we start here in the uk where, less than four weeks in to her newjob, the finance minister, chancellor of the exchequer rachel reeves, has been setting out her priorities in a statement to parliament. this morning the experts are assessing what's ahead. so, let's talk you through the key points. she has announced above—inflation pay deals for workers across the public sector. but she warned of a multibillion—dollar black hole in the uk's finances this year, which she claims was covered up by the previous government. the big number is this — a £22 billion shortfall due to unfunded spending commitments this financial year. of those, the single biggest cost is public sector pay settlements.

the government has accepted the recommendations of independent pay review bodies. so, nhs workers and teachers will be getting a 5.5% pay rise. the armed forces will get 6%. others will get a similar increase. these pay awards are well above inflation, which fell to 2.3% in april, the month they base annual pay on. but the government denies it will stoke inflation higher, saying it's only in line with average wage growth across the economy, which was 6% in the first quarter of the year. so, what will it cost? at least an extra £9 billion a year, not including a 22% pay rise that's been offered to junior doctors. how will it be paid for? that is the big question. well, the chancellor has announced some immediate spending cuts. she's asking government departments to make savings of £3 billion. the winter fuel allowance

for all pensioners will now be means—tested, which means seven million households will no longer get it, saving 1.4 billion. and scrapping the scheme to send migrants to rwanda will save 800 million. all in all, savings of 5.5 billion. so that leaves another £16 billion to find this year. the labour party promised in its election manifesto not to increase taxes. our political editor chris mason asked the chancellor if she will have to go back on that pledge in the budget later this year. can you be straight with people tonight and so that you will be putting up taxes for some in the autumn? i putting up taxes for some in the autumn?— the autumn? i don't want to increase _ the autumn? i don't want to increase taxes _ the autumn? i don't want to increase taxes on _ the autumn? i don't want to increase taxes on working . increase taxes on working people, income tax or vat, but we stand by those commitments. there will be more difficult decisions about spending,

welfare and tax, the budget at the spending review later this year. it is important to be honest, people have been misled for too long. everyone is looking at what she said in parliament. what does it mean for the uk economy? there is a lot of analysis and discussion as to what this means. gervais williams is head of equities at premier miton. let's start with a question about inflation. do you think these measures are inflationary, ie, the pay that junior doctors and others are going to get going forward? during the globalisation period when there was free moving people in the lowest cost manufacturing, imports were offsetting inflation, it was fine. unfortunately with less movement, we are actually appearing that inflation is just below the surface. if the government does overspend and

put too much stimulus into the economy, inflation will return quickly. i don't think it will be particularly inflationary but i think it will be inflationary at the margin. earlier this year we had at a steep rise the minimum wage. i steep rise the minimum wage. i rememberand sure you steep rise the minimum wage. i remember and sure you remember and our viewers will remember andrew bailey at the beginning of this whole inflation concern, he was saying he didn't want hi paid deals to go ahead. he was calling the business leaders and the government to be very cautious when it comes to setting wages. what do you think he and his team of the bank of england about this? i team of the bank of england about this?— about this? i think what will ha en about this? i think what will happen is — about this? i think what will happen is the _ about this? i think what will happen is the government | about this? i think what will i happen is the government will occasionally come to these settlements but they need to cut back elsewhere. we have heard from rachel reeves that she is looking to cut back some ex— manager elsewhere, and if you want to keep inflationary pressures contain, you have to cut spending elsewhere advising

overall stimulus of the economy will try inflation. it is unsettling because the uk, the government bond issuance is less than the national savings. we rely on international investors to buy our bonds, and if we stop doing that, we would import inflation from a currency reason as well as inflationary reasons. jeremy hunt in parliament - inflationary reasons. jeremy hunt in parliament was - inflationary reasons. jeremy| hunt in parliament was quick inflationary reasons. jeremy . hunt in parliament was quick to say we were transparent as a government, the office of budget responsibility was looking at our numbers, etc. what do you make about this debate about the black hole? i think it is politics. the settlement in terms of the public wages was actually adding ten or ii public wages was actually adding ten or 11 billion. most of it is politics. all politicians are very good at facing up the entire amount of spending going on and isis even when this government leaves in five years, there will be

things that the new government will complain about.— will complain about. indeed. they may — will complain about. indeed. they may not _ will complain about. indeed. they may not leave. - will complain about. indeed. they may not leave. we - will complain about. indeed. | they may not leave. we shall see what happens in five years. the devon —— devil is always in the detail. thank you for your time this morning. now, some food for thought on the economy — mcdonald's has been hit by its first fall in global sales since the start of the pandemic in 2020 as lower income consumers struggle with the cost of living. the boss of the fast—food giant says the poor results are forcing them into a comprehensive rethink on the prices they charge. here in the uk, the price of a big mac has gone up by almost two—thirds since 2020. mcdonald's shares rose as the firm promised to develop cheaper meal deals. michelle fleury has been following the story. no amount of special sauce can make higher prices more palatable, as mcdonald's has found out. sales at the burger giant sputtered, consumers around

