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Speaker 1: Bloomberg Audio Studios, podcasts, radio news.

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Speaker 2: This is the Bloomberg DAYBAQT podcast, available every morning on Apple, Spotify,

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Speaker 2: awherever you listen. It's Wednesday, the twenty fifth of June

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Speaker 2: in London. I'm Caroline Hepke and.

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Speaker 3: I'm Stephen Carroll coming up today. An early US intelligence

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Speaker 3: report shows American air strikes have only had a limited

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Speaker 3: impact on Iran's nuclear program.

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Speaker 2: The EU warns it will impose tariffs on American imports

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Speaker 2: if the White House keeps a baseline levy on its goods.

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Speaker 3: Plus struggling to work it out, chat GPT's appeal to

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Speaker 3: office workers presents a growing problem for its biggest backer Microsoft.

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Speaker 2: Let's start with a roundup of our top stories.

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Speaker 3: America's unprecedented air strikes on Iran's nuclear facilities had only

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Speaker 3: a limited impact, according to early US intelligence findings. A

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Speaker 3: report by the Pentagon's Defense Intelligence Agency says the bombing

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Speaker 3: likely didn't cripple the core components of Iran's program, including

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Speaker 3: its centrifuges. According to people familiar with the assessments, the

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Speaker 3: US strikes are likely to have set Tehran's plans back

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Speaker 3: by several months to as much as a year. US

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Speaker 3: President Donald Trump's team dismissed the reports, which cast doubt

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Speaker 3: on his claim that the strikes totally obliterated their targets.

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Speaker 3: White House Press Secretary Carlin Levitt posted on x that

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Speaker 3: the intelligence finding of limited impact was flat out wrong

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Speaker 3: and quote a clear attempt to demean President Trump. Despite

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Speaker 3: the White House's pushback comments, the assessment will likely only

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Speaker 3: intensify calls from the United Nations Nuclear watchdog for renewed

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Speaker 3: inspections of the targeted sites. This as a ceasefire Trump

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Speaker 3: broker to end the twelve day conflict between Israel and Iran,

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Speaker 3: appears to be holding after twenty four hours.

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Speaker 2: Meanwhile, President Trump has cast doubt on NATO's founding principle.

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Speaker 2: As he arrived at the Military Aunts annual summit here

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Speaker 2: in Europe, Trump was asked by reporters on Air Force

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Speaker 2: one if he was still committed to Article five of NATO,

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Speaker 2: which says that allies will come to the aid of

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Speaker 2: a country under armed attacks.

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Speaker 4: Numbers definition, So Article five you know that, right, But

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Speaker 4: love committed to confer help friends with Many of those

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Speaker 4: leaders have committed.

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Speaker 2: To helping, So the US president's comments, it depends on

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Speaker 2: your definition. It comes as NATO's other leaders try to

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Speaker 2: keep America engaged by promising to ramp up defense spending,

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Speaker 2: so the UK says that it would buy at least

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Speaker 2: twelve new US made F thirty five A fighter jets

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Speaker 2: in an attempt to curry favor, and NATO Sexuary General

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Speaker 2: Mark Rutter texted the US President to say, quote, Europe

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Speaker 2: is going to pay in a big way as they should,

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Speaker 2: and it will be your win.

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Speaker 3: The European Union has planned retaliatory tariffs if the White

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Speaker 3: House keeps its baseline levies on EU goods. Bloomberg has

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Speaker 3: learned the European Commissioner is preparing a list of American

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Speaker 3: imports worth ninety five billion euros to tax on top

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Speaker 3: of its existing duties. Officials told Bloomberg they expect certain

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Speaker 3: US tariffs will remain in place even if trade talks

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Speaker 3: go well, and the EU will respond to those. The

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Speaker 3: US has just two weeks left before President Trump's self

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Speaker 3: imposed pause on tariff's elapses, with only the UK securing

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Speaker 3: any deal on paper so far.

