next up, mark carney and a set of new forecasts from the bank of england. top turnaround. bank misses the mark on fourth quarter trading revenue. stay tuned for our interview with the chief financial officer. tightening policy. rex tillerson wins senate confirmation as united states secretary of state. this is bloomberg "surveillance". i'm francine lacqua in london with tom keene in new york. tom, it is the most interesting day. there is quite a lot of central bank action regarding the b.o.e. and we're in week two of president trump and foreign policy starts to be at the forefront of what markets may have to worry about. tom: you almost rip up the script for the united states today. what we're seeing is way different from what is in the morning papers. all of this about australia and mexico. kevin will join us in the next hour. stefanie in this hour. it is a new script coming off the evening and the president. francine: it certainly is. let's get straight to the news. >> we are starting with foreign policy. president trump is blasting a resettlement deal with australia. it

let's kick off with the bank of england. change anticipated there what should we be looking out for? >> i think you hit upon all the main points, insofar as looking to say to what extent the bank of england decides to revise its growth inflation yet again. they already revised upwards in november, but cut them quite dramatically in the wake of the brexit vote at the end of june last year. yes, they are likely to revise it upwards again, that's after a cut since brexit. since november, when they last revised them upwards, there's been continued positive momentum in the uk economy and exceeding expectations. so q4 growth coming in at 0.6%. and annual inflation at around 1.6% as of december. this, again, was higher than people had been anticipating. governor mark carney said recently that he is willing to look through above target inflation for a certain period of time, but there are limits to how long he would be able to maintain that attitude. one thing we are looking at is will the bank of england maintain its neutral policy

. >> head of the bank of england's first thursday of the suit best will carney blank? >> how would an expected surge in fixed income trading effect europe's biggest investment banks? we get the numbers this hour. >> following facebook's timeline. the social networking giant beats earnings again. the shares plan for new revenue streams. ♪ welcome to bloomberg daybreak: europe. i am anna edwards. >> breaking news. we are going to kick it off with sony. >> sunny cutting their profit outlook two ¥200 billion from ¥270 billion. --y have been plaguing these the movie side of the business. surpriseto monday's 112 billion yen charge against its film business. that is despite continuing dominance in its video games through its playstation gaming consoles. it has been the possibility that aty could cut the outlook the results of the weakness they flagged at the beginning of the week. how much was that already priced into shares, we will see. the moviest between division and the stellar games division has manifested here. >> we have a bit of banking that is one of the themes that

let's cross live to the bank of england, where governor mark carney is expected to explain the bank'spolicy would not be automaticic. the mpcis policy would not be automaticic. the m pc is required to balance a period of above inflation with a period of wea ker of above inflation with a period of weaker growth. this means any overshoot of inflation above tarrings the can only be temporary in nature and limited in scope. as such, the m pc has been clear its tolerance for above target inflation is limited. today's decision reflects the committee's updated assessment of those forces and those limits. the committee has unanimously confirmed the current monetary policy stance remains appropriate. it has also made important have visions to its forecast and highlighted some of the keyjudgment forecast and highlighted some of the key judgment underlining it. forecast and highlighted some of the keyjudgment underlining it. growth has remained resilient since the referendum with the uk posting the fastest rate in the g7 last year. the mppc expects growth to be stronger than in november with the

sterling weakness, the bank of england on hold. stance remains, but we roll over on the pound. elsewhere, it is a weaker dollar story. we have to talk about facebook, crushing when it comes to earnings. some of these numbers are huge. earnings were 7% among -- above consensus. revenue grew 31%. daily active users was up 18% year on year. more people checking facebook everyday and more people doing it on their phones. mobile ads making up 84% of total advertising. facebook warning of potential slower growing in 2017, but those numbers coming in strong. taking a look at mead johnson. getting effort -- surprise bid for $16.7 billion. a potential bidder had been nestle or grupo danone. issues as wet watch into the open. ralph lauren -- stefan larsson who came to run the kind -- company is now leaving. he came from old navy and was supposed to be focused store and help ralph lauren turn it off around, but now he is leaving. this is overshadowing a quarter that was not that bad. the third quarter topped estimates. washington has been larg

also, the bank of england, they will be meeting. want to mention, in this post-brexit economy, we have inflation rising. the question is what will the debate you like -- debate be like from the bank of england ? . they indicate that inflation expectations. .ou can see this inflation expectation going up. rishaad: the thing is, we have the chart up, we're looking at at the moment. to essential is this down sterling and the rapid depreciation after what happened in june? these are base effects, aren't they? cathing: yes, they are, but they are affects that you cannot ignore. economyep the post-brexit. if the economy is rising because of higher export prices, that is the other side of the coin. much.d: thank you so kathleen hays joining us from tokyo looking at the ecb, the bank of england, and the fed. let's get you over to sydney. haidi: president trump has witnessed the swearing in of former exxon eeo, rex tillerson, as secretary of eight. earlier, there was a vote in favor of his appointment. supported the president's view that his

