>> ge is set to be in talks with the government. a new offer could come on friday. pledging for prosperity. britain and china set to have a target by the end of next year to boost growth. england, willk of we get more talk of a rate rise? us aentral bank gives glimpse into policy changes with today's minutes. and living in a smart world. how it means big money for that tech world.

hello. welcome to "countdown." i am mark barton. -- in6:00 on monday and london on this monday here at bloomberg reporters are waiting to deliver stories that will drive your day. cranny is looking at the chinese market. the chief executive of siemenss is making his case to french lawakers after presenting a joint bid with mitsubishi. caroline is in paris with the details. caroline, tell us how the siemens executive came across. the market is a different size come up the same message just three weeks after he had to testify.

it was his turn to try to convince them that the siemens did was [no audio] as you know in france, convincing the french is almost as important as convincing the shareholders. he had to reassure that tidbit would safeguard investments. he also said that he would inject 7 billion euros. 14 billion euros that is more than ge. i wanted to find out what was the first reaction from the french president when he announced the bid. is the president is a good listener.

he knows the facts. i'm sure he appreciates it socially, industrially, and angeli. >> -- financially. nightre was response last according to people familiar with the matter saying that they will refine their bids in terms -- and theyaunching will also make sure that the french retain access to their nuclear technology made by alstom. it is a way for ge to reassure their bid is still valid. >> the mitsubishi ceo was also there. what did we learn from him? >> made question for mitsubishi is whether the french company part agree to sell bid -- for- mitsubishi has offered

a 10% stake. they say they want to keep the stake for the long-term. the mitsubishi ceo says he had been in contact. ongoing.ns were still i put this question to the mitsubishi ceo yesterday as well on whether he was confident that they would accept his offer. >> i do not know. his decision. we have not received any comments personally. himselfct, the ceo france in testify in front of french lawmakers on july 10. companya french telecom

-- >> thank you. that was caroline connan in paris. as you can expect alongside a photo opportunity was also business opportunity. manus cranny joins us now. >> what i didn't really's is part of the condition -- realized is art of the condition -- talk about public relations. you can imagine how that plays out on social media in terms of reaching out to the west. , the objective put a target on it. $100 billion. the focused was clear on technology. has advanced

technology that can be married with china's vast market. together we carry eight -- carried huge energy. >> that huge energy is the quality of what both people need. it brings back to a word i learned. symbiotic relationship. >> brings me back to those days. o level days. >> mutually beneficial to either side. british involvement in china can help balance the chinese economy. that is what he wants to do it he wants to rebalance. $30 billion. possibilities are in there as well.

there are two areas that he wanted to focus on that were united. david cameron began to play a youthful moment of politics. >> as members of the european union, we have a pushing very hard for the european union to stop the work on a free-trade agreement with china -- start the work on a free-trade agreement with china. that is something print put on the table before any other european country. we are a big supporter of free trade route it could in law growth and investment for people in china and britain. we think that is an important push for the british to make. , inside the euu is a huge free-trade agreement and appropriate jobs inside the eu. i'm not advocating being inside the eu. i'm merely saying that cameron is a master of clinical moments. europeanhas flocked to

-- >> they have. this is quite significant. it is three major shipping companies coming together. they're getting together with mediterranean shipping. the eu of the united states america is back here and the guy -- they get the deficiencies going. the chinese, no. but does not quite suit our vision of global trade across 29 seafaring routes. it suits them to approve maybe energy and whole mining, but when it doesn't suit them to approve a deal, the rest of the world approves, that doesn't suit me, sir. >> what is on the agenda? speech.oday, we have a

it is at 10 a.m.. then perhaps more significantly -- the governor of the people's bank of china. i would imagine that third piece of today will be very much about -- >> inc. you. see you later. new data showing prices continue to fall. we have the details. good morning. what are we seeing? could speakish i with the eloquence of the relationship with china and the rest of the world. the property market in china is big is this. today's a late syndication of how that business is faring. a very dramatic slowdown in home price growth.

prices fell at about half of the cities surveyed. this is the first time this has happened in two years. of 70 cities. is it just the property price slowdown continues at an even faster pace. however, not saying this is necessarily a collapse. this is part of the necessary adjustment taking place. prices decreased in the month of may. beijing saw 2/10 of 1% gain. as we look at other cities across china, and this varies from it is on the eastern seaboard, but are pretty prices say that those are masked -- macro risk. we see china moving very carefully to calibrate rules on lending as well as the doling

out of mortgages for rural customers looking for affordable housing. it is a tricky balance as we tried to get the property market in a symbiotic relationship with the rest of the economy. the slowdown is quite dramatic. >> that is definitely the phrase of the day -- symbiotic. forty of geopolitical risk investors. after the break, unrest in the middle east. ♪

