>> time for a reboot. mark carney revealed a plan to fuse departments of the bank of england. janet yellen makes her debut. >> it is u.k. budget day. live in westminster. >> welcome back to "countdown." i am mark barton. annaam an edwards -- edwards. >> the u.k. budget is set to be

unveiled later today. let's head over to guy johnson. good morning, guy. to bes budget is going long on politics, short on economics. to be honest, the chancellor is going to conduct a series of tweaks today. it is about setting the agenda for 2015 when this country will go to the polls. it is about the narrative in advance of the general election. , it willare saying really be about the cost of living. it will be about social mobility. it will be about jobs and there will be some economic things were we'll have a bit of a push when it comes to generating more experts -- exports for the british economy. this is about filling out the political landscape in advance of the election. the labour party will have something to go at here but probably on the economic front, very little because the chancellor will be able to

announce that the british economy is basically back to the peak of 2008. the unemployment is definitely coming down and for the first year and quite a few years, we are going to see wages rising faster than inflation. inflation back down to the bank of england's target. wages are likely to exceed that and that is something you will be talking about. on the export front, we will hear more about mentoring medium-sized company. the chancellor has himself a target of 2020 of doubling the exports of the u.k.. he is struggling with that so we will see a bit of a push. this is about politics and not about economics. the numbers are going to look a little more rosy and the chancellor is going to make it clear that the recovery is fragile and could be blown off word tof the electorate decide to opt for labour. fitsm not sure where this

in, but we understand that new pound coin is in the offering. to be honest, i think the fact that this is going to be a big deal today probably tells you about the fact that this will not be that much in the budget. yes, we will have a new coin in the united kingdom. moment subject at the given the scottish referendum on independence but we will see a 12 sided coin. apparently it will be harder to counterfeit because counterfeiting coins apparently is big business. back to you. looks a littleit bit like the threepenny. i look to you, because you probably do remember. it was around from 1937-1971. i don't know anything about it. >> stay with us. they will unveil the budget. do not miss it. joining us now is the head of

-- bill.management long on politics, short on other things. am one of the individuals they were talking about. is that it isent 14 months before an election. the potential for surprises and giveaways is there and particularly folks that have a living standard that are focusing on keeping inflation rates down, supporting middle income families, and particularly through the task allowances to maslow. whatever will be given will be modest but very focused. >> neutral overall? >> neutral. i see things like anti-avoidance measures getting funded. there's the possibility of the use of some of the funding from public sales of the interim banks as a source of funds.

that has issues. the big picture is that the path of austerity has to be held to bring we are still looking at a debt excluding the purchase of dividends and post office at about 5% of the gdp. it still looks large. >> it will stay that way to 2018, 2019, which is many years after the chancellor originally happened he would knock it down -- >> clearly, short of america we are not going to get the objectives accomplished by the end of this part. the other part is we do not see the office residing -- revising its estimate. that is the key issue. it really limits the room for maneuver. in terms of growth numbers, a lot of people are expecting a lift, a reduction from the heart growth numbers. assumptions have been cut as well and it is the

nominal growth projection that really matters, not just real gdp. the borrowing numbers will probably be reduced modestly by rebuilding or 4 billion. some people are suggesting that in terms of medium term , it is moretations of the budgets responsibility to come up with it then those are weight on that unemployment is coming down in the short term which means in the medium-term, you have to make effort assumptions about spare capacity. >> i think we have already taken , conservativeing view about the level of capacity in the economy. probably a little ahead of what the bank of england had submitted recently. it is just under the outing of the february inflation report. the story is, we are looking at a number of years of -- that limits the options that are there.

to have a big impact on the macroeconomy. we are on a glide path. the estimates would suggest that the newtill looking at parliament and is there going to be another politically-driven philosophy to reduce the government and the economy? that is a different story. >> they're going to cap they're spending. >> is a different program. postelection, we will be looking at it again. a very different context. >> a year ago we were talking about a triple dip recession. is growing faster than our g-7 counterparts and could do and 2014 as well. >> part of the budget is focused on sustainability. we have been talking about the export center. -- sector. there may be something in the

small and medium private sector as well. credit access -- >> john longworth said earlier that the target of one trillion pounds in exports by the end of the decade is a little bit lofty. >> it is difficult given what we have seen in terms of the limited impact of sterling has declined. >> he was saying that away from the budget, what is important for them at the bcc is to keep interest rates low so we do not push sterling out and damage exports. >> the bank and the government are concerned about those prices. our view is that sterling will rise because what is happening elsewhere as well as what is happening in the u.k., particularly with the bureau. u.k. rates are house viewed. we don't like the u.k. equity market. >> why not? >> it is a defensive market. the way we look at how we manage money, it is hedged. we don't get the right -- the benefit of a rise in sterling.

