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tv   Business Briefing  BBC News  June 21, 2018 5:30am-5:46am BST

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this is business briefing. i'm samantha simmonds. banking on brexit. uk chancellor philip hammond says london can remain a ‘global capital of finance‘ — despite growing scepticism in the city. plus, living beyond the moment. instagram to take on youtube with videos up to an hour long. and on the markets, shares are higher despite fears of a looming global trade war — asia boosted by reports of new stimulus measures to support the chinese economy. we start in the city of london where this evening britain's finance minister, chancellor of the exchequer philip hammond, will address top bankers at the annual mansion house dinner. he'll be trying to convince them that london can remain a ‘global capital of finance‘ after the uk leaves the european union. and he will confirm he‘s sticking
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to plans to balance the government‘s finances by 2020 — despite growing concerns about the state of the uk economy. uk interest rates arejust 0.5% — barely above their level after the financial crisis. and they are expected to stay there when the bank of england meets later today. that‘s because britain‘s economic growth rate slumped to just 0.1% in the first three months of the year, its worst quarterly gdp figures for five years. on top of this, uk financial firms — the biggest sector of the economy — are increasingly worried about their status post—brexit. they fear they will lose so—called passporting rights, which let them provide financial services across the eu. and they warn of disruption to $34 trillion worth of derivatives — financial contracts like futures and options — as well as some 36 million insurance policies. banks and insurers say there‘s just not enough time to rewrite them
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all — according to financial services lobby group thecityuk. there was some relief for the battered pound sterling late on wednesday though — it rose from a 7—month low after the government narrowly got its eu withdrawal bill through parliament. international trade secretary liam fox welcomed the vote. there were some procedural changes today but no change in the fundamental issue here, that is that the government cannot be forced by parliament to negotiate something that the government does not want to do. that is the key as we move forward. hopefully this takes the brexit debate into a new place. the focus is not on the legislation which, of course was designed to give us a smooth transition, but now onto the future economic partnership itself. with me is david clarke, head of policy at positive money. it‘s a think tank and pressure group that campaigns for reform
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of the financial system. reform may be coming whether we like it or not. what do you want to hear from the chancellor tonight? he will set out his vision for the future of the uk financial services act after brexit. he wants the uk to remain the undisputed centre for global, as. that will depend on getting a satisfactory deal for the eu, as. that will depend on getting a satisfactory dealfor the eu, with the eu. at the moment, the position of the government is that it wants something called mutual recognition, where the eu will recognise the uk‘s regular tory regime —— regular treat regime and vice—versa. they say it is not on the table so we will be interested to see what plan b is. it may be because we have to pay a lot for access to financial services. it is important we do not prioritise the interest of the financial sector
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over other areas of manufacturing because that would exacerbate the imbalances that exist already in the economy. as far as the city is concerned, what are your primary worries about drop and make job losses 7 worries about drop and make job losses? thousands of jobs worries about drop and make job losses? thousands ofjobs in london in the, to anyone a of london‘s economic output. so far we have not seen economic output. so far we have not seen any mass movement from economic output. so far we have not seen any mass movement from banks, have we? a small trickle effect. some banks, such as the swiss investment bank ubs say they want to remain your‘s —— they want london to remain your‘s —— they want london to remain the financial hub of europe to balance in new york. banks are waiting to see what the outcome of the negotiation is. the eu is our biggest export market, particularly for services. it is crucial for the financial services sector that we get a good deal. i think you can see that although there may not be that
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many moves by banks yet, they are merely waiting to see what the outcome is sunday will be looking closely at the speech from the chancellor this evening. you think the bank of england and the government are prepared to the possibility of some kind of possible financial shock? if we left the eu without a deal it would be an enormous financial shock. i think there is a concern at the moment that we would be relying on the bank of england to question asked from that low of a brexit shock just as we look to the bank of england after the eu referendum. at that point, the eu referendum. at that point, the bank of england forward interest rates and expanded the quantitive easing programme. we could not rely on the bank to caution as the game from a brexit shock. interest rates are already below i% and there is not much further they can fall. qe is now £445 billion. there are concerns about the effect that has had on inequality and both of those policies have failed to feed through
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to investment in the real economy and a rise in wages. so it is important that the government and the bank of england to think about how they can respond to a brexit shock. we will hear what the chancellor has to say later. thank you. photo—sharing app instagram has launched a new feature allowing users to upload videos of up 60 minutes. it comes after rival snapchat announced a similar video feature, aimed at keeping users on the site longer. our us technology reporter, dave lee was at the launch of igtv. this is instagram‘s long expected move into long form video. no longer will clips be just a few seconds, now they can be as long as 60 minutes. the goal is simple, they wa nt to ta ke minutes. the goal is simple, they want to take out the new dam at advertising revenue from youtube and ca ptu re advertising revenue from youtube and capture younger audiences that are gravitating towards snapchat which already has similar content. instagram that have a big challenge on its hands. to start with, the
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video will be shot vertically and it also has still some of those top creators currently using other platforms into making stuff for instagram instead. currently they will not share any advertising revenue so will not share any advertising revenue so i asked instagram‘s co—founder why any creator would wa nt to co—founder why any creator would want to move to their platform instead. they find a growing audience and connecting to that base is valuable for them, but for a career launch or about doing deals with brands and branding content and they negotiate those separately away from instagram. that will continue. we have seen some ideas elsewhere. youtube have been in this prolonged time. snapchat stories has been copied by instagram. what sort of originality is coming from your company? looking at the community and giving them what they want. putting things in that you may have seen putting things in that you may have seen elsewhere, we have acknowledged that stories came from snapchat first, it does not work when you see other companies do that, it does not
