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tv   World Business Report  BBC News  October 11, 2022 5:30am-6:01am BST

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this is bbc news with the latest business headlines for viewers in the uk and around the world. big and painful spending cuts are needed to put the uk's finances on a sustainable path. that's the warning from a leading economic think tank. we get expert analysis. keeping the lights on and warm this winter. eu energy ministers meet again amidst warnings of rising energy costs and rationing. and wake up and smell the coffee! if you can afford it, that is. coffee prices are soaring and we'll find out why.
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we begin here in the uk, where the institute for fiscal studies is warning the chancellor "big and painful" spending cuts will be needed to put the country's finances on a sustainable path. the independent think tank predicts with a weaker economy and promised tax cuts, there will be a large shortfall in revenue. it calculates the government would have to spend £60 billion a year less by 2026—27. the treasury says its tax cuts and reforms would deliver "sustainable funding for public services". more for public services". detail on that on october sist. joining me now is janet mui, head of market analysis, rbc brewin dolphin.
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they have quite a lot of detail as to why they believe the government will not have the money it needs to go ahead with plans? money it needs to go ahead with lans? ., ., ., plans? thanks for having me, first of all— plans? thanks for having me, first of all before _ plans? thanks for having me, first of all before the - plans? thanks for having me, first of all before the mini - first of all before the mini budget the government was already in a bad situation, in terms of deficit because we have already spent so much during the pandemic, the economy, the key driver of the government plan, is to generate revenue is the assumption we will generate growth every year, and that is higher than what we are accustomed to, and it's very difficult for the current economy like the uk to generate that kind of growth, thatis generate that kind of growth, that is based on the idea of trickle—down economics, where higher spending and high earners will spend more and it will trickle down to the rest of economy, there is a lot of
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doubt on that and concerns about inequality and that kind of environment it is very difficult for the economy to grow and get enough for school revenue to subsidise the tax cuts and debts we are going to see. ., . ., see. the chancellor did announce _ see. the chancellor did announce on _ see. the chancellor did announce on october i see. the chancellor did| announce on october 31 see. the chancellor did . announce on october 31 he see. the chancellor did - announce on october 31 he will set out a new debt cutting plan, and an accompanying official forecast in plan, and an accompanying officialforecast in a plan, and an accompanying official forecast in a attempt to calm down markets, so far that news has not made much difference, gilt markets got even worse yesterday? absolutely, it's because of the fact that we know that the gilt markets stabilised because the bank has intervened by committing to buy government bonds, we know that that programme is going to end this friday one october 1a, so there is concern around that, the bank of england knows that so they announced another programme that would provide extra liquidity if you have to
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access cash for bonds, that has access cash for bonds, that has a timeline it will end on november ten, a timeline it will end on novemberten, i a timeline it will end on november ten, i think the markets arejust nervous november ten, i think the markets are just nervous these programmes are good and supportive but they will end at some point and eventually the bank of england will go back which could lead to high gilt rates. , ., ,., rates. there is a full report on our website _ rates. there is a full report on our website about - rates. there is a full report on our website about what| rates. there is a full report i on our website about what the ifs is wanting, its calculation, you can read that detail and i have tweeted that story as well. staying with the uk, the unemployment figures for august will be published in little over an hour. looking back, although the unemployment rate fell to 3.6% in the three months tojuly, the lowest since 1974, the employment rate and number of vacancies also fell. rises in regular pay are also failing to keep up with rising living costs.
