speculations that osborne could announce plans to incentivize u.k. homebuilders. those are a few of the things we will be talking about. when i look at the open i am going to be looking at futures. euro stoxx 50 flat. dax futures higher by 22 points. looking for something movers as well. manus cranny. >> a very good day for you -- to you. the dax at record highs yesterday. by 16x has gone up percent since its october lows. is it overdone? china hits a three-year high. equity markets, we broke trend. commodity companies are on a low. the pmi will be out today. with theischer along

new york fed president talking about oil prices going lower. good for the economy. stanley fischer talking about movement. we had a conversation about where we are with the euro. on thursday, december 17. it will be incredibly important. green just opening in the . those futures indicate we will get higher. three companies we are keeping an eye on have had a little bit of speculation and an upgrade. flurry. nice speculation shell might be interested in buying bp.

our bloomberg television team would say anybody and their right mind -- in their right mind would want a little more information about what is before they could .ossibly think about buying bp barclays raises the stock to overweight with a 30% upside in the price target. at 439.8.ading sales are in line. they say they are on track for a 6% growth6% growth in 2016. the stock of just under half a percent. ladbrokes, this is the gaming company. to complete his term.

confident 2015 would see further operating and financial progress. ,e will complete his continue his role in 2015. they will evaluate internal and external candidates. rouble. -- the dollar ruble, it doesn't if the central bank intervened. will it make 63? putin is 63 next year. will the ruble be 63 next year? >> will oil be at 63? up by nothing. it is the day when riggins chancellor gets his last a chance to shake the nation's economic agenda before next year's general election. in a few hours time george

osborne will deliver a range of measures with one eye on voters. what will be on the statement -- in the statement? funding for lending scheme would 2016, atntil january, what other announcements might we expect? mark, how constraint is george osborne going to be? d is georgetraine osborne going to be? he keeps missing those deficit targets. >> you said it. when the coalition came in power, touch -- george osborne said the deficit would have disappeared by now. not quite the case. the deficit last year was 97.5 billion. the deficit this year would fall by 12 billion pounds. -- for george for

osborne, this is clear the deficit is 6% higher -- this year the deficit is 6% higher than last year. how is he going to narrow the budget deficit when tax receipts have been disappointing. employment has been rising to people since50,000 march. the problem is they are low paid jobs. they are self-employed jobs. that is why osborne has a public finance issue this year. with theas an issue structural problem. bywants to eliminate that 2017, 2018. that's going to take a lot of cuts. that'srall deficit,

going to be a big push as well, particularly if tax receipts are disappointing. he is very much constrained by the public finances. is constrained to some extent. i guess the big question is what can investors expect in terms of therne's outlook for economy and the giveaways? >> the economy is growing. 3% this year. it is going to be the top g-7 economy. other things, it has grown for seven consecutive quarters. they will boost the outlook. unemployment below 2 million. that has not happened since 2008. wages, basic pay, excluding bonuses, finally outstripping. those are the big tex. yes, he is going to support business through the extension

of funding for lending scheme. big business will be helped anymore. are one billion pounds of savings to support small businesses as well. all of these are big measures. extra 15 billion pounds on improving the capacity of the u.k. roads. there could be a big election banner. a progressive system. it will probably help those desperate to get on to the themng market actually get onto the housing market. lots of measures. dig beneath the headlines, and the underlying fact is the public finances are not in as good a shape as he hoped they would be in march. >> stay warm. we will catch up with you later. let's get a market perspective

on what we might hear from george osborne today. we are joined by the head of u.k. rate strategy at ubs. great to have you with us. first question, i am looking at sterling denominated assets. i look at sterling. what can osborne say today that makes me as an investor want to buy those things? >> there are two elements. one is the deficit, the amount of borrowing, which we need to see come down, and we need to see credible plans for how that is going to happen. there has been a lot of slippage. there has been progress as well. investors want some confidence the u.k. remains on the right track. the deficit is still installed. the other element is -- the deficit is still stalled. the other element is it has to elementen the european gives calls for concern. there has to be a mix of deficit reducing strategies, but alongside that, the more long-term deeper economic

