when the u.k. really needs is an industrial strategy -- what the u.k.y needs is an industrial strategy. but the prime minister does not think a strategy like that is necessary. >> we have called for a green transformation strategy that creates that attractive package, turbochargers production. that wider strategy is important, something we have called for previously. we are grateful for this new investment. it is important. it is essential that we build on that. christian: 500 million is a lot of taxpayer money, but if it will bring in 4 million to the wider economy, that is money well spent -- 4 billion, that is money well spent. >> ends this is an opportunity to anchor further production within the u.k. we are already seeing other companies make big commitments to the u.k. for instance, electric and production will be taking place in northwest other manufacturers are investing in factories in the northeast. there is a real opportunity to build not just on the jobs that currently depend on that for production, but also the totals. 800,000 jobs currentl

what does that mean for the u.k.? do they not go in u.k.? when it comes to gaming, the u.k.s worth paying attention to. all kinds of forces come together. we will get ed ludlow's take later in the program. let's get back to what we have been discussing. the tone was set in the u.k. earlier. we were expecting wage growth to fall but data this morning spoke to get cooking up a bit. you heard from the chancellor and the governor of the bank of england talking about the need for wage moderation last night but we are not seeing that. the u.k. is starting to see this becoming a reality. today's data maybe speaks to that. the issue around this is are we going to be seeing this continuing? this chart is interesting. what you've got is cpi, which we will get next week from the u.k., and wages, the blue line. if those two cross, does that take end of the sales of the idea that wage rises will continue? at the moment, have got below inflation wage rises, but if inflation drops below wages, does that mean labor can no longer ask for a higher wage and wages will start falling? it will be

a lot of attention on the u.k.'s. the u.k. -- the u.k.'s situation. the u.k.'situation is the closest we have seen to a fiscal dominant story. i almost wish they did a stability report on government spending. right? the amount of gilts the u.k. government has to issue in the next few years, the amount of spending that they opened up over covid, and they have not necessarily drawn back on it. we get all these comments that tax cuts might be on the table and it comes to the budget later this year. a lot of speculation over whether the sustainability of interest rate payments of the u.k. government might cause some problems soon. dani: rishi sunak has been on the campaign trail basically saying no, no, no, taxes are not my priority, tax cuts, it's this inflation battle. certainly top of mind for everyone. that is valerie tytel. for more of the top stories that you need to know, and go dayb on your bloomberg terminal. that is the daybreak page, leading with that cyberattack i mentioned today. coming up on the program, the strengthens through 1.40 as bulls bet on a

u.k. prime minister rishi sunak loses conservative seats in parliament dared will break down the results. i will break down the results for earnings hitting the tape. it is a beat for the second quarter coming in at just over 7 billion norwegian krone. the estimate was for 6.9 so that is a slight beat. revenue also beating coming in at 53.6 billion and estimate was for 48. the good news is they have increased their 2023 guidance on fx and inflation. they will be spending more. good news for making poor projects but is that bad news if you are worried about cost? it is about the fx story and the inflation story, considering what is happening with the norwegian krone and the central bank in the risk of it getting left behind. second quarter adjusted net income coming in at 3 billion norwegian krone. the estimate was for 3.3 billion. overall, that seemed like a beat they are facing macro headwinds of fx and inflation. we will be speaking later this morning with norsk hydro's chief financial o

u.k. time, followed by the press conference at 1:45 p.m. u.k. time. have a slew of interviews to bring you throughout the morning. we will speak to the shell ceo, and don't forget our conversation with the volkswagen ceo, coming just after 8:00 a.m. u.k. time. also we will speak with the mercedes ceo. of next we have markets today. this is bloomberg. ♪

u.k. time. coming up, if surprise from governor ueda. what does bank of japan policy change mean for market? this is bloomberg. ♪ lizzy: welcome back to "bloomberg daybreak europe." the bank of japan has halted financial markets after announcing a tweak to its long-term yield curve control policy. governor kazuo ueda's first surprise move is sending japanese banks surging. joining us now is mark cranfield for more. the boj is front and center today. break down the significance of this move for us. >> one of the ironic things is he's the only central banker this week but did not that he was data dependent. that is exactly what he has done. he put japanese bond market on a path to data dependency. it is confusing about what they are saying but essentially, we have a new limit for japanese yields at 1% rather than 0.5% which we had before today. depending on how the data goes, japanese yields, if the data stays strong, japanese yields will gradually work their way towards 1% target. it seems like a