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one reason for the fall in the unemployment rate is a rise in the number of people who are no longer looking for work, and so not counted in the figure. they are called in active stop. chris gray is director of manpowergroup uk. the unemployment number for august, what are we likely to see? , ., ., ., , see? good morning, it is pointing _ see? good morning, it is pointing to _ see? good morning, it is pointing to a _ see? good morning, it is pointing to a loosening l see? good morning, it is- pointing to a loosening labour market, but it's still quite tight, my anticipation of the unemployment number is that it will probably remain about the same and go up a little bit as you mentioned earlier, we are expecting a downward trend on vacancies, real pay will still continue to be squeezed, what's interesting with the real pay period, which runs from in this
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particular release from june through to august, is that the inflation increase during this period but we didn't see pay increase as well, it plateaued. as you say the participation rate or activity rate is going to be the number of greatest interest, during the last period, we saw 16 to 2a —year—olds, and the 50 to 64 —year—olds, and the 50 to 64 —year—olds increasing the inactivity rate but we saw a decrease in the inactivity rate oran decrease in the inactivity rate or an increase in participation by the over 60 five —year—olds, which indicates pressure on earnings and income as a result of the cost of living. mit? earnings and income as a result of the cost of living.— of the cost of living. why is that the trend _ of the cost of living. why is that the trend at _ of the cost of living. why is that the trend at the - of the cost of living. why is i that the trend at the moment, the inactivity rate going up and up? fix, the inactivity rate going up and u? �* ., ., the inactivity rate going up andu? ., ., , ., and up? a lot of it points to, and up? a lot of it points to, a lot of the _ and up? a lot of it points to, a lot of the data, _ and up? a lot of it points to, a lot of the data, it's - and up? a lot of it points to, a lot of the data, it's not - a lot of the data, it's not great data we get a lot of points to people, who are just
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tired and wanting a break in taking a sabbatical, they've earned a lot of money over the last 20 years and have savings to allow them to support that. 16 to 24 —year—olds that is not the case? it 16 to 24 -year-olds that is not the case?— 16 to 24 -year-olds that is not the case? it could be the older art of the case? it could be the older part of the _ the case? it could be the older part of the workforce - the case? it could be the older part of the workforce the - part of the workforce the younger part of the work we are seeing people taking more time, may be doing a masters or a phd because again, they are nervous about what is available on the market as they came out of education. market as they came out of education-— education. also as well is there a — education. also as well is there a problem - education. also as well is there a problem the - education. also as well is - there a problem the government is trying to fix in the sense that, they are not earning enoughin that, they are not earning enough in terms of the cost of living crisis at the moment, because real wages is not keeping up with the cost of living, they opt out because they are better off on benefits than they are earning a low wage? than they are earning a low wane? ., , than they are earning a low wae? ., , ., than they are earning a low wae? ., ,., ., than they are earning a low wane? . ., , ., . wage? that is a real dynamic that the government - wage? that is a real dynamic that the government has - wage? that is a real dynamic that the government has to l that the government has to face, of course, we know the intention is to try and
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encourage people into work, but i think what we are seeing is that people are trying to work with more creativity and agility, taking on more than onejob, and the other day agility, taking on more than one job, and the other day what they are looking to do is make sure they are creating opportunities for the future, by getting experience today which allows them to getjobs, morejobs in the which allows them to getjobs, more jobs in the future, it will be challenged for the government to the right balance with that. , with that. the uk employment fi . ures with that. the uk employment figures will _ with that. the uk employment figures will be _ with that. the uk employment figures will be out _ with that. the uk employment figures will be out in _ with that. the uk employment figures will be out in an - with that. the uk employment figures will be out in an hour l figures will be out in an hour and 20 minutes. now let's focus on the us economy. the outlook for us growth has been downgraded. this follows on the heel of a dire warning from the head of one of america's biggest banks.
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jp morgan chase's chief executive, jamie dimon, says the us is headed towards a recession in the next six to nine months. jimmy diamond is not one to mince words from his perch at the top ofjpmorgan, he has a keen eye on the american economy, he noted consumers are in a better financial position than they were be the financial crisis in 2008 and the economy remains relatively healthy, he will use the us is headed for a recession next year. the comments come as many economists worry about a possible recession has the federal reserve rapidly creases the cost of borrowing, the chair of the central bank to rome powell has said reading in inflation as a priority but the federal reserve by suggested it will take some time for these interest—rate hikes to hit the economy and actually start to bring down inflation. and all
