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Speaker 1: This is Bloomberg Daybreak curate for this Thursday, the eleventh

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Speaker 1: of May in London.

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Speaker 2: Coming up today, a.

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Speaker 3: Double digit problem surging inflation set to force the Bank

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Speaker 3: of England into a twelfth straight rate rise.

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Speaker 2: Pause for thought.

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Speaker 1: Cooling US inflation adds to the case for the Fed

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Speaker 1: to stop hiking.

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Speaker 3: Biden does up the pressure. The US President warns the

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Speaker 3: whole world is in trouble if America defaults.

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Speaker 4: UK executives look for a US pay rise, a bonfire

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Speaker 4: of EU laws is extinguished, and.

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Speaker 5: The rise of older preneurs.

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Speaker 4: Those are the stories we're looking at in today's papers.

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Speaker 5: And I'm Leanne Gerrins.

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Speaker 1: Plus Disney minus the Entertainment Giant sees a drop in

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Speaker 1: streaming subscriptions.

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Speaker 6: That's all straight ahead on Bloomberg Daybreak Europe. The business

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Speaker 6: news you need to start your day in just one

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Speaker 6: fifteen minute podcast on Apple, Spotify, the Bloomberg Business App

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Speaker 6: and everywhere you get your podcasts.

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Speaker 7: Good morning. I'm Stephen Carroll and I'm Caroline Hetger.

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Speaker 2: Here are the stories that we're following today.

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Speaker 3: The Bank of England is set to raise rates by

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Speaker 3: a quarter point today. The move would take the bank

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Speaker 3: space rate to four and a half percent, the highest

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Speaker 3: since two.

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Speaker 7: Thousand and eight.

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Speaker 3: Speaking to us here on Bloomberg Radio, former Monetary Policy

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Speaker 3: Committee member so Shield wad Wani said, there's a strong

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Speaker 3: argument for not going much higher.

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Speaker 8: I think the risks of a US recession have gone up,

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Speaker 8: which I then think possibly make it unwise for us

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Speaker 8: to take rates in the UK two five percent or

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Speaker 8: above what.

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Speaker 3: One is view feed into a debate about whether the

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Speaker 3: Central Bank will again leave the door open to more

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Speaker 3: rate hikes. The decision due in midday London time, with

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Speaker 3: the press conference half an hour later, and we'll hear

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Speaker 3: from Governor Andrew Bailey when he speaks to Bloomberg at

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Speaker 3: four o'clock this afternoon.

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Speaker 1: Bloomberg has learned that ECB officials are starting to accept

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Speaker 1: that interest hikes might need to continue in September. Our

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Speaker 1: sources say that some policy make us from across the

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Speaker 1: spectrum of the Governing Council think that two further quarter

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Speaker 1: point hikes may not be enough to tame consumer prices.

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Speaker 1: That could mean a possible third move in September, bringing

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Speaker 1: the deposit rate to four percent.

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Speaker 3: The US inflation has dropped below five percent for the

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Speaker 3: first time in two years. The data signals that price

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Speaker 3: pressure is beginning to ease, with services inflation slowing noticeably.

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Speaker 3: Bloomberg opinion columnists and former New York Fed President William

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Speaker 3: Dudley says there's more work to do.

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Speaker 9: The Fed making some progress on the inflation front, but

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Speaker 9: they haven't made much progress yet on the labor market

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Speaker 9: and on the.

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Speaker 8: Wage trend, So it's hard to see inflation going all

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Speaker 8: the way back to two percent.

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Speaker 7: Where the labor market this day and.

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Speaker 3: Reaches as high, they're going to keep rates at this.

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Speaker 8: Level, or maybe a lit'll leave a little bit higher

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Speaker 8: until they see as that their confident and inflation has

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Speaker 8: been to get back to two percent.

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Speaker 3: Speaking to Bloomberg, Dudley also conceded that the Fed's monetary

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Speaker 3: policy has got attributed to problems in the banking sector.

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Speaker 3: USCPI command at four point nine percent year on year,

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Speaker 3: investors greeting the figures as a sign the central bank

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Speaker 3: is unlikely to keep tightening. The Fed raised its benchmark

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Speaker 3: great above five percent last week for the first time

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Speaker 3: since two thousand and seven.

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Speaker 1: So US inflation shows signs of cooling, perhaps giving the

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Speaker 1: Fed room to pause, But the debt ceiling remains a

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Speaker 1: major concern. President Biden says that a default would drag

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Speaker 1: the US into a recession and have devastating repercussions for

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Speaker 1: the global economy.

