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00:00:02Now on BBC News. The latest
00:00:04business news from across the globe.
00:00:06globe. Business Today. MUSIC
00:00:17MUSIC Oil Oil under pressure. Energy chiefs chiefs pull out of a major gathering
00:00:20gathering in Riyadh after Iran backed
00:00:22backed Houthis attack the main airport.
00:00:25airport. Also tough choices being being made for finance ministers
00:00:28ministers as they meet in Bangkok.
00:00:30Bangkok. As the head of the IMF warns
00:00:32warns countries to rein in the spending
00:00:34spending as debts and borrowings
00:00:37borrowings surge. And not just a
00:00:39a pretty face. Research on the financial
00:00:41financial boost coming from the UK's UK's beauty sector. But could it
00:00:45it also give a much needed facelift
00:00:47facelift to Britain's high streets?
00:00:52streets? Hello there and welcome welcome to Business Today.
00:00:59Today. I'm Lukwesa Burak oil prices. We have to start here don't don't we? And they remain volatile
00:01:02volatile at the moment, hovering hovering at around $106 a barrel
00:01:05barrel as those tensions continue continue to rise following deadly
00:01:08deadly attacks in Saudi Arabia, including
00:01:10including a strike on Riyadh Airport Airport itself, fresh incidents in
00:01:14in the Strait of Hormuz have also also heightened fears of disruptions
00:01:18disruptions to oil exports. Amanda
00:01:21Amanda Rastovic is the senior forecasting forecasting analyst at Expana Markets,
00:01:25Markets, and she says that without without a resolution, the outlook
00:01:29outlook for the winter looks pretty
00:01:31pretty bleak. Before the you know,
00:01:33know, the crisis in the issue with
00:01:35with Iran started about 17% of crude
00:01:38crude was moving by pipeline. Now
00:01:40Now we they have increased that to
00:01:43to 40%. But that is finite. You cannot
00:01:46cannot just lay more pipe and move move more crude oil. So as the Houthis,
00:01:50Houthis, you know, begin to target target more of that infrastructure,
00:01:53infrastructure, we could see this this take a step back, which is really
00:01:57really unfortunate because we've we've just started to see, you know,
00:02:00know, oil flows get back to pre-crisis
00:02:03pre-crisis levels. So to have this, this, you know, tensions flaring
00:02:07flaring again really adds a whole whole 'nother level of risk to the
00:02:11the movement of commodities throughout throughout that area. And as we,
00:02:14we, you know, have winter looming.
00:02:16looming. We're also really focusing
00:02:18focusing on how much LNG is getting getting out of the Gulf as well.
00:02:22well. You know, they produce about
00:02:26about 30% of fertiliser and moving
00:02:29moving LNG through that area. And And as we get into these colder months,
00:02:32months, we're going to really start
00:02:34start seeing, I fear, a price increase,
00:02:37increase, probably a quite shocking shocking increase. And then we're
00:02:40we're going to have another one come come next spring when farmers start
00:02:44start to buy fertiliser and LNG as
00:02:47as well. And this is just it's becoming becoming a vicious cycle until we
00:02:50we can get all of this cleared up.
00:02:53up. There's several avenues that that are going to be really affected
00:02:57affected by this, especially coming
00:02:58coming into the winter season. Now
00:03:01Now to us academics Robert E Hall Hall and Michael Woodford have been
00:03:05been awarded this year's Nobel Prize Prize for economics. The pair received
00:03:08received the prestigious award for
00:03:10for their development of new macroeconomic macroeconomic models, which are used
00:03:14used by central banks and governments governments around the world along
00:03:18along with the title Nobel Laureate.
00:03:20Laureate. Each winner receives $1.2
00:03:24$1.2 million. Well, my colleague colleague Michelle Fleury saw her
00:03:27her earlier. She's back on the show
00:03:30show and Michelle, the pair won the the prize for the work that they've
00:03:34they've been doing in helping to to take instability out of the financial
00:03:37financial world. But what's actually actually new or rather what have
00:03:41have they tweaked? Yeah, I mean,
00:03:43mean, so first of all, I think they
00:03:45they have to share the 1.2 million.