u.k. inflation day that today is expected to show a drop in headline rate but core cpi is unchanged. the ble will need to raise rates again. shares morgan stanley and bank of america jumped after better-than-expected second-quarter results. attention turns to goldman sachs and attention turns to asml. it is a beat for their second-quarter booking for the chipmaker coming in at 4.5 billion euros, the estimate was for just under 4 billion euros. third quarter net sales, these are the estimates. they are seeing it higher on the high-end. the estimate was 6.5 one million euros for the third quarter net sales. as the low end of their estimates. the high end is 7 billion. the one disappointing thing is the gross margin for the third quarter. the forecast was 50% in the estimate was 51.3% perhaps costs are going to be an issue for them going forward, but at least for this quarter, they did have a better gross margin. the gross margin was 51.3% in the estimate was 56 -- 3.6%. overall, as i mention

why is inflation falling in the u.k.?etary policy is doing its job or is it following because of other factors on the supply side? bruna: only about one third of monetary policy tightening has hit the economy. the simplest way of explaining this is to say that if you go to the bank and you want to take out a two year mortgage, the rate you will be quoted will be 6%. if you actually look at the average mortgage rate and the outstanding mortgage debt in the u.k., that rate is at 2.6%. we have to go from 2.6% to 6% for the impact of monetary tightening to be felt globally. there is a long way to go and that will be a drag on the economy and inflationary pressure moving forward. what is helping for now is energy prices are falling so we have energy falling sharply and global food costs have fallen as well and that is finally translating into lower food inflation. it is those drivers helping at the moment. monetary drive has yet to be felt in its full impact over the next 18 months. ed: -- guy: you wonder how the bank of engla

the u.k.n acquisition. threads could add $8 billion per revenue --per year in revenue for the next years. and partnering with microsoft word a multibillion-dollar partnership, to incorporate generative ai into its business. we sit down with the kpmg ceo. melissa checked the markets with abigail doolittle. abigail: we do have the s&p, nasdaq and other indexes higher but we are off the highs. 1% on the cooler than expected inflation report. yields lower, helping socks in terms of a ration perspective. look less expensive, especially true for big tech such as nvidia and microsoft. big tech names that have been under pressure earlier this week on the upcoming special nasdaq 100 rebalancing are getting a did. showing on the commute kitchen services sector on the year, the second-best sector on the year up about 37% and a couple of the names helping out today. meta, threads, the competition to twitter is getting a boost. some analysts think it could be a significant revenue booster for meta. alphabe

u.k. jobs data will hit in under an hour's time, really will go to whether the boe will do another jumbo rate hike. andrew bailey said yesterday inflation will come down rapidly. we will be getting germany's survey at 10:00 a.m., the last was pretty dour considering germany did into recession in the winter. finally, the nato summit will be continuing. i think the u.k. jobs data is gonna be so important because bailey seems to say that inflation will be coming down but if that comes in hot, the market is not going to believe them. kristine: exactly. interesting timing to be making those comments, especially on the eve of another important jobs data. we've seen time and again the bank of england really getting surprised along with the rest of us in terms of how hot inflation has been. he already is coming into this with a little bit of a credibility problem for the boe. in my view, it's quite interesting that he is still on this idea that inflation will pull back. i think we are seeing it pu

>> this was a big deal for the u.k.. the u.k.y wants to show it can compete with the global giants in the most hyped area of . that it can be a leader geogteraphicchally and intellectually when it comes to artificial intelligence. they are holding the presidency this month. they wasted no time putting on the security council meeting. i spoke to the foreign secretary before the meeting started. i started off by asking what the point of the meeting was, when he was hoping to achieve. >> ai will have an amplifying effect and accelerating effect on all things we currently use technology for. it can be used for good, medical research, climate change, analyzing big data sets. there are also potential maligned uses of ai. we are saying at the un security council we need to work internationally to understand the risks to look to mitigate the risks and put some structures and regulations i place. it can only go internationally. >> give an example of what you think is maligned. >> the use of ai for weapons. just as ai can be used to develo

>> here in the u.k.have a sets of legislation inlace, we have a growing responsible ai ecosystem. the u.k. is positioning itself to be the place for responsible ai, design, develop and, research. those pieces can be in place if we have the right tools, we have the right commitment to policy change, and we have public engagement and involvement around these questions. right now what we see out of the white house is a set of commitments of companies is saying they are willing to mark their own exam papers and they are willing to set the exam themselves and they will decide the morning of the exam if they want to show up for it. lewis: right. gina: it's a plea doesn't go far enough in terms of giving public assurance -- it simply doesn't go far enough in terms of giving public assurance for the things we need to have in place for the kinds of ai we are using today that is powering our banking systems, health care systems, our smartphones, and yes, our bbc player. lewis: ok, let's talk about specifics here.