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Speaker 2: Chinese companies are ramping up shipments to Britain in a

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Speaker 2: sign of how US tariffs are reshaping global trade data

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Speaker 2: from Britain's Office for National Statistics shows goods imports from

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Speaker 2: China climbing to six billion pounds in April. That's up

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Speaker 2: eleven percent on a year earlier and the highest in

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Speaker 2: more than two years. Bloomberg's James Walcock has more Now.

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Speaker 5: Good things are increasingly coming in small packages. Imports of

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Speaker 5: low value Chinese goods in small all parcels were up

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Speaker 5: sixty six percent in May compared to the previous year,

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Speaker 5: hitting a UK record. It's the kind of deliveries she

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Speaker 5: In and Timu specialize in, and economists say, although trade

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Speaker 5: data is volatile, it's a sign higher US tariots maybe

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Speaker 5: driving cheap goods elsewhere. Although the shift could put downward

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Speaker 5: pressure on prices, it also has the UK government on

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Speaker 5: watch for unfair competition in London. James Wilcock Bloomberg Radio.

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Speaker 3: The Prime Minister Kris Starmer says he will push ahead

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Speaker 3: with controversial cuts to UK disability benefits despite a brewing

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Speaker 3: rebellion within his labor party. Poomberg's Even Parts has the details.

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Speaker 6: Kirs Starmer says there is a clear moral case to

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Speaker 6: reform the welfare system, signaling he's not going to back

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Speaker 6: down in the face of what could be the biggest

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Speaker 6: parliamentary rebelly in his government has faced. Some one hundred

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Speaker 6: and eight members of Parliament have put their names to

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Speaker 6: an amendment that would sink a key part of the

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Speaker 6: Chancellor's fiscal plans. That number is more than enough to

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Speaker 6: override the government's sizeable Commons majority, risking a humiliating defeat.

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Speaker 6: At issue is the five billion pounds of cuts to

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Speaker 6: the burgeoning bill for disability and sickness related benefits. Last month,

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Speaker 6: the government announced a dramatic reversal on plans to cut

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Speaker 6: the heating payments for pensioners. Kase Darman now signing he's

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Speaker 6: not planning a second big U turn this year in London,

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Speaker 6: I'm une pots Bloomberg Radio.

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Speaker 2: Well, let's turn our attention to the Federal Reserve chair

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Speaker 2: Jerown Powell, who says that higher inflation is keeping rates

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Speaker 2: on hold for now. Speaking to a Congressional panel yesterday,

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Speaker 2: the central bank chief repeated his view that there is

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Speaker 2: no rush to adjust policy.

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Speaker 7: If it turns out that inflation pressures do remain contained,

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Speaker 7: then we will get to a place where we cut

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Speaker 7: rates sooner rather than later. But I wouldn't want to say,

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Speaker 7: I wouldn't want to point to a particular meeting.

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Speaker 3: I don't think we need to be in any.

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Speaker 7: Rush because the economy is still strong, the labor market

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Speaker 7: is strong.

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Speaker 2: Palell's comments counter President Trump's calls for an immediate FED

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Speaker 2: cut and recent statements from Governors Chriusopher Walla and Michelle

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Speaker 2: Bowman signaling willingness to lower borrowing costs. In July, Powell

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Speaker 2: also maintained that the FMC should remain cautious whilst the

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Speaker 2: impact of President Trump's economic policy becomes clear. The news

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Speaker 2: zo comes after policymakers voted to leave interest rates unchanged

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Speaker 2: in a range of four quarters to four and a

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Speaker 2: half percent last week, and.

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Speaker 3: The former New York Governor Andrew Cuomo has conceded to

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Speaker 3: younger rival Zora and Mumdani in a stunning upset of

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Speaker 3: the New York City Democratic mayoral primary. According to preliminary results,

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Speaker 3: Mumdani garnered forty three point five percent of the vote

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Speaker 3: and Cuomo just over thirty six percent. Here's bloombergs Denise Palegrini.

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Speaker 8: The race is not officially called yet because no one

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Speaker 8: has fifty percent to the vote, but sixty seven year

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Speaker 8: old former governor Andrew Cuomo has conceded to thirty three

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Speaker 8: year old Democratic socialist Zoran Mumdani.

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Speaker 3: Tonight was not our night.