the bank of england has made another significant change to its forecast for economic growth. rise by 2% this year, significantly higher than its previous prediction of i.4%. but the bank is warning that there will be ‘further substantial increases‘ in inflation over coming months. our economics editor kamal ahmed reports. we are still spending. employment is rising. the bank of england cut interest rates... borrowing has become cheaper. today, the governor nodded to the new president and his plans to boost the us economy, all reasons for this significant upgrade of britain's growth forecast. the governor admitted that consumers had shrugged off any brexit gloom. consumers have not been affected by any of the associated uncertainty around brexit. and that is to a large degree understandable. the labour market is holding up, wages are growing at roughly the same rate, modesty, but roughly the same as the past, and in part because of our actions, credit is available and it is cheap. these growth upgrades are some of the fastest the bank has ever published. last november it said g

bank of england raises growth forecast again but remains wary of brexit impact. ank of england governor did not think that things we re governor did not think that things were going to get better after the vote. he is eating humble pie for the third or fourth time now with a raised forecast. it is quite interesting. note the gdp forecast is to draw 2% this year, same as la st is to draw 2% this year, same as last year, up from 1.4%, the hmmfi last year, up from 1.4%, the forecast in november, but the hmmfi forecast in november, but the forecast after the decision to leave the european union was only 0.8%, saw the bag forecast, this is going to be damaging in the short term. the reason is the thought this would affect consumer spending and confidence. what they did not factor into the equation is that when 52% of the voting public think they have got their way the confidence grows. maybe what we have here is people who really believed that brexit was going to be good for their pocket and therefore are spending more money, building up a bit more debt which might not b

the boe conversation, we have a chief economist from north america, many years working at the bank of england. what surprises you most out of this meeting? >> i think it was the extent of upgrade,h upgraded, -- and the shift of the goal post. given the growth upgraded and inflation will be above target for a long time, they should really be thinking about moving rates. the way they avoided that was the sigma we think the sustainable level of unemployment is lower than we thought. what has changed in just three months? it is a puzzle. you can conclude that they do not want to -- vonnie: mark carney said there is uncertainty over rates and it is a news around the bank of england at the moment. >> i think what they are worried about, clearly they have a growth impact of brexit wrong so far and the rate cut they had last august looks like it was not needed, so they should be think about with drawing it. what they are afraid of is if they hike now, growth may outperform all and it looks as though they got it wrong twice and they want to avoid that. mark: is there credibility here, is in germany yo

bank had to say — he‘s with me now. first of all, on growth, this is not what the bank of england itself was predicting. output is good news. there is a bit big question over the quality of the bank‘s forecasts, which are generally highly regarded and important for the financial markets and for all of us to see what is going on with the economy, because in the uncertainties after the brexit vote last summer, the bank came out and said it was downgrading the outlook for the economy this year, 2017, to growth of just for the economy this year, 2017, to growth ofjust 0.8% from over 2%, a big downgrade. november came along and they said it would probably be more like1.4%, a and they said it would probably be more like 1.4%, a bit better. now they are saying 2%. it is in the nature of forecasts to be wrong to assert a degree but that is a big difference and have opened up the bank to allegations they were being excessively pessimistic last year. mark carney, the governor of the bank of england, was asked today what went wrong. i think the thing that we missed is the strength of consumer spending and consumer

bank of england to talk about. the bank of england's -- of 2017.conomists expect them to raise productions. for more, let us go to bloombergs nejra cehic, outside the bank. mark carney, any surprises today? that would be interesting. he does have as always, this delicate balancing act. we are expecting those policies to stay unchanged, but super thursdays today and we get the news conference from mark carney and this is sometimes where some surprises might come through. as you said, what we are expecting is an upgrade to near-term growth and inflation superst, so the last thursday november, the bank of england for cats, 1.4% growth, 2.7% inflation for 2018, and we are expecting those forecasts to be raised. it will be interesting to see how mark carney balances, upgrades the forecast while still maintaining that neutral style, particularly since november. we have had solid growth as inflation is picking up as well even though sterling has stabilized. it was always balancing what was happening at the moment with any risks to the outlook in the futur

there is a reason why people from the bank of england speak in such a measured way. people from the bankof england thought or even slower, that could have huge effect. they very careful. it is also about the tone. it also has to be measured. completely. if you spend that much time looking at all the data right across the country, you are going to be witty measured in how you deliver that. see ya later on. a north yorkshire town that was split in two by the boxing day floods in 2015 will be reunited later today when its only road bridge reopens. up until now, residents in tadcaster could only cross the river wharfe via a temporary footbridge or face a lengthy detour after the grade two listed structure was damaged by winter flooding. breakfast‘s jayne mccubbin reports. all hands on deck. a 13 month, £a million rebuild, nears completion. are we all excited? yes, we are! i can't imagine it. can you, tomorrow, at two o'clock? what has the last 12 months been like? and nuisance, to put it mildly. the yorkshire art of understatement. these are the scenes when the storm hit on boxing day in 201