in the u.k.uel: europe is always a trade. phone u.s., trade europe. central banks are in a tricky position. the fed and ecb have to hike. china might help part of europe. i believe the case to diversify away from expensive, narrow u.s. markets plays for international equities. i can see europe performing. guy: europe is a china trade. that is the takeaway. forget everything else. emmanuel: europe is a china trade. it started with china reopening very quickly when data started to disappoint. we've seen domestic data on pmi's disappointing as well. i feel for sentiment to be more cheerful in europe, people need to be shifting. you need to see global cyclicals , the china catalyst to come back for this part of the market to attract again. alix: that was a nice way of saying yeah, kind of. appreciate it. the bank of canada governor speaking now. we think we are close to the end of the tightening cycle. also pausing interest rates in january did make sense and they are trying to read the balance betwe

it is driving the pound, driving the u.k. two-year and the u.k. property sector.toxx 600 up by .2%. ftse 250 outperforming. persimmon, i could've picked a number of names, of nearly 10%. the market is reassessing with this lower inflation number how far the bank of england is going to have to go. are we going to get to 7%? the market does not so anymore. the owner of luxury brand gucci, the management team is being changed out significantly, but there is no this idea that has been driven by a number of activists that kering need to potentially merge with rewshaw. there is a fantastic story on the bloomberg talking about the idea that maybe kering is for advice, defense advice. the we are going to get more high end consolidation -- maybe we are going to get more high-end consolidation in the luxury sector. that stock up. kailey: you will dig into that further in a moment but first checking on u.s. markets, we are in earnings season, text you after the bell. nestor 100 has been dashed nasdaq 100 has been such a performer, up about .2% of the moment. the earnings str

ed: there is a history of research in the u.k.. also president biden on his visit to you the u.k.the prime minister brought up this cooperation between the u.s. and the u.k.. what is your assessment of that cooperative work in the field of ai? >> i think the field of ai, it is an ecosystem coming together when it is to do in academia, regulation or government but also the enterprise and the providers working in a broader ecosystem it is critical for the success of ai. one thing i would also add to your point of the visit today, the ai regulations and ai standards is really important to put in play because one thing that is critical here is ai is here to stay. i studied ai 20 plus years ago and this is not a new technology. it is a technology that is at the forefront, it is in prime time today, we to stick carefully in a trusted and transparent fashion, it is really critical. if there is any standard or any collaboration between governments as a key topic i think it is only important for organizations to be doing that. ed: do you go back to the point that caroline made about the gl

u.k. time.the bank news this morning here in the u.k., ceo allison rose is stepping down after the british lender closed -- bank account. she resigned after admitting leaking information about the politician turned pundit in a leak related to his status as a customer of the bank. this included some of u.k.'s wealthiest people including members of the royal family. now pacwest bancorp is being taught by a smaller rival bank of california as part of a rescue deal. shares of both bank surge in after hours trade on the news, others will be investing $4 million to a pain about 20% of the combined company and warrants to buy more shares. the combined bank will have about $36 billion of assets, that is less than what pac west alone had at the end of march. we also have more news out of nissan and renault, the automakers have signed a deal rebalancing their alliance with nissan to invest up to 600 million euros in the ev unit. they have been targeting an ipo as soon as the fourth quarter. time now for o

the rbc also says animals brought into the u.k.ally are also more at risk of having been exposed to infectious diseases abroad. the charity says puppies brought in are more likely to be aggressive. you are live with bbc news. the indian prime minister is on a two day visit to france, where he will attend the traditional but still day parade tomorrow. he will is president macron's guest of honor. the two letters are set to discuss defensive issues. theed carpet treatment comes on the back of last month's state dinner in washington. despite their differences, the war in ukraine and tensions do remain in india's human rights record, western democracies are still keen on deepening ties with india given mutual concerns about china. a senior fellow from the united states, we should probably start with the deals that will be signed in paris. i understand they're going to buy about three dozen raffaella fighters from the french. how important is that to indian defense? >> it is extremely important for indian defense, because india is reall