the world shying away from the higher cost of burgers, fries and soft drinks. even the ceo admitted it was too expensive. beginning of last year, we warmed of a more terminating —— discriminating consumer, particularly among lower income households. as this your progress, those pressures have deepened and broadened. on a call with investors, mcdonald's said food, labour and paper costs had risen by as much as a0%, forcing it to raise prices. one analyst noted the godlen arches' price hikes were higher than its rivals. the pricing increases have been faster than the rest of the industry. consumers are savvy, they're aware of that. that cat needs to narrow after having the one, two menu. kind of disappear. —— that gap. they need something where there is consistent venue. —— value. price certainty matters a lot.

the fast—food giant is working on fixes like extending the $5 meal deal into august at some us restaurants. that sent its share price higher. more and more restaurants from mcdonald's to taco bell are launching value meals to win over budget—conscious consumers. let's stay with the economy, because we are expecting economic growth figures from countries across europe in the next few hours. growth is expected to have improved slightly in the three months to the end ofjune in france, spain, germany and italy, contributing to a rise across the euro region. however, some economists are warning that europe could slip back into recession despite hopes of more interest rate cuts from the european central bank. continued pressure on the cost of living has boosted far—right populist parties. and a return of donald trump to the white house possibly at the end of this year or even in the new year could spell major problems for the region

as he puts up trade barriers that could hit exporters hard. of course they are looking ahead to that possibility. claus vistesen is chief eurozone economist at pantheon macroeconomics. good morning to you. let's just get some of the numbers out of the way to begin with. what are we expecting to find out today about the eurozone economy, key economies coming with our growth numbers? we economies coming with our growth numbers? economies coming with our urowth numbers? ~ , . growth numbers? we expect, most --eole growth numbers? we expect, most peeple expect _ growth numbers? we expect, most peeple expect the _ growth numbers? we expect, most people expect the eurozone - growth numbers? we expect, most people expect the eurozone gp - people expect the eurozone gp rose again in the second quarter, rememberthe first quarter, remember the first quarter, remember the first quarter was quarter, rememberthe first quarter was actually quite good in the eurozone which came after a period last year where growth was mostly zero. so the eurozone is growing again. probably not that quickly but it is growing again. pm? probably not that quickly but it is growing again.— it is growing again. why are some economists _ it is growing again. why are i some economists pessimistic, saying eurozone could head back into recession? i saying eurozone could head back into recession?— into recession? i think there has been — into recession? i think there has been a _ into recession? i think there has been a couple _ into recession? i think there has been a couple of - into recession? i think there has been a couple of red - into recession? i think there i has been a couple of red flags and the numbers at the start of the third water, some have been really poor. again, this is

difficult to quantify, we are arguing that allowed effect of high interest rates are going to hit the economy it will hit with a relatively long lag and therefore there is still that shadow over the economy, and then as you mentioned, there is political uncertainty in the us. but there is always a session risk in the eurozone, when growth is not high, there is a risk of something happening and you are at zero and so i think that is something that is always there. but we think the eurozone economy is now growing, not quickly, but growing. in economy is now growing, not quickly, but growing. in terms of our quickly, but growing. in terms of your outlook, _ quickly, but growing. in terms of your outlook, let's - quickly, but growing. in terms of your outlook, let's talk - of your outlook, let's talk about that issue that i mentioned in the introduction, the possibility of another trumpet presidency in the us. what would that mean for europe, do you think —— trump. it would mean uncertainty. the institutional framework in europe knows what to expect, they have been there before. i

think there might be less uncertainty than many people fear, but the issue with a trump presidency, quite frankly, we have no idea. it is a loose cannon. we don't know exactly what kind of line i trump president or how quickly will move forward on trade policies, for example, so if there is that risk. as far as europe is concerned, i think europe is concerned, i think europe in a way we all feel slightly better prepared this time, think they know some of the tools that the trump presidency might bring. mil presidency might bring. all ri . ht. presidency might bring. all right. thank you. get the numbers, we will fill you in here on bbc news. now to the energy industry, because in an hour or so's time, we get financial results from bp here in the uk. at the beginning of the decade, bp pledged to decarbonise its business by slashing oil and gas production and channelling billions into green energy projects.