still the bank of england is keeping rates where they are. johnson. will we see more consolidation? the consumer in the uk will face higher prices and inflation. wage growth is picking up a little bit. not enough to offset the higher inflation, it will get difficult for the consumer, companies providing consumer goods. they will have to be some cost saving somewhere. consideration is one of the strategies companies pursue. let's move on to shell, reporting lower profits, blaming these low oil price. as well as restructuring the business. where is all you're going to go this year? we expect the oil price to be stable, maybe slightly higher as the oil market in general comes to a new balance. we have had a huge fall in oil prices because supply was too high, it demands are not growing as much. setting off a big process of rebalancing. some of it is coming through. the restructuring of businesses, of investment, work platforms, oil production. now that is coming through the oil price has stabilised. the situation is not as dramatic as it was. pro

the bank of england has raised its economic growth forecasts for the next three years. services produced by the economy, will rise by two per cent this year — much higher than its previous prediction. growth has remained resilient since the referendum with the uk prosting the referendum with the uk prosting the fastest rate in the g7 last year. the mpc expects growth to be stronger in the forecast peered than in november with the economy expected to expand by 2% in 2017 than 1.75% there after or around 1.75% there after. this upgrade will lead the level of the uk output around 1% higher over the next three yea rs around 1% higher over the next three years than we had expected in november. this stronger outlook is the product of four factors. in order of importance, they are, first, the chancellor‘s autumn straight eased fiscal policy over the coming years. this explains about half of the forecast upgrade. second, the outlook for the global economy is firmer, reflecting and easing fiscal policy in other major economies together with improvements in financial conditions a

also tonight: once again the bank of england raises its growth forecast. it now thinks the economy will grow by 2% percent this year. the barrister and evangelical christian accused of extreme physical abuse, after grooming boys in the 1970s. six people — including two former hbos bankers — have been jailed for their part in a bribery and fraud scandal. and what happened when donald trump, the former apprentice host, questioned his successor‘s ratings. why don't we switch jobs. you take over tv because you're such an expert in ratings. and i'll take over your job expert in ratings. and i'll take over yourjob and people can finally sleep comfortably again. coming up on sportsday. two days to go until the start of the six nations and home nations teams have been announced. good evening. phil shiner — a human rights lawyer who brought dozens of allegations of murder and torture against british soldiers who served in iraq — has been struck off for dishonesty. mr shiner, a former solicitor of the year, has paid thousands of pounds to a fixer to find iraqi client

the bank of england has been painting a rosier picture of the economy in its latest forecast.sts for the next three years, defying fears last year of an imminent brexit slowdown. interest rates have also been kept on hold at 0.25%. but there are warnings that consumer spending could still slow down, as inflation soars. simon gompertz has been listening to what the bank had to say. he's with me now. growth first of all, forecast to be a lot higher than it was less than a year ago. it is. the bank looks every three months at how well the economy is doing. it is important in guiding policy. it adds to this picture, people have accused it of being excessively grim about the economic prospects after the brexit vote. in august, it said economic growth in 2017 would be only 0.8%, a big fall. in november, it revised it up big fall. in november, it revised it up to1.a%. now big fall. in november, it revised it up to 1.a%. now it is saying it will be 2%. a big change. it has meant accusations that they have been too pessimistic. it came up again today ina pessimistic. it came up again t

today's inflation rate is still below the bank of england target at 296 below the bank of england targete shops, but pressure is coming through the pipeline. prices at the factory gate are up 3.5% and producers passing on the much higher cost of raw materials, up by more than a fifth. also driving prices up isa than a fifth. also driving prices up is a 17% rise in the cost of petrol and diesel. with that come higher transport costs, but the government point out that inflation is still co mforta bly point out that inflation is still comfortably within the target range. i would remind you that the inflation figure announced this morning, 1.8%, is still below the bank of england's target. the bank of england monetary policy committee is seeking to manage inflation to maintain itself at or around 2%. when inflation is at this level, the economy should be working well. the economy should be working well. the economy is growing much more strongly than opponents of brexit predicted, and on financial markets in the city, the next move in interest rates is expected to be up. the market sees a rea

