in the 12 months to december. we'll assess what it means in america, and around the world. here, though, a surprise fall in uk inflation — but it's still above the bank of england's target, keeping the uk economy under pressure. also... cashing in on trump's china tariff threats — india's tech businesses look to pick up the slack. welcome to business today. now to germany where the economy shrank last year, for the second year in a row. initial calculations show gdp in europe's biggest economy fell by 0.2 percent. analysts blamed factors including german exports facing increasing competition in key markets and high energy costs. the news comes less than six weeks before general elections. the main governing party, chancellor olaf scholz�*s social democrats, is currently lagging in third place in opinion polls. salomon fiedler is an economist at berenberg bank. he told me more about

the challenges facing germany. the number itself was not unexpected at this point. even this has not continued for roughly three years. so not looking that great for germany at the moment and, we have to say, it's not only a cyclical problem at this point but rather a structural one. so this number underlines really the need for large scale reforms that the economy needs if we want to see more growth going forward. if we want to see more growth going forward-— going forward. this is being described — going forward. this is being described as _ going forward. this is being described as the _ going forward. this is being described as the longest. going forward. this is being i described as the longest phase of stagnation in post—war history of the what can germany do? what are the structural problems the country needs to deal with? the problems the country needs to deal with?— dealwith? the problem is a very large _ dealwith? the problem is a very large amount - dealwith? the problem is a very large amount of - deal with? the problem is a . very large amount of structural problems affecting all production sectors at this moment that weighed down. you

have demographic issues which mean the labour and that will be low ago. we have the russian energy policy which made reduction much more expensive thanit reduction much more expensive than it needs to be. we have excessive regulation, which slows everything down, very high tax rates, which sap incentives to go for growth opportunities. so a lot of sites where we would need structural reforms. a lot of potential issues that can be addressed by the next government.- addressed by the next government. strip out the olitics government. strip out the politics but _ government. strip out the politics but put _ government. strip out the politics but put it - government. strip out the politics but put it back- government. strip out the politics but put it back in? what will change in the election in six weeks? at what will change in the election in six weeks? at this oint, it election in six weeks? at this point, it looks _ election in six weeks? at this point, it looks like _ election in six weeks? at this point, it looks like the - election in six weeks? at this point, it looks like the next l point, it looks like the next chancellor will be the

conservatives, and the cpu currently has a message a bit in that they want to go for some reforms, including reducing corporate and personal income taxes and some modest new regulation. the reforms they propose at the moment are not going to be anywhere near enough to bring growth back to what we have seen in the decades before the pandemic, but they should at least help a bit. the cdu will not be able to govern alone. they will need a coalition partner, probably from the centre—left, most likely the social democrats again. they seem a bit more reticent when it comes to these reforms. so we need to see how much we get in the end, but our baseline would be that we see at least some reforms going forward.

in the us prices edged up more than expected in december, driven higher by food and energy costs. consumer prices rose 0.4 percent last month, after climbing 0.3 percent in november. this means that in the 12 months to december price rose 2.9 percent up from a 2.7 percent rise in november. the federal reserve reserve's inflation target is 2 percent. earlier today we also had inflation figures for the united kingdom that also showed prices up 2.5% in the same period — an unexpected fall in inflation for the first time in three months. now back to matthew. breaking news. we have been watching those developments. as we edge towards a ceasefire deal between israel and hamas. hamas telling the bbc in the last few minutes it has approved the ceasefire deal. we also await the israeli response

as well, but mark logan is in jerusalem, monitoring events. bring that up to date. it is a very fast moving situation at the moment. we were expecting a press conference about 35 minutes ago by the qatari foreign minister or prime minister, in which we thought that they would announce that a ceasefire in gaza has been clinched. that has not happened, that press conference, and then there were reports that hamas had made one final demand to israel, regarding israel but �*s presence in the south of the gaza strip, a corridor which is close to the rafah border crossing with egypt. however, we have just had a statement from a hamas official, saying, as you said, they have told the bbc that the movement, hamas, has handed over its approval of the ceasefire agreement. that