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Speaker 10: Here's what's happened if MAGA Republicans get their way, American

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Speaker 10: defaults on our debt, higher interest rates for credit cards,

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Speaker 10: car loans, mortgages, payments for Social Security, Medicare, our troops

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Speaker 10: veterans could all be hauled in the lane.

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Speaker 1: Biden's remarks come a day after his first round of

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Speaker 1: talks with congressional leaders made little headway towards an agreements.

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Speaker 3: Disney's shares fell and after I was trading on Wall

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Speaker 3: Street after the company reported a drop in streaming subscribe.

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Speaker 3: The firm says losses that the division will rise by

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Speaker 3: one hundred million dollars this quarter. But David Traynor, CEO

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Speaker 3: of New Constructs, who specialize in investment research, says it's

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Speaker 3: not bad news.

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Speaker 9: Streaming was never really meant to be a profitable business.

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Speaker 9: It's a loss leader for other profitable businesses, and Disney

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Speaker 9: is by far the best position media and content company

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Speaker 9: to monetize content.

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Speaker 3: David Trayner says the key news for Disney shareholders is

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Speaker 3: still the recent return of CEO Bob Eiger. Total revenue

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Speaker 3: of the world's largest entertainment firm rose by thirteen percent

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Speaker 3: to twenty one point eight billion dollars for the period,

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Speaker 3: driven by strong performance of the company's theme parks.

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Speaker 1: And investors have wiped as much as two point three

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Speaker 1: billion dollars off the market value of carl ICAN's investment

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Speaker 1: firm after it disclosed a federal inquiry into its practices.

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Speaker 1: More now from Bloomberg's Charlie Pellett.

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Speaker 11: It adds to the pressure that a short sellar attack

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Speaker 11: has been putting on the stock since last week. According

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Speaker 11: to a filing, the US Attorney's Office for the Southern

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Speaker 11: District of New York is seeking information on Icon Enterprises

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Speaker 11: corporate governance, securities offerings, dividends, and due diligence. Icon Enterprises

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Speaker 11: says it is cooperating with request. Separately, the firm hit

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Speaker 11: back in detail for the first time again short selling

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Speaker 11: firm Hindenburg Researchers report, which claimed on May second that

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Speaker 11: the company is overpriced and said it found evidence of

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Speaker 11: inflated valuations for some of its assets in New York.

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Speaker 11: Charlie Pellett Bloomberg Daybreak Europe.

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Speaker 1: Those a few of our top stories then for you

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Speaker 1: this morning. I mean interesting the story around short sellers

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Speaker 1: with Carl Kamp because there's another piece on the terminal

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Speaker 1: that there are now investigations that are beginning into short

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Speaker 1: sellers related to those US regional banks. It seems to

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Speaker 1: have peaked the interest of the FDIC in others. I

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Speaker 1: think that'll be quite interesting if that becomes a bigger issue,

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Speaker 1: given the importance of that story in the last few weeks.

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Speaker 7: Yes, certainly one to watch. Meanwhile, do you get nostalgic

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Speaker 7: about technology?

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Speaker 2: No, I just like the novelty.

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Speaker 7: I am all surprised by that.

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Speaker 3: No, because this is the whole idea of flip phones

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Speaker 3: basically are back, except if you're Apple, because this is.

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Speaker 7: The foldable screens.

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Speaker 3: We were all marveling at a colleague of ours foldable

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Speaker 3: phone earlier in the week. But the trend of a

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Speaker 3: foldable phone, which has been around for a couple of

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Speaker 3: years now, debut by Samsung in twenty nineteen.

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Speaker 7: Still Apple hasn't managed to enter that game yet.

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Speaker 3: And there's a great piece by our colleague Ladsabov looking

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Speaker 3: at this and how It's not unusual necessarily for Apple

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Speaker 3: not to jump on a technology trend immediately, because they

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Speaker 3: tend to sit back and wait until they can do

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Speaker 3: it well and in an Apple way. But the question

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Speaker 3: now is is whether or not Apple will jump on

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Speaker 3: the foldable bandwagon or maybe not.

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Speaker 5: Listen.

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Speaker 1: I think if it's a great bit of kit, of

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Speaker 1: course you want to have it. I think perhaps Apple

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Speaker 1: can afford to be relaxed. I mean, what, they totally

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Speaker 1: dominate the kind of high end market for smartphones.

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Speaker 3: I mean seventy seven percent of the market for phones

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Speaker 3: that are of over seventy seven hundred and fifty one dollars.