then last year it rowed back on the policy as soaring oil and gas prices saw it underperform rival energy firms and its share price fell sharply. bp has been widely discussed as a takeover target for a bigger rival. so, what will we find out today? drjorge leon, senior vice president of rystad energy and a former oil economist at bp. good to have you on the programme. these numbers from bp will be really interesting this time because not only have we got the issues ijust mentioned, but also, we have a fairly new ceo in position stop give a reflection of how he is doing. give a reflection of how he is doinu. , , doing. indeed, yes. one thing that bp did — doing. indeed, yes. one thing that bp did mention _ doing. indeed, yes. one thing that bp did mention a - doing. indeed, yes. one thing that bp did mention a couple l doing. indeed, yes. one thing. that bp did mention a couple of weeks ago is that they should expect a slightly lower profit compared to the previous quarter, and that is quite important. last week we saw

total results done by 6%, exxon has also signalled we should expect lower revenues this quarter. i will not be surprised it was a drop of five, 6% in results from bp today. five, 6% in results from bp toda . ~ . , , five, 696 in results from bp toda . ~ . , , ., five, 696 in results from bp toda. ., today. which sends a shiver down many. _ today. which sends a shiver down many, many - today. which sends a shiver down many, many people's| today. which sends a shiver - down many, many people's spines because bp is in most pens and funds in the uk. —— pension funds. many people watching the programme will not be aware of that, but what bp does in terms of its share price, it impacts their future.— their future. for sure, it does. now, _ their future. for sure, it does. now, the - their future. for sure, it i does. now, the interesting thing here i think is revenues are going down, are likely to go down as one of the fact that oil prices at the quarterly level were higher than the first quarter. the average was $82 per barrel and the second quarter average was $85 per barrel. it is surprising on the surface that revenues might be lower. however, the key here and bp has been explicit about

this is refining margins. that is where it has affected bp's results. , ., ~ results. ok, interesting. thank ou for results. ok, interesting. thank you for giving _ results. ok, interesting. thank you for giving us _ results. ok, interesting. thank you for giving us your - results. ok, interesting. thank you for giving us your take - results. ok, interesting. thank you for giving us your take on | you for giving us your take on this, and we shall bring the viewers the bp news as and when we get it. as i say, that is coming in at 7am uk time. around the world and across the uk, this is bbc news.

you are with business today. i'm sally bundock. to asia now, and the car industry, because japan's mitsubishi motors is in talks overjoining an electric vehicle alliance with honda and nissan. the japanese car makers are facing growing competition from tesla and chinese rivals. mariko oi is looking at this for us. she has the details. nice to see you. what's going on? this see you. what's going on? as ou see you. what's going on? as you said. _ see you. what's going on? sis you said, if this deal is confirmed, this will create two camps in the auto industry in

japan, the trio of mitsubishi, honda and nissan versus toyota which of course has a tie—up with the likes of masto. teams are sells about 16 million cars each year, while the trio would have combined annual sales of just over 8 million, but more crucially as you said, globally they have been behind in the electric vehicle race, which of course is currently dominated by the likes of tesla and china's vy d. there are european carmakers as well as china's smart phone maker entering the race as well, and the intense competition has been affecting their bottom line. toyota hasjust released it as global output has been falling for a fifth month in a row —— byd. japanese carmakers especially toyota have until now been more keen on hybrid cars, which use both gasoline engine and an electric motor, they also just like they are still investing in hybrids as well as others like hydrogen cars, they are now stepping up

and spending on evs. not all alliances work but at least just over a third of mitsubishi is owned by nissan so they are no strangers. is owned by nissan so they are no strangers-— is owned by nissan so they are no strangers. thank you. to get our no strangers. thank you. to get your take _ no strangers. thank you. to get your take on — no strangers. thank you. to get your take on that _ no strangers. thank you. to get your take on that for _ no strangers. thank you. to get your take on that for us. -- - your take on that for us. —— good to get your take on that for us. now, if i asked you which global city is the cafe capital of the world, you would probably say rome or maybe or paris. so, this might surprise you. china's financial hub shanghai has seen such an explosion of new cafes that the local government is now claiming it has more coffee shops than any other city on the planet. our china correspondent stephen mcdonell has been finding out why. one of the most famous places in the for tea has taken a coffee in a big way. this means major chains, but in shanghai, it's different.