joe biden in the u.k. en route to a nato summit. the president said relations with the u.k.ock solid, but there are disagreements over ukraine. floods in north america, and they are running out of water in europe. the u.n. says it is extremely worried about the record high temperatures. we start with those allegations made on friday evening that a bbc presenter paid a teenager tens of thousands of pounds for sexually explicit images. young person, now aged 20, is represented by a lawyer who issued a statement in the last few hours. "for the avoidance of doubt, nothing inappropriate or unlawful has taken place between our client and the bbc personality, and the allegations reported in the -- in 'the sun' are rubissh." "the sun" said, a complaint was not acted upon by the bbc. we've seen evidence that supports their concerns. it is for the bbc to properly investigate. currently, bbc news does not know the identity of this young person, nor has it seen the evidence, but bbc managers have spoken to the metropolitan police who say they are assessing information and taking a view

but the u.k.t positioned at the current moment to adopt a series of subsidies or tax cuts to invest in its own green transition. the labour party talks about this, but it seems to come along with a package of tax increases that is politically not viable in the current economic context. this is a tough issue and has been a transatlantic issue. guy: is biden makes -- bidenomics achievable in the u.k.. the labour party -- there is talk about the labour party replicating what joe biden is doing, more activist industrial policy. focusing on key areas, key industries. is that something you can do in the u.k. or can you only really achieve bidenomics in areas like the united states that have sufficient scale? first of all this is a very ambitious program in the united states and will come down to implementation. we are at the beginning of a significant transformation potentially. the u.k. is comparing apples and oranges, a different market. the starting point, the baseline is different. many argue the u.

the u.k.europe and the u.s. the same? is a soft landing a based case? is that question different for all those regions? the u.k. is having some issues. idiosyncratic, particularly for comes to brexit. is a soft landing a base -- the base case? particularly when it comes to europe. christine, what do you think? base case, soft landing? christine: let's break this down into two parts. it's not the base case when it comes to soft landing. but people are skewing more toward the possibility that we will see that. let -- my argument is one about a hard landing? that seems to not be part of the discussions. i argue that it has to be. as you point out, the uris -- u.s. is not europe, is not the u.k.. the situation in europe and the u.k. is very problematic. inflation levels are well above the bank of england and ecb targets. even if the fed is starting to be more data dependent, i don't know the bank of england or ecb can afford to do that. guy: i hear what you are saying but look at growth. eddie, lo

we know the u.k. is a part of the treaty that man's these.s a point of contention between these leaders? >> the key thing ahead of that summit of course was really to show a united front. more words, as you mentioned. joe biden saying clearly that there is no greater friend or closer ally then the u.k. and u.s., and they had some warm tea and words for the cameras in the garden of downing street. if you like that was the kind of public image that both men wanted to portray. certainly when it came to the question of cluster bombs it's controversial because it can spread munitions across a wide area. sometimes unexploded munitions cause a problem for civilians. the u.k. has signed up with many other countries to add to this convention, discouraging their use. rishi sunak said that downing street would be diplomatic about this because the u.k. is inside this convention and had to make it clear that u.k. discourage the use of these. the u.s. is not a signatory to that convention and i don't think necessarily the two men fell out about that. but t

perhaps some relief for u.k.nationals that sterling is weaker today, we usually see the fx impact when it comes to the ftse 100. a lot of italian banks live there. the yield pictures coming in, although concerning signs. they fell about 4/10 of 1% off the back of unclear results coming from spain's election. jp morgan ahead of the vote said that would be the worst outcome. we did get ibex that felt pretty -- fell pretty dramatically at the open. it was able to fight its way a little higher, so not as big of a drag. at the open, the stoxx 600 opening much lower. spanish stocks down 1.5%, it kind of waffled. see the impact of weak european data erasing some of the gains in the overall index, it was able to ever so slightly end higher, just less than 1/10 of 1%. when it comes to stocks on the move, the best performing stocks -- i have the best in the worst for you. ocado the best-performing, the online grocery had a dispute -- legal dispute with a norwegian automated grocery business over its platform. it was settle

the u.k.they are deciding and ask for all the parties. they want to state legal so they can find a solution. they want to find a way of moving forward in the deal deadline is july 18. it's now crunch time, does this happen? activision up 3% but the stock is suggesting there's confidence we are moving forward. caroline: that tribunal is all about. kicking off the discussion with the agency today. it's desperately trying to get this deal done. we know the clock is ticking on july 18. let's get you more on this. the u.k. is the final hurdle? >> yeah, it's down to the wire. tomorrow, if microsoft doesn't close it, they pay $3 billion and if they can close it and risk further wrath from u.k. regulators. the market seems to think this is closing. i saw a note that the word imminently is being thrown around a lot. there is still three or 4% deal spread. some people think there is still a risk so down to the wire. ed: the appeals tribunal is looking at whether to allow the parties to go away and find