>> time for today's company news. ge is in talks with france to refine guarantees on jobs and access to nuclear technology asseta big for the energy . that is according to people familiar with the matter. this is ahead of a june offer deadline. they argued their case for a joint purchase of alstom ancestor french lawmakers. jets to thel jumbo commercial finance arms of

china's biggest bank here to do is according to people familiar with the matter. it would extend boeings reaches of the world's most popular country and provide a boost for the jet would have struggled to attract buyers. facing a potential penalty in the u.s. over its dealings with sanctioned countries. it is sticking with a plan to expand into american bank west divisions. think west will hire almost 100 wealth management advisors through may 16. welcome back to "countdown." i am mark barton. the time in london a 6:15 a.m. the unrest in iraq and the iran nuclear negotiations has given investors plenty to think about. how best to navigate the risk? joining us is the head of the fx strategy is my guest. thank you for joining us today. let's begin with the data the

meeting. he was three months ago when the market got into a little bit of a pickle. when is the fed going to raise interest rates? what will be the main focus for today's meeting? >> the focus will be on the forecast, as well as the conference. divided.t was clearly unemployment was lower and expected to be lower. at the same time, it was more of the same. they did try to dismiss any hawkish signals. with that said, the market to the interpretation as hawkish. that lasted until the release of the minutes that indicated that they had no intention at all this and hawkish signal. the focus will be on the statement and what yellen has to

say. if anything come if the fed were to revise lower the forecast or the inflation forecast, they may have less of an impact. policy.ation of we'll want to touch on that? >> there's a new exit strategy. by as a risky speech deputy which highlighted the fed will be hiking rates even as they continue to have new security. .e will continue it will remain stable even after the taper. the same time, they will be looking at ways to tighten they will all be questioning yellen about that could if she were to into gay a form of hiking, it could be used maybe even -- if she were to

even hint at a form of hiking, it could be used. short-term securities for cash and then that is reversed? >> the banks would have to keep the reserves for the fed instead of spending them. you are yielding a little bit more. it is these sort of old-fashioned tightening. that is an alternative double allow the fence to keep the huge reserves still holding. index is up 2% since may 6. again, the signal for the dollar will come from the state and from what yellen has to say rather than the actual forecast. there is a scope for small

talks. thenumbers may suggest markets are conditioning itself for a hawkish statement anyway. carney-esquego for kind of moment question i'm talking about the bank of england at the moment. he is surprised investors by turning into a hawk when his previously perceived as a dove. >> especially given all that has happened in the aftermath and what the ecb has delivered. it is already in place. even if they want to be a hawkish, there is a concern that this will derail markets. now there is that risk. i think that the data in the u.s. -- from the point of view, i think that is fairly unlikely. the fed will look to improve data and overall, the message is

optimism. they are still cautious on the assessment. as appraisal come from the timing and the new exit strategy. if that is to be implement it in full, that will be a surprise. >> and we have minutes from the bank of england's last meeting. will there be signs of division? >> there is a risk. guess -- i do not think that is a central case. they will vote in favor of the status quo and if there is a division, there is a split. what is important is that the minutes will maintain the message from the speech whereby governor carney did highlight hike.sk to the early rate

phrase of the expression used by the hawks. it highlights how it has evolved. 1.5%. does that mean that there is less need question might -- less me? -- less need? >> it could be used should they need to really. ofshould act as a sort imperfect, -- all of that said, you could argue that the dip in inflation was influenced by the timing. there was a pickup in prices.

minutestly, what the has been maintaining for the last six months or so is that they do look at the data. a great importance is the evolution of expectation. .t has been stabilizing may hikegest that they even if inflation were to remain below the target. >> fact even a second. we will talk about the index. we have some data out of japan showing exports in the nation fell for the first time in 15 money -- 15 months. stay with us. ♪

>> welcome back. i am mark barton. the time in london in 6:25 a.m. this is going to worry as the economy contracts. you want demand outside, don't you? >> that is part of the strategy indeed. i guess, it is not that surprising. given that theg u.s. trade deficit widened to

the widest in four years. great for the japanese economy. obviously it will take away from growth in the second quarter. investors are looking for quite a dip from the first quarter. >> will a rebound? >> presumably. it may mean that politicians and policymakers will have to reassess their assumption about how resilient the demand is going to be. weakness would be needed to sustain the export competitiveness. if anything, it is not a positive number. it highlights the weaker yen to help the japanese exports. >> good to chat with you. come, deciphering the

central bank policy next. ♪

>> welcome back. i am mark barton. yen is theand they focus of the day. japan experts fell in may for the first time in 15 months because of weak demand from the u.s. and asia. that as to the challenges for the prime minister. he is trying to steer the economy through a forecast contraction this quarter. we had slowing demand from the