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Speaker 1: It's one But having said that, you can understand that

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Speaker 1: they do not want to be caught out if this

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Speaker 1: is definitely the new the kind of new wave of

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Speaker 1: technology at the moment, it's largely the Android phones though, that.

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Speaker 7: Is exactly yeah.

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Speaker 3: Yeah, And it's this question as well as that, you know,

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Speaker 3: do I find working on a phone quite frustrating?

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Speaker 7: Is that age? Is that because I'm just looking too Well.

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Speaker 1: It's just the staggering amount of time that we spend

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Speaker 1: having to look at the screen, isn't it.

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Speaker 2: I think that's the two bigger.

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Speaker 3: Phone, better or worse for that anyway, debate for another day.

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Speaker 3: Let's turn back to matters here in the UK and

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Speaker 3: the dilemma facing the Bank of England as it goes

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Speaker 3: into its right decision today. Stubborn rather double digit inflation

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Speaker 3: set to forth the Bank of England into a twelve

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Speaker 3: straight interest rate rise today even though the end of

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Speaker 3: its lightning quick hiking cyclist coming into view. Let's bring

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Speaker 3: in our UK correspondent.

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Speaker 7: Lizzie Burden. Lizzie, what should we be expecting from the

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Speaker 7: Bank of England today.

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Speaker 12: Well, Stephen, we are expecting a quarter point height to

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Speaker 12: four point five percent. But there is going to be

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Speaker 12: a vote split on the committee. Economists reckon it'll be

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Speaker 12: the same as last time, seven to two. Because you've

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Speaker 12: got doves like Silvana ten Rairos saying to be a

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Speaker 12: hawk right now is like being a fool in the shower,

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Speaker 12: keeping turning on the hot tap, not being patient enough

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Speaker 12: to wait for the warm water, and scolding yourself in

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Speaker 12: the process. But you've got hawks on the committee, the

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Speaker 12: likes of Catherine Mann saying you need to bear down

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Speaker 12: on inflation expectations, keep going with the tough action, get

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Speaker 12: in control of the second round effects of this imported inflation,

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Speaker 12: So a seven to two split four point five percent

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Speaker 12: where we expect rates to end up today. But the

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Speaker 12: real focus will be what's the future path for rates

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Speaker 12: and when does the pause come?

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Speaker 1: So how much forward guidance do you really think we're

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Speaker 1: going to get then?

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Speaker 12: I mean, this is a question because how much certainty

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Speaker 12: can you give when there's so much uncertainty around the data.

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Speaker 12: We've had surprise after surprise when it comes to the

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Speaker 12: inflation and labor market data.

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Speaker 5: How credible can.

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Speaker 12: The Bank of England be other than saying it's all

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Speaker 12: data dependent from here on out? Was the Bank of

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Speaker 12: England too dubvish earlier in the cycle and is it

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Speaker 12: too late for tough talk now? So we'll get the

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Speaker 12: press conference, we'll hopefully have the interviews after that, but

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Speaker 12: I would look at the forecasts for clues for the

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Speaker 12: future path for rates. Most economists Bloomberg have surveyed say

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Speaker 12: that the Bank's going to raise its inflation forecast for

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Speaker 12: this year next year in twenty twenty five. That's because,

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Speaker 12: of course we've had that upside inflation surprise in the

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Speaker 12: latest data, and it'll be interesting to see where the

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Speaker 12: bank reckons inflation will end the year. Because NISA, the

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Speaker 12: think tank, has said that Rishi Sunac's priority is top

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Speaker 12: priority of harving inflation by the end of the year,

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Speaker 12: isn't looking necessarily realistic anymore, and in fact they say

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Speaker 12: that it's pretty irresponsible who have set that target because

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Speaker 12: it interferes with the bank's inflation fighting mission.

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Speaker 3: What about quantitative tightening, Lizzie? What should we be expecting

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Speaker 3: to hear on that front?

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Speaker 12: So economists expect that the Bank's going to keep going

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Speaker 12: with its current pace of quantitative tightening, cutting the portfolio

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Speaker 12: of bonds by eighty billion pounds a year, with just

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Speaker 12: over half from active sales. Of course, it started guilt

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Speaker 12: sales last November.

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Speaker 5: And then we've heard from.

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Speaker 12: The Deputy Governor Ben Broadbent saying last month that a

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Speaker 12: decision on qt's due in September. So nothing expected on

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Speaker 12: that front today, will have to wait till after the summer.

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Speaker 3: Okay, are UK carrithonder, Lizzie Burden, thank you very much

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Speaker 3: for joining us with the latest from the Bank of England.