reforms that are going to develop are a stronger and more flexible economy. let's talk about u.k. bond yields. does it matter for costs? the deficit is high, but borrowing cost yields, 18 month low. why does it matter? >> it matters because of what it tells you about investors expectations about growth over the coming years. i don't just mean this year and next year, the short-term focus you tend to get in these political statements. i mean the structure ability to grow in the new term. i am not sure if long-term growth is entrenched. political at uncertainty. the conversations i have been having is it does not matter who gets in the government, whether the conservative party or the eu referendum risk, the labour

party and what could happen with the deficit, it seems to be a lose lose situation. are there any bright spots ahead of the general election for u.k. asset? >> if it was not a fixed term parliaments where the election has to happen in may, it would be almost better happening any other time. it is an unfortunate roadblock in terms of economic confidence and recovery. we would like to end up with a fractured government, some sort of coalition where any sort of progress on fiscal plans and long-term economic planning i definition becomes more difficult, and/or a government where a referendum comes into clear focus. whatever the merits of holding that referendum, it's going to create uncertainty in the business environment. >> when you look at the economic backdrop, the headline gdp numbers are pretty strongly comparatively to the rest of the g-7. to level of gloom that seems

be injected into the discussion are coming into this as well. we look for europe and the mess there. can it really escalate the economy from the mess in europe? >> that the big question bond investors have been asking. we have seen guild start to outperform u.s. treasuries quite significantly. the reason is investors are worried we are being pulled into the eurozone crisis, and one of the reasons investors are worried is because the crisis appears to be worsening and because senior figures in the government and the bank of england have been drawing elaborate attention to the risks the u.k. economy faces because of the eurozone situation. that's when the market is getting worried. it remains to be seen if the u.k. can't continue -- can continue to decouple from europe. it can do so indefinitely. >> we are going to spend a lot of time talking to george osborne. road sits governor

carney. of u.k.it, a third government debt held by the bank of england, arguably the guys who could bring in the biggest tax cut. doesn't carney and bank of morend policy matter a lot than what osborne could announce today? >> absolutely. you said yourself this is the last chance from a political standpoint to try to attract beers, so there are going to politically motivated aspects of the statement. policy,e case monetary especially at the current juncture with the fact interest rates are at extreme lows and absolutely critical to consumer behavior, are far more important, and from a pure

market perspective, i think it's fair to say that inflation reports, the bank of england meeting minutes are more relevant and likely to cause market movement than anything we are likely to hear today, depending on revisions to the big picture forecast. >> let's wrap it up. today we get the government parties trying to politicize the recovery. on the one hand strong growth. labor is likely to talk about the slow wage job recovery. when you look at next year -- when you look at rates for the bank of england, where are we going? sterling lower? >> our thought is rates will eventually go up. to be honest, the more the skies have darkened, and it is the eurozone responsible for that, the more chances we are sitting here 12 months from now wondering when rates might go up. the u.k. has managed to inflated self to a large degree.

it self to a large degree. the ongoing policy will be whether they can continue to do that next year. >> thank you very much for joining us this morning. ."ay with "on the move we will have a breakdown of the statement. after we will look at the corporate side of things. will big oil get relief? what are the big industry winners and losers? later this hour we will get an inside look at the u.k. labor market. we will speak to the finance director at britain's biggest recruitment agency. that is just a look ahead. don't miss the coverage of the -- of thestay with us statement. stay with us. ♪

