>> bank of england set to release its latest economic forecast. governor carney's challenge rate hikes.ging angelaan chancellor merkel says all efforts need to be taken to hold elections in ukraine on may 25 as france has sanctions against russia which could get tougher. >> russia's foreign minister sits down with bloomberg. as day tog continues up after zeneca takeover hearings. he is avoiding detail on his job pledge.

>> welcome to countdown. >> welcome to the program. bloomberg reporters are standing by across the world ready to deliver the stories that will drive your day. john is looking ahead to the bank of england's inflation report. >> john is in hong kong with the details on the rise in chinese david isd in berlin, focused on angela merkel's comments on the ukraine. >> we will tell you about some of the interviews we are bringing you today. we have an exclusive interview with the russian foreign minister coming up at noon london time. in conversation with them and we will bring you that conversation live from moscow. >> the bank of england will publish its reports.this

morning what clues might hold about the policies? jon ferro will tell us what the market is thinking and what mr. carney might be preparing to tell us. >> you were going to get forecast growth and inflation. that is the only two things people care about is rate hikes. the bank of england is looking for 3.4% growth and employment has come below that seven percent unemployment threshold they had me going on about. it is spare capacity that they seem to be focusing on right now. nobody has a clue how much will be left of it. >> they said it was 1.5% in february. >> that is the immediate projection but the issue is there was a white divisional which individual policymaker thinks there is. the issue perhaps is in the labor markets. if you look at wage growth, that may be the best indicator. two guide to work at the bank of england says that could be your best indicator of slack.

it is a pure reflection of supply and demand fundamentals. but we have seen is wage growth just start to have inflation. we only turned a corner. it has been a long time. it is about trajectory and how fast this moves forward. >> that has a bearing on how rices are going to be one of the big areas of conversation around the inflation report. thehe on the -- all indications say the are going to do something. the guy on the fpc and the mpc delivered a speech and said this is the brightest light on his dashboard right now. it is the housing market. he talked about the west midlands. he talked about 10% house price growth on the year. it tracks the medium growth of the u.k. house prices, it indicates it is not just london. >> ed boggs is on the press this morning calling on an

osborne. >> they want to use these macro financial tools. or limit loanss to income ratios on mortgage terms, nothing new. norway has done it. they limited high valued mortgages to 10% of mortgage lending. the big issue is in the u.k. we have a supply problem. a supply problem where they should be building around 200,000 houses a year and a only building 100,000 a year. the u.k. -- the microwave is on. the bank of england cannot build houses of the need to come to demand. >> thank you very much. stay with us this morning -- we will break down the u.k. unemployment report, the inflation report, and the unemployment data. all of that is coming up later on bloomberg. now, what one hand gives, the

other one takes away which is what is happening in china. many analysts predict a stock market rally but it has the opposite impact. john joins us love him -- from hong kong. the market has slowed down. is that a fair assessment? >> for the time being, it certainly is the fact. the economic slowdown, the property slump, home sales are at 80% in april. -- it wasing so far announced there was huge fanfare and had lots of hope. it is a different story. the market is followed because of the concern about that 7.5% gdp growth which will now be about or the new normal on the words being used by the premier recently. you see the markets have declined.

the various impacts, for example, the h shares of the worst informing -- worst-performing index of the 17 in the world. china is down by three percent. the world index which accounts for most of them up by 2.2% and that shows you that chart. the are underperforming at developed world showing you the impact of that. has actually weakened by 3.5% because of the various figures coming out in property markets. factory production missed estimates. downuilding construction 22% for the first few months of this year. all of that equates to a weakening currency because of concerns going forward and missing that target. . >> thank you. john for us in hong kong.

>> the situation in ukraine deteriorates with seven ukrainian soldiers killed by insurgents yesterday. angela merkel says all efforts must be undertaken to make sure ukraine may 25 elections take place. she was speaking at a news conference in berlin last night. david is in berlin with the details. she also met with the osce and the imf and these other bodies. what was the focus? >> yes, she was meeting with the oecd. wheel was get those confused. we also have the imf extensively talking about the german economy. the news conference events were taking -- were overtaken with questions about what is going on with the ukraine because the german foreign minister is in ukraine at the moment. he is trying to get talks together, try to get these

parties together to talk. there was another meeting that will take place today and this one is led by the organization for security cooperation. the osce. the other organization which they are looking to actually lead these roundtable talks, they want to bring together the kiev and ukraine central government along with pro-russian separatists to try and talk these issues out to the magically -- diplomatically. angela merkel was asked if she thought these talks could be successful. is call to make a contribution, including russia. we believe roundtable chaired by the osce is a good opportunity to do this work. the more a presented its, the better but it is still clear but only those that are welcome are ready incredible to achieve goals not through violence. merkel as always many clear that she wants to keep the diplomatic lines open because of -- ors her perform

preferred solution but if we do not get those elections taking place on the 25th of may, or if they are undermined in any way, this is the message coming from the french, then further sanctions, economic sanctions a meetingnsidered at in brussels on june 4 and five. christine lagarde from the imf also saying -- at the same news conference outlining how much damage this situation has already done in russia and pointing out that further damage could happen to the economy. isclearly, the situation already having consequences. the growthised %orecast for russia to .2 this year and one percent next year. that is provided the situation is resolved. degree of, the

uncertainty that is generated by the current circumstances would clearly deteriorate the situation. clearly, today the focus is going to be to see whether they can actually have these roundtable talks and whether they can draw any parties together and find any hint of a solution. >> thank you. david joining us from berlin. with ukraine at the center of things, a reminder that later today we will bring you an exclusive interview with the russian foreign minister. that is coming up at noon in london time. ryan will be conducting the interview and we will bring it to you live from moscow. executive andf president of report wide chief and development and the astrazeneca ceo would appear before parliament science and technology committee today to