it impacts a ftse 100. our preference is for the mid-cap sector. it is basically half the indexes into the economy, nominal growth is resilient. there is am in a activity. the u.k. middle standard has been prospering. >> those companies that depend on overseas earnings, should they be wary? >> 25% of the sector of footsie that is and -- ftse that is influenced by those. , thank you.ill >> up ahead, we will look at the budget announcement by going inside the housing center with galley yard. ♪

time for today's company news. toyota has reached a $1.3 billion settlement to end a u.s. criminal probe into unexpected acceleration in its cars. the settlement could be announced as early as today. the carmaker recalled more than 10 million vehicles for problems related to unintended

acceleration. toshiba plans to sign at least three partnerships to manufacture lighting fixtures in europe in the next year. the partnerships will allow toshiba to sell asian leds in europe. an has -- nsion pl google is bringing its android software to smart watches. the project android where will extend the android system to wearable gadgets, including watches. welcome back to cart -- welcome back to "countdown." the budget announcement today, let's look at the u.k. housing sector. at acarney gave his take school in london. >> we should not be

trigger-happy, but we have the tools and we are well armed to address those risks. governor mark carney talking about the tools the bank of england has at its disposal to tackle the housing markets should it feels necessary. there have been concerns that we are starting to see in over cheating -- overheating housing market or it -- market. they have redeveloped county hall in westminster. they're currently developing over 3000 apartments here in london. that is galliard homes. let's talk to the managing director.

is a concern we are seeing risks build up in the housing market. are you concerned? >> no. currently we are delivering less than 50% of the numbers and everyone else's numbers. we need to be delivering. we have a massive undersupply in the market. the headline-grabbing numbers that are making headlines in newspapers are very small amount of the market that are selling at high prices in a very small part of london that is being sold at prices that are not reflective of the market in general. there is a big demand. >> that is the demand story. the problem is that there is not massive supply right now. >> it is restricted desperately by planning. across london is the city of london. , 33ave 33 separate boroughs separate planning departments each with their own strategy, each with their own and ordinance in several issues that are important to them. to make it impossible any significant inroads into the

big numbers that we require. i believe that the government needs to introduce something similar to the olympic delivery authority which managed to take a whole chunk of london and build all of 3000 apartments and everything was required in terms of an stretch archer -- in terms of infrastructure in a short. of time. need it over the authorities. >> something with statutory powers is the only thing it will make a significant difference. choose laces across london have existing transport links and build toll houses around those notes and that is the only way we can make inroads. >> focusing on the demand side seems to beion, it demand-driven rather than supply-driven. they're focusing more of those policies towards new homes, but nevertheless it is still a demand-side of the equation story. >> all the strategy is put in

place to support the demand and is very successful. that is reflected in the headlines for you see talk of overheating the market. people can buy and are buying homes. the reality is, the supply is not there. while the headlines are being in london in terms of prices and overheating in the market it is not the reality. we need 42,000 new homes a year in london. lester we have less than 18,000. this year will be 20,000. you cannot have 20,000 shortages in your target numbers every year and expect and overheating. it is significantly different. in terms of the strategies that are put in place to buy and the like, that has not taken off for london because i have not been required here. the london market generally works with people selling off a plan, developers building in advance and selling off a plane. although strategies in terms of

help to buy, they are aligned with mortgage offers. they'll expire in six months. companies like ourselves that sometimes so years in advance, it does not work like a. -- like that. areow many homes of these sold to london residence and how many of those outside the u.k.? >> it varies. the central prime london is predominantly sold outside of the u.k. zones two-3-4, there significantly higher london owners. we launched one first and london and sold 215 apartments on one weekend. they were wondering -- londoners buying in london. they are keen and open. >> we will leave it on that note. thank you very much for your

thoughts. we will have much more in advance of the budget today. very much a political focus in the story coming out of the chancellor today. he is definitely repositioning the country for the next general election. we're going to hear a lot about exports so we will hear about that later in the morning. back to you. is 7-19.me in london we will be back with ubs's u.k. head of investment on what to more expect from chancellor osborne's budget speech ♪