>> welcome back. as we have been discussing, the u.k. chancellor is set to deliver a statement later. the funding for lending scheme has been extended. homebuilders will be watching thatly for any changes could send homebuilders even higher. the u.k. homebuilders index pushing higher and higher. joining me with more is ryan chilcote. what could -- what impact could

doody change have? >> let's talk about this. maybe not everyone knows. dutyuld this stamp change have? >> it's a tax. you pay 1%, up to a house worth $250,000 -- 250,000 pounds. you paid 3% after that. there are steps up. what the construction industry is saying, if you really want to help first-time buyers like you did last year, what you need to do is stop taking so much tax off them for the first home. 250,000 pounds will not by much of a house in london. >> i think it will buy a house in london. >> is well below the average price. corners the far-flung

of the country. you couldn't get a lot. the construction industry is saying, that band of jumping from 1% tax on the purchase of a home to 3% at 250,000 pounds is not appropriate anymore. in 2000, 14s set years ago. since then the average price of a home in the u.k. has gone up 140%. we are hearing osborne is thinking a couple things. first, getting rid of this slab system whereby it works in blocks and going to a progressive system. the more the house costs, and it doesn't fit into categories, the more you will pay in tax. effectively, first-time home buyers would have to pay less on their first purchase. that would allow them to put more into their deposit, which coupled together with helping to .uy could mean a lot

if you wanted to buy a 250,000 pay 7.5me, you have to thousand pounds in tax. say 5000 pounds. that is 5000 pounds to a deposit. you could buy a house that costs 100,000 pounds more. you go to the labour party. you get rid of the idea of the mansion tax. you steal the nomenclature from the labour party. you make it look like your own incentive. you charge wealthier people more on more expensive operatives. >> that's the homebuilders. we know bp. we know about the taxes to take out oil in the north sea. it's probably not ok when we to $70 or $60 a barrel. can he help them? >> he could help them. he has articulated how he could

help by asking for tax relief. in this country there is a lobbying body called oil and gas u.k. they are saying you need to give us tax relief because in the whenthe biggest resource it comes to oil and gas is the north sea. 20 billion barrels of oil thought to be the need the seabed. that requires -- to be beneath the seabed. when taxes were raised on oil and gas companies in 2011, the ofncellor said, if the price oil falls below $75, i will revisit that. oil is at $70 a barrel. ast month they said -- sent letter saying, how about we make good on that are ominous? >> a couple of things i want to bring your attention to. the euro-dollar dropped. that's a two-year low. spanish services pmi out a

little earlier. another currency getting whacked over the next year or so has been the shekel. is real in aabout couple minutes. stay with us. -- israel in a couple minutes. ♪

>> welcome back. we are going to look at the middle east. the israeli shekel is extending losses this morning after prime minister benjamin met now to -- benjamin netanyahu called

meetings of ministers. from an economic impact, early elections could not come at a worse time, could they? but that's right. >> that's right. the economy contracted for the first time in five years in the third quarter, largely due to a hit taken because of the 50 year war in gaza. it takes time for tourists to regain confidence they can come here safely. 70 -- 47% of for the economy. fitch downgrading israel's outlook to positive. -- that accounts for 7% of the economy. think they had this in mind. the israeli shekel is touching almost four to the dollar right now. it's at its lowest level since september, 2012. this is good news for exporters,

but the flipside is it is going make importing more expensive. one of the objectives of the current government is to lower the cost of living for israel's middle class. the cost of living is extremely expensive, even compared with somewhere like london. on the plus side, it should be said investors are used to this kind of thing, because this is in for first time the government has fallen midway through its term. i'm sure it won't be the last. >> thank you very much. the israeli shekel taking a beating. the euro taking a beating as well. a fresh two-year low for the euro. let's get back to the u.k. still to come, the countdown to the statement. we speak to the leader of the largest recruitment agency right here in the u.k. about what he expects from the statement and if he is concerned about the direction politics are taking. you can follow me on twitter.

♪ .