answer more questions. today, it is about the impact of the potential takeover on the second largest u.k. drugmaker. it is round two. yesterday, was in front of the information committee and that was where he said he would not be pinned down on the commitment to preserving jobs. >> it was a fascinating conversation. yesterday was about jobs and he was saying he is focusing on making science productive. this is something many analysts have pointed out in the past. they have done a lot of consolidation advisor before -- at pfizer before. that means job cuts. they made a 20% pledge which is keeping 20% of their r&d staff in the u.k. that doesn't tell you how big the r&d is going to be and that is what many of the lawmakers were trying to get detail about. on a did say rmb overall

global basis was going to drop. when you turn around and see what they said, the whole issue is it rhetoric from politics overprice? ceo says ifneca the price reflects the full value of the company justifies the risks, then of course we would have to make a positive recommendation. >> that is the job of the co2 deliver value. you say, it is a political question or about the price. at the moment it is about the price because the government is only considering bringing legislation that would allow them to intervene. that is what this is all about. trying to ascertain whether it is worth bringing in this legislation. >> finish was this, what they have said is they will look at the price and but pfizer has not looked at the books yet of

astrazeneca. >> we will take a short break. the bank of england gets ready to release its outlook growth, our next guest says that the u.k. bond markets are on the verge of mounting a real and present test. we will let you know what that means next. ♪

they are seeking more than $3.5 billion as state investigations into the banks dealings with sanction countries including sudan and iran. the agreement which could come in the next month is still being negotiated. prosecutors are also seeking a guilty plea from bnp. sap is planning its first widespread job cuts in more than four years as it shifts to delivering more software online. the company is eliminating jobs across divisions. the cuts will not number in the

high thousands and will not result in sap exiting lines of business. saab risks losing a $3.5 billion order for its fighter as voters prepare to review the purpose that's the purchase. 61% of voters are ready to block the 22 plane contract. the referendum will be held on sunday. welcome back. >> today it is bank of england a. the quarterly inflation report was released a little later. we have some unemployment data. backgovernor carney pushed against the rising rates expectations? bank of america and merrill lynch's analyst is here. what does carney have to do today when he goes after the report? >> i think he has to go a bit further than he has in the past. what he has been doing since

august and in related speeches is stress of that rates are staying on hold for a while and when they go up, it will be a very slow and gradual process. that can medication has largely been aimed at convincing consumers and businesses to be confident about spending and investing. that message is still being made a loud and clear. i am in support of what the governor has been saying and that is how to clear impact. that is one of the reasons why growth has been so robust. the market is taking a slightly different view, especially of late. and started to put data rates up sharply. to monetary conditions and we're getting to the point where the bank will be a bit worried. he has to convince not just the consumer and the businesses, but the markets and they mean what they say. >> one of the big issues whether it is here in central london or in the west, does he need to do with the market to convince

interest rate markets that he has control? >> it is clear the strength of the housing market is one of the reasons the recovery has gone strength to strength. of course they want to recover is to continue but they wanted to be a steady recovery, not something that forces them to risk on with aggressive rate hikes and chokes everything off the year down the line. the housing market is an issue they need to address but rates is not necessarily the right talk to be using. >> how different is the view of the market is expressed by interest rates currently in the market and the view being presented by the bank of england? is adjusted this agreement about when the first rate hike comes or the timing of the rate hikes afterwards? >> it is more about what happens after the first hike. the first hike is widely expected around the first quarter of next year and that has not really shifted any earlier. i think the bank is comfortable with that being priced in. thereafter, now, there is this

cycle priced inuvo 5 -- 25 point basis hike every few months. this mantra that they have employed -- >> isn't not limited and gradual? >> there was no specific definition of what that means. it is ad suggest that much more rapid cycle than the bank is anticipating. there was a bit of a conflict. broaderring his of the issue, where to begin back to the interest rate because the models they are running -- we will return to precrisis highs. if you have a trajectory like that or rate of change like that, that shows that whole argument. >> there was a terminal rate the market is expecting is not moved that much. gradualof a smooth, rise back to around three percent at the moment, we are now forecasting a much more rapid move. it doesn't get much further and i don't think that's what the bank wants to see. >> thank you. more details on the u.k.

economy. stay with us. ♪

>> welcome back to countdown. >> in 23 minutes past 6:00. if we start to see the bank of england start delivering on a rate rise in the first quarter

2015 as marketing to be expecting, where does that leave the bank of england versus other central banks? >> that is an important question because in all of this, all the central banks and all the major economies are trying to come out of this together. none of them are too sure about what lies ahead when they do start to raise rates and whether they can normalize policy. movingthe impacts of the rates before anyone else which is what that would almost certainly be is it tends to strengthen the currency. you get a widening interest-rate differential so it seems like they will head off in the opposite direction. the fed is probably on hold for another 18 months. >> what does that mean for the pound? >> that means is that the u.k. recovery has steamed ahead. it means we'll go from strength to strength in the bank of england is already record of saying we assume enough strengthening at the pound and we don't want to see anymore.

it doesn't help with trade which is one of the areas -- >> that is where they really want to grow. when you look at the shirt -- the short end of the curve, is everybody got the positions or you think these markets have much further to run? >> they can. that's the point of rate hikes. --is a mechanical intrigues increased. the group of like three or four percent on sterling or next and nothing on dollars or euros, it drives that appreciation further. >> when we going to start to see dissent of the -- or are we? we haven't thought of a new members reviving -- arriving on the committee. >> the new members early on will toe the government line. he is not being that controversial. we have inflation below target, the impact of the stronger currency and higher rates pushing down on that further. he is being perfectly mainstream.