>> welcome back to "countdown." i am anna edwards. >> and i am mark barton. let's chat about the budget bill still sitting, still chomping at the bit weird bill o'neill from ubs wealth management -- at the bit there. bill o'neill from ubs wealth management. give us your assessment of the housing market, focused on supply and demand. the knee has predominantly been the focus here in the u.k.. -- the need has been predominantly the focus in the u.k. >> surveys are suggesting that there are a dearth of structures to sell. if you look at the national level, mortgage approvals are

running at about 6% of the previous peak. net secured lending per mark net , repaying mortgage payments, is limited. you cannot talk about oval conditions at the national level. there is a constraint of the supplier. ell.just of structures to sai buyense is that hard to structures will be with us for a while because it is seen now as a way of closing a gap in the market to basically create -- again, to seek out or incentivize construction of homes. >> do you think the treasury and the bank of england seem to be on a collision course over housing? >> my sense here is that pre-election is going to be more difficult. our view is that is going to be

up to 10% year-end inflation by late this year using the measure we look at. bank findslty is the it hard to argue the fbc that there is a threat to stability. if it is a threat to the london market and the aggregate numbers do not -- >> so as long as the lending statistics don't look bubbly, it doesn't matter necessarily whether the price is -- >> the dynamics of the london market are different. dominated obviously by capital interest. the moving and sterling is much more relevant. hard toional level is talk about a bubble condition. give us your thinking right now. >> in terms of an inflection point, i think the key story is around europe. if you do not get an earnings recovery in her -- in europe,

there is something seriously wrong. there is an anomaly. earnings should be better. look at against u.s. performance. europe should be better. with the recovery economy particular, the data accelerates and you do get some upgrades in european growth this year. we should see topline growth coming through man funnel down and improve margins. the financials at the banking sector that is responsible for about 40% of this peak, i think there is a much more benign environment there through 2014. >> the foreign ministry as saying the crimea situation should be resolved through the legal framework. what is the threat to investment at the moment? is it an escalation of the tensions? is it to do with the slowdown in china? >> the slowdown in china is extremely important. our perception is that the

economy is slowing but from the point of view of a perspective on growth internationally, it is a market collapse rate of clearly there is an issue around leverage in the economy and we think that will be addressed through selective defaults that are actually clearly sending a warning signal but also confident and explicit backstops provided by the authorities. movement in the rmb will put an offset. toare seeing a slowdown 7.14%. is international environment improving for china and it begin begin to the cup -- to pick up. we do not see a collapse in growth. that is the key issue. thank you very much. >> bill o'neill,. toyota pays over a billion

dollars to settle a criminal investigation. ♪

>> welcome back to "countdown." >> let's get right to jon ferro for your ethics check. >> the fed will be a big focus for the fx market. we could see 620 per dollar for the first time in 11 months. chinese central bank is still guiding to fixing things lower. everyone is talking about it. it is the one to watch. everywhere else, dollar-yan. n. dollar-ye more dissipating things out of japan. a trade deficit for the last -- the 20th straight month. the japanese currency is down

and exports have seen limited games. imports have gotten more expensive. >> time for the top headlines today. the federal reserve is set to announce its break decision later. one had by janet yellen. -- headed by jenny on. they believe they will taper the stimulus by $10 billion. the total search area for the missing malaysian airlines flight has included to 2,750,000,000 square not ago miles. -- square a nautical miles. says he has no intention of splitting up eastern ukraine. he signed an accord that set in motion plans to annex crimea, reversing what he describes as a

historic wrong. eu leaders meet in brussels to discuss further sanctions against russia. toyota is said to have reached a deal with u.s. authorities over a long-running investigation. we have more on this developing story from tokyo. craig, how big a number is this for toyota and what is the significance? is $1.2ettlement billion. that is pretty comparable to a settlement that we never reached with owners -- that toyota reached with owners for a vehicle that had more than 10,000 real -- 10,000 recalls in 2010. it is a big number for toyota. they have more cash than any other company in the automotive industry and it is one they can certainly handle and move on from. >> put this in context in term

of the biggest recalls we have seen in the auto industry if you could. the one that everyone is paying attention to as of late has been general motors. they have recalled more than one million vehicles for an issue with models that are quite a few years old. it is related to be the mission oftch -- the ignition switch the models. it has been blamed for a dozen deaths. for toyota, the settlement we is withing about today u.s. regulators. those u.s. regulators now have to turn their sites to gm so that it may be related to today's settlement. >> this investigation goes back quite a long way. the recalls happen a number of years ago. what has it done in the period to the sales

and reputation of toyota? started recalls really in 2009, continued into 2010 and really reached a fever pitch in 2010. of 2011, justng as they were recovering from that, that is when they were hit by the tsunami in japan. later that year, the floods in thailand. they relinquished global sales leadership to gm that your. they recovered and have been able to reclaim leadership in sales and their quality rankings have really improved. you look at consumer reports, you look at jd power and associates, and they ranked toyota among the best ranked brands in the automotive industry for quality. >> thank you very much for joining us. to continue our discussion of the economy here in the u k ahead of the budget a bit later, we are joined by a man who has the business perspective.