dani: in bond land, the u.k.pi figure yesterday fueled the bond market rally we have been witnessing. what does it mean to have the u.k. participating in this narrative of getting closer, if not already at peak rates? mark: it is a big change because the g10 has been led by the u.s. the ecb were thinking though central banks are coming to the end of their hiking cycle, it is helping their bond market, but the bop was outstanding. the u.k. markets have been lagging behind. they will not catch up as far as treasuries go and german bunds, because a inflation number was good in the u.k. but still way too high. headline inflation above 7% is more than the central bank wants, but it is heading in the right direction. now you have the bank of england meeting in early august, they will probably go ahead with the hike but they might give the message that they do not need to go to 6.5%. they can come in below 6%. that will be a relief to the u.k. asset class, but we want to hear that from the bank of england. they may want

what could u.k. government to change her mind and keep you here and make the u.k.attractive for startups and health care? dan: i believe for companies, they have to be in a place to get the most amount of resources and capital so we can invest back into making our technology better for our patients, and really deliver on the practice of addictive care. if the government can make the listing look better, make it more friendly for startups, employees can benefit from these initiatives, enable other investors from outside to invest, that is a good step forward. what i want to encourage, to focus on companies that are growing, because if you have a lot of small companies coming successful, it does not matter where they list. if they are based here, most of the money and resources comes back here to create jobs and opportunities. that is what i would encourage governments to focus on. lizzy: a clear order to improve liquidity. thank you, dan vahdat, ceo, huma therapeutics. plenty more ahead. this is bloomberg. ♪ lizzy: welcome back to "bloomberg daybreak: europe." i'm l

katie: supermarkets have a difficult job in the u.k.e moment because not only are they talking to shareholders but also the broader u.k. consumer and there is a lot of pressure on supermarkets at the moment that they can't be making huge margins or profit because food inflation is so high. but broadly i think the message today was that sales are up and in clothing, interestingly, sales were down. it's a mixed picture but they kept guidance unchanged. guy: in some ways u.k. supermarkets are an interesting case study. they are working capital businesses that sell us stuff and basically don't pay their suppliers for weeks, if not months, at some point. how much cash do these companies throw off at the moment at a time when cash and working capital freed up generates a huge return? katie: supermarkets are very cash generative but at the same time tesco, sainsbury's, all these big supermarkets are following their own strategies to try to be as efficient and make as many costs savings as possible. they are clear to say they run on tight margi

its licensed by the u.k. government. it flew over the same area where the distress call was made on multiple previous journeys. it even flew the day before and after the incident. but not in the hours the vessel was sinking. instead, it took more than an hour for the lifeboat to arrive in which time a fishing crew rescued the majority on board. >> we must stop the boats. >> reporter: this is part of a campaign on deterrents and hostility by the government to deter those trying to reach the shores. some are able to see beyond u.k. waters. drones with automatic identification abilities. and while the companies tout their life saving capabilities. footage from the drones is used to identify those driving the boats and prosecute them for human trafficking. a new bill will take it further criminalizing anyone who seeks asylum in the u.k. this way. >> the technologies could be used for search and rescue. for finding boats faster, but the reality on the ground is the opposite. it is assisting powerful actors to sharpen their bo

look at the data out from the u.k., the u.k. market looks unbelievably cheap.he rest of the world looks significantly cheaper. the problem is that u.s. tech has done so well and you have had to chase it. if you do not want to be behind the benchmark, you have to chase it. if there any cracks in that narrative, i think we are in for a different second half of the year. we thought it was going to be bearish, it was not. alix: that was going to do joe question to you -- that was going to be my joe question to you, is the u.k. so bad that you have to own it? guy: we have to go, thank you very much indeed. her boss sure is watching, they always watch because she is so smart. the biggest names in tech gather for what some call the summer camp for billionaires. ed ludlow has a fantastic outfit on, look forward to seeing you in a moment. this is bloomberg. ♪ alix: want to get to the start up where we come to the top tech stories as silicon valley starts its morning. ed ludlow joins us now as sun valley starts its morning. you got a lot of shade on your jacket. it looks