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Speaker 4: Tonight was Assemblyman Mundi, and he put together a great

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Speaker 4: care paign.

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Speaker 8: I'm Doney, backed by young supporters attracted to his promises

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Speaker 8: of rent freezes and freeze city buses. Under New York

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Speaker 8: City's Rank Choice, the votes for other candidates start to

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Speaker 8: get redistributed until the candidate gets fifty percent of the vote.

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Speaker 8: And this race is being widely watched as an indicator

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Speaker 8: of future direction of the Democratic Party in New York.

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Speaker 8: Denise Pelgridy, Bloomberg Radio.

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Speaker 2: And those are our top stories for you this morning.

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Speaker 2: Right in the markets, this cease far between Israel and

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Speaker 2: Iran seems to be holding. Oil prices are up by

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Speaker 2: one point two percent for brank Ree futures this morning,

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Speaker 2: but we're still treading on the sixty seven hand or

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Speaker 2: sixty seven ninety eight, so there.

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Speaker 3: Is relief there.

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Speaker 2: Also, we saw the Nasdat rising one and a half

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Speaker 2: percent on Tuesday, notching up another record high versus February.

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Speaker 2: So we've seen a huge rebound for the Nasdaq, something

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Speaker 2: like thirty percent. The S and PFI found it also

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Speaker 2: climbed to one point one percent yesterday. Stop futures this

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Speaker 2: morning are positive up to for the U stocks fifty

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Speaker 2: futures this morning is interesting though. The markets took Pal's

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Speaker 2: testimony the first day of it yesterday as as Darvish,

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Speaker 2: which I thought was a little bit strange given that

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Speaker 2: he reiterated this idea of no rush to cut interest rates.

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Speaker 2: But markets did boost bets on a reduction. They're looking

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Speaker 2: at July, it would seem, so let's see if that

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Speaker 2: changes again today. The other thing to think about too,

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Speaker 2: so European stocks yesterday really rallied one point one percent

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Speaker 2: of the close for the US stock six hundred, lifted

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Speaker 2: by airline stocks, and then just looking at the bond

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Speaker 2: markets tenny US eels a four point three percent In.

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Speaker 3: A moment, more on that US intelligence report on the

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Speaker 3: effect of US strikes on Iran, plus the rivalry, the

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Speaker 3: curious rivalry between two artificial intelligence names for the battle

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Speaker 3: for the office the workplace? Who's using AI at work?

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Speaker 3: A word first? Though, on another story that's caught or

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Speaker 3: I this morning, dating apps are out, matchmakers are in.

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Speaker 3: I really like this story at what point. Could we

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Speaker 3: have told this story over the past twenty years.

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Speaker 2: Well, yes, but I think it's the cost of the

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Speaker 2: matchmakers that has surprised me. And also so this is

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Speaker 2: Blinberg's ignacive Gonzalez and Lara Sally have been writing about dating.

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Speaker 2: I did not know that match Group, which owns Tinder,

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Speaker 2: has been seeing the number of paying clients online decline

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Speaker 2: for eight consecutive quarters. Actually, yes, the apps are grimm

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Speaker 2: they are becoming less popular. Apparently Match Groups of business

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Speaker 2: isn't expected to return to revenue growth until twenty twenty seven.

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Speaker 2: But the organizations that are making money and apparently growing

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Speaker 2: are these matchmaking services that cost thousands, if not tens

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Speaker 2: of thousands of pounds, slush dollars, slush ears.

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Speaker 3: Well, this just feels like one of those moments where

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Speaker 3: you have sort of a cyclical turn in an industry

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Speaker 3: where all of a sudden, dating apps were huge for

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Speaker 3: a certain other time, and maybe this is the move

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Speaker 3: on to the next phase, going back to in person connections.

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Speaker 3: But a very interesting read from our colleagues talking through

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Speaker 3: speaking to those matchmakers and some of the people that

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Speaker 3: use them, and what they expected of and whether or

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Speaker 3: not they think it's good value for money. Yeah, so

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Speaker 3: interesting find Well, I mean that's the point. But then

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Speaker 3: if you don't, are you going to be annoyed that

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Speaker 3: you spent thousands of dollars on a service that didn't

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Speaker 3: yield results? And as was, what's the science behind it?