and even, for example, let's take this seriously, someone like christian forbes at the bank of englandnty that had resulted in the negative forecasts, the indicators are flawed and from the bank of england to the imf... inaudible. they have reversed their forecasts for 2017. i have heard what you said, i have reflected whether it answered my question, and i have decided it doesn't at all. didn't the maltese prime minister, mr muscat, get to the heart of this when he said the other day the uk's deal post brexit with the eu must be worse than the terms of its membership. he said we can see no situation where whatever is negotiated ends up being better than the current situation that the uk has. that's where the eu's position is today. you've quoted the maltese prime minister and i'm quoting to you the german finance minister. if you want to play quotes, i can quote you francois hollande, who has consistently said the uk is going to pay a very high price. francois hollande will not be in the elysee when we do the negotiations. but look, you're quite right, there is a range of different vi

the bank of england cut interest rates... borrowing has become cheaper. he new president and his plans to boost the us economy, all reasons for this significant upgrade of britain's growth forecast. the governor admitted that consumers had shrugged off any brexit gloom. consumers have not been affected by any of the associated uncertainty around brexit. and that is to a large degree understandable. the labour market is holding up, wages are growing at roughly the same rate, modesty, but roughly the same as the past, and in part because of our actions, credit is available and it is cheap. these growth upgrades are some of the fastest the bank has ever published. last november it said growth for 27 team would at 1.496. said growth for 27 team would at i.4%. that figure has been raised for 2%. the 2018, it originally said growth would be i.5%. that has also been increased, more modestly, to 1.6%. mixed in with the good news, some caution. for this food firm in kent, inflation is on the up, driven by the fall in the value of sterling. the price of goods that n

bank of japan held steady, the bank of england the next day. of 2000 to about the beginning -- were and of 2015. look at the yellow line. the fed starting to raise rates, the bank of england cutting rates. the big move they made last summer. actually turning the key rate of it negative. i don't think we will see much divergence right now. bank of england on thursday may have a debate about when their move will eventually come. >> in tokyo for us, it will be a big week. latest check of the business headlines. but airline indigo plans to further increase capacity despite a 5% drop in quarterly earnings. the equivalents of $70 million the last quarter. analysts were expecting an increase. failures dropped 16%. it is matching competitors on ticket prices. the most ind fell november after fourth-quarter revenue missed analyst estimates. earnings increased 10% from the year earlier to $2.76 billion. the company said it stronger dollar affected results in europe and revenue may be hurt as it spends more on rebates and incentives. they expect revenue g

the inflation figure announced this morning, at 1.8%, is still below the bank of england's target. to manage inflation to maintain itself at or around 2%. so, when inflation is at this level, the economy should be working well. it is worth remembering we've been through one of the tamest periods for inflation since the 1960s. the price of food overall is down 2% on two years ago, and if you take vegetables, like potatoes, down by 4%. the key question is, with petrol prices rise by 17%, when will these prices start to go up again, and will our wages keep up? in a report to be released tomorrow, the anti—poverty charity thejoseph rowntree foundation fears they won't. all over the country, people are really struggling right at the moment to make ends meet. theirfuel prices are going up, theirfood costs are going up, their heating bills are going up. and, if we see this increase in inflation keep going, we predict we could cost rises of nearly 10%. that means we could see almost 4 million more people tipped from just—managing into poverty. hello, this is sport today, live from the bbc

normally interest rate is the tool for the central bank, but mark carney, the canadian bloke, the big boss of the bank of englandation even above the target of 296 inflation even above the target of 2% for a little bit before triggering any interest rate rise. given that inflation is driven predominantly by the drop in the pound, then yes, he has said they will look through it to some extent, but he has also said there is a limit to how much they will look through it, so everybody will be looking to see, are they caught in a difficult position with prices picking up? in the meantime, this is extremely busy, because you have the central banks but also so many earning stories coming in, and we will hear from the shall boss later, astrazeneca, facebook, there are many, but what has caught your attention? deutsche bank, the loss wasn't quite as bad as perhaps it has been previously, and everybody has been previously, and everybody has been previously, and everybody has been focusing on the fines and everything they have had, they are trying to draw a line under that. the question now is how the banks will make money

the bank of england has made another dramatic rise in its growth forecast for this year. recast made in august. growth has remained resilient since the referendum, with the united kingdom posting the fastest growth in the g—7 last year. we expect the economy to expand by 2% in 2017. 1.75% thereafter. or around 1.7 5% thereafter. this will leave the level of uk output around 1% higher over the next two years than we had expected in november. joining me now is lucy o'carroll, aberdeen asset management's chief economist.ucy, why did they get it so wrong? they thought in the face of uncertainty, consumers would rein in their spending and start saving and actually they were unabated in their spending. they kept on spending and that's probably the main cause. what about inflation? it's been creeping up. howfardo about inflation? it's been creeping up. how far do you think it will go? it looks like inflation could hit the bank's 2% target as early as february and then rise quite considerably above 2% for the rest of this year. it's hard to judge because a lot of it depends on cur