and chiefcofounder executive officer of cloud computing company. good morning. your first set of results, you joined aim in the last year. you had a busy year. revenues are improving. you're not quite profit-making quite yet. talk us to the achievements of the last 12 months. >> it is exciting. a lot is being done. people have been watching us. they know about the clouds so our revenue is up $.44 on the year. 120 --revenue is up 120%. we have had some big customers, household names. large telcos and system integrators reselling our services globally. people are beginning to understand the whole world is going to move to the cloud model. microsoft is a very large part of that. you see satya nadella has a focus on that.

our focus is to be the largest player in the world. >> do businesses get the cloud yet? >> big businesses get it. they are clever people. they pay the cio to think about strategy. they are consuming it faster. small businesses are beginning to become aware of it but sometimes the incumbent suppliers to small business itself need to transition their business model and that is hard. oillast telcos are like the tankers were they get it and move it. to get to market fast, it is hard to do it themselves. --ee large telcos and excise there basing their product on our infrastructure. >> one client is the u.k. government moving a lot of what they doing to the clapboard -- to the cloud. >> they see the strategy.

they're going to move to the cloud. procureo see a need to digital media contracts. they're working with microsoft and dell to the ploy a specific government cloud of program which has added security to provide services to the government. >> what does that mean in the post-snowden era? do they specify where the data has to be held? is this something your clients are thinking about more? where is the data held, where will it travel to and through as it goes through from the company to your storage facility? >> your show is not long enough to answer that question. [laughter] qualityad a high company like us, it is more secure because we can invest in scale that even large companies cannot afford themselves. the government has security level to have to in year two. the cloud is secured like a standard cloud but it is also

physically secure, security cleared personnel. it is an added layer of physical security. cloud should be more secure than anything an individual organization can deploy itself. >> we spoke to the british chambers of commerce earlier. her focus is on avoiding this lost generation. they are focusing on youth and employment. it is something i know you are very enthusiastic about, your past and various foundations and charities. you are trying to inspire talent dormant, trying to provide a level playing field for those who do not have the best opportunities. what is the best way of achieving those aims? >> i am looking at starting my own charity, which is about young people having insights into the workplace and their choices. , the curse austerity services, they have been cut back. they can't really see their options. they're trying to make decisions

about their lives and careers and what to go study without actually knowing the realities of those roles. we have people across the spectrum from all over the world, from the united nations. we are very much about the working sector, you can be from any background. on tva secret millionaire a year ago. one of the guys i met in prison is now a consultant. there was a roadmap to get there and that is what the country needs. technology entrepreneurs, this generation y as it is often called, they're the future. it is not about winning election, it is about looking further ahead. >> are you looking to the chancellor today to deliver anything in particular? some are talking about giving more incentive to those with money to back businesses created by those younger entrepreneurs. >> it is hard to legislate a

factly around who should provide money to whom. fantastic -- the enterprise investment scheme in this country is amazing. equity is great. equity is not always the option for young, growing businesses. the -- it is a good tax structure in u.k. but i think more can be done. >> thank you for joining us. >> breaking news on persia. gallois will be the new chairman. he is quite a name in business. he was the ceo of the aes -- eads which owns airbus. look at his cv. he now works for the office of the prime minister in france and

has done since 2012. his most recent poached him a which you are i am am sure aware of, was his post at eads. he will be the chairman appears geot.-- the chairman of peu ♪

time for hot shots, a look at some of the day. uruguay, it is man against the untamed hordes. weekendhered over the for a gaucho fiesta. writing wild horses without saddles. they date back to the 1700s. they kicked off the flower got a ceremony. people living in the southwest province in china believe that as asia's bring good luck every year when flowers are in full bloom.

azaleas are considered royalty of the garden. competition took place in u.k. -- the wife carrying competition. dozens of couples raced through yards of obstacles. the tradition goes back to stole times when raiders women from neighboring villages. the prize for the winning couple? beer. welcome back to "countdown." when you be taking part in next year's wife carrying competition? a i think calling it tradition is overplaying it slightly. it is not like we do this on a regular basis. thank you. let's look at some the top corporate stories we are covering today. caroline hyde joins man said. -- joins me on set. >> we are starting to see the

stall wart of the consumer world. it has managed to grow and grow at exceptional rates despite in their country. it is starting to see a little bit of weakness because of the euro strength. the euro strength against the --, the ruble, but still brazil. the has eating into sales. once you convert them back into euros, less bang for your yen. it seems to be coming as a bit of relief to investors at the numbers have slowed but it comes in line. we have seen 1% increase in terms of profit, 5% in terms of sales. it is not an overall slowdown we could see the shares up 1%-2%. there is an emerging market angle to it and weakness coming through but there is also the