the u.k. to 476. the 10-year is down 20 basis points to north of 4.1%. there was a sneaky suspicion that the bank might have to go again, 50 basis points, but the economic data in the u.k., perhaps changing the conversation a little bit. a little bit of a downside surprise. the right kind of downside surprise in the u.k.. tom: that's what the governor needs. it is the move, but my basic -- help me, you have live this, i would suggest core inflation is stickier than here. i would guess. it is interesting to see, but are we correct that real estate inflation filters into the united kingdom economy much quicker than here? jonathan: i was say the transmission from monetary policy and the u.k. to the bullish market is much much more direct. given the mortgage market and the u.k. given the one in the u.s.. tom: can i give a symbol for east coast wall street? this is the wonderful mr. will end who is more diminished -- and missed each day. he picked up the pieces after the death of robert williams, a

and u.k. so we do think it will probably be one of the first central banks, the ecb, to stay there longer. rather than taking rates too much higher from here beyond the due hikes are there about -- they are about to do, they will try to stay there higher for longer to try to tame inflation. yousef: after having spoken to the rest of your team, what are the conclusions about what is left of economic growth at the end of 2023? how much do we get across the line from what you can tell? anna: in terms of where we are heading, we think we are heading towards recession towards the end of this year. across the board particularly here in the u.k. given how much the boe has to rebuild that credibility and tame inflation. so we think the second half of the year is pretty weak and will make it to q4, we might be really weak or negative growth across the board. we have stagflation or stagnation which is something will be talking about towards the end of the are. then depending on how fast inflation falls,

it is rare, 50,000 people are diagnosed around the u.k. awareness is low. could asked the deputy prime minister to meet with me and families affected so we can discuss with the government can do to raise awareness and fight for funds for research going forward? >> i'm happy to give that commitment. i think best on health minister's. one of my colleagues sadly died of that disease. i have a great awareness of it and it is important that we continue to raise its profile. >> last week i had the pleasure of going to -- the new chancellor. starting without -- she started unable to afford a school uniform, finished off in the white house and is a strong example of resilience and mobility. can i ask the prime minister to do everything we can to support her? >> i joined my honorable friend and relating the governments congratulations to her and i would ensure that the secretary of state is the representation that he made. >> [indiscernible] home to world research and innovation, thousands of jobs, huge amounts of research are at risk. the ft reported last week, sch

u.k. bank stocks rising and giants lift dividends after the stress test. we sawtek once again outperforming. let's get to treasuries. we have a raging debate between morgan stanley and bill dudley over what is going to happen with the bond markets. we have one view of dudley saying they are looking at 4.5%. morgan stanley thinks the yield curve is on course for 2% or 3% while some describe the bond market selloff is far from over. we call it the long end of the two is the parent -- of the tooth. we are parsing the language that came through from the ecb's novel making it clear that the series of interest rate increases is not finished yet. upside risk to the inflation outlook are seeing -- seen as predominating. we are at 1.09 on this. let's get to asian equities because they are pulling lowered the session. charlotte joins us from hong kong. what is weighing on the markets over there? >> the session is not looking upbeat. we see a rally and regional equity stake in a pause in a lackluster

i was speaking with jim mellon, a billionaire u.k. investor. he said the u.k.the sick child of europe. it is germany, that is where the pain is. you mentioned the german story. i want -- i wonder what you would say to that. i understand some of the bias in their. what is your take between which economy is in a worst addition? >> it is undeniable the journeyman he can't -- the german session -- the german economy is in a slump . you saw a hit from energy to germany's manufacturing sector was serious. they are not getting support from china. the recovery in china in the first quarter was domestically focused and consumer spending on services. they are in a difficult situation. we have not seen the drag on the economy from the monetary policy tightening kick in in force yet. germany is in a difficult situation right now. the periphery on the other hand, very much supported by tourism. lots of booming tourism, they are the recipients of this next generation e.u. funds which are helping their investment spending numbers. europe has a lot of heterogeneity across diff

we have a huge commitment from the u.k. of this opportunity, and a huge commitment from cptpp members who want to make it a great success. rishaad: how much more difficult is it to strike a more difficult deal without being under the umbrella of the european union as a lone player, britain against others, as opposed to having a bloc of 28 countries? natalie: i have been doing this job for a while now, as his majesty's trade commissioner for asia-pacific, and one of the great delights has been the flexibility to bring a new, innovative approach to u.k. trade. we signed our first ever digital economy agreement here with singapore. our first ever green economy framework. and we have brought digital and sustainability, green trade, into the heart of everything we're are doing in the asia-pacific. because the world is changing. we are listing to what countries and governments and businesses want in this part of the world. they want investment in tech. and they want respect for the green agenda. so i think the focus being on thos