the bank of england says the economy will grow by 2% this year, more than twice as fast as previouslyht. forecasts failed to factor in continued strong consumer spending. the government has set out its vision for the uk outside the european union. in a white paper it says britain can become "independent and truly global." labour says any deal on brexit must be properly scrutinised by parliament. an inquest has heard how the fiance of carly lovett, a 24—year old woman killed during the tunisian terror attack of 2015, tried to save her life. ms lovett was among 38 people killed in the attack in the holiday resort of sousse. in a moment it will be time for sportsday but first a look at what else is coming up this evening on bbc news. at 7pm, we'll get all the details on the latest news relating to donald's trump's presidency in our new programme, 100 days. at 8:45pm, jim naughtie is talking to the bestselling author sophie kinsella about her new book my about her new book my not so perfect life. and at10:1i0pm, we'll be taking a look at tomorrow's headlines with the times columnist matth

the interest rate decision from the bank of england at 7:00. tomorrow is the jobs report. >>> going back to the top corporate stories. facebook's fourth quarter earnings beating forecasts as revenue rose better than expected 51%. mobile accounts for 84% of facebook's total ad revenue versus 80% a year ago. 1.86 billion average users, up 17% from a year ago. on the call, mark zuckerberg said he expects to ramp up hiring and spending this year as facebook invests in more video. >> we're looking for ways to grow the ecosystem of video content on facebook. we want people to think of facebook as a place for interesting and relevant video content from professional creators as well as their friends. last year we started to invest in more original video content to help feed the ecosystem, and we're plan doing more in 2017. >> yesterday we found out that a jury ordered facebook's virtual reality unit oculus and other defendants to pay a combined half billion dollars to a video game publisher over allegations that facebook stole its technology. it is said

and we have super thursday tomorrow, lots of information from the bank of england. n't know, they are live in the states. go to the website! three women and a man who sold hundreds of dogs kept inside cages on a farm have been spared jail. the group advertised the pets — which they sold to unsuspecting members of the public for an average of £450 — as "home—reared". they handled about 750 puppies as part of the "sophisticated enterprise", which was worth up to £500,000. our correspondent ben ando was at basildon crown court, and has more details about the case. it was back in 2014 that the rspca first started receiving a lot of calls from people complaining the puppies they had bought as home reared from houses in these london we re reared from houses in these london were falling sick, and in some cases dying very soon after they had been purchased. they launched an investigation, and they traced the puppies back to eight puppy farm on a traveller site in essex. they arrested theresa wade, victoria montgomerie, her daughter roxanne montgomerie, her daughter roxanne m

policy baton passes to the bank of england. e bloomberg school of economics' kathleen hays has been watching what the fed is saying. >> the fed made one small sentence to indicate it is watching what has happened since donald trump was elected. one of the most obvious signs to businesses and consumers, his intentions to cut taxes and spending. he moved quickly on trying to. let's remind everybody that the key rate is unchanged. increased until the end of this summer. the fed can send signals if it wants to. "measures of consumer and business sentiment have improved of late." on consumer confidence. the middle line is the main index. of top line, expectations the future leading the pack. donald trump is having an impact. bloomberg intelligence wraps this up, saying the fed chose not to rock the boat. they don't want to send any premature signals of any change. they are getting ready to hike later in the year. yousef: with a slave that strategy aside for the moment. le tus leave that strategy aside for the moment. we haven't heard

that is the role of the bank of england to tell us when the banks, individual banks are in some difficulty difficulty, or might be in some difficulty, in terms of the new capital rules that were introduced after all the problems of 2008. but the problem with the co—op bank, some of us have a lot of time for it and its customers, as far as we can see, this talk about the excellent service, the customer service they get, is the brand, the co—op bank brands, the perception of the co—op bank, suffered enormously in 2008 and various other personal events closer to the former chairman since. and for a bank to recover its image, it's perception is immensely hard, ask rbs. sure, but those who are with the co—op, they see it as vital to why they bank with it. i interviewed a guy this evening he was saying, look, there will be ta kers was saying, look, there will be takers out there who have the same ethical responsibilities and the same ethos as the co—op. if not, then sell it to the customers themselves, which has happened before in france. i should think the co—op's bank 4 million customers are i

the central bank that we deemed the least amount of spare capacity in the economy and therefore would have to expand -- respond as quickly, followed by the fed, followed by the bank of englandat the bottom of the table was the rbnz in new zealand and the bank of canada and the swiss national bank. anna: we'll talk more about the fed and the bank of england in a moment. you mentioned the russian ruble. there was a lot of excitement if that is the right word around russian assets at the end of last year because of the nascent trump policy and what we knew at the time about a rapprochement between the united states and russia. things are little hazy on how much that will take place, and does that hold a great deal of value in terms of where the russian ruble goes? right, and looking at what i said a month ago, the currencies that would be stressed, and the ruble would be in their. when we model it just on oil, we are overshooting. trump-putin is the story. the balance of risks are beginning to go the other way in terms of the movement for the russian ruble. anna: thank you very much, derek. coming up on the program, the the cleveland, fed president tells us the u.s. cannot wai