as the year goes on, if wages continue to recover, you will start to see both on the committee and more markets dissent building. the inflation is very soft. , dohe great debate -- today you think we get a little or update or guidance on the index? i think the number is 1.5%. >> we may get an update but they are being careful not to press that point. as long as real wages are flat, it suggest that there is plenty of capacity in the labor markets. >> thank you for joining us today. john from bank of america and merrill lynch helping us move ahead. willg up on the program, be uk's biggest commercial broadcaster be a world cup winner? we will have more on the strategy shift and world cup. that is ahead of the company's sales figures which will be out in about 34 minutes time. >> recovery efforts continue in the turkish town where a fire

has killed at least 200 people and lingering smoke hampers the rescue work. we will have that story as it rakes. there are some live pictures of that very difficult scene. ♪

>> welcome back. let's head to jonathan. >> two big trades love the look at. let's start with the euro. 3 -- gone to one dollar 1.3719 after the bank will give the stimulus. two people with knowledge of the matter tells bloomberg news that support would not be automatic. either way you shop that way up,

expectations are elevated for the ecb. the pound, 1.6862. another press conference with mike carney at the inflation report and what he could do to push back expectations of an early rate rise. >> these are the bloomberg top headlines. the bank of england reveals its inflation report in just a few hours. investors are looking to see if stronger gross -- growth numbers will encourage the central bank to increase rates sooner. the pound has rallied in the past month. rebels in eastern ukraine that killed seven government soldiers and wounded eight. ukraine asked russia to condemn the militants. ukraine's defense minister says the east is in an undeclared war with russia. we have extras of interview with the russian foreign minister at noon london time. at least to wonder people have

died in a coal mine fire and another 200 are still trapped underground. in their game -- lingering smoke is hampering rescue efforts. because the still under investigation. let's get more on that story about the turkish coal mine which has killed more than 200 people. and left more than 150 trapped. elliott is following the events. what is the latest? >> the latest is that rescue workers are still trying to reach those miners that are trapped inside the mind in western turkey. i believe we have some live pictures we can show you of what is taking place out there. relatives of the miners are still unaccounted for have been gathering outside the mine trying to gather or glean some information about their loved ones. the latest official death toll minersbut there were 787 in the mine at the time of this

explosion which led to this fire. it is feared this death toll could rise substantially over the coming hours. the prime minister is on his way there to show the government is mindful of the seriousness of what is going on. is not yet turkey's worst mining designer -- disaster which was back in 1992 when almost 270 miners were killed. there is every fear the death toll could rise to a number, to what level that would make this turkey's worst mining disaster. >> this is still unfolding. a lot to learn about how this happened and what the true impact is. what we know about how this disaster first occurred? >> the energy minister of turkey has said that it seems there was a electrical fault that cause an explosion. that led to the fire. it led to a power cut which that that the lift cages

carry the find -- the mine workers up and down the shaft could no longer work. because the fire didn't have enough oxygen to burn rapidly, led to poisonous carbon monoxide being produced which is led to be the cause of the deaths of some of the miners down there. oxygen is being pumped into the mine but some of the smoke is hampering rescue work as efforts. just a month ago, the labor ministry gave this mine a clean bill of health although there will be an investigation once -- beener the miners had accounted for have been settled and there will be an investigation to find out exactly how an electrical fault occurred. it was just bad luck or some kind of negligence that took place. certainly for those miners that lost their lives, some funerals will be held today for those miners. this is in western turkey. >> thank you very much.

today,ttle bit later sales figures will break across the terminal. let's take a look at the strategy and hopes for a world cup boost. forhould be a good day adam. >> it should be. if you look at what people will be emphasizing this morning, not so much the world numbers. it will give an indication of what it will be. it will be outlook for the world cup. what is happening in may, june, july. is expected the advertising market will be very strong because of the general economy, but also the boost affect of world cup. >> what is it about the world cup? is it because consumer good companies spend more on advertising in those prime very watched slots? is that the whole extent of the world cup impact? >> exactly.

you get certain types of advertisers that will advertise more around the world cup. to put it in a very crude demographic sense, it will aim towards more male, younger viewers who seem to watch more football. if you look at the world cup from an advertiser's perspective, the timeslots of the matches are very advantageous. the matches take place in tee time in the u.k.. >> there'll be a lot of people in the pub. >> is going to be crowded. you have a lot of interest anyway in the the brazilian team. also, the premier league has a lot more international players they did four or eight years ago. a lot more of these names are more well known than they w ere. that should produce audiences. >> it is no longer just terrestrial tv in terms of -- >> exactly. if you look at what the tv strategy has been, they have

been very successful at building the scope of revenue. terrestrial, they have an online product. increasingly, they are focusing on content. >> they made a big acquisition in the u.s. >> talk about what that means for the business because why the getting into buying u.s. content companies? the u.s. has been quite good exporting content formats. bye by u.s. content? -- why u.s. content? >> it is a great format. they have the real housewives. i have watched that. if you look at these shows, one thing -- if you look at the shows that left field house, they are shows. poor stars is the number one show. these are excellent formats. >> it still sells then? >> it does.

you look at britain's got talent and the x factor, for years people have said these formats are tired and they come back again and again. >> it is manage reality. >> we were just talking about why. if you look at what has happened recently, it is quite interesting. you have two deals in the u.k. market in the past couple of weeks. you have the combination of discovery. if you look at viacom buying channel five. it seems like an old strategy. why pick up the smallest of the mainstream markets? it could be that viacom wants another route for its content. it might be that viacom thinks the retransmission revenues will be allowed for the mainstream channels. if that happens, you can see the u.s. get a big boost for broadcast revenues. if you look at all three media, it is a major u.k. production house. i think the reason is u.k. format and u.k. programs were extremely well in the u.s.