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Speaker 3: That decision due at midday today. Up next though a

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Speaker 3: UK execs look for a US pay Bump, a bonfire

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Speaker 3: of EU laws is extinguished and the rise of entrepreneurs.

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Speaker 8: Now.

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Speaker 6: The paper Review hond blue Bird, Daybreak Europe the news

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Speaker 6: you need to know.

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Speaker 1: Again It joins us with a run through the newspapers.

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Speaker 1: Let's start with the Financial Times. Does it pay for

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Speaker 1: British executives to move to the US.

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Speaker 2: This is such a pertinent question. What did they find?

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Speaker 10: Yes?

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Speaker 4: And Caroline, isn't this debate really back into the spotlights.

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Speaker 5: The article in the.

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Speaker 4: Ft really breaks down the pros and cons for British executives,

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Speaker 4: debating whether they.

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Speaker 5: Want a new life in the US.

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Speaker 4: Now the debate over whether the UK is using its

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Speaker 4: top talent and actually faller furthering behind New York as

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Speaker 4: the home of the world's top companies.

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Speaker 5: As I just said earlier, it's really.

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Speaker 4: Something that's coming to the forefront again and fears are

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Speaker 4: growing among boards that restrictions on wages are actually damaging

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Speaker 4: UK based companies. Recently we heard from the LSE boss

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Speaker 4: that Julia hoggets calling for a fresh look at how

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Speaker 4: executives are paid right here in the UK.

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Speaker 5: And we also know sholders.

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Speaker 4: Recently voted down proposals for pay at UNILEBA. A lot

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Speaker 4: of people are saying top executives shouldn't get all this

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Speaker 4: money in the cost of living crisis.

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Speaker 6: Now.

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Speaker 4: Gavin Patterson, he used to run BT but left the

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Speaker 4: company here in the UK to work for Sales Force,

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Speaker 4: the big tech company over in Silicon Valley, told the

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Speaker 4: paper on a personal level, you earn more money in

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Speaker 4: the US. But what's interesting, you see is come back

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Speaker 4: to the UK now is reflecting on it and says

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Speaker 4: governance in the US has positives and negatives. He says, reflecting,

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Speaker 4: you know, on the threat of class action lawsuits, which

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Speaker 4: is very different here in the UK compared to the US.

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Speaker 4: And I just want to say, how much do you

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Speaker 4: think a chief executive roles medium payers in the US?

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Speaker 5: Stephen, without looking.

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Speaker 7: I don't like six seven million.

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Speaker 4: So it's thirteen point four million dollars. And that's compared

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Speaker 4: with the UK, which is five point think five million dollars. Now,

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Speaker 4: that was back in twenty nineteen, according to Wills Towers Watson.

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Speaker 1: So well, listen, you can earn a lot more, but

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Speaker 1: the size of businesses in the US markets is much

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Speaker 1: larger on average obviously, so but yes, there is still

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Speaker 1: a huge premium for working in the United States. I

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Speaker 1: quite like this though this line around outrage constraint is

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Speaker 1: still lower in the US.

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Speaker 2: Yeah, and that is a.

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Speaker 1: Kind of issue, the comparisons to what the medium pay

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Speaker 1: is in the business versus the CEO. Anyway, that from

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Speaker 1: the ft BONFAVEU laws scaled back to the fury of brexitteers.

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Speaker 1: So this is the ongoing story around legislation and it's

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Speaker 1: in the time.

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Speaker 4: Yes, it is, Caroline, and we have to discussed us

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Speaker 4: before in the paper review and it's something that has

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Speaker 4: been brought up and it's been a hot topic for

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Speaker 4: a while within the government. Now the government, according to

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Speaker 4: The Times, has ditched its plans for thousands of EU

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Speaker 4: era laws to expire automatically at the end of the year.

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Speaker 4: Now we did already know this, but now we know

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Speaker 4: the extent of it. Now the plan was dubbed a

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Speaker 4: post Brexit bonfire, and it is a major Brexit U

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Speaker 4: turn from the government. We must remember that this was

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Speaker 4: the legislation promised by the government, especially in its last

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Speaker 4: election manifesto. Now it's going to scrap EU laws, which

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Speaker 4: has infuriated these right wing backbenches. So they've done this

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Speaker 4: huge U turn to scrap those EU laws. The time

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Speaker 4: says only a fraction of the nearly four thousand EU

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Speaker 4: laws still in effect in the UK will be scrapped,

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Speaker 4: so five hundred and fifty laws will now be revoked

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Speaker 4: and three thousand will remain. Kenny Badenock, the Business and

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Speaker 4: Trade Secretary, said the government would no longer sunset all

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Speaker 4: the laws by the end of the year. The sunset

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Speaker 4: means expire them by the end of the year, and

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Speaker 4: Badenock said that had just become so clear that during

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Speaker 4: the process of identifying which UK laws to derive from

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Speaker 4: the EU, that there was a risk that important legislation

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Speaker 4: could be scrapped inadvertently.