we will know more about fiscal policy and the economy performing. >> that bank of england's decision drops now. rates unchanged. , we remains points at 0.25%. the program stays on hold at 435 billion pounds. in the corporate bond buying program, both of which are set to end by the end of this month or at 10 billion on target. >> comedy ways can you stay neutral without actually staying neutral. mark carney said that the next move in rates could even be up or down. theyis in line for what were saying in november. if you were looking for any signal on where the bank of england i go next, mark carney was very resident -- reticent. >> i think it was the extent of the growth rate from 1.4% to 2% this year. the shift of the goal posts, because given the growth upgrade , the inflation is going to be above target for a long time. they should be thinking about moving rates. theway they avoid that was sustainable level of on employment much lower than what we caught the four. they changed that judgment in three months. they just want to hike. >> at the same time, on the other side of london, to

the bank of england lowering its natural rate of unemployment. you buy into that, a cold currency war erupting? >> i'm not sure i do. sterlingion you had in is really a brexit effect. it's completely change from the last 40 years. i don't think it is a policy manipulation. it crash priced? >> i would question that, simply because political uncertainty is something the currency markets hate. wasould be remarkable if it as smooth as some have said. if you get those difficulties in negotiations, starling could fall further. anna: stay with us here on the program. manus: we will an exclusive conversation later in the day. 7:40 u.k. time. this is bloomberg. ♪ anna: a very warm welcome back to "bloomberg daybreak:europe." yen,ollar against the 112.27. let's get some breaking news, coming in line with estimates. you could say new drivers of growth to offset declines, the paris-based company counting on you there pe to replace falling revenue from its best-selling insulin products. expected regulatory decisions for drugs to treat eczema and rheumatoid ar

the bank of england has revised down their view of productivity.t this is simply because they now believe that people want to work more hours per work. there was a view that in some cases, people were working very long hours to make ends meet. the bank has changed its view. overtime, productivity growth will be lower. that is interesting. if we are having the debate here in london, the u.s. is in the lead in is as. what we are seeing there will come through our policy as well. you, t well david -- thank david so much. john williams joins bloomberg later today. you can catch them all bloomberg markets at 6:30 p.m. u.k. time. anna: coming up, we will go live to malta where eu leaders are gathering for an informal summit. manus: we will continue to preview today's jobs report, the first under president trump's tenure. parenthe snapchat company is filing for its ipo. this is bloomberg. ♪ manus: it is 2:20 p.m. friday afternoon in hong kong. quarter seng is down a of 1%. chinese stocks are lower today and the central bank is making more moves to tighten

the bank of england has made another significant adjustment in its growth forecast for this year, it ed to grow 2% in 2017, up from a november forecast of 1.4%, despite last year's fears of a sharp slowdown after the eu referendum. interest rates have also been kept on hold at 0.25%. but there was a warning from the governor of the bank of england mark carney that productivity and wages could still be lower because of the referendum result. this stronger projection does not mean that the referendum is without consequence. uncertainty over future arrangement is weighing on business investment which has been flat since the end of 2015. business investment is expected to be around a quarter lower in three years than projected prior to the referendum with material consequences for productivity, for wages and for incomes. with me is our personal finance correspondent, simon gompertz. 0n growth, what should we read into that? good news, it is expected the economy, our national output, will grow by 2% this year and that is higher than the bike was saying before. the question is whether the r

the bank of england has raised its productions for growth, the third time says the referendum. fficials are warning that the process of leaving the european union could cause medium to long-term damage, but the forecast for 2017 is looking rosy. to do away with the bank ofjitters, england raised its growth outlook for 2017 for the second time in three months. the bank had doubled his august forecast to 1.4% in november and expects the economy to grow by 2% this year. markets initially braced for the worst after the june referendum, but the u.k. has been doing better than expected. in economy expanded by 0.6% the last quarter of 2016, one of the strongest growth rates in the world. yet the bank of england warns its revised forecast does not brexit end o ff the effect. >> it does not mean the referendum is without consequence. uncertainty is weighing on business investment which has been flat since the end of 2015. of gdp isly the level expected to be one point 5% lower in two years time than we had projected in may. reporter: the bank kept interest rates which had been cut for th

if you were looking for any signal on where the bank of england will go next mark carney , was very reticent i think it was the extent of the growth rate from 1.4% to 2% this year. then the shift of the goal posts, because given the growth upgrade and that inflation is going to be above target for a long time, they should be thinking about moving rates. the way they avoid that was the sustainable level of on employment much lower than what we thought before. they changed that judgment in three months. they just don't want to hike. >> at the same time, on the other side of london, towards westminster, the houses of parliament, has been the brexit secretary david davis presenting the brexit white paper. the takeaway of that, 75 pages long, financial services, the u.k. seeking trade with the european union. and for the right of eu citizens to remain within the u.k., the u.k. is looking for a reciprocal deal with its european partner. pretty much follows the 12 points that theresa may set out in her brexit speech last month. they provide more detail and also reiterate that slightly threatening t