market. if you think about the successes on the format side, even going back to things like who wants to be a millionaire. they have been mastech successes -- massive successes in the u.s. market. they look at the u.k. and say these are big hits that can be transported across. >> we look for to those hours of the top -- those numbers of the top of the hour. >> up next, we will take a look at the downton abbey broadcaster itv with the uk's biggest commercial broadcaster the world cup winner. >> we will take a look inside during the cane spam festival -- during the cannes film festival. ♪

>> time for some news. france's largest cable operator said it is on target to close its purchase of the phone carrier by the end of the year after reporting a jump in quarterly profit because the

chief of financing. that income ran -- rose to 35 million euros in the first quarter to 23.6 million euros a year earlier. hascompany says its ipo reduced borrowing costs and boost the profits. google is making it easier for customers to get the test version of its glass internet connected spectacles. the devices will go on sale to anyone in the u.s. today after previously only having been available by invitation and referral. the west african nation of guinea that is dispute over the rights of the world's biggest untapped deposit will not affect the plan to build a mine estimated to cost $20 billion. and the month sued mining company saying they conspired to steal the rights to the mine. welcome back to countdown.

is 6:43ime in london a.m. the cannes film festivals kicks off tonight with a film starring nicole kidman. the rich and famous has dissented on to the french town but where do they stay? bloomberg goes in tied -- inside the martinez hotel, one of the top choices for the stars. >> and population triples when the film festival is in town from 70 to 200,000. there is only a handful of choices. festivalnes, the film started two weeks ago because of preparation inside each hotel also in the whole city. it is crazy. >> he runs the martinez hotel, the place to be and be seen in cannes since the 1920's. tonight, is hosting the festival's jury, including the

president james. you can mingle with the a-list is by the pool or on the hotel's private beach. the cheapest room at the martinez during the festival is the 1000 square meter penthouse, one of the biggest in europe, will cost $52,000. prices more than doubled during the festival but rooms here are not just for sleeping. areost of the suites becoming show rooms, offices. make the top award and/or yell are based here. it is like two weeks of the oscars. >> the pressure, you cannot imagine what we had to do on a daily basis. eventsne of the longest

all over the year, all over the world. >> the uk's biggest commercial broadcaster will post first-quarter sales today. it is likely to be optimistic ahead of the world cup. caroline hyde is here. >> we are expecting a boost in sales. they set themselves up to be up five percent of their expecting optimism for what they will pose for the second quarter. largely tad to the people world cup -- to the fee for world cup -- fifa world cup. and the analysts saying the world cup will boost perhaps revenue by two percent. it is notable they have 32 exclusive games, according to itv. to have the final with the bbc. last time, 47 million people

tuned in to itv to watch the world cup. 2.2 billion tons of beer were drunk as well. itv is going to be a bit of a winner even if england is not. >> don't be a skeptic. it's too early for that. >> i cannot wait. i'm china catch up with my own newspaper story. content is also pretty important. >> really interesting because left field acquisition came at the right moment according to many analysts. the independent producer they reach elite -- they recently purchased, it is $360 million but then you have options to have $800 million at the upper end if profit targets are met. and big acquisition being made by the chief executive. it is really glorious content if you are into that kind of thing.

>> i watched once or twice. housewives andy pawn stars. >> i like cake boss. that is another production company they recently bought. it is all about the reality tv to add to the x factors and downton abbey's. content is king, particularly when you get the likes of netflix coming into the areas where you don't want to watch live television anymore. you want to stream your content so itv is making a play at diversifying itself. they can use their own content and the rhône channels. -- in their own channels. they're launching a new channel which launches in june which targets the younger female audience, the ones the tune into real housewives. interesting, one little caveat.

city concerned about growth in the past -- after the second quarter. maybe they are just one little area of concern. >> that is a reasonable concern. thank you very much. >> coming up, and boost from the sale of a famous -- we will have that story. that is coming up next. ♪

>> welcome back. a little bit of paper reviews. we thought we would lighten the load. shall i kick it off? >> let's go to david. >> i am very glad you talked about kicking off because i am talking about the kicking off of the world cup in brazil. it starts on june 12. this is the front page of the spiegel. the headline is death and games, the world before the world cup. you can probably see the bazooka, the world cup football made by editors on fire above sugarloaf mountain on rio de janeiro. tomorrow is german gdp. i will be live talking to people all day long about world cup

sponsorship because they had their man sponsor. litanyory goes on to the of terrible things being happening in the preparation for the world cup, including just this week, there's been another death. there has been a construction related fatalities. some of the stadiums are not ready yet. said thatesentatives they have been through hell trying to put these events on in brazil. it is going to be interesting to talk to the chief executive officer tomorrow to talk about what this whole brazil vent -- event is looking like as a major sponsor. >> we will pick up on the world cup scene because if you are going to attend the world cup, this could be the welcoming face of brazil that greets you. brazil's new world cup kit.

this is the outfit that is going to be gone up some of the special forces in brazil, in rio around the world cup. in is been dubbed the robocop protective outfit. it is flame resistant, up to 427 degrees. it comes with all kinds of the quitman, some of it is so technical i cannot pronounce. it follows widespread demonstrations during last year's confederations cup and there has been public demonstrations around the world cup. even before, fans have had a chance the fallout with each other at the games, we have had demonstrators on the streets of brazil. some pretty serious equipment being given to the police and other forces in brazil ahead of that. they are being given martial arts training. wow. another world cup story. >> this is in the times on the front page. the british are always a little bit cynical about the english football team and its performance.

the home office, the government apparently as cynical as well because there was a report commissioned about public opening hours because they are going to be open later for england games. there's been an impact assessment and the home office says it is unlikely the english team is going to be qualified for the knockout round. how could they be so negative? >> the gauntlet has been laid down. >> people very upset by the lack of support coming from the government right now. >> i don't have a wild cubs cory -- world cup story. it is this man. you may note he is wearing a rather thick pair of rim glasses. his trademark as well as his sort of -- basicall those glassesy, they have really pumped along. vision express, their overall profits rising to records.