>> welcome back to "on the move." i'm jonathan ferro. 30 minutes into the trading day. this is how things are shaping up. dead flat. activity in the dax, though, up .01%. a decent move in the euro. down to a fresh two-year low. the move to the fx market to watch and manus cranny as well. >> it is tied up with foreign exchange. specifically the movement in the ruble. analysts are reconsidering their overall position. we have barclays.

they said the earnings will be hit by a lower ruble. they cut the stocks to equal weight. 1.1 billion yearos worth of revenue. how does it translate to the numbers? it could cause a hit of 10 million euros. 80 million in 2015 to the bottom line. metro down 6.9% at 1561 again, more concern about russia. this is a cash and carry business. a retail business. jpmorgan morgan concern about local foreign exchange margins in russia. full-year sales are not this question. that's one to watch there. ladbrokes.he

2015. they continue to see further operating progress. >> those are three strokes to keep an eye on. london there is only one man to watch today. george osborne. time to get a map is shot of one of the most critical ssues. paul, good friend of the show. thank you very much for joining us this morning. >> let's talk about the gloom in the rhetoric. the g.d.p. numbers. this is a pretty strong backdrop.

everybody is concerned about the election next year. as a his leader, you see many an -- as a business leader, election. y an >> there is no real clear look at what the outcome will be. from a labor standpoint it is not clear what the policies will be. i think it is a little bit more uncertainty about the u.k. elections that we have seen in the past. the thing is we have strong economic growth. the further you muff away interest london, we have recovery stories in small businesses across the u.k. >> the missed budget deficit targets because of tax receipts lower than expected. people talk about the low wage job recovery. is that what you're seeing at hays? >> we don't do blue collar jobs. i can only talk about the

professional jobs. 2013 was about companies being more confident and looking to higher more people on interim contracts, temporary contracts. 2014, we see a lot more professional candidate confidence. we saw wage inflation. now we're seeing recovery in the professional space across the whole of the u.k. the really nice, interesting ing y sa lot of it is coming from smaller companies looking to spend more money and hire more people. >> you're one of the first executives to come on this show and talk about turning the u.k. economy. almost two years ago now. a lot of people are talking about slowdown in europe. is that impacting what's happening here in the u.k.? >> no. i'm not sure it will. the recovery is stalled a bit. our growth continues to be strong in those markets.

i think currently this is about what is the next phase in the recovery across the euro land. if you're in the u.k., you have had a number of years a poor economic backdrop and poor consumer sentiment. what i find fascinating, if you go to a lunch and sit down with 20 chief exis and talk about their businesses, two years ago the u.k. was in the worst countries they looked at. now it is in the top three. they will start to spend on a number of projects. secondly, the revenues will come through. things like copper. it is a forward indicator. it tepids to come in two years ar recovery. i think there are reasons to be cheerful about the u.k. economy. >> today each political party will do their best to politicize the recovery. from an economic standpoint,

what are the kind of policies you want to see from the u.k. government, not just for the next year but whoever is in charge beyond? >> what you can expect is chancellor to do is sort out what the conservative also do if they get back into power. most importantly, set up what they will do on deficit reduction. the key is it will be a continued gradual reduction. i don't want to see large cuts in public expenditures. i think all you can do, the chancellor has done a lot to help small businesses but continued focus on science, i.t. and engineering, support for smaller companies and then third part of it is look, however i put it, we have a skill shortage in those areas. how can get more bright people to go to universities and do those courses and people coming

out with those types of degrees. i know this is controversial you know what? where we need skilled immigration in those areas, can we please accelerate that? these people pay a lot of tax and create jobs. >> let's talk about that. it is a huge political debate. you manage a business. do you foresee an environment where in a couple of years it is going to get hard for those people to get a job in this country? >> the real issue is what will the outcome be of all of this? if you're struggling to get the right prn in engineering to bring somebody from abroad, and of course about 5% of all the jobs we do globally and are in 33 countries, is international transfers. you need to support good companies that want to bring

transfers to the right position. i'm not clear in my own mind what the outcome will be from a political standpoint. some of the countries have a grading system. you have to have a certain degree of education, certain at amount of income. when we bring people into the u.k. in engineering, we're bringing them with firm job offers in place. they need to continue. i think that is fairly different for low skilled individuals. what we need to be careful on is not putting it all into the same bucket. >> when we look at the level of skills those individuals could have, that is the debate now. the u.k. and their position in the e.u. as that debate evolves, for the companies you are speaking to, are you beginning to think about what the u.k. looks like outside of europe? >> i think in many respects, let's have the referendum.

