.The big question - whether the portable Switch console
:05:39. > :05:41.will be the money-spinner Nintendo has been hoping for.
:05:42. > :05:44.Sharanjit Leyl is in our Asia Business Hub in Singapore.
:05:45. > :05:51.What do we expect to hear? That is right. Those numbers are due out
:05:52. > :05:57.after the Japanese market closes. As you say, expectations are that
:05:58. > :06:04.Switch will take Nintendo from strength to strength. It launched in
:06:05. > :06:08.March and immediately Nintendo sold about 2.7 million units. We should
:06:09. > :06:17.compare that to its rivals, Xbox, which sold about 3 billion units. --
:06:18. > :06:30.2.7 billion units. Nintendo is essentially saying it hopes to send
:06:31. > :06:34.out 10 million India to come. The company did not expect that they
:06:35. > :06:39.would have promised meeting demand, but Switch production was lower than
:06:40. > :06:45.what the company, based on Kyoto, plant. There were reports of people
:06:46. > :06:49.lining up to buy Switch consoles, suggesting that demand for the game
:06:50. > :06:56.remains strong. But do not expect new announcements about smart phone
:06:57. > :06:59.games from Nintendo or any of those products at their media briefing,
:07:00. > :07:03.which they said they will not be doing for these first quarter
:07:04. > :07:06.numbers. Sharanjit Leyl in Singapore, they give that analysis.
:07:07. > :07:08.-- thank you for that. Volkswagen is set to hold
:07:09. > :07:10.an emergency supervisory board meeting later today
:07:11. > :07:12.regarding allegations that the carmaker operated
:07:13. > :07:14.a cartel alongside Audi, Porsche, Mercedes and BMW,
:07:15. > :07:17.to control pricing on parts. If true, the reports would be
:07:18. > :07:20.a further blow to the German car industry, which is trying
:07:21. > :07:23.to recover after the recent Damien McGuinness
:07:24. > :07:37.reports from Berlin. VW, BMW, Daimler, Audi, Porsche. All
:07:38. > :07:41.German car brands accused of collusion. The allegation is that
:07:42. > :07:49.since the 1990s, they regularly held talks to agree costs, either for
:07:50. > :07:52.parts or for technology. The aim was, allegedly, to block
:07:53. > :07:56.competition. All five car companies deny the claims or refused to
:07:57. > :08:01.comment. And it is possible that the talks were legal, held steadily to
:08:02. > :08:07.discuss how to standardise technology across the industry. But
:08:08. > :08:14.the news has rattled investors. When German media first published the
:08:15. > :08:20.reports, last Friday, VW shares fell by 4.9%. Shares for BMW and Daimler
:08:21. > :08:23.dropped more than 3%. The European Commission and the German cartel
:08:24. > :08:30.office have not yet launched an official probe, but are looking into
:08:31. > :08:35.the allegations. If true, this would open up a whole new chapter in the
:08:36. > :08:39.diesel emissions scandal. That is because engine exhaust technology is
:08:40. > :08:44.also allegedly involved in the cartel. VW and other German brands
:08:45. > :08:48.are only now starting to recover from the emissions row. So another
:08:49. > :08:51.scandal would be a blow to the industry's reputation. Damian
:08:52. > :08:54.Maginnis, BBC News, Berlin. Britain is hitting the breaks
:08:55. > :08:59.on new petrol and diesel vehicles. The government plans to ban new cars
:09:00. > :09:02.and vans powered by fossil Government officials are expected
:09:03. > :09:09.to unveil a $332 million fund to help cut down on pollution
:09:10. > :09:12.to improve the air quality. The money could go
:09:13. > :09:13.towards retrofitting buses The reported move follows a similar
:09:14. > :09:17.announcement earlier this month President Trump says
:09:18. > :09:20.Apple's chief executive, Tim Cook, is committed to building
:09:21. > :09:23.three plants in the US. Such an investment would help
:09:24. > :09:26.the administration follow through on a big campaign promise -
:09:27. > :09:29.reviving the country's manufacturing When asked, Apple
:09:30. > :09:35.declined to comment. Now, before we go, let's look at the
:09:36. > :09:48.markets.