u.s.. slowing demand from china. these are two of japan's biggest export destinations. that is threatening to weigh on shipments that is losing against the dollar. a big fall of the yen last year. there you go. there is the dollar yen so far today. 2.28. 10 oil exports from southern and northern iraq is set to accelerate even as militants advance on baghdad. data examined by bloomberg shows exports from government controlled southern ports will be 11% higher next month repaired for the yearly average. they point to double crude export next month. in a couple hours, the bank of england will reveal minutes from its last meeting. governor mark carney says a rate increase could come sooner than

expected. and the european union will have to rely on antitrust rules. withn exclusive interview germany's interior minister. he says they cannot just break up the company. >> europe cannot unravel chinese american and indian, or south american companies. what kind of legal system would that be? that is not going to work. >> the south african president delivered the state of the union address to parliament on tuesday. it comes just after the nation's credit rating was cut to one not above -- our guest joins us from johannesburg. good morning. the president started off by expressing disappointment over low growth. he talks about targets to hit 5% by 2019. what is the plan to get to those

levels? radical social economic transformation. that is what he basically said throughout his state of the nation address last night. it's is the first time we have seen after he took ill. he basically said that the most important thing is going to be the economy. he spoke about 5% growth. that is five years from now. south africa is only expected to grow by about 2%. the other target that he put on the table is the fact --mployment needs to drop to it is currently sitting at 25% and has been stuck there for the last 10 years or so. one of the more important things that has come through is there talking about an overhaul of the energy there and to the focus on the mining companies and also what came through is a fact that we could see a revision of the minimum wage coming in south africa.

are these changes radical enough? i do not believe so. said the main reason for the slowdown in growth is due to the economy and electricity shortages. it seems as if there is a bigger problem there. >> of course there is a bigger problem. one of the things we have seen is that these issues that you mentioned we have seen for the last few years. some -- remember one of the big projects has been delayed time and time again. he was talking about bringing in a new mix of various energies and talking about nuclear that has been a very controversial issue and also, shale gas. the underlying problem is the aggressive strike action we have

seen here. it is the 20 wink of the platinum strike -- 20th week of the number strike -- platinum strike. there are issues that need to be addressed. there was the one mention of that running through during his address. >> thanks. always a treat to chat with you. she was coming to us from johannesburg. the market will receive the latest minutes from the last tank of england meeting. week's bank of england meeting. manus cranny should to help us decipher it. these are exciting minutes in the wake of carney's address. >> absolutely. you look back at his speech. why bother with minutes? who cares about minutes? can drop a bond.

that is essentially what carney did last week. motivation.ot his .e makes that very clear raising rates today would be wrong in regards to housing. housing -- >> the final line of defense, isn't it? >> it is indeed. is he the most dexterous banker in the world? these are the for guidance. that is the. . we are a must that the point where capacity could be used up. to a certain extent, he is not a tree hugger. >> he's not afraid to move on. >> he is not afraid to move on. that is the important one. reflect backwards as we look

at what he said. let's take a look at some of the statements. the decisions are becoming more balanced for some. that they the wording said matters more than anything. more balanced words. >> correct. the arguments discussed around the table -- is it more balanced toward a rate hike? the second piece of that agenda is more evidence of the slack reducing. that is a debate in itself. it is very hard to define. >> 1.5%. >> exactly. those other nuances. i want to show you a chart. i'm kind of going back to the a six. >> we're looking at the

expectations for rate hikes going forward. >> correct. the price of sterling -- you by -- andg on a three-month you see it popping along and singing a song. their quarters of a percent. bit of a squeeze up there in the price of sterling. i want to show you the longer-term. we come in. the market says, well. he's going to raise rates. they will raise rates. the reason why a want to show you this longer-term chart is because i want you to look at the last time this was dying. it was during the ben bernanke taper tantrum. the question is this -- this

carney have a temper tantrum moment? >> who was on the monetary policy if you -- >> i was quite surprised and confused. my assumption is either they have massively upgraded their forecast based on new discussion which we will not know yet. minutes are due out shortly. or even though he's a pro and is very good, he did not quite calibrated right. he said he was trying to say, ok, don't get too carried away. the markets have overreacted. i lean towards the second. it seems he has got that calibration wrong. with this --ve you there are new members coming on.

says it will go in the fourth quarter. don't worry yourself. yearrate hike by this possibly above 1.5%. coming.ate cut is chat.snap, snap, it is all about the pace party. >> thanks, manus. it is the oldest underground system in the world. london is going high-tech. it is part of the general move. it is internet of things to help code with an increasing population. caroline hyde report. ♪ carriesn's underground millions of people on when

billion trips a year. the city is growing bigger. that means more stress on infrastructure. -- theyts to harness want to make london's smart and make smart investments in infrastructure. this research facility is trying to do just that. it is called the transport system had a poll. it is finding ways to make hasbro systems more efficient. >> it is internet located. there is a pothole there. it is the kind of technology that we want to make happen to improve the efficiency. >> in the case of the tube, that means monitoring. they monitor different parts of the underground.