there's been an explosion of small specialist cafes. the government here says there are over 8,000 cafes in this city. in this street, over a stretch ofjust 100 metres or couple of hundred metres — 18 cafes. every one of them has lots of customers. translation: in shanghai, school students are being i influenced by their parents and drinking coffee. some grannies send their kids to school and then also pop in for a copy. so, how many cups a people drinking? translation: shanghai has long been _ an international trading city. we started drinking coffee a long time ago. smaller cities would also gradually getting different types of cafes. some cafes here are run by people with disabilities. this one, with visually

impaired staff, has a a unique way of handling out the coffees. you order here and they pass the coffees through the window. there it is. laughter yet, with this many outlets, the competition is fierce. what advice would your friend who is considering opening a cafe here? translation: don't do it! the return is awful. you need to buy very expensive machines. and put a lot of money into decorating. you are earning very small amounts of money compared to other industries. you have got a cafe. you've spent all this money on rent. what are you going to do with it at night? one solution — turn it into a bar. yet with concern about the economy, will thirsty customers keep spending? translation: i'm

quite optimistic. i i hope the chinese economy will quickly return to pre—pandemic levels. the chinese government says it wants a recovery led by consumption. maybe it is a step in the right direction. steve mcdonell, bbc news, shanghai. now, from �*cafe—nomics' to �*fan—onomics'. we have all heard about the �*taylor swift effect' on economies and cities where she is performing and the boost live music events give to the service sector. but the live entertainment industry hasn't been without controversy. in the us, the biggest venue and ticketing operator livenation — owner of ticketmaster — has been sued by regulators for having too much power over the business. and the biggest ticket resale platform viagogo — owner of stubhub in the us — has come in for criticism over touts using the sites to

inflate the price of tickets. the new labour government has promised to put in a cap on ticket prices, limiting the mark—up to 10%. cris miller is global managing director of viagogo. good to have you on the programme. good to have you on the programme-— good to have you on the programme. good to have you on the rouramme. ., ~ i. ., ., programme. thank you for having me. it is desperately _ programme. thank you for having me. it is desperately required, i me. it is desperately required, isn't it, better _ me. it is desperately required, isn't it, better regulation - me. it is desperately required, isn't it, better regulation of. isn't it, better regulation of your industry? i isn't it, better regulation of your industry?— isn't it, better regulation of your industry? i want to talk about the — your industry? i want to talk about the marketplace - your industry? i want to talk about the marketplace in . your industry? i want to talk i about the marketplace in itself and what the viagogo does which is enabling fans to connect with sellers to go to any live event anywhere in the world. what we ultimately do is make sure it is safe and secure for everybody. sure it is safe and secure for everybody-— sure it is safe and secure for eve bod . ., ., ., ., everybody. how do you do that? we all assume, _ everybody. how do you do that? we all assume, and _ everybody. how do you do that? we all assume, and we've - everybody. how do you do that? we all assume, and we've heard the stories about what's claiming thousands and thousands of tickets and they are resold for a lot more —— bots. it can come from any variety of places. corporations and sponsors. _ variety of places. corporations

and sponsors, professional. and sponsors, professional resellers, fans, event resellers, fa ns, event organisers, resellers, fans, event organisers, concert promoters, sports teams. it is a right —— wide range of inventory and we make sure everything is safe and secure. the purpose of the report that we put together with the centre for economics business research was really about to display the value of the economic impact, and the impact it can have more emphatic have in the uk. the net result of that was three quarters of £1 billion was reinvested in the local businesses supporting 8000 jobs. businesses supporting 8000 “obs. ., , jobs. how can you say is because _ jobs. how can you say is because of— jobs. how can you say is because of the - jobs. how can you say is| because of the secondary jobs. how can you say is - because of the secondary market that you are seeing that cause—and—effect? how can you prove that? cause-and-effect? how can you prove that?— prove that? the results of the re ort prove that? the results of the report was — prove that? the results of the report was basically _ prove that? the results of the report was basically a - prove that? the results of the report was basically a survey | report was basically a survey of thousands of people that actually use the resell market and the intended what the value was for the resale service, why do people sell tickets which is a number of different reasons, but the most important reasons where they could either not make it to the event of a no longer wanted to attend the

event. these on cells that take place within 12 months, two years in advance in the case of the olympics. when you look at the olympics. when you look at the buyers that actually use this service like viagogo, they use it for many reasons, so let's say they are travelling to a new country, let's decide they missed the on sale for some reason or maybe they are only aware of the event a week before the event. so it is those fibres having this enormous impact on the economy. if the government in the uk was to introduce the on ticket prices, how will that impact you going forward? i prices, how will that impact you going forward?- prices, how will that impact you going forward? i think the most important _ you going forward? i think the most important thing - you going forward? i think the most important thing is - you going forward? i think the most important thing is to - you going forward? i think the | most important thing is to take a step back and look at the entire economy and is happy what the emphatic and have that a service like can have. if you look at the olympics, are a lot of restrictions and regulations in place that doesn't allow for a free market to be enabled like viagogo, so what happens, you have loads and loads of empty seat. not providing any security for people to make the purchase of these tickets, they