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of this comes as burning season kicks off in the us. the biggest financial institutions are set to report this week, many believe their forecasts will likely reflect growing pessimism about the american economy. let's get some of the day's other news. ben bernanke, who led the american central bank during the 2008 financial crisis, is one of three recipients of this year's nobel prize in economics. he shared the honour with economists douglas diamond and philip dybvig. the prize was for their work about the importance of preventing runs on banks. the committee said their research had "improved our ability to avoid both serious crises and expensive bailouts" and had been vital during the covid pandemic. shares of chipmaker tsmc are down over 6% on the taiwan exchange. other major chip—makers like samsung are also in the red. it comes after the biden administration published a sweeping set of export controls on friday, including a measure to cut
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china off from certain semiconductors made anywhere in the world with us equipment. the world's biggest flower show, held once a decade, has largely failed to blossom. figures show the floriade, which has just closed, made a loss of approximately 100 million euros for the local authority in the netherlands. dutch media is referring to it as the "flopped floriade". reviews have been dismal, the cost—of—living crisis and covid have kept a cautious public and tourists away. our correspondent anna holligan has been speaking to those behind the scenes who, despite the disappointing turnout, are trying to focus on the bright side. the forecast was for 2 million visitors. in the end not even half that number came stop. i am concerned about the structure of the floriade. i5 structure of the floriade. is
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there anything positive to say about the flower show? it has experimental _ about the flower show? it has experimental shows - about the flower show? it has experimental shows of - about the flower show? it has experimental shows of bio - experimental shows of bio —based materials, important to show how people can do in their own lives to change the environment and create comfortable microclimates. in europe with decreasing of insects and bees we need bees to give enough food and vegetables, you have to make sure restaurants have a lot of food in the city, was always the whole system you have to take care of.— the whole system you have to take care of. each pavilion has its own purpose _ take care of. each pavilion has its own purpose this _ take care of. each pavilion has its own purpose this one - its own purpose this one demonstrates how plant —based diets can be used to detoxify the fashion industry and how they can serve a multitude of functions as well especially insulating helping people to look at nature from a new perspective. shipping containers, up cycled into office space. nations sharing their innovations.— their innovations. from my oint their innovations. from my point of — their innovations. from my point of view _
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their innovations. from my point of view floriade - their innovations. from my point of view floriade can l point of view floriade can inspire, countries and governments to do more and take this climate crisis very seriously, the theme and topic of regenerative energy, has invited this type especially want to showcase solutions for future. that want to showcase solutions for future. �* . future. at a time when the netherlands _ future. at a time when the netherlands is _ future. at a time when the netherlands is around - future. at a time when the - netherlands is around countries being encouraged to tighten their belts, spending is under scrutiny, and much focus has been on the fact floriade has gone over budget for the fourth decade running. this is one of the cable cars that let's visitors get a birds eye view and this year the plan is for some of these innovations to remain in place in the hope they can have a positive impact on the urban district they occupy for the last six months. a new district should arise from this fertile ground, although there is still debate
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over the cost and when construction can actually start. anna holligan, bbc news. stay with us on bbc news, still to come: you still to come: may be sipping on a strong copy you may be sipping on a strong copy this hour but have counted the cost for. coffee prices are soaring and we'll find out why. just fine parts of san francisco least affected by the earthquake are returning to life, but in the marina area where most of the damage was done, they're more conscious than ever of how much has been destroyed. in the 19 years since he was last here, he has gone from being a little—known revolutionary to an experienced and successful diplomatic operator.
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it was a 20—pound bomb exploded on the fifth floor of the grand hotel, - rapping a hole — in the front of the building. this government will not weaken! democracy will prevail! it fills me with humility and gratitude to know i have been chosen as the recipient of this foremost of earthly honours. this catholic nation held its breath - for the men they call the 33. and then... ..bells tolled nationwide - to announce the first rescue, and chile let outi an almighty roar. this is bbc world news, the latest headlines . international condemnation of moscow as, for the first time in months, — the ukrainian capital and other cities are bombarded by russian missiles. the latest trial of hollywood film producer, harvey weinstein, has begun in la — he's facing 11 further charges of abuse.