>> is a retailer of eyewear. >> he has helped with the numbers. >> the label is done particular well. >> that article is in the telegraph. one -- juste other as i go to put the old pension fund into stocks. >> are you a contrarian indicator? >> you know what. >> were fairly contrarian on a number of levels. it is on a high as the economy surges so you can deftly tell as i come out of cash and going to stocks having missed the rally for the past couple of years. >> i am sure that is not true. thank you, everybody. newspapers illuminating as ever. we will get first-quarter sales from itv and discuss it at length. with the uk's biggest commercial broadcaster be a world cup

winner? the broadcasters of the u.s. also having another dimension to the story. we will love analysis of those numbers when they break and we come back. ♪

>> bank of england set to release its latest economic forecast. governor carney's challenge remains managing market expectations on the timing and pace of rate hikes. countdown two elections -- german chancellor angela merkel says all efforts must be taken to hold elections in ukraine on may the 25th. sanctions against russia could get tougher. in exclusive conversation -- russia's foreign minister sergei lavrov sits down with us and we have earnings out now from itv.

welcome to the second hour of countdown. today, here on bloomberg we are going to bring you an exclusive interview with the foreign minister of russia sergei lavrov which will be coming up on noon the london time. that conversation taking place live in moscow. we are getting numbers breaking from the broadcaster itv. a few details coming through so far. the company singer their growth strategy remains on track. let's talk to caroline hyde about the company. >> bit of a mass. 583 million pounds, up two percent but the market is looking for a five percent gain. on my performance is up 14%. clearly, that is where the money is being brought in.

revenue isg online up three percent but they are saying they're on track. strategy is there, particularly when it comes to cost cutting. this is a company that tried to reorient itself for the future because not only have they got the warm breeze of the world cup coming their direction in the second quarter where we are expecting some strong numbers because they have 32 exclusive live games that will attract the advertisers. it is also about content. selling content, they been making some big purchases. they recently bought left field animated 80%. it could go up to $800 million if the profits come through. it is about getting into a show called upon stars -- called upon star andcalled pawn having reality television so they can sell internationallys. >> they do well selling the stuff they already do internationally.

the company that has downton abbey in the ukraine -- and the u.k. we will see what they are saying about the future for the second quarter. we have a statement saying looking ahead, the second quarter advertising revenue is forecast to be up 12% and that is a pretty big rise. they expect to outperform the tv ad markets. looking optimistic for the second quarter and that is in line with many analysts viewpoints. >> why not? thank you. those are the numbers from itv. we have numbers breaking from sony. some overlap between those businesses if you look at the media side. to give you the top line on sodium -- sony, the net loss is at ¥50 billion. it seems like that forecast coming through disappointing when compared to estimates as is typical with the japanese

businesses which tend to be measured on the forecast for the full year. analyst look ahead for the full year and waited for cap against the company and that is where people look for how to work out whether the company is on track or not. just to give you some background because the person who took over as ceo on 2012, said the refund -- survival will be run by games and mobile devices. he will put tv on a separate unit. that could more details on this numbers from john who joins us now from hong kong. >> good morning. a bit of a blow. mentioned, it is a net loss forecasting a loss of ¥50 billion. there is a profit of ¥57 billion and that is dramatically contrasting that. the operating profit forecasting

at ¥140 billion and an estimate of ¥231 million so it is more or less in line. the playstation 4 and the phones, he is really put it on consoles and games. not really working at all again. the crucial business is electronics. they sold that pc business, the vaio brand. they have also come -- cut 5000 jobs. they have cut the business to the bone. they're looking forward of what they're going to do when they posted a loss which is a huge concern. this comes after the close of trade in japan today. more troubles ahead for sony. >> tell us about that. it is not just banking bosses that are under pressure to forgo bonuses when times get tough. >> that is right.

bonus forover his years in a row. the ceo of sony has no bonus since becoming ceo in 2012. no bonuses for the consecutive -- executive team either. ¥1 billion is being foregone. no bonus for him. if banking bosses follow that example -- imagine barclays, imagine. >> thank you very much. situation ukraine deteriorates with seven ukrainian soldiers killed by insurgents yesterday, germany chancellor angela merkel says all efforts must be undertaken to ensure ukraine's may 25 elections take place. she was speaking at a news conference in berlin last night. david is in berlin. she also met with the imf. what was the focus of the discussions?

, thee imf and the osce focus of what they were talking about was the german economy. they had this news conference afterwards and obviously, ukraine came up because the german foreign minister has been trying to getssa people to get together and talk. this is the diplomatic solution that germany is trying to broker. they're trying to create a nonviolent solution to this whole crisis in ukraine. mrs. merkel was asked about the intent for the osce, the organization for security and cooperation in europe which is a , a security rights monitoring group led by european union representatives. they're also tried to put together a roundtable in kiev the progression separatists and the central government in kiev

to bring resolution. she was asked about how successful she thinks that might be. everybody is called to make a contribution, including russia. we believe that roundtables chaired by the osce is a good opportunity to do this work. the more representatives at the table, the better, but it is also clear that only those are to achieve are ready their goals through nonviolence. >> she also said that for her, the key to this whole issue is the presidential elections in ukraine. if those elections go through, she will be pleased with that but the risk is they will be further -- there'll be further interference from russia. and france says that the resident appearance in those elections then further sanctions will be considered.