they monitor things like escalator vibrations and checks for a knology's -- four acknowledges -- abnormal ties. streets. beacons on soon they will be offered discounts. even he throws newest terminal features smart toilets. they notify operators when repairs need to be done. there is a financial incentive as well. we estimate 900 billion pounds are random. them capturelp around 10% of that arkin. investment and making london's smart cannot afford to be dumb. not just the two that

is going high-tech. building a house in the cloud. controllping consumers home appliances from anywhere in the world. ♪

>> time for today's world cup news. belgium beat algeria. juliett took the lead in the first half, scoring with a penalty kick. belgium made a comeback in the second minute to substitute players both scored goals, making it 2-1 to belgium. brazilian law requires that fee fifa provide double wide seats for obese to world cup fans. sometimes people do not need that much space. fifa is using guidelines to check who qualifies. object tormed around see whether they meet the criteria.

an arresting suspected drug trafficker on his way to watches soccer team play in the world cup. he and his family had bought tickets to the match. he was arrested at an airport in rio. welcome back to countdown. imagine a factory where every machine feedback information to solve problems on the production line. imagine a hotel room with the lights come stereo, and the window shades are adjusted to your preferences. it is all possible. london wasde is in on the forefront of this emerging knowledge he. good morning, caroline. >> good morning. some of those things you say, it is already a reality here in the smart apartment.

you can control the lighting, heating, the television. it is all connected to the internet. i could get myself coffee while chatting away. the coffee ration over my shoulder kicks into gear. , i'm very pleased to say alert me. it is in many homes. smart meters. it gives me a sense of how quickly you are adopting to this. how quickly our people interested in bringing this into their home? >> i think what is happening is is coming into everyday life as a matter of living. what is happening is exactly what happened with the internet itself. it is a good place to start. if you look at how internet started, it changed the way we communicate and consume

information and use entertainment and shop and bank and so forth. overppened very quickly number of years. the internet of things will happen in the very same way in which it will happen as people connect devices in homes. >> give me a sense of how quickly. >> we launched internet about -- we have promoted this at the start of the year. high active heating. gathered overly 75,000 customers in the short space of six months. >> are they using it? >> absolutely. the average of customers and iraq's with the thermostat. it is about once a day compared

to three times for the average household. feel why do i need things connected to the internet? i really do not need to make my coffee by the internet. will this have former reaching effects? is this about making health care more affordable by monitoring mark --erly question elderly? how can this draw the economy forward? >> if you look at this apartment, it is fabulous. we have confirmed widely held myths that internet thing in the smart homes and the connect did devices from alien there's and wi-fi enthusiasts. but it has everyday applications. look at the smart car. it is automated.

it tells you when it is safe to drive, makes it more convenient, climate controlled, it shows you how the fuel is consumed. insurance companies are keen to take the data to ted -- assess your driving styles. we have seen energy management systems and thermostats to help you manage the usage of the energy and tight might be able to control it. sensors. efficiency. convenience. it is about peace of mind. safety and security. smoke sensors. carbon monoxide sensors. all of these are actually going to be connected in march or smart phone. when you're out of your home, you are still connect did to the

most precious asset you are to own in your lifetime. >> we have got to wrap this up. give me a sense of the world. >> i think this is going to be huge. it is going to be even bigger than that normal internet. the internet of things is going to be huge. millionbe about 15 connected devices in the next year. this will be part of parcel of our everyday life whether it is a car or at home or personal care or elder care. it will be so prevalent. >> thank you very much indeed. clearly the opportunity is huge. we will talk much more about this. i will show you around in a little bit anze also speak to

the company behind the apartment as well. >> coming up, brazil world cup fans not dancing to the somber beat. and others intory today's newspaper segment. ♪

>> welcome back. i am mark barton. the time in london is 60 d 5

a.m. the news -- 6:55 a.m. time for the newspapers. boys kidnappede while hitchhiking their way home. this is the headline. the government vows to turn up aaretz.t on h iss israeli government blaming it on the terrorist organization. it recently put aside his differences to form a unit -- they deny the kidnapping, but at the same time praised it. >> thanks. we look at the sports segment could somber beat silenced to a brazil stutter. they played against mexico. mexico and brazil, you'd think

they are favorites to progress to the next phase. mexico will have to properly and croatia. .oday, australia and holland all of the latest next. stay with us. ♪ . .