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Speaker 3: Really interesting story. We'll put a link to it in

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Speaker 3: our show notes and you'll find it, of course on

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Speaker 3: bloomberg dot com and on the terminal.

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Speaker 2: Now, there is a c star holding between Israel and Iran,

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Speaker 2: but Bloomberg has learned that US intelligence assessments show only

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Speaker 2: limited impact from US air strikes on Teyran's nuclear program.

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Speaker 2: This is despite President Trump saying at the weekend that

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Speaker 2: the strikes totally obliterated their targets joining US. Now, as

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Speaker 2: Bloomberg's EMBA News director ros In matheson Good Morning of OZ,

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Speaker 2: what do we actually know about the damage done to

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Speaker 2: Iran's nuclear program? We have this assessment from the Pentagon

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Speaker 2: and also the IAEA. They clash with President Trump's view.

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Speaker 1: Well, that's it's actually interesting to see the White House

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Speaker 1: actually criticizing its own intelligence findings, because, as you say,

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Speaker 1: the Defense Intelligence Agency at the Pentagon has found at

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Speaker 1: least an initial assessment is it's unlikely that the US

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Speaker 1: bombing crippled the cork parts of Iran's nuclear facilities below

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Speaker 1: the ground, of course, they're deep underground, including their centrifugures.

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Speaker 1: And on the back of that you've got the IAEA,

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Speaker 1: of course, the un energy monitors who've been saying for

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Speaker 1: days it's very unclear what's going on, but they doubt

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Speaker 1: that these strikes set back around atomic ambitions significantly.

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Speaker 3: You know, could it be months, could it be years.

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Speaker 1: And of course the question above all is where is

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Speaker 1: this uranium that's enriched already to a sixty percent level

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Speaker 1: that the IAEA has lost track of. So those bits

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Speaker 1: of evidence in the sunlight images that we've got suggest

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Speaker 1: that it's unlikely that significant damage was caused to these

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Speaker 1: to these sites. Of course, the view from the White

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Speaker 1: House is that they've been totally obliterated, and that's the

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Speaker 1: line they're sticking to and in line with the Israelis

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Speaker 1: who have said that a keep part of their goal

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Speaker 1: in their own strikes against Israel was to destroy these facilities.

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Speaker 1: And so the question really is as the dust clears

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Speaker 1: metaphorically and literally, do we get a better sense of

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Speaker 1: those facilities, but without enough IAEA monitors on the ground,

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Speaker 1: and there are limited numbers there, it's very hard to

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Speaker 1: verify exactly what's going on.

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Speaker 3: Ross this as the course, as we're watching for further

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Speaker 3: developments out of the Middle East as well. We've had

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Speaker 3: some comments from the Ranian president, Massive Pozaskian as well,

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Speaker 3: talking about the great wounds that were inflicted by the

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Speaker 3: strikes from Israel as well and claiming that Israel's failed

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Speaker 3: to achieve its goals in Iran. This twenty four hours

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Speaker 3: on does appear to be holding.

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Speaker 1: It does appear to be holding, although it's very fragile,

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Speaker 1: even as we saw yesterday. It's of an extraordinary twenty

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Speaker 1: four to forty eight hours, and we had at least

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Speaker 1: a little bit of concern that the CEESPI, which we

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Speaker 1: weren't quite sure when it was going to take effect,

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Speaker 1: having an early wobble with a strike from Iran and

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Speaker 1: then Israel feeling the need to respond to that.

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Speaker 3: So it's incredibly fragile.

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Speaker 1: I mean, these are two countries who've been barring missiles

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Speaker 1: and drones at each other only days ago, and getting

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Speaker 1: the two countries to stand down is very difficult given

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Speaker 1: their history. Given of course, the weakening that Israel has

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Speaker 1: done against Iran through its proxies Hesbillah in Lebanon. It's

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Speaker 1: continuing warring Gaza against Hamas. There's a lot of complexity there.