at thene lagarde also same nook -- news conference talking about the impact has taken a toll on the russian economy and could get worse. >> clearly, the situation is already having consequences. we have revised the growth .2% thisfor russia to year and one percent next year. that is provided the situation is resolved. the degree of uncertainty that is generated by the current circumstances would clearly deteriorate the situation. she said it is provided the situation is resolved. the focus today will be on these roundtable talks that will be led by the osce. we will keep you updated on that. >> thank you very much, david.

the bank of england will publish its quarterly inflation report at 10:30 a.m. what clues might hold about policy direction? say, what are they going to to you their pushback or market expectations or give their blessings? >> what is therefore crass for growth -- the forecast for growth? that is some pretty strong growth. unemployment is below the seven percent threshold which is leading the minority. there are some people crying for rate hike now. we have this big decision over the amount of slack left in the uk's economy. the guys that set rates in this country are completely divided on this. you have martin on one side and then mark carney on the other side which thinks there is a long way to go. if you look at the labor market today and the data comes out later, the magic piece of data is going to be wages.

wages has already just started to get real wage growth and that is how that accelerates overtime and whether we get a first dissent on interest rates. nobody expects a rate hike in the coming months but what we could get his people starting to defend against rates. >> we were talking to john earlier and he was saying the markets and the banks are not too far apart when it comes to when the hike started, despite some calling for to happen now. the market of you is first quarter 2015 but he is saying it is coming off this. >> the feds are having gradual averages. can they promised that? was the decision for their ability to deliver on that promise. >> they will be looking at developments in the housing market. the job of doing something about it my fault to the fec. the bank of england does have

this under their agreement. >> they do not want to address with bankrate. they want to address it with michael credential -- macro credential tools. there are two big tools they can use that norway is used. limit high loan to high-value mortgages. limit mortgage terms. they can say to me -- you earned such and such are only allowed to have five times earnings and nothing beyond that. that could soften the housing market but the big problem in this country is a massive supply problem in the u.k. housing. we don't build enough homes. we build around 100,000. the bank of england cannot go out there and build homes. it is not just a london problem, it is a u.k. problem warehouse prices have got ahead of themselves. they need to temper demand. do they go for some of these other tools?

>> elections are not too far off as well. thank you very much. stay with bloomberg. we will break down the u.k. unemployment report and the bank of england quarterly inflation report. a full workday of events. more on what the bank of england's inflation report might mean for the market and the pound. we will have analysis after the short break. ♪

>> time for today's company news. the u.s. is seeking more than for investigations for the bank dealings with sudan and iran, according to people familiar with the matter. the agreement is still being negotiated. prosecutors are also seeking guilty plea from bnp. technologyrman company, is planning its first widespread job cuts in more than four years as it shifts to delivering more software online. the company is a limiting jobs across divisions. the cuts which are under way will not number in the high thousands and will not result in

s&p exiting loans and business. order has been lost as swiss voters prepare to view -- to look at the order. 61% of voters are ready to block it. welcome back. and head of the bank of england's quarterly inflation report, let's take a look ahead at what might this report might hold for the markets. we are joined by stephanie flanders, the chief market strategist for the u.k. and europe. great to have you on the program. let's talk about what we will hear from the governor, from the bank of england in its oddly named inflation report which is holding the forecast for inflation and other things. >> it is exactly what it says.

given that they are intolerant policy -- their entire policy is focused on impatient -- remember we had that brief. new governor suggested for guidance with link interest rate policy, also the employment rate. the seven percent which we thought would take a couple of years to reach, we have gone past that milestone. we are back to focusing on inflation. far aheads have got from the bank of england's own forecasts are when the first rate rise will happen. when you look at the last report, the forecast adjusted that even with no change in policy at all, inflation would be more or less on target or below target over the next two or three years so there was nothing in the last report to suggest they were sanctioning any expectations of a rate rise. we are going to be looking to see if there is a bit more of that in this report. i think the expectations are getting ahead of themselves.

i don't think we will see rubberstamping of interest rate rising next year. >> is at the start of the rate hike cycle that they falling out about or is it the case of those rate hikes when they start to come? >> it is a very old situation where you do have well above trend rated growth. there has been quite a while since we have been growing at faster than three percent rate and that is what the bank of england is expecting this year and possibly even next year. people think how can we have monetary policy at this emergency logos level when the economy is tearing off? a lot of it is about the slack and economy. and people want to give the maximum room are finding out whether there was lost ground, the lost potential and the economy could actually come back. i think i can use to be a very interesting argument but the rest of the world is looking at

this because the bank of england may well be the first major central bank to raise interest rates after the is very long period of lose policy. >> of the majors, the bank of england -- it is certainly important. into theld we read unemployment numbers because we will get those as well? we had this more explicit link between unemployment and rates previously. that is gone now and we are focusing on inflation. we will get details on wages and that will be key to working out the capacity. we will get real wage increases. >> what is driving that -- what you're looking for is one of the key singles they look for is where they actually things are getting a bit tight, are they getting behind the curve in terms of the rate situation is what is happening to wage costs. what is interesting is that normally you would have wages going up because the wages are rising. what is actually pushing earnings into real growth after

inflation for the first time in several years is forward inflation thanks to the strengths of the pound. that means something different to the bank of england because they say they have inflation falling. the forecast may be lower than they were a few months ago. that is helping to boost household sales. it is not necessarily raising costs directly for companies. >> thank you for coming in to talk to us. stephanie flanders joining us from jpmorgan asset management. starbucks didn't become a copy cap -- copy powerhouse without a few tricks up its sleeve. we will show you what is behind the store experience next. ♪