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with the colder months just around the corner, european leaders are keen to address how they can mitigate the rising energy costs, set a price cap on gas imports and ensure supply security going forward. the eu's commissioner for energy, kadri simson, is in prague at an informal meeting of the eu's energy ministers, hoping to lay down the groundwork that might lead to a eu wide deal soon. there was no breakthrough at last week's summit, where each member country's differing approach to energy sources and suppliers proved a hurdle too high to overcome. joining me now is richard black, senior associate, energy & climate intelligence unit. and approached the price of energy, we crisis, energy, security and supply that is a tall order, isn't it? it's worth saying they have made substantial progress in some important issues, so for
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example, they have restricted the consumption of electricity, they've agreed that, they put a cap basically on the price of electricity paid not being generated by gas, this is mainly renewables and nuclear and some of the midnight plants, the big issue remains for this meeting, can they put a cap on the price of gas that is coming into europe, on all gas or some gas because there are fears that by doing that, they would restrict the ability to import enough gas. find to import enough gas. and whether gas _ to import enough gas. and whether gas comes - to import enough gas. and whether gas comes from is problem. with germany, 40% are still coming from russia. we are seeing very different views remember states. a group of about there are german and the others don't want that to happen. a couple one is, could you simply cut the price another one, could you cut the price of gas but not the an
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interesting thing here is that currently the price of gas coming into partly because countries are been successful in securing surprise of liquefied natural gas. demand is fallin: , liquefied natural gas. demand is falling, largely _ liquefied natural gas. demand is falling, largely as _ liquefied natural gas. demand is falling, largely as a - liquefied natural gas. demand is falling, largely as a result i is falling, largely as a result of government asking for it. that i think a sort of affecting opinion as we go as well. �* ,., , , , well. also, this is very short-term, _ well. also, this is very short-term, we're - well. also, this is very - short-term, we're looking at short—term, we're looking at this awesome, this winter, we have a harsh winter that could be a real problem in the months ahead it was about long—term as far as the eu is concerned in terms of energy supply? there's no doubt that _ terms of energy supply? there's no doubt that as _ terms of energy supply? there's no doubt that as you _ terms of energy supply? there's no doubt that as you seeing - no doubt that as you seeing attention is largely seen on the short—term in the longer term there are different ideas for example one idea is to build a gas pipeline so the energy import facilities in spain and portugal could take large amounts of gas to germany in northern europe and so on thatis in northern europe and so on that is something that obviously wouldn't be in place
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this winter, conceivably next winter, probably the winter after that but then you've got questions about whether that would actually be needed because what would happen to the global gas market and supplier prices by then is really hard to countenance. i think one of the important things is that demand is having some impact. as a an amount that if you can do it, the root of the problem, the single most important thing you can do that is happening across europe already. when it stronger, sometimes in terms of energy policy. spain and portugal are a relatively comfortable
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position. sweden is now the biggest act exporter of electricity. and partly there are other things going on mike strikes for example, with petrol refineries. and part of their things are due to maintenance issues. it’s their things are due to maintenance issues. it's been aood to maintenance issues. it's been good to talk _ maintenance issues. it's been good to talk to _ maintenance issues. it's been good to talk to you. _ maintenance issues. it's been good to talk to you. richard l good to talk to you. richard blacked out. the cost of a cup of coffee has become more expensive, the european union's statistics office said last week. coffee prices had on average surged i6.9% in august from a year earlier eurostat said. this week in the uk it's coffee week, and coffee is big business, ani)with more than 95 million cups drunk in the uk this week in the uk it's coffee week, and coffee is big business, with more than 95
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million cups drunk in the uk every day, according to the british coffee association. but like every other sector coffee producers are facing substantial increases and that's are impacting roasteries and cafes both in the uk and internationally. joining me now isjeffrey young, managing director of allegra strategies, a london—based management consultancy specialising in the coffee and foodservice industry good morning to you. have you already had a cup of coffee? not yet. i'm actually currently in new york city. and i will be having my copy a little bit later. ., ., ., ., , later. you need to go to bed, soon i would _ later. you need to go to bed, soon i would imagine - later. you need to go to bed, soon i would imagine after. soon i would imagine after we've had our conversation so you don't want a copy a nutcase. you don't want a copy a nutcase— you don't want a copy a nutcase. �* ., , , ., nutcase. i've had plenty of coffee today. _ nutcase. i've had plenty of coffee today. returning i nutcase. i've had plenty of coffee today. returning to | nutcase. i've had plenty of. coffee today. returning to the uk tomorrow morning. 50 coffee today. returning to the uk tomorrow morning. so 'ust talk us through i uk tomorrow morning. so 'ust talk us through what i uk tomorrow morning. so 'ust talk us through what copy h uk tomorrow morning. so just talk us through what copy of l talk us through what copy of producers are facing. is it the