online part of it. >> opening in yet more countries. they will be open in greece online. they will be looking towards south korea and mexico. a company that has managed to flatten its competitors by having a standout business model. they are able to get fashions in store worker and online a lot faster. they push on my for a lot of competitors. a lot of the clothing retailers were quite slow to pick up the online compared to other areas of retail. it seems to be a prevailing view buyetail that he would not this way but it is not the case. many big retailers playing catch-up at doing it effectively in some places. teachthe way they have to themselves to reach a particular country but if you're selling in china, to be selling on london

on my. in china, you have to have intricate details. you have to be able to zoom in on the him. -- the hem. they need 15 pictures where it we in london get four. inditex has managed to nail it. they are still expanding on the ground as well. 450-500 shops are going to be opening this year. they lookout out for new ones and additions. i remember that in germany, customers there returned more than another arts of europe because they have had a very strong catalog shopping model for many decades. there used to shopping that way. -- they buy a lot and then return. thank you very much. >> breaking news from crimea.

ryan chilcote has the details. >> in the last 15 minutes, a group of protesters have stormed ukraine's naval headquarters. it is an crimea. they are basically demanding that these officers at this ukrainian naval base either crimea,o russia, or then russia, or get out of crimea. but there are a lot of them are women. they have said, get out. they have the russian hymn playing on cassette players. they have raised the russian flag. situation inile crimea where you have ukrainian servicemen who have been holed up on their basis in crimea. secede.ea has asked to russia is going to annex it and you have servicemen who are looking for a way out.

either they intend to stay there , swearing their allegiance to ukraine, although things are going against them at the moment, or they need to get out. these women are saying, men and women protesters, are saying it is time to get out. no arm demand that we saw some clashes last night. we saw fatality last night. situationto a larger we have these bases left over from just before the vote where they are still swearing their allegiance to ukraine. >> you are off to brussels tomorrow for the you leader summit. >> it should be interesting. we have the personal sanction asset phrases of the 13 russian officials and travel bans, but now that russia has annexed crimea we can expect them to step up a bit. trade sanctions, i don't know. it seems like we are a ways away

from that. >> coming up, we are to focus on the fed. we look ahead to the fed rates. stay with us. ♪

>> welcome back to "countdown." i am mark barton. >> and i am anna edwards. >> john is here. he promised me that he would tackle what is the new mpc. >> you scary when you do these

things. we can talk about it if you want. >> think of it as an appendix to the show. new measure beat from the nbc -- i think how they move from i thinkto the nbc -- that is largely a reflection which is going on at the strategic bank to get a crossover. >> they were saying it is all about bricking down silos and getting the different parts of the bank to speech it out -- speak to each other. you need to have regulation that is part of the bank, not tacked on at the side. >> the focus of an inflation target and central banks got good at it. they missed the bigger picture and the risk. that is why they want to see a in price for us

stability. he called it fatally flawed. >> the initial focus obviously greateste, since the challenges of macroeconomic policy in the late 1970's and into the 1980's was the fight against inflation. culminated native -- in something which helped secure 15 years of price stability and sustained economic growth. it has to be said that with time , a healthy focus became a dangerous distraction. >> you could say this is quite significant, couldn't you? this has been an and inflation-fighting cental bank. >> there is another way of looking at. priced ability and this inflation target was like the be all, and all. they're giving you a whole range of things to look at. we also get unemployment, --

>> which we don't care about anymore. --we do a little bit but >> "on the move is next. >> that will do it for "countdown" for today. ♪ . .

>> welcome to "on the move." i am francine lacqua at bloomberg european headquarters. we are just moments away from the start of european trading and our markets team has everything covered. here with me now is caroline , and guyathan ferro johnson is also standing by. futures are a little bit of a mixed bag today. >> we had gains across europe yesterday. today was just plain busy. bank of england minutes, unemployment in the u.k., the budget as well and the fed this evening.

it is something everyone is talking about. >> we have to keep a close eye on that. let's get straight to westminster and guy johnson, all over u.k. budget day. to be athis is going budget long on politics and short on economics. it is about setting the narrative in advance of the general election in the united kingdom next year. politics, not economics. there could be a few giveaways to get the electorate more towards the tories rather than labor. >> in terms of corporate, you are watching inditex. >> it has been the business model that retailers aspire to. adding your fashion within the shops in two weeks. it left h&m in the dust. starting to see a little bit of weakness he cause of the euro strength. big inflation from the emerging markets. russia,