>> welcome back. it is 7:24 a.m. in london. starbucks has put a lot of thought into how the experience is -- provide you in stores. >> walk into a starbucks and you are going to feel a pretty laid-back environment and that is exactly what starbucks wants. that casual experience is actually the result of tons and tons of very well-thought-out details. you haven't even walk in yet but already, starbucks is working on it. start with the door handle. designers like to call this the handshake between the customer

and the store. this door handle that and get here by accident. is providing a little bit of advertising, getting you thinking about the coffee you are about to buy. flow,cks is all about getting people in and out of the stores in the most efficient way possible. they need to get people to the back to place their order but how they do that without hanging a giant order here sign? that use lighting and visual cues. notice how the merchandise and food is back there and it is lit more brightly than the rest of the store so that when you walk in, you automatically move towards the back. as you are moving back, starbucks already knows two things are happening to you. you are getting to see all the different options in the place you can decide where you want to set. your also getting some positive reinforcement. before even place your order, you are seeing all these nice people enjoy the delicious cup of coffee -- of coffee.

see this little strip of countertop? it is all part of starbucks' plan to maintain your connection to the people who work here. if this wasn't here, the first thing you would encounter is these really tall coffee machines which might kind of push you back from the counter, but because this continues, we are drawn towards the counter. and because everything is below eye level, you could remain in eye contact with the people making your coffee. thanks. here is a question -- i just gave starbucks my money so why am i seeing more advertising for coffee? starbucks is based on repeat business. advertising to me on my way out of the store is to get me thinking about the next time i come back. up, we will have an exclusive interview with richard cousins, the ceo of compass group, the world's largest catering group. the company has announced it

will return one billion pounds to shareholders in a special dividend. that is coming up after a short break. ♪

>> welcome back. let's head out to jonathan ferro. looks let's kick things off -- >> let's kick things off with bureau. -- with bureau. euro. two people have told bloomberg news the support will not be automatic. going into june, the expectations for the ecb to act our height and it's keeping a lid on the euro.

labor market data out of the u.k. at 930 u.k. time. that is going to be one for him. they are more compelling going into this one. the bank of england reveals its quarterly inflation report in just a few hours. investors are looking to see if drunk or a stronger growth numbers -- investors are looking to see if stronger growth numbers. rebels in eastern ukraine have killed seven government soldiers and wanted eight in an ambush. ukraine urged russia to condemn the militants. interview exclusive with russia's foreign minister. at least 200 people have died in a turkish coal mine fire.

200 are still trapped underground. we are bringing you live pictures from the scene. lingering smoke is hampering rescue efforts. the fire being investigated, very much an ongoing situation in turkey. scores of people injured. elliott gotkine has been following these events. >> rescue workers still trying to reach the miners trapped underground. as you can see from the live pictures, a lot of activity, relatives of those missing have been gathering their as well. the prime minister is on his way to the scene to underline the gravity of the situation. the latest official death toll is 201, but it is feared that it could rise quite steeply.

it is feared that this could end up being the worst mining disaster in turkish history, but the worst disaster that we have seen so far this century anywhere in the world. the rescue efforts are being hampered i've combination of reasons. is preventing trapped miners from ping ferried up and down the mineshaft. cuts and explosion caused a fire and that is -- that has caused carbon monoxide to be produced inside the mind. it is also hampering the rescue workers efforts to get inside the mine, so they are pumping oxygen inside right now. there has been smoked in the naming -- emanating, which is also preventing the rescue workers from going in.

every fear that this death toll could rise substantially from the number which we have right now which is 201. >> thank you for joining us. the world's biggest catering company compass group has just reported earnings. it announced a special dividend. i am joined by richard cousins, the ceo, for an exclusive conversation. let's talk about this return of money to shareholders. tell us why you have decided to pay this money out. >> the sustainability of our performance and the cash flow. that strong cash flow and produced -- has reduced our debt so we have decided to do the one billion pounds special dividend today. we are carrying on with the 500 million pound share buyback program we announced six months ago. we put the dividend up by 10%.

>> the antidote to the lazy balance sheet. what is your attitude to doing deals? do you still see opportunities? >> our balance sheet is still .trong we think we have the financial flexibility to do deals. we are not interested in doing the big ones. we think that will continue. it will be a bit lumpy, but we can do sensible ones. >> why not the big ones? there seems to be a frenzy going on across the space. >> we are very cautious, we will only do deals that get an excellent return and have sensible execution risk. quite excited about the trends we see in the

organic growth. >> let's talk about the organic growth. tell me what is cyclical. what is structural? >> the best majority is structural. north america, which is a great business for us. excellent growth. the economy is fine, but the six percent growth is driven by outsourcing trends in education and health care. in europe, the economies are getting a fraction better, but only a fraction. we can see our pipeline out and outlooks encouraging. we seem to be winning and retaining more business. in the emerging markets, the economic situation is a bit mixed, brazil, turkey, india,

china, we are seeing a strong acceleration and outsourcing. >> talk to me about foreign exchange. there have been talks that you would be impacted negatively on the currencies. we are looking ahead to the bank releasing their inflation report. what is it about currency markets that have the potential to hurt your business? us, it is only in translation. it is not really part of the day to day business. >> it is a small negative and we cannot avoid that. >> what about geopolitical tensions? you do have operations in russia. are you seeing any pullback? >> we are not in the ukraine. i was in moscow a month ago.

most of our business is in the moscow area and it is doing very well. if this crisis were to continue, it might slow down a bit. >> what about the u.k. economy, 10% of your revenues? what kind of impact are you seeing from the recovery in the u.k.? >> we tend to be a bit of a lag indicator. we see a very small improvement in the volumes are restaurants. same script, healthy trends in terms of outsourcing and retaining. that will take about six or 12 months before it comes through in the numbers. you have been ceo of compass for eight years. you have seen a lot of trends come and go. have you got your sites on new challenges? >> my challenge is to make compass into a great business

and i feel very bullish about that. on the move starts at the top of the hour. >> you can go to sleep. bank of england. world is watching what happens as the bank of england today because if you jump first, you jump first. i jumped after you. we will have the global head of equities to try to put that .tory can the trend continue? itv, the numbers are good. >> we have talked a little bit about their strategy. they're going into the u.s. and reality tv shows that you and i never watch.