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beam, the cost of the beam. in the past year. having said that, the real prices of coffee have not increased very much. in real terms, inflation—adjusted. to be able to produce coffee. it'sjust recently caused coffee prices to rise. sustainability, climate change is one thing. weather disruption. there has been left frost another sort of diseases that really the fundamental one is currently in increase, farmers just can't make a living from it. a lot of
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people have exited the market and that's our they have a really big impact on roasters here. 95 really big impact on roasters here. ' ., . , , really big impact on roasters here. ., . ,, ., really big impact on roasters here. ., . here. 95 million cups of coffee every day- _ here. 95 million cups of coffee every day. people _ here. 95 million cups of coffee every day. people having - every day. people having several cups of coffee. if we look at the _ several cups of coffee. if we look at the actual _ several cups of coffee. if we look at the actual price, - look at the actual price, internationally, the price of coffee is priced in dollars, first and foremost. and it is since per pound effectively. currently, the current rate for the overall market is 200 and 17 cents, just over $2 per pound of coffee, so that is a
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roundabout $4 50, which is perhaps in pounds, just over £4 perhaps in pounds, just over £4 per kilogram. just perhaps in pounds, 'ust over £4 per kilogramh per kilogram. just to interrupt ou, do per kilogram. just to interrupt you. do you — per kilogram. just to interrupt you, do you think— per kilogram. just to interrupt you, do you think this - per kilogram. just to interrupt you, do you think this is - per kilogram. just to interrupt you, do you think this is a - you, do you think this is a problem that will get worse. they will, with climate change. they will, with climate change. the us dollar rising substantially provides some benefit to farmers because coffee is always priced in dollars but there are underlying factors that affect farmers costs. we underlying factors that affect farmers costs.— underlying factors that affect farmers costs. we are going to have to leave _ farmers costs. we are going to have to leave it _ farmers costs. we are going to have to leave it there, - farmers costs. we are going to have to leave it there, i'm - have to leave it there, i'm sorry. there is a lot to talk about clearly but thank you so much for staying up with us in new york to talk as to the challenges facing coffee farmers. interesting. you might be bring one right now, who knows? thank you for your
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company today. up—to—date on all things business news and sport. have a good day and i will see you soon. hello there. despite a few isolated showers in the far northwest, on the whole, monday was a glorious autumnal day with a lot of sunshine — a great opportunity to get out and enjoy those late—summer flowers. however, clear skies by day lead to a chilly night, and we could see a touch of frost as temperatures hover around freezing early on tuesday. these are favoured spots across central and southern areas of england. a little more cloud further north and west, and here, we keep the threat of some showers. so, the showers there from the word go during tuesday and they will become a little bit
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more frequent as we move into the afternoon. elsewhere, clouding over a little into the northwest of england and northern ireland. a little of fairweather cloud generally, but it will be largely fine, settled and pleasant, with 16 degrees the afternoon high. now, as we move through tuesday evening and into overnight, this weather front here will continue to drift its way steadily south and east. there'll be more isobars on the chart. the further north you are, the stronger the winds, and that will drive that rain steadily south. so, to begin with on wednesday morning, it's going to be a showery story with some heavy rain out to the west, but still, the clearest skies perhaps in east anglia and southeast england. now, that wet weather will gradually drift its way steadily south and east. skits have excused it's going to take its time doing so and weaken off considerably as it moves its way down through the north of england and into south wales, staying fine and dry with highs of 18 celsius ahead of it. behind it, again, the sunshine comes through and temperatures at around 12—15 celsius. it's going to take its time doing so and weaken off considerably as it moves its way down through the north of england and into south wales, staying fine and dry with highs
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of 18 celsius ahead of it. behind it, again, the sunshine comes through and temperatures at around 12—15 celsius. as we move into thursday, there's a better opportunity of seeing some more heavy and persistent rain across south wales and southern england. the position and the timing of that weather front still subject to question, so it's best to keep an eye on the forecast. but on thursday, we could start off with some wet weather in the southwest, gradually drifting through wales and gradually pushing towards the london area towards the end of the day. north of that, it will be largely fine and dry away from the north—west of the great glen, where we could still see a few scattered showers. friday into the start of the weekend turns unsettled once again, with showers or longer spells of rain and the winds will be a feature.
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good morning. welcome to breakfast withjon kay and sally nugent. our headlines today. russia is widely condemned after bombarding residential neighbourhoods in ukrainian cities, including launching missile strikes in the centre of kyiv for the first time. the number of care workers in england falls for the first time with 165,000 jobs vacant across the country. a royal takeover — the prince and princess of wales present a special edition of radio one's newsbeat on mental health. we might run out of time and priya might say this is the worst newsbeat production or two interviewers she's ever seen. do you know what, you can come back.
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