because they had an interaction with u.k. interests that the u.k.ernment was requested for the u.k. exclusion and actually, as i said, there was an exclusion given on returns and that's a decision to not proceed. it was a decision made by the scottish government. >> it seemed to be in an english fashion and in the u.k. interests, that whole-- should the relationship being equal as approached? >> as i said, the operation added impact on u.k.-wide interests and that is why you can make the conclusion on a narrow basis which would allow it to proceed in a particular way. i think it was a decision of the scottish government, particularly. >> is it possible for-- >> that's not right, actually. i think the chief executive of scottland-- i think that the schemes remained on those and many ran without glass and i think it's the scottish government decide not to proceed and that's a decision that they can explain. >> with these standards committee. >> the minister when parliament is in session the most important enactment should be made in the first nance in

u.k. minister ben wallace said" people want to see gratitude from ukraine in relation to western aid." u.k. prime minister rishi sunak downplayed those comments saying he has expressed gratitude on a number of occasions. let's get more from our europe editor katya. it is great to see you. president biden called the summit a success. do other allies aee? >> first of all it is important to take a step back because you can look at a summit like this from the outside and it looks like a load of world leaders talking shop. it matters. there was a lot riding on the summit. we have warm, conventional war fail -- warfare on a scale not seen since world war ii. attention has been brought to europe because of the security situation. in the eyes of the nato leaders there, this is not about ukraine. this is about security in all of the continent and the feeling at the summit is russia cannot be victoriousn ukraine because if it were to be victorious, it might whet its appetite to look at other europea

in the u.k., it was the hottest june on record.ts warned the heat this because the death of an unprecedented mber of fish. first, hundreds of israeli soldiers backed by drones and armored bulldozers are assaulting palestinian militants. the palestinian health ministry said eight have been killed, 50 others wounded. it is one of the biggest raids in 20 years. the operation started with multiple drone strikes on the refugee camp. the israeli army vehicles were seen moving in. they say it contains a command center. leaders say it is an attempt to destroy a refugee camp and innocent people have been harmed. palestinians have been throwing stones at israeli troops from behind burning street barricades. fighting has been a continuing and the gun battles on the streets with militants seen firing at the israeli army. vehicles have been seen firing tear gas. the state department said it was vital to take precautions to prevent the killing o civilians. let's go live to our middle east correspondent who is in jerusalem. what is the latest ton

the u.k. russia worsen. british diplomats are warned their freedom to move around the country will be restricted because of what moscow calls london's hostile activities. meanwhile, the port cities of essa and another have been targeted in missile strikes. also in the program, the boss of one of britain's biggest banks apologizes to the former you could leader nigel faraj over closing his bank account, saying comments made were inappropriate. scorching temperatures continue to soar in many pas of the world. in greece, and other wave is on the way. and record crowds and viewers are expected for the women's world cup, which has kicked off in new zealand. ♪ and first this evening, to russia. in a worsening of relations, the country's foreign ministry restricted the movements of british diplomats in response to london's hostile activities, they say. for now, with a small number of exceptions, diplomats will have to give at least five days notice to travel outside a designated so-called free movent

u.k. time, we will get german factory orders. they rose at the start of the year but saw a double-digit plunge in march. that suggests the sector will continue dragging on growth, despite the fading energy crisis and improving supply chains. at 1:30 p.m. we get u.s. jobless claims. they are excited to serve for the week that ended on the first of july, potentially marking a new high. that will be following by u.s. jolts data at 3:00 p.m. london time. the job openings and labor turnover survey. that is expected to reflect how softening of the labor market has come primarily from a decline in access demand for labor, the pace has slowed over the past few months. and both of these data points are merely a preview to tomorrow's grand finale, the key jobs data. we hear from dallas fed president lorie logan on the policy challenges for central banks. i hope she has enough time to cover that long list. expect her to underscore the hawkish mood, and as a voting member of the fomc those comments will be closely follow. how could the jobs