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fit to dig so we are working on the design to make it feel like instagram internally and make it fit in. the company also announced that instagram has over of the monthly active users, the fastest growing major social network on the internet. if they want to keep that up, this plan has got to work. let‘s go to asia now, where chinese mobile phone maker xiaomi is gearing up for its huge stock market flotation. but it may not be quite as huge as initially planned. tim mcdonald is following the story. can you bring us up to date? can you bring us up to date7m can you bring us up to date? it is still a very big initial public offering, even if they are not getting as much as they wanted. this isa getting as much as they wanted. this is a 6—$.i billion ipo, the world ‘s biggest tech debuts since alibaba in 2014. previously, xiaomi had wanted to raise $10 billion. a split in shares between hong kong and shanghai. that dual listing
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structure may not go ahead just yet as there seems to be a hiccup with the chinese authorities. it will be interesting to see how xiaomi does. it was started by making cut—price smart phones and they have been more aggressive targeting lacoste markets and some of their competitors. they are big brazil and and some of their competitors. they are big braziland india, and some of their competitors. they are big brazil and india, for example. xiaomi slipped into the top five smart phone makers after stellar growth of nearly 75% last year. 92.4 million units were sold so year. 92.4 million units were sold so there is a market that the competition is fierce and xiaomi was, a few years ago, the leading smart phone maker in china and now is struggling to reach the top five. do not forget that apple makes huge profits from premium product like the iphone so we willjust have to wait and see whether the budget version can also offer a good return for investors. now let‘s brief you on some other business stories. german car giant daimler, owner of mercedes benz, has warned profits will fall this year because of trade tensions. it says new chinese tariffs on cars imported from the us will hit sales
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of its profitable sport utility vehicles which it makes in alabama for export to the rest of the world. the european union will launch retaliatory tariffs against us exports on friday, including bluejeans, motorbikes and bourbon whiskey. the move comes after president trump imposed steep duties on steel and aluminium earlier this month. and now — what‘s trending in the business news this morning. cnbc has calculated that trump‘s trade fights have cost the stock market trillions. it suggests trade is one big reason stocks are flat this year despite strong economic growth and corporate tax cuts. up next — newsbriefing. we‘ll take you through the stories making headlines in the global media today including: the chancellor is to admit for the first time that taxes
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will have to rise to cover the costs of increased spending on the nhs. in a speech tonight, philip hammond will say that any increases will be done in a "fair and balanced way". he will also make it clear the government will stick to its promise to reduce the nation‘s debts. jon donnison reports. in the week the prime minister pledged an extra £20 billion of that one mac funding, tonight will get some indication of how the government intends to pay for it. and the chancellor, philip hammond, is expected to say that taxes will have to rise as he gives his annual mansion house speech on the state of the uk economy. he is expected to say that any increases will be fair and balanced, to support the nhs we all use. this could put at risk the
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conservative party‘s manifesto pledge last year that there was a firm intention to reduce taxes. and in an early draft of the speech released overnight by the treasury, there is no mention of the so—called brexit dividend that theresa may said could be used to pay part of an increased one mac built. economist have said they dismissed the idea that there will be a dividend from leaving the european union, arguing that the cost of the economy outweighs any reduction in payments to the eu. bereaved families are calling for criminal proceedings to be brought over the premature deaths of hundreds of hospital patients, who were given overdoses of powerful painkillers. an inquiry has found that as many as 600 patients at gosport war memorial hospital in hampshire may have died over an 11—year period because of the unnecessary prescribing of opioids. coming up at six o‘clock on breakfast: we‘ll have all the day‘s news, business and sport. they‘ll also have more on what‘s next for brexit plans as theresa may‘s
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flagship brexit bill clears its final parliamentary hurdle. this is the briefing from bbc news. the latest headlines: after the outcry, the climbdown. president trump ends his policy of separating migrant children from their parents. migration is also a big issue in europe. on sunday there‘ll be an emergency eu meeting dealing with the crisis. now it is time look at the stories that are making the headlines in media across the world. we begin with the washington post. it reports that president trump has backed down on his policy of separating immigrant children from their parents on the us—mexico border. it comes as images of youngsters in cages sparked outrage around the world. the guardian features a story about lord sugar. the high—profile presenter of the apprentice has apologised for a tweet comparing the senegalese football team at the world cup
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to beach vendors in marbella. sugar posted a photo—shopped picture showing players apparently selling handbags and sunglasses. the times front page reveals that donald trump and vladimir putin are preparing to meet. the us president is due to visit brussels for the nato summit next month. the meeting between the two leaders is speculated to take place around this time. it‘s a move that‘s causing alarm in westminster. the straits times has a cashless society story. it says singaporeans are adopting online payments with such gusto that the government hopes that the country will be cheque—free by 2025. the new zealand herald online is on baby watch as they wait for their prime ministerjacinda ardern‘s baby to arrive. ms ardern is currently in labour, and the paper has live online coverage from outside auckland hospital. the 37—year—old is only the second world leader to have a child while in office. bbc news 0nline features a story about japanese fans
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at the world cup. the ‘samurai blue‘ supporters impressed organisers when they came equipped with large rubbish bags and cleaned the stadium after their team beat colombia on tuesday night. so let‘s begin. with me is jane foley, senior foreign exchange strategist at rabobank. the washington post starts with donald trump‘s decision to reverse that order, ending his policy of separating families at the border after an international outcry. indeed it does, and the thing that shocked me — the pictures were extremely shocking, but then we heard about the numbers. this is the washington post and it says that, since last month, 2342 children have been separated from their parents.

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