>> i never watch any of those cheeky reality tv shows. , the a big deal acquisition they made in the united states. >> in terms of the underlying appetizing -- >> you are talking about double-digit gains in terms of advertising revenue. stocks close little bit higher. the first couple of questions to mark carney. >> thank you very much. mark zuckerberg enters a new chapter today. we will see how many billionaires are still in their 20's. ♪

france's largest cable operator says it's on target to close its purchase of a phone carrier by year end after reporting a jump in quarterly profit. net income rose to 35 million euros.

the company said its november 20 13th ipo helped reduce borrowing costs and boost profits. google is making it easier for consumers to get the test version of its glass internet connected spectacles. rio tinto has told the western african nation of guinea that its dispute over the rights to the world's biggest untapped inr deposit will not affect the plan -- iron ore deposit will not affect the plan. they conspired to steal rights to the mine. welcome back. we're wishing a happy birthday to mark zuckerberg. the founder of facebook is turning 30.

how many billionaires are left under the age of 30? zuckerbergch is mark as he turns 30? he has done quite well for himself. looks pretty incredible guy -- >> pretty incredible guy. he is the 14th richest person in the world. he lost about 14 million, but he is up over two on the year. >> careless to lose 14 million the day before your birthday. >> he is in the top 20, the 14th richest. he is not the youngest. his cofounder was born eight days after mark. he is the only one left under 30. >> there really are not very many in their 20's. >> wealth favors the aged. areof the billionaires who

60 or older. need a little time to build up a fortune. .> that is positive news still plenty of time. >> we all have a shot. >> who are some of the lucky of 40?der the age >> the majority are from facebook. and then there is a chinese woman who inherited a construction company from her father.

>> a lot of inherited money. qa for joining us -- thank you for joining us on the latest on the billionaires under the age of 30. coming, the ftse 100 closed at record highs yesterday. we will have more on what to watch as the markets open. ♪

>> welcome back. friday's summit, the future of growth, let's take a look at the u.k. start a scene. -- startup scene. thank you for coming to talk to us. anybody who needs office space, but tell us about your business. >> the clubhouse is and meeting space -- is a meeting space borne out of my need for this space. years, i was meeting my clients and investors and partners in hotel lobbies and coffee shops around london. that is a trend that has been growing. some people have called it cappuccino commerce. >> is this the death of the

hotel lobby? >> we provide a more businesslike alternative. we filled the gap that was otherwise unrepresented and we have members from all different industry backgrounds who use the clubhouse as their base. finding something with you that they are not finding in a service office? >> we fill the gap in the markets where people do not need a service office or a permanent desk. they need something more businesslike. to this space, a number of companies setting up businesses that call themselves the air b&b of office space. you can be matched up with the company that has some space on offer. it sounds like years is the kind of thing that you just need for an hour. it is for people that just

need a base to touchdown for a few hours a day. it is not somewhere where people can spend the whole day, but it is a flexible meeting place. you have coworker spaces at one end of the spectrum. we are a flexible meeting area where people can come and an hour or two, maybe five days a week. taps into the increased number of small businesses being created since the last recession. >> there are four 5 million self-employed people in the country. i guess that is our target audience. it is a reason why the forward guidance has been revised. >> you are part of his problem? >> quite possibly.

we are encouraging growth through the facilities we offer at the clubhouse. we have members from about 250 different companies. hopefully, we are playing our part. >> thank you for joining us. quick look at the markets open. a lot of focus will be on the inflation report. u.k. unemployment numbers coming out and the number of company stories. >> good morning. the important thing here is the inflation. ahead of that, we do get those unemployment figures, expected 6.8%. a little bit that gets little closer.

bank of england expecting unemployment to fall to 6.5% in 2015. completely blown out of the water the original target of seven percent. it will be interesting the wage growth, a very important number. not just that headline figure. >> we will look forward to those two. i know you have been looking at the numbers from i cap. cap -- things have been very challenging. regulation has made business more difficult. inc. said had to reduce credit -- banks have had to reduce credit. it means they have been raining in their fixed income currency and commodity businesses. that has affected it somewhat. the regulatory environment is a little bit difficult.

much lower volatility. when you look at the institutional market and compare it to where our market is in the retail arena, we have seen slightly lower volumes in april. the lack of volatility is affecting trading conditions. they foresee a challenging time ahead. not only were the numbers a little bit worse than expected, but their outlook is not great either. will make it volatility returning -- morally get volatility returning, we will see activity from the major banking clients. >> thank you very much for joining us. next.e move" is up

stay tuned. do not miss the exclusive interview with the russian foreign minister later on during rogue ramming. -- programming. ♪

>> welcome to "on the move." moments to go before the start of the european trading day and the team has everything covered. here with me now is caroline hyde. jonathan ferro on the markets. david tweed joining us live from berlin. stocks are at a six-year high. >> maybe you are the reason for the record highs. it is called the most unloved bull market in history.

you mention these levels to people and they say, one is the correction? -- when is the correction? what is going to turn this around? i don't know. >> healthy market, a healthy turnaround in the u.k. outlook,he advertising that picture that itv is painting. sales up about two percent. the second quarter is for the glut of growth will come from. they expect advertising sales to rise 12%. there is concern, what about the second half? >> if you have a look at itv stock, maybe that is what the market is telling us. there is a bit of concern after the world