>> the french. refine thelks to bid. of $100de target billion by the end of next year to boost growth. >> inside of the bank of england. will we get more talks of a rate rise? in a smart world. how the internet of things means big money for the tech industry. ♪

>> welcome. i am mark barton. and london and we are getting breaking news from h&m. >> the number two clothing retailer says that prophet in the second quarter beat estimates. 7.6 4 billion swedish. -- 7.64 billion swedish. sales in june are off to a good start, so far. online expansion fuels sales growth. they plan to open 8-10 new markets. they are pressing ahead with investments and geographical expansions and they have new selling formats that increases competition from chains. introduced a new chain. they opened up their first store.

another story. that is the one. the first store in the southern hemisphere. it is firing on all cylinders. >> i see your edit their. -- there. the shoe range will be introduced. >> it is important. if you like your shoes. >> you are right. gave thee rival markets a lot to think about with the recent profit warning. their second profit warning that they issued this year. it is interesting to see how h&m is doing online. there are other rivals. with interest, that finance looks ahead to the second half of the year and says investments all the

will come back to hurt them. >> no warning of that, as of yet. net income beat estimates. 5.6 3 billionates billion swedish. >> caroline has the details. tell us how they came across. >> that is right. many in never seen so such a short span of time. testify in front of french lawmakers. he knew that he had to do the same. he had to reassure the french lawmakers. in france, it is almost as important to convince the french straight -- state as it is

shareholders. he said that he will safeguard jobs and local investment and said that his joint bid with moneyishi would inject to bring the energy assets more than 14 billion euros. he thinks his offer is superior to ge. i asked him yesterday, before the appearance, why he said that. >> we have superior technology. siemens are the efficiency holders in turbines. there are others who talk about it. they do not have it. we know how to do it and that is why we have beliefs that we have -- that we can execute.

>> according to people familiar to the matter, they said that there will be jobs. according to people that talked to bloomberg. they will make sure that the french retain access to nuclear technology made. according to a newspaper this morning, and fax, a new ge bid could come as soon as this a new ge bidfact, could come as soon as this friday. . >> what did we learn? >> the question is whether they will accept selling part of mitsubishi. the have offered 900 million euros. at the moment, they said that they want to keep the stake in the long-term.

yesterday, told french lawmakers that he had been in contact and discussions were ongoing. i asked the same question to the mitsubishi ceo yesterday on whether he was confident that they will accept his offer. >> i do not know. it is up to them. we have not received any comments, at this moment. ceo will testify in front of french loss make -- french lawmakers. >> thank you very much. is it a housing stock or a tech company? a mixture of both? we are getting information on the pricing this morning. the daily mail is part owner of

zoopla. the price is being set. the total market capitalization will be 918.8 million pounds. various other shareholders are telling us what kind of money they are going to make on the back of that. countrywide says that they will realize growth pricing. propertynot the only stock to list in the last year. the shares are up double digits. >> yeah. >> in that timeframe. strength is in the housing market and it is an interesting time for them to come to the market. was on hismeron first trip. the photo opportunities flourish. manus cranny gives us a flavor of what one god -- what went on.

queen, along with his wife. that was quite a deal breaker, if that did not happen. you can imagine what kind of home reception there would have been. the premier went to england and did not meet the queen. the more important point -- >> ever buying the important detail -- eyeing the important detail. >> he was given a copy of downton abbey. i want to talk about numbers. $100 billion is the point of trade. we like numbers at bloomberg. that is the objective for david cameron. $70 billion. the focus for li is technology. u.k. has advanced

technology that can be married with china's fast markets and, together, we can create huge energy. -- vast markets. together, we can create huge energy. >> biology. >> only a few years ago. i should tell the audience. that they canink help rebalance the chinese economy. about theo talk imbalances between the east and west and the growth potential there. his message was clear. he talked about a united europe and a united kingdom. play at thetics at point of receiving. david cameron. >> as members of the european union, we have been pushing very hard for the european union to work on a free-trade agreement with china.

we are a big supporter of free trade and we believe that they can unlock growth, investment, and jobs. -- forple and shou people in china and in britain. >> did you get that? within the eu, there will be a free trade agreement. suit them, they do not. they blocked the tripartite agreement. it does not suit you. >> it had an impact yesterday. thank you very much. cars, and factories are surrounded by intelligent devices. now, they are beginning to talk to one another. frightening, perhaps. caroline hyde joins us now from or apartment,at,

to some viewers. gadgets!rts of fun let's have a look at the smart apartment and what it can do. i am into pull down the blinds. -- i am going to pull down the blinds. well, have a little analysis of the lightning -- lighting. we can make it more colorful. there are serious notes. you can control temperature, which will help with energy levels. checking myself out on television, i can check out what is happening in the rest of my apartment. might want toi monitor my home in the future. also a way to track precious objects as they travel. monitors yours

post by putting chips in them. you can see utilities. energy utilities are embracing the internet of things. are making sure that they are making the most of their own efficiencies. track patientt health care going forward. how could this change cities? you could have sensors in the lighting. pounds to be cut by managing energy. think about how much more drivingt it could be around, monitoring all the traffic in the city. we could go as far as to think that we will see a future that is entirely connected and managing to save billions of pounds. andcing chronic illness

diseases developed. it is astonishing how far we can go into the future. it is not just an odd fad. this is something we could have 50 billion connected devices of. one amazing you fact, according to cisco systems. they see growth from the internet of things. we will talk more about how it life.lp your and my do catch up with us. >> wouldn't the people who make all the nuts and bolts and bits of pieces -- and pieces love it if we were enthusiastic.