anna: i know the bank of england has said they will look through the weakness of the pound, but someit does stick, doesn't it? it means people who were importing stuff, buying imported products, you are feeling the effects of that inflation. it's going to have an impact. >> it does. the other side of that is due retailer margins get squeezed? you look at the market share of things like discount supermarkets, probably it goes up. the last time inflation was very high, following the financial crisis, that is what happened. margins went down for retailers and market share for discovery tellers went up. manus: there is one thing for sure -- we are going to pay in the end. anna: it's what happened to ex-ceo, the supermarkets would put the price is up. manus: let's talk about the bond market. there is one theme running through, and it is talking about u.s. yields potentially rising. u.k. yields have not really priced in the potential of a referendum. m-line was looking at it in the negative, the spread of being the why this in history between u.s. and u.k. this is u.s. over u.k. do you see

bank will be moving in the same direction. of course, we're all looking at the same sort of things and that's rising inflationary pressure. we've got the bank of englandwe've got the fed today, but also, you know, while the central bankers are meeting with their teams and making decisions on the cost of borrowing, all these companies are reporting their earnings. what picture are we getting?|j reporting their earnings. what picture are we getting? i think we're getting a reasonably positive picture out of companies and out of the so—called macrosignals at the moment and people are obviously worried for instance in the uk about the impact that brexit will have, but the real economy has done far better than you were being told on your programme six months ago and the united states is picking up momentum at the moment. that's clear. it's going to grow faster this year than last year and even the european union, it is an under achiever, but growth in the european union is going to be a little bit faster in the coming year than it was last year. so a better background for companies and their reporting season will be, i think, quite reasonable. richard, tha

further out the bank of england is predicting inflation will hit 2.7% by the year end. the reasons. what are the most powerful forces here pushing inflation up? in the short term, the inflation figures are not to worry and, although the uptrend has been very steep, the baseis uptrend has been very steep, the base is quite narrow. we are having the effects of energy price declines last year, so base effects and of course the effects of sterling post—referendum depreciation. that is pushing up raw material prices down the supply chain. these other categories, energy and food predominantly come about driving the inflation headline. core inflation is still fairly tame. there is an avalanche of consumer price pressures down the supply chain. the effect of raw materials are ready causing manufacturers and vendors, transportation service providers, to push up prices. we also had the producer price index today, which showed factory prices are rising by a whopping double digit to 20%. when you come home —— compare that with 1.8%, there is more coming down the pipeline. that 2096,

--o not think policymakers if you look at the bank of england today, they basically said we do not knowet's wait and see. i think it is half uncertainty, and everybody has got to calm down and say sensible things instead of suddenly deciding you will be at war with australia. mark: is the year of the central banker over, danny? danny: i don't know cured i think mark was probably wrong on that one. if we see fiscal authorities taking over and taking some of the strain away, then we will get some advantage, which will be that central banks will start rates, which will be a really good thing to do because when the shock comes along, at least they will be able to cut them. i would certainly be in favor of a big central boost that allows central banks to get out of town . they are not the ones driving everything. and raise rates. but i think we are a long way away from that, certainly in the u.k. vonnie: danny, with all the changes in regimes, if you like, 12 monthsifferent from now than it did 12 months ago. do you see that they will give the responses that you have been calling for for all

would remind you that the inflation figure announced this morning, 1.8%, is still below the bank of england'smittee is seeking to manage inflation to maintain itself at or around 2%. when inflation is at this level, the economy should be working well. the economy is growing much more strongly than opponents of brexit predicted, and on financial markets in the city, the next move in interest rates is expected to be up. the market sees a real possibility rates may have to increase before the end of this year. very much a reflection of the fact that economic activity has been so strong coming into 2017, and the consumer has held up relatively well. until recently, price rises for consumers were tamer than they had been since the 1960s. the price of fish, for example, is only back to where it was three years ago. so far, consumers have been shielded from higher costs, but inflation above the 2% target now looks inevitable. andy verity, bbc news. the car—maker vauxhall could be taken over by the french company, peugeot. the parent company of vauxhall — the american car giant general motors — is ha

today's inflation rate is still below the bank of england target at 2% with prices rising 1.8% in thehe pipeline. prices at the factory gate are up 3.5% and producers passing on the much higher cost of raw materials, up by more than a fifth. also driving prices up is a 17% rise in the cost of petrol and diesel. with that come higher transport costs, but the government point out that inflation is still comfortably within the target range. i would remind you that the inflation figure announced this morning, 1.8%, is still below the bank of england's target. the bank of england monetary policy committee is seeking to manage inflation to maintain itself at or around 2%. when inflation is at this level, the economy should be working well. the economy is growing much more strongly than opponents of brexit predicted, and on financial markets in the city, the next move in interest rates is expected to be up. the market sees a real possibility rates may have to increase before the end of this year. very much a reflection of the fact that economic activity has been so strong coming into 2017, a