is been reported by our gaza correspondent, who is currently in turkey, who has been speaking to sources inside hamas. it would appear there is approvalfrom hamas. it would appear there is approval from the homicide, which was the outstanding approval, because it seemed that the israeli government negotiating team had approved it from their point of view. if that indeed is confirmed, we are lucky to get a confirmation from the qatari is eminently that a ceasefire deal has been struck and, if that is struck, we expect the israeli government to vote through that deal, probably as early as tomorrow, thursday. there is obviously a clear choreography that is going to be laid out over the coming hours, as we wait for the official confirmation. we will learn a lot when the qataris hold that news conference. in terms of what we know about

what has been negotiated, take viewers through that. what we know is what has been leaked, basically, to the israeli media and from sources close to the negotiations, that this would be a three phased deal. the first phase would last six weeks, and that would involve a release of about a third of the israeli hostages still being held in gaza. we are talking about 33 of the 98 hostages still held. the hostages still held. the hostages would be released every week, starting with three hostages to be released on the first week. those who would be released would be women, the elderly, the sick and injured and, in return for their release, hundreds of palestinian prisoners in israeli jails would be released, possibly as many as 1000. it troops in gaza would

begin to withdraw from some built—up areas, allowing some of the displaced gazans to return to their homes. we are talking about almost 2 million displaced gazans. what israel wants its security guarantees and vetting of the gazans who are currently in the south of the strip who would want to return to the north. israel would begin to withdraw to what it is calling a buffer zone along the border with gaza, while maintaining a presence in the corridor in the south of the corridor in the south of the gaza strip. 0n the corridor in the south of the gaza strip. on day 16 of the gaza strip. on day 16 of the first phase, they would begin to negotiate the second phase of the deal, which would involve the release of more hostages, prisoners and more discussions over the shape of a post—war gaza. how would it be rebuilt and who would govern it? a couple of additional lines i want to bring viewers. axial is

our reporting a us official also saying a gaza ceasefire deal has been reached, so bit by bit, strands of information all seems to be heading in the same direction. let me bring you up—to—date with a press release that's come from the hostages and missing families forum headquarters. we saw pictures a bit earlier in the afternoon of those families in hostage square in tel aviv, and let me take you through what they have said. they say, in they have said. they say, in the light of reports about an imminent agreement, we welcome and deeply appreciate the return of every hostage, each one representing hope and relief not only for their immediate family but for our entire community. we urgently pull for a framework which ensures the return of every person held captive after more than 400 to two days, our loved ones continue to endure an emotional distress. 0ur

ones continue to endure an emotional distress. our mission remains unfinished until all the hostages, both living and dead, are returned home. let me bring you back in, mark, because that is so critical to this was to steal. a ceasefire will come after space two and three and an initial pause for those 46 days you were taking us through, but absolutely central is the return of the hostages and, as we are talking, we don't know the exact numbers of those alive and those who are not. no, the israeli government believes that about a third of the remaining hostages there, so perhaps 30 or so of the remaining 98, are dead. and they believe, under the ceasefire deal, as we understand it, the dead bodies would be returned to israel in phase three of the ceasefire talks. as you were saying, this

is a deep wound in israeli society. travel across israel and you see the phrase bring them home now. when you fly into tel aviv airport, there are photos of all the remaining hostages who are not still home, with flowers and teddy bears. 0n cafes at restaurants, it's the slogan you see everywhere. you see it on car bumpers. for israel, the idea of bringing home hostages is so deeply intertwined in israeli identity. they have had hostages before, of course, taken to gaza. there was a famous israeli soldier who was taken hostage and then released in 2011, and a massive effort to get him back, which they finally did, releasing hundreds of palestinian prisoners at that time, you sinwar, who went on to lead hamas and was killed by the israelis last october. so bringing home israelis is a

very deep and profound need in israeli society. this is the jewish homeland, asjews see it, and the idea they have been taken to, by what the israelis call a terror group, that is what they are determined to achieve the even if, as i say, the israeli governed fields any of those still held possibly are dead. before i read out the various reports that writers are filing, it's important to say that we still wait for verifications for all of this. but the reuters news agency is reporting that israel will release a 30 palestinian detainees for every civilian hostage and 50 palestinian detainees for every israeli female soldier hamas releases. they got on to report female soldier hamas releases. they got on to repo