i definitely saw somebody moving on the screen. sure you are not watching an episode of big brother? thank you. still to come, with islamic extremism and sectarian killings on the rise, we will talk in the region and speak to a middle east expert.

\ >> welcome back. >> 17 minutes past 7:00 this morning. group, isi extremist significant gains in iraq. the u.s. says they will not rule out airstrikes. joined by there head of the middle east analysis. what do you think the priority is, in terms of where we should focus our attention? is it around baghdad and isil moving in? >> it is not just isil.

coalitionde sunni that is trying to assert themselves against the shiite. to establish themselves in a much better position in power. this is really the priority. it,ously, we talk about everyone is concerned about the energy. so far, energy is just an aspirational target for isil. they do not have the ability. civil war in iraq is increasingly likely. how long would such a sectarian war last? ityou could easily imagine slipping into years. the key question is, what kind of order should we have around sunni provinces, shiite

provinces, and kurdish provinces? is this a confederacy or, separate states? it has been tried. it has not really succeeded and the question is, how do you change the political structure? morevalse malaki influence, it would have to be a fundamentally different redrawing of the map. a scenario where the federal government of baghdad, which is currently dominated by the shiite , dominates the north. the ability to do so is limited. in order to do so, you have to inflict a huge number of civilian casualties. so, they do not want that.

want to assert themselves. it is difficult to imagine the previous status quo. ande talk about the u.s. airstrikes being discussed. some sort of diplomacy with iran seems to be on the table, as well. does the u.s. have a clear political objective and an exit strategy? >> this is the limitation, in terms of using air power. you can stop them from attacking baghdad. power toart using air retake territory, you have to rely on the iraqi military. there is no guarantee that they will succeed. it becomes endless and without an objective. to goal is to make malaki

make the compromises. amountquires a certain of political vision that seems to be completely lacking. now, the thinking seems to be, the bad guys will attack the bad guys. so, the point about iran, is it really material, what we're seeing here? the u.s. is considering talks and it sounds like a big deal. seriouse seeing a re-engagement. in the end, the negotiation with the iranians could succeed. visions. conflicting -- the united states is trying to force a compromise and wants to get rid of isil.

there is an overlap and policy there. what should the political arrangement look like? >> how does saudi arabia fit into all of this? the shiites are being used as proxies, essentially. how do they fit in? >> neither country is comfortable with isil. there is an amount of cynicism involved. l cans like isi effectively fight against the iraqi government and serve the interests of turkey and syria, even if they do not actually like group. they have smuggling routes through turkey. we're pretty sure the turkish government knows that this exists. it suits their interests. >> thank you for joining us today. he joined us from ihs.

>> the chinese property market is slowing down. we dig deeper into the numbers when countdown returns.

>> welcome back. >> it is 7:25 and the chinese property market is slowing down. kong withned in hong the details. talk us through the data.

declininghome prices and half of the cities surveyed in may. a dramatic drop-off in 35 out of 70 cities. to whichs the extent the property market in china is slowing. by design. reinovernment is trying to in credit growth. there are markets where the government is opening the lending caps and increasing lending. it is loosening some restrictions for rural lenders, event -- an in an attempt to make housing. we see the price decline .3%. prices in beijing are up .2% in the month. home price growth is slowing in economy the overall

continues the trajectory of moderation. a jump inorts profits. ahead, we'll see how a new store format and online expansion is fueling sales growth.

>> welcome back. let's take a look at the fx and the dollar against the yen. it is the yen that i am interested in today. it goes back to the start of the year. the yen is down and -- the dollar is down, excuse me. stuck in a narrow trading range. that has been the trading range. attention.aught my export data in japan is falling for the first time in 15 months.