charlotte halled to shake things up at the bank of england. y be a candidate to succeed the governor, which would make her the first woman to hold that role. she will become deputy governor of markets and she starts her job next month. the agreement gives her the widest powers of any of mark carney's equities, two years before she plans to depart. let's bring in jeremy on the great debate on the bank of england. may have ake a woman pretty powerful position. she was brought in by carney, deputy governor or governor in the making? fans, as youlot of said, she was brought in to shake up the bank. as far as the voting record, we don't know how she will sit yet, but she's replacing someone to do not vote apart from governor carney at all. there's a possibility that she's we see.centrist that it will be interesting to see. we are about to hear the hawkish lamb or rise a bit more aggressively. is because of sterling. >> it absolutely is. the market can be a little overexcited by the speech last week. she's not voted for a rate rise and she will proba

thefed gives little away on brakes as janet yellen awaits trumps policy impact. >> head of the bank of england'sday of the suit best will carney blank? >> how would an expected surge in fixed income trading effect europe's biggest investment banks? we get the numbers this hour. >> following facebook's timeline. the social networking giant beats earnings again.

the bank of england left rates and qe unchanged yesterday. raded its economic that somend revealed policymakers are more concerned about inflation. governor mark carney said the central bank is ready to respond to surprises. determinant of the u.k.'s medium-term prosperity will be the new relationship with the e.u. and the reforms that it catalyzes. these processes will have a significant bearing on inflation. francine: let's bring in moritz kraemer. he's in frankfurt. joining us in london, stephen booth. moritz, thank you for sticking around. what is your take on brexit? how can the u.k. make aches success -- make a success of this? moritz: the brexit hasn't really happened. that is important to remind ourselves. so far, we see the sunny side of brexit. you have monetary stimulus, soft peddling on the fiscal side, and weakening sterling. think the negotiations would be very difficult. they will be difficult early on. after setting the general framework of negotiations over the summer, you will see the discussions starting on the settlement. a

the bank of england has said that it will keep the £5 polymer note in circulation and issue a new £10those figures on employment and wages. they give us an idea of what shape the markets are in. the rate of people in employment hit an all—time high. the proportion of women in work reached 70%, the highest it has ever been. joining me now is gerwyn davies, labour market analyst from the chartered institute of personnel and development. good to see you. unemployment maintaining at that record low. the news, right? yes, it offers further good news for employment in the uk. employment is growing, albeit at a slower pace. this is no mean feat given that we have seen very sharp increases over the past couple of yea rs. if increases over the past couple of years. if rouble are watching throughout the day, they might hear the comparison made between the rate at which wages grow compared to inflation, and that is important. that is significant, isn't it? this is the worrying aspect of the figures. we have seen wage growth come—down from recent rates of growth, which are consistent about predic

there have been discussions and leaked comments last week from the bank of england talking about movingtion to brexit? there is a lot of areas that we have to look at but we have to remember that in the us, in the uk and in the eurozone to a certain degree, economies are improving. we will skirt over the - marriages in will skirt over the gay marriages in the church of england because we only have about one minute to go. vitamin d can prove to prevent your risk of catching a cold and flu. how often do you go on holiday to a sunny climate? once a year? it takes a few weeks for the vitamin d to benefit your body. you need to go more often. what the story actually saysis more often. what the story actually says is that we should be putting vitamin d into food and slipping it into food so we don't get so much cold and flu and of course the big buzzword which is relieve the burden of the nhs. who knew that living in a sunny of the nhs. who knew that living in a sunny warm of the nhs. who knew that living in a sunny warm climate. along, you don't get so many colds and flu is. i very rarely ge

lauren: bank of england decision today. akness after reporting a full-year net loss to help current telecom stocks under pressure. dax down the quarter of 1%. but you have the cac squeaking out again fractionally higher and that the u.s. fractionally higher earlier and now it's up a quarter of 1%. nicole: apple cap and out of positive territory. three days of selling. 246 points. yesterday the dow gained 27. back in the right again. dow futures looking at 61. s&p futures and seven. nasdaq futures on 20 and tomorrow is the monthly jobs report. lauren: oil at a prayer this morning at 40 cents at 54 and 20 the barre nicole: a look at how the dollar is faring against other key currencies this morning. weakness of the dollar moving to levels from last year. the europe from the u.k. pound, mexican peso from the japanese yen stronger against the greenback. facebook continues its impressive growth of the company earning report after the close yesterday showed a jump of nearly 30% of revenue per user in the fourth quarter. last year