we talked before. it impacts businesses' decisions. the good news is it is irrelevant for most businesses at the moment. two years of business is a long time away. we're focused on the next six to 12 months. i would rather let's have the referendum and get the issue off the table. from a hays perspective, we would rather have a strong u.k. as part of europe. i think that gives us greater opportunities >> let's wrap it all up. the next four years, there is a profit target at hayes. do you accelerate beyond that target? >> i think 250 million in formal years. 250 pounds at the end of the first year rpgs we're well ahead if this year. came out in q 1 and will be

shown in q 2. one of the things hays is much better at than our competitors is for every additional pound we get in our business, we drive a greater business of profitability. good start for the second year. very confident. underlying this, the world voifer continuing to improve and in the 33 countries we're in, 19 countries have grown more than 10% in the last quarter and that is continuing to pick up. >> just very quickly before we go. i believe there is an operating target of 166 this year. on course to beat it? >> on course to meet it at the moment. the beauty of my business, four to five months visibility. at the moment the economy is very important to us in all of our key countries around the worl. >> it is not all bad despite the demroom you here from

politicians. stay tuned to bloomberg. we'll bring you live coverage of the osborne statement. coming up, ruble on the run. oil prices and sanctions could bring russia into recession. we will talk about russia after the break. stay with us for that. ♪

>> welcome back. i'm jonathan ferro in london. this is "on the move." aing currency and sanctions

from the west all major headaches for vladimir putin. the ruble weakening again today. we have seen the forecasts from the economy ministry. shock horror forecasting what everybody thinks is going to happen anyway. a recession. is that inevitable? >> i don't know if it is inevitable but it looks like it is coming. the oil price downtown bode well for russia. we just did a very nice survey that gives us a picturor what is going on inside of the services sector. there is pain that we have not seen really in the last five years to be examine. that is hsbc's p.m.i. survey. we have a contraction. 300 businesses. how business is going. they say it is contracting more than economists thought. said it would be contracting by worse than they have seen since twine. we're getting a picture from the -- since twine. geerting a of the other side of the economy.

how much the world needs russian oil and how much they are prepared to pay for it. that dove tails into what we got from the russian economy yesterday saying that we could expect a recession in 2015. we heard that from lots of other economists. this is the first time the kremlin said we can expect a contraction of 0.8%. up until now they said 2015 looks like the economy is going to grow by 1.2. the last four or five years, everybody has been talking about stagnation. in russia, it looks like sub4% growth. it is still growth. they said our growth may not be great but it is better than yours. that is something they would not be able to do now. look at russian growth going back to 2000, since president putin took power. back in days before 2008, when they had that recession, growth

wednesday to between 4% and 10%. this is when you had jim o'neill for goldman sachs. russia was part of that club. now we're going to go to our second recession in russia according to the kremlin. all bets are off in termses of what that means for mood in that country. >> just quickly quickly, i look at the currency. going lower and lower and dollar/ruble going higher and higher. f you showed me that chart and asked whether the central bank was in this currency, i might say no. >> three things are going to hit 63 in 2015. the russian president turns 63. the price of oil could go to 63 and the ruble doug 62.

less than six months ago we were 34 rubles to the dollar. now we are at 54 and over the last hour we have been moving closer to 55. 623 is not unfathomable. the central bank intervened in the market. they have billions if they want in their war chest. the russian government is reluctant to get too involved. they are concerned this is at a minimum driven by geo politics and also the oil crisis. they think that might be very expensive for them to do. there is thinking in terms of the ruble terms, if they let it slide, they can kind of balance the budget. they said they still need 10 billion bucks to balance the budget that they are going to take out of their war chest but it appears the kremlin and the central prank happy to see the ruble go lower.