can be two years in advance. if you look at a market like the euros for instance where there is a open free market, we can satisfy that, we are held to fill the for all sorts of events including the final for england. it is important that people keep an open mind about free market. just people keep an open mind about free market-— free market. just to say, could ou tell free market. just to say, could you tell us _ free market. just to say, could you tell us what _ free market. just to say, could you tell us what is _ free market. just to say, could you tell us what is happening i you tell us what is happening with stubhub and is hopefully some financial markets. it has been postponed because of of stagnant market conditions. yes, the point is that we are always looking for the best opportunity to do it and it will be at our discretion when we decide to do it. we are in a lucky decision to make that decision. —— in a lucky position to be able to make that decision.— position to be able to make that decision. interesting to net our that decision. interesting to get your take _ that decision. interesting to get your take on _ that decision. interesting to get your take on what - that decision. interesting to get your take on what is - get your take on what is happening in that market. global director of viagogo. that is pretty much it for business today. thank you so much for your company. we have

more detail on the stories recovered in this programme. we are watching out for the bp numbers on the latest growth figures for the likes of france, spain, germany, other key economies across europe. we will let you know when we get those figures. have a lovely day. i will see you soon. hello there. we're going to see some contrast in temperature across the uk over the next few days. slightly fresher conditions for scotland and northern ireland, but england and wales certainly holding on to the heat and the humidity for another few days. for most of us, it is looking pretty dry and pretty sunny, as well. but will we see a heatwave? it depends where you are. these are the threshold temperatures, which we need to hit for at least three consecutive days. now, that's 28 celsius for parts of london and southeast england, 27 for much of england and wales — we've already seen one day above that — and actually, over the next few days across parts of the midlands, southern, southeast england, we could well see those threshold temperatures exceeded for a heatwave.

now, through the day on tuesday, lots of dry, sunny weather. areas of cloud just floating around across parts of northern england, northern ireland, and at times, scotland — so you could just see a light passing shower here, i think. further south — long, clearspells, blue skies, lifting temperatures to between about 28—32 in the southeast. these typically the high teens or the low—20s, though, as we head further north. overnight tuesday night and on into wednesday, largely dry, settled, humid again — so another muggy, sticky night. just a chance of the odd shower cropping up perhaps towards the south. but look at those overnight temperatures — 18 degrees in london, but we're looking at glasgow and edinburgh around about 7—8 celsius. so a real contrast as we head into the early hours of wednesday. but again, for wednesday, lots of sunshine, it's going to feel hot and humid again for england and wales in particular, where temperatures could reach 30 degrees or higher. typically again, the high teens or low—20s as we head through scotland and northern ireland. but a bit of a change into thursday, because we're going to start

to see this frontal system moving its way in from the west, bumping into the high pressure, bumping into the hot, humid air — that could well spark off some heavy showers and some thunderstorms. so a bit of a breakdown in the weather possible for thursday, especially so for england and wales, but some uncertainty about the positioning of any of those thunderstorms. if you do catch one, torrential downpours could bring some localised flooding. with the threat of showers, it's not quite as hot by this stage in the south, but still could get close to 30 degrees. and then, as we head through friday into the weekend, eventually weather fronts will start to move their way eastwards, introducing something a little bit fresher coming in from the west. so, after a hot, humid few days, it is looking a little bit cooler and more unsettled as we head towards the end of the week and into the weekend. bye— bye.

good morning, welcome to breakfast with sally nugent and ben thompson. our headlines today. shock and grief after two children were killed and nine others injured in a knife attack in southport. this attack in southport. is like the worst thing you can ever this is like the worst thing you can ever imagine. my daughter was there on saturday. ourfriends' kids ever imagine. my daughter was there on saturday. our friends' kids were here and they got slain and massacred. iam in i am in southport where people have

laid flowers overnight. a17—year—old is in police custody. a cut to winter fuel payments for millions of pensioners— as chancellor rachel reeves says difficult decisions are needed. we'll be looking at the reaction and what might come next. it was medal monday for team gb as they picked up six, including golds for mountain biker tom pidcock and the eventing team. today will be dry and sunny more or less across the board and it will be warm or hot and potentially the hottest day of the year so far in the south—east. all the details shortly. it's tuesday 30th july. our main story. police are trying to establish the motive of the attacker who targeted a children's dance workshop in southport, killing two children and injuring nine others. six children and two adults are still in a critical condition

as a result of the knife attack, which is not being treated