we have weak demand from the u.s. and asia. that adds to challenges for shinzo abe. he is trying to steer the economy. outbound shipments decline. imports dropped. that slowed demand from the biggest export destinations. gh, as thens to wei yen slides. place last year. the dollar-yen is barely budging this year. you can see that chart. the dollar is up 2.9%, year to date. >> these the top headlines. andexports from northern southern iraq are set to accelerate, even as militants come from baghdad. data examined by bloomberg says that it will be 11% higher next

month compared to the yearly average. in a few hours, the bank of england will release the minutes from their last meeting. analysts want to see if there is any dissent among policymakers. mark carney said that the rate increase could come sooner than expected. will have tounion rely on anti-trust rules to curb google's search engine dominance. they said that the eu cannot just break up the company. >> europe cannot unravel chinese, american, indian, or american companies. what kind of legal system would that be? that would not work. >> let's go behind the growth. charles allen is here. a retail analyst for bloomberg

industry. in case you did not know, it is a team of 140 analyst that provide mobile research and eta on 100 industries. -- data on 100 and is research and data on 100 industries. what is the secret to h&m's success? >> the secret is the profit increase. it was cost control. they have been investing in loads and loads of new things. brands, things like that. that ways into the cost and the margin. intoleveraged -- weighs the cost and the margin. they leveraged. is big secret of the success trend fashion in the big brand and doing different things with the new brands that they have. >> what about the margin?

a decline there. >> it came down a little bit. nothing like as much as the first quarter, when it was down quite heavily. at whether itking was down because of markdowns or something else. it was purchasing costs. i do not think that will be a big concern. >> where will the growth come from from here? >> i think we are really looking at the other brands. stores, as opposed to 3000. and then, we have online. another 8-10 countries. hemisphere, they are opening up. a successful opening in australia. they have south america. >> it should cut the retail scene. there are a lot of frightened

retail executives as a result of h&m's arrival. australia -- the domestic retailing is much more competitive and the flipside of that is seeing people who are successful with their online operations finding the market much tougher. >> it is mentioned in the same breath. online expansion, as well. who is doing it better? >> i think it is always a bit unfair to compare them. i think they are better than most of the rest of them. i think that, at the moment, the operation is a little bit more with h&m. and thee been investing recent investment is not looking

h&m's. as they could flip around from one quarter to the next. >> thank you for joining us from bloomberg industries. >> a-10 assured. -- a tennis shirt. which gift when i give you? >> that is mentioned in the bloomberg story. not just online shopping. >> i would go with it. tennistomas berdych shirt man. >> we begin a conversation. >> i will thank mark for that. in my career in this institution -- >> an incredible achievement. >> we're going to talk to you about the mpc. speech will be

under scrutiny. tell us about it. >> people around this table. i want to put this in context. in 2013, forward guidance of all. -- evolved. unemployment was going to be the target. puff the magic dragon. forward guidance will take the capacity. things got a little bit pressed and better and the housing market continued to fly. this is prepared to change. as a governor who is prepared to say that that was two or three months ago and we need to change, or recalibrate, and reaffirm where we need to go. raising rates would be the wrong response, according to commerce bank.

he is looking at tools to do it. the issue is the language. these are the things we want to look at. talk about johnson the 9:00 a.m. or 11:00 a.m. and,ve nine people voting if there was a shift in even one of them, it would be a dramatic piece of news. the language we are looking for is numbers becoming more balanced for some. more balanced for some. it might raise risk. we all agree that we need more evidence of slack in the economy. >> markets pricing in rate hikes sooner than expected. sooner than before. what are the money markets telling us? >> the short sterling tells the story perfectly. .75%.ht be

that is the flat line. by christmas. it will be about .75%. short sterling. look at the longer-term chart and i will wrap up. there you go. timeast time, the last that you saw this level of trepidation in the market was the bernanke tamper -- taper tantrum. mark carney had a taper tantrum. has the market over analyzed? possibly. a high-techre in smart home. we will be exploring it after the break.

>> first. oracle chief, larry ellison, is trying to buy micros systems for more than $5 billion, according to people familiar with the matter. the deal could give them a bigger position.

it could provide customers. offering musicrt videos that have not agreed to be part of a subscription service. they have not. executive will unveil the first smartphone at an event in seattle today. they will be the exclusive carrier for the smartphone in the u.s., according to a person familiar with the matter. it is a string of strategic partnerships. welcome back. i am mark barton. >> i am and that edwards -- anna edwards. you will find the finest lighting, security, and telecom systems. it is courtesy of a company.

joins us froment this smart home show room right now. >> thank you. i am joined by gary lewis. home thatset up this is the first of its kind in europe. >> it is the first of its kind in europe and it is a smart apartment. we developed a home concept to show people what a smart home can really do. it is not a smart -- scary thing. it is here to help. it is a man cave. -- it is really showing people here. we have a games area. we are showing touch screen technology. i will show you something that we can do to try to help envisage a little bit more what we are trying to do. >> all connected in the internet.