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Speaker 1: So it's very difficult to get a sea spa and

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Speaker 1: make it stick. And beyond that, it's really hard to

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Speaker 1: get a path towards some kind of more stable diplomacy.

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Speaker 1: Of course, we've seen many rounds of talks to try

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Speaker 1: and get some kind of deal over Iran's nuclear program.

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Speaker 1: Those talks have gone nowhere. Maybe now they've got a

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Speaker 1: small window. I mean, Iran has obviously seen that Israel

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Speaker 1: in the US mean business, so that might prompt something.

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Speaker 1: But how or when diplomacy can get a chance here

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Speaker 1: that is also very unclear.

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Speaker 2: Meanwhile, NATO, the NATO gathering the Sextuary, General Mark Rutter

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Speaker 2: has dialed up the flattery of President Trump to kind

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Speaker 2: of warp speed the present. Though on board Air Force One,

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Speaker 2: you heard him. They're kind of crackly talking about collective defense.

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Speaker 2: It depends on your definition. This will surely alarm Europeans.

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Speaker 1: Well, it certainly will, because they were, you know, spent

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Speaker 1: months and months preparing the ground for this meeting, this

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Speaker 1: summit of NATO leaders, and the idea being to basically

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Speaker 1: avoid Donald Trump saying or doing anything that might cost

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Speaker 1: furthered doubt or NATO so careful preparations to get you know,

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Speaker 1: people to agree to this five percent defense spending, and

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Speaker 1: of course Spain not yet there, which is awkward for

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Speaker 1: UTA and NATO as a whole, other countries dragging the

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Speaker 1: chain also arguably on that and trying to avoid Trump

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Speaker 1: again putting the question mark over Article five, which is

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Speaker 1: this framework really under which NATO operates, the idea that

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Speaker 1: you defend each other when needed. Article five is pretty

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Speaker 1: clear on that, but Donald Trump already on the plane

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Speaker 1: over musing.

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Speaker 3: Aloud about what it might mean.

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Speaker 1: And that's really what we've been we've been, We've been

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Speaker 1: expecting the idea that for Europe at least, this has

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Speaker 1: all been a significant wake up call, you know, for Europe,

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Speaker 1: when you're thinking about the future, you've got to presume

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Speaker 1: that the US may not be there even despite the

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Speaker 1: you know, Article five existing, or coming to aid in

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Speaker 1: a different way than you'd expect, different kinds of assistance.

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Speaker 1: And that's certainly the parameters that Donald Trump now seems

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Speaker 1: to be laying out, so whether he commits to something

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Speaker 1: at the end of this remains to be seen. We'll

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Speaker 1: see in a press conference later today, but certainly it's

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Speaker 1: off to a bit of a webblue start.

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Speaker 3: Okay very emy AI's director Raslin Mathison, thank you.

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Speaker 2: Now. As more people start using artificial intelligence tools at work,

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Speaker 2: competition is heating up for enterprise contracts. So Microsoft, the

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Speaker 2: dominant supply of workplace software, seeing its AI assistant co

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Speaker 2: pilot lose out to open AI's chat GPT. The behind

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Speaker 2: the scenes dog fight is complicating and already fought. Relationship

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Speaker 2: between Microsoft and open ai are reported to what Adabaio

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Speaker 2: is here with more on this too. A good morning.

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Speaker 2: How big do you think the rivalry between Microsoft and

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Speaker 2: open ai is?

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Speaker 9: Well, the answer is is pretty big. It's certainly very lucrative,

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Speaker 9: and it's actually still growing. It's something of an unlikely situation, actually,

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Speaker 9: given that Microsoft has invested nearly fourteen billion dollars in

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Speaker 9: open ai since twenty nineteen, so you'd think they might

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Speaker 9: be all in on the firm, But actually also in

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Speaker 9: that time, Microsoft has backed other rival AI startups, They've

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Speaker 9: built their own models, and they've stalled open AI's restructuring plans,

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Speaker 9: so the relationship is slightly fraught. On the other side

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Speaker 9: of that equation, you have open Ai. They've signed deals