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Speaker 5: Now, as I said, we had heard about this rollback.

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Speaker 4: Happening before, but now we're really seeing the extent of it,

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Speaker 4: which has annoyed right wing backbenches and brexfiteers of the

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Speaker 4: Tory Party.

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Speaker 3: Okay, so details they're coming from the Government on the

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Speaker 3: reduced scale back of those EU laws. Let's go to

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Speaker 3: the Telegraph next. Leanne and a piece from the journalist

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Speaker 3: Helen cow and Taylor talking about why more and more

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Speaker 3: of Generation X have no intention of retiring.

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Speaker 5: So journalists and artists.

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Speaker 4: Helen Cohen Taylor's opinion article as a ray of sunshine.

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Speaker 4: If you don't want to play golf, cut back or

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Speaker 4: quietly quit as you start going gray and have a

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Speaker 4: dodgy hip. Now, this is what she says in an

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Speaker 4: opinion article for The Telegraph, and she says, as Generation

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Speaker 4: Z whittles down it's working week to four days or

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Speaker 4: even less, Generation X seems to be heading in the

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Speaker 4: opposite direction.

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Speaker 5: And she also makes the point that.

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Speaker 4: Jeremy Hunts so called Kay budget in March confirmed the

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Speaker 4: government doesn't want them to quit either. She talks about

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Speaker 4: older preneurs launching new ventures in our late fifty.

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Speaker 5: She says, and beyond.

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Speaker 4: And she says this group is twice as likely as

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Speaker 4: a thirty year old to start an extremely successful company.

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Speaker 5: I think that's pretty amazing.

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Speaker 4: She also talks about Trinny Woodall she started her brand

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Speaker 4: at the age of fifty three. She's got a really

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Speaker 4: you know, extensive beauty brand. Now she does makeup, she

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Speaker 4: does close.

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Speaker 7: We remember her not quite a typical entrepreneurial, not quite.

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Speaker 5: The typical we remember her from the days shows, but

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Speaker 5: she was already well known.

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Speaker 4: But you know it now has a market valuation of

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Speaker 4: one hundred and eighty million pounds her business, and she's

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Speaker 4: so good on social media show. It shows that age

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Speaker 4: doesn't matter when it comes to that. And Jeremy Clarkson two,

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Speaker 4: he's been learning a lot about farming.

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Speaker 5: Clarks and farm laughing, No.

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Speaker 4: I Carolina laughing, Yeah, since farm has become a big deal.

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Speaker 1: Well, the thing is, we're all living longer. So you know,

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Speaker 1: for me, my life expectancy for the year that I

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Speaker 1: was born in this seventy seven, so you can understand that,

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Speaker 1: actually everyone needs to keep going for a little bit longer.

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Speaker 1: And entrepreneurship, yeah, the most popular time to start a

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Speaker 1: business obviously in your fifties.

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Speaker 4: But like Stephen said, they have pointed out people who

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Speaker 4: already had successful careers, so they launching themselves from a

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Speaker 4: position already.

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Speaker 7: Now they'll take away from their success.

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Speaker 4: Not to take away from their success, but I just

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Speaker 4: think this is a great article.

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Speaker 5: Doesn't matter if you're going.

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Speaker 2: Gray like me.

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Speaker 7: This is Bloomberg Daybreak Europe.

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Speaker 3: You're morning brief on the stories making news from London

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Speaker 3: to Wall Street and beyond.

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Speaker 1: Look for us on your podcast speed every morning, on Apple,

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Speaker 1: Spotify and anywhere else you get your podcasts.

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Speaker 3: You can also listen live each morning on London DAB Radio,

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Speaker 3: the Bloomberg Business app, and Bloomberg dot Com.

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Speaker 1: Our flagship New York station, is also available on your

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Speaker 1: Amazon Alexa devices. Just say Alexa Play Bloomberg eleven thirty.

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Speaker 7: I'm Caroline Hepka and I'm Stephen Carol.

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Speaker 3: Join us again tomorrow morning for all the news you

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Speaker 3: need to start your day right here on Bloomberg Daybreak

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Speaker 3: Europe