there are tactical ways in which this helps. it is not just about a modern gadget. it is about saving money in the future and you can save money on your grocery bills. >> yes. example, in the future, we will have a shopping bill delivered to us in an electronic format. we can decide what we would like to eat. we will know. the system will know what you bought last week. you may have bought chilies and pesto. it will say, here are 50 things you can cook tonight. it is to try and help people not wait as much food. 38% of the food that we buy is wasted today. we know what is in the cupboards and what is going out. it will help us save food. that is one way that we can use technology to try to help the environment. >> this is about efficiency and the environment.

the demand must be coming from the higher net-worth individuals right now. >> absolutely. it is safe to say that most of our clients are the richest people in the world. it is starting to trickle down. havef the new builds will technology. controls, all sorts of things like that. >> how do you envisage this working in the city. -- the city? it is trying to take rusher of the population. -- pressure off of the population. control each of the items within the home, the power stations can, perhaps, turn off certain items. maybe lighting or the

temperature in the home. that will help power stations deliver the power that they need to. >> what would you say to someone who thought that the internet of thing, this apartment that you are showcasing, is a bit of a phaze?a turning >> the home is going to start working for you. at your remotely look security system. it is not a gimmick. it is not gadgets. we make it easy for people to use. it is what everyday people want today. >> it is a sense of the demand. -- give us a sense of the demand. where do you see demand going for your company? is it building up and you are seeing people? >> this industry is growing and growing. like i said, it is new builds

and big houses. it is everywhere. be doing ind you this room on a regular basis? >> entertaining my friends and children, as well. >> jerry of cornflake. this is a superb flat you have invested in. it shows potential people who want this how it would work. the internet of things is not just about the individual. it is about how we can alleviate pressure on hospitals and make utilities more efficient. we will be talking a lot more about that throughout the morning. we will be talking to a chief executive later about a ship that goes inside of all of these inside -- chip that goes of all of these devices. $19 trillion improvement the

economy can really be a reality. >> thank you very much. >> he said he would entertain his children and his man cave. i thought that was for bachelors. -- mane ra pipedream are a pipepedream -- dream. >> we will have more with our next guest, marshall.

>> welcome back. i am mark barton. >> it is 7:51 and let's take a look at the markets. ahead of the market open in eight minutes time, let's talk to marshall. let's start with the fed. that will tide markets -- guide markets. what are you expecting? >> there has not been enough of a change in the economy for them to change their tone of voice. the statement will be pretty similar to what they had before and i do not expect any great change and what they are stretching desk stressing. -- what they are stressing. people are focusing on the forecast. >> it was three months ago that the focus of the market and the rate forecast had everyone in a

flap. the markets calmed down. have the markets learned to cipher what is important today? >> yes. the comments will be important. were quites comments contrary to what people expected him people were expecting a more dovish stance from her. although, she has warned us to not put emphasis on it. the markets are still focused on a quantitative interpretation of a concrete expression of their views and, right now, the dots are ahead of the market. ,ven if we repeat the same dots which i would not expect. they may move them up. the fm oc is ahead of the markets and the markets will is ahead of the markets and the markets will have to adjust. >> rates will move.

where do you think they will go to? >> the forecast is that rates will start rising earlier. >> could they have a mark carney moment? the bank of england governor spoke last week and surprised when he said that the rates could go up sooner than the market expects. >> yes. that is one of the reasons why the focus is on the meeting. there is a lot of focus on everything. after the apostasy on the issue of forward guidance, people think he has torn up the whole concept. forward guidance is in play. it is all about the data. >> surely, your guidance is your guidance until things really change and then, you change the guidance. >> the whole idea of forward guidance is to say that we are not going to change. the central bank has to promise

to reliably be irresponsible. what they are saying is that, sorry, we are not going to be irresponsible. july,ce you took over in we have gone from no rate hikes in a long time to maybe this year. >> exactly. it is a mockery of forward guidance. >> geopolitical events have not moved to the markets. why not? what is going on. >> it is astonishing. people are, for one reason or thinking the liquidity caps on there and there is going to be a lot of money. that is coming the markets. with the ukraine, he did not believe it was going to be a disaster. the interest on both sides were for a negotiated resolution. that seems to have come true. iraq, i don't know.

these are not rational people who are open to negotiation. it is a multiyear crisis. >> on the move is next. anna will be watching. the prices are set.

>> welcome to "on the move." we are moments away from the start of european equity trading. investors await signals of a tightening timeline from central banks on both sides of the atlantic. market minutes moments. 930 a.m. london time. will there be a whiff of dissent on the monetary policy committee? janet yellen speaks and the fed votes. we will have that covered throughout the day. arguemens and mitsubishi

their case in front of french lawmakers. both testified last night at a national assembly after launching their joint bid on alstrom -- alstom. who will win the backing of the french state? backdrop onhe macro the micro backdrop. european markets are just opening up. let's check in with manus cranny. it is all about the minutes, and it is to some extent. equity markets are rising this morning. from allee a shift nine members being convinced that now is not the time to talk about arise and rates or a