>> thanks. the ruble going lower and oil going lower. while low prices are weighing on russia, turkey is seeing a different impact. guy johnson spoke with a finance minister and asked about crude and the effect on the turkish economy. $5 t narrows our deficit by billion. that is a sizable improvement. it will help make it more manageable. reduce inflation and produce growth. what else can we ask for? >> should we assume lower interest rates? >> that will depend on a lot of factors. i think a decline of inflation ultimately would facilitate lower rates but that is not

something that i would like to comment on, that monetary policy. all i can say is that our fiscal position is very strong. g.d.p. ct debt of 5% of next year. clearly we have a very strong fiscal position. if the deficit continues to narrow, which is quite likely on the back of lower oil prices, i think that will make turkey's story more compelling in the growth and rate outlook. >> so the man sitting in front of the turkish finance minister, guy johnson, he is sitting next to me now. a benefit it seems. >> a huge benefit. countries like south africa are also in the mix as well as oil comes down and the speed it has come down has a huge impact on the turkish economy.

it could lead to lower interest rates and higher growth. this is exactly what the administration there has been hoping for. i asked him can you keep a smile off your face? he said no. this is phenomenal. >> it is not just turkey. it is the likes of india as well. they had a huge oil import bill. >> for the bulk of emerging markets, there is a commodity story they are relying on. the decline in commodity prices is a huge negative, but there are exceptions and turkey is definitely one of them and there are others. you think about most markets, there is a propensity to export commodities. that is what countries rely on. it is not a good thing for the emerging markets but for some that rely on huge flows of money in, turkey is one of those that benefits. >> also very interesting in the

u.k. today. >> i think today is about politics. the budget deficit. everybody is excited about a budget deficit in the u.k.. today is not going to move the dial. it is going to be a slow grind. a slow process. if we hear about a balanced budget. great. that is not designed to change anything fund memoryly when it comes to the deficit. it is going to take two terms. we know that. they missed their projection. they will have to deliver more in terms of the cuts. there are going to be significant cuts. >> it is about politics. if you want to bet on george, t is 1-10 that he'll use the phrase long-term economic plan. will he utter those words in his speech today? stay tuned to "on the move" to find out. we are back after this short break. ♪

>> welcome back to move. britain's bookmakers are gearing up ahead of george osborne's statement today. you can take a bet on everything from the color of the chancellor's tie to how his speech is received. >> bript's economic plan is working.

-- britain's economic plan is working. > this year, length of speech, 2012, herattled on for 46 minutes. ast year 50 minutes. one of the old favorites, gorgeous george goes with blue for the tie. e have gone with navy 2-1. >> order. i apologize. alm yourself, man! >> we know mr. bercow loves the

ound of his voice. 2-5 for one time or less. 6-5 for none. i'm not sure about that. i like the 3-1 for three or more. in 2012, it was eight. >> we will talk about the osborne statement in a moment. breaking news in the bond market. italy joins the sub-2% club. the bond drops below 2%. record lows in the market for many bond yields across europe. the euro dropped by .05%. euro/dollar fresh two-year low at 1.2331. big moves in the market to talk about. he u.k. will be dominated by

the osborne statement. stay tuned bloomberg. we will bring you live coverage at 12:30 london time. follow me on twitter. we can talk markets too. ♪ 6

>> osborne's balancing act. the chancellor prepares to deliver his last autumn statement before britain goes to the polls. we will bring it to you live. >> going big on small business. osborne extends the funding lending scheme for another year. >> getting off the ground. a permanent delay holds up norwegian transatlantic expansion. is the u.s. deliberately keeping this carrier in a holding pattern? we will talk about that with the company's ceo.