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Speaker 9: with rival cloud computing partners, so Microsoft rivals, and for example,

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Speaker 9: they've recently agreed to acquire AI coding assistant Windsurf, which

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Speaker 9: directly competes with Microsoft's GitHub copilots. So the two seem

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Speaker 9: to be the frenemies in the tech world at best,

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Speaker 9: but they're also of course competing for market share in

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Speaker 9: the corporate world. Open ai says it has three million

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Speaker 9: paying business users, whilst a Microsoft spokesperson said Copilot is

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Speaker 9: being used by seventy percent of the Fortune five hundred

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Speaker 9: and their page users have tripled compared with this time

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Speaker 9: last year. So it does seem that Microsoft is slightly

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Speaker 9: edging ahead in that core raised for now, but as

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Speaker 9: our reporting shows, that could all be about to change.

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Speaker 3: So why are they competing on and I suppose what

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Speaker 3: are the selling points for each of these companies with

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Speaker 3: their products.

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Speaker 9: Well, that's the thing, Steven, They're quite similar. So both

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Speaker 9: companies are essentially pitching AI assistance that can help with

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Speaker 9: the sort of labor intensive administrative tasks in the workplace,

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Speaker 9: so writing research, analyzing data, and they're saying that they

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Speaker 9: can free up workers to focus on more meaningful challenges.

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Speaker 9: And it gets worse because both chatbots are largely based

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Speaker 9: on the same open AI models, so very similar offering

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Speaker 9: on both sides. A Microsoft spokesperson is quoted in our

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Speaker 9: really detailed story about this on the terminal and they

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Speaker 9: say that what sets them apart is fine tuning the

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Speaker 9: technology for business use. So, after all, Microsoft has been

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Speaker 9: in the corporate space for much longer. Programs like Outlook

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Speaker 9: and Excel, for example, their workplace staples, so they know

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Speaker 9: what's going on. And whilst chat GPT dominates the consumer space,

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Speaker 9: Microsoft says their in tune with business needs and that's

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Speaker 9: why they have Barclays and Accenture, for example, as clients.

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Speaker 9: But our reporting is showing that many office workers are

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Speaker 9: convinced that chat GBT is the better product after using

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Speaker 9: it in their personal lives, and so now they're actually

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Speaker 9: convincing their bosses to make the switch over to open AI.

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Speaker 2: So in terms of the border effects then on the

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Speaker 2: use of AI on the workplace, I mean, I must

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Speaker 2: admit I've been messing about with AI, but it is

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Speaker 2: much more at home to the things for things outside

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Speaker 2: of work, it's obviously going to be coming to workplaces

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Speaker 2: in a big way.

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Speaker 9: Yeah, I mean, there's been a number of reports saying

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Speaker 9: that there are benefits of using AI in the workplace

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Speaker 9: in terms of productive capacity and also really speeding up

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Speaker 9: those menial tasks. For example, this week there's new research

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Speaker 9: from MIT that says AI agents can raise worker productivity

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Speaker 9: by sixty percent. So AI agents being complex sort of

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Speaker 9: artificial intelligence models that can work autonomously and can actually

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Speaker 9: be fine tuned to employee personality types as well, So

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Speaker 9: some pretty high level things going on. Some are really

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Speaker 9: just banking on this technology for a breakthrough. We heard

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Speaker 9: from Andrew Bailey recently Governor of the Bank of England,

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Speaker 9: who suggested that AI could be used to sort of

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Speaker 9: counter the collapse in the UK's long term growth rate

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Speaker 9: by really boosting productivity. But having said that, there are

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Speaker 9: concerns about the potential for AI use at work to

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Speaker 9: lead to job cuts, especially when it comes to junior roles.

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Speaker 9: Those are the ones that usually comprise of more of

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Speaker 9: the administrative tasks, and they're largely taken up by graduates

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Speaker 9: who are already facing a difficult job market, so some

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Speaker 9: concerns there. It's not all positive news when it comes

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Speaker 9: to AI in the workplace, but it's certainly making an

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Speaker 9: impact so far.

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Speaker 3: This is Bloomberg Daybreak Europe. You're morning brief on the

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