for u.k.re will be zero tariffs on things like cars and whiskey, and for cptpp countries that run businesses in the u.k., she says that will turbocharge that investment. haidi: -- shery: what about china? how is that likely to progress? paul: that will be an interesting one because china has a number of difficulties with admitting members of the cptpp. new zealand was the host of this meeting over the weekend. the trade minister gave a very diplomatic answer, saying there was no specific discussion on any individuals. but australia's assistance trade minister was more forthright, saying this will be some way off, obviously referencing the ongoing trade strikes by china against australia. some of those have been removed but some are still in place. the next chair of the cptpp is canada and of course china has a few trade issues with canada ongoing as well. making it even more complex come after china the next is taiwan. it will be a very interesting set of discussions trying to get china admitt

with the u.k. case, it's not the only part of the transition, to be clear, but it's an important part. we seen a big structural change in the u.k. mortgage market, so we have seen a change in the structural market since the last tightening cycle, which was about 20 years ago. that has been a change from a variable rate mortgage market to a fixed rate mortgage market. i must say, it is not a u.s. mortgage market. it is much shorter. the average term is often around five years. but we know -- we think we are at about 85% in that part of the market. so we know that the transmission of monetary policy has been slower as a result, because obviously it depends upon the timing and the sequence of those fixed terms coming to an end. so we have to judge that. it is another factor in the development of uncertainty that we have to judge when we are making our decisions, which is how much of the tightening that we've already done has come through, and how much is yet to come through? and we know going quite a

this is unlocking money from the u.k.on system and aggregate it so it has greater ability to do that. in the u.s., you have huge pension funds aggregated together with significant scale. they are able to do more because of that scale. you see that in canada as well. there will be some desire within the government to do that. whether or not there will be sufficient scale to do it remains to be seen. whether or not this is right to push money into these startups and if it is the right area in their lifecycle remains to be seen. but we should talk about michael barr as well. alix: it is the bipartisan policy center where michael barr spoke earlier. it is michael barr versus wall street. defendant vice chair unveiled his plan -- the fed vice unveiled his plan. the market takes it in stride. we will break that down more. this is bloomberg. ♪ yourebsite store was also the first time you realized... well, we can do anything. cheesecake cookies? the chookie! manage all your sales from one place with a partner that always puts you

we had the eurozone flash pmi numbers come out i want to bring you the u.k. ones that have also fallen to the down side coming in at 50.7 versus the 52.8 number we had back in june in parallel to the eurozone, the u.k. pmi numbers are slowing down as well the flash manufacturing pmi in the u.k. has come in at 45 it's slowed down to where we were back in june at 46.5. the services number also showing a deceleration at 51.5 versus 53.7 in june this is the slowest pace in six months and similar to what we spoke about in europe. it is very clear that the interest rate hikes that have been introduced by the bank of england are beginning to have an impact on the economy, notably on the services sector that is also what we saw out of europe as well so both of these pmi numbers surprising to the down side. it does tell you that perhaps some of these disinflationary dynamics that we spoke about are beginning to pick up steam and that is something the central bankers will have to be thinking about very closely as well. >>> also coming up on the show, spain's conservati

u.k. inflation is starting to tumble. if that continues, that may be a prelude to a much harder landing and people are talking about the u.k. economy being in serious trouble potentially as we start to see the effect of the existing rate hikes coming through. how does the dollar do if the u.s. economy lands gently and the rest of the world, europe in particular, hits it hard. >> that's a good question but the answer lies in what is the binding constraint. if the binding constraint is inflation, that means that perhaps we are still going to get more rate hikes out of the eu and out of the boe then we would out of the fed. ultimately, you said inflation was down the u.k. to below 8%. that is still a really high number. normally, you would think that's a number that requires some level of intervention from the central bank. i think it is still a situation where the dollar is relatively not bid in the other currencies will do better. kailey: to come back to the point that inflation is high, is there still a risk that the cool

the u.k. is where the focus is. caroline: really an about turn. we wonder what is next for activision blizzard. it is all eyes on the cma, it feels unlikely the deal will go in line with the date. does that ultimately matter? >> not actually. it is not a cinderella clause, meaning it does not expire at midnight. they can move forward with the deal. there is a possibility they could either come up with an official extension date for the next couple of months, or they could keep it as it is, keep moving forward with the cma to try and close under original terms. ed: i guess there are a range of scenarios, you and i reported that the crux of what is happening in the u.k. is an offer to sell the cloud gaming rights to appease the regulator. what doesn't extension look like? there is more than one way of doing this. leah: the minute you open up one of these deals, everything can come up for renegotiation. they could be looking at changing the top line number, they could look at changing the breakup