00:03:48million. Still not bad but but they they do have to share to share that
00:03:52that prize money. I mean this goes
00:03:54goes back to economic theory for
00:03:57for years everyone relied on, on on kind of Keynesian theory. And
00:04:00And it was this idea that you would would persuade policymakers that
00:04:03that sometimes you need to stimulate
00:04:07stimulate demand and other times times you need to try and slow down
00:04:11down growth by raising rates. But
00:04:14But what has happened is that their
00:04:16their research has kind of helped,
00:04:19helped, if you like, address some
00:04:21some of the volatility that we've we've seen, some of the kind of how
00:04:25how to smooth out some of the ups
00:04:27ups and downs that are associated associated with the economic cycle
00:04:30cycle and to kind of fine tune some
00:04:33some of that Keynesian philosophy. philosophy. And so on the one hand,
00:04:35hand, you've got Robert Hall, his
00:04:37his work focused on demand and on on households. In other words, how
00:04:41how are they decide to make purchasing purchasing decisions? Some of that
00:04:45that has to do with the money they they have in their pocket, but some
00:04:48some of it has to do with what they they think they will make in the
00:04:51the future. In terms of income. Michael
00:04:54Michael Woodford, on the other hand, hand, from Columbia University, he
00:04:56he was focused on the supply side. side. So for example, how businesses
00:05:00businesses might set their prices prices for goods. And historically, historically, if you look at businesses,
00:05:04businesses, they try and kind of of plan months and months ahead when
00:05:07when they're making an item ordering, ordering, you know, all the inputs
00:05:10inputs and all of that. And so they they set prices that they think will
00:05:13will cover their costs. Now you look look at where we are right now today,
00:05:16today, for example, with all of these these supply shocks and some of that
00:05:19that kind of planning has been thrown
00:05:21thrown out the window. But it was
00:05:24was this idea that they came up with with that you should look ahead and
00:05:28and therefore policy makers should should communicate clearly their
00:05:31their plans in advance. And now we're
00:05:33we're kind of seeing a bit of a sort
00:05:36sort of shift away from that in terms terms of if you look at the central
00:05:39central bank here in the United States, States, we've got Kevin Warsh, who's
00:05:42who's the governor there, and he he says, actually he doesn't want want to communicate plans early.
00:05:46early. He wants to kind of refer
00:05:50refer revert back to an earlier system system where actually you kind of
00:05:52of keep your cards pretty close to to your chest. So interesting timing
00:05:56timing here from the Nobel Prize. Prize. Yeah. Very quickly, I mean,
00:05:58mean, gone back to the 1970s to today.
00:06:01today. But Michelle, very quickly, quickly, I mean, compared to the
00:06:04the data they had in the 1970s, the
00:06:07the data they have now, I mean, they're they're spoilt for choice. These
00:06:10These are vast data sets. They are
00:06:13are vast data sets. And obviously
00:06:16obviously some of that is then what
00:06:18what do you do with it. And so it's
00:06:21it's this kind of research that helps helps you sort of refine up to a
00:06:24a point. But as we've seen with geopolitical geopolitical shocks, even the best
00:06:28best laid plans, even all of that
00:06:30that data can kind of get sort of
00:06:32of thrown into disarray by, by sort
00:06:35sort of events, as they say, events. events. Indeed, indeed, lots of events.
00:06:39events. Michelle, thank you very very much indeed. That's all we can
00:06:42can say these days. Events. OK, well,
00:06:45well, let's go to events in Thailand Thailand because global finance chiefs
00:06:48chiefs are gathering for another another event. It is the International
00:06:52International Monetary Fund and World World Bank annual meetings that are
00:06:54are taking place. And while soaring
00:06:57soaring energy prices pile the pressure pressure on economies all around
00:07:01around the world, AI investment has
00:07:02has been labelled as a slow moving
00:07:05moving tsunami, impacting around around 40% of jobs worldwide and
00:07:09and also a key driver to rising inflation.
00:07:11inflation. If we look at US price
00:07:14price gauges so far this year, we've
00:07:16we've seen software and accessories
00:07:19accessories really drive a predominant predominant force in those inflationary
00:07:23inflationary pressures because we we are seeing very tight supply demand
00:07:26demand dynamics. There's this robust
00:07:28robust demand for AI, but we just just are not seeing supply being
00:07:31being able to keep up with that. that. And that's coming through in
00:07:35in prices. We think about semiconductors semiconductors compute in particular.
00:07:39particular. So even though AI in
00:07:41in the long run is likely to be disinflationary, disinflationary, I think we're seeing
00:07:44seeing that add to this broader inflationary
00:07:47inflationary mix. So that's one factor factor that that we are going to
00:07:50to see. You know governments focus
00:07:52focus on. But as well there's also
00:07:55also concerns around regulation, regulation, around the growth impact
00:07:58impact of AI. So a number of factors
00:08:00factors I think to keep to keep certainly certainly members busy this week.
00:08:03week. OK. We're going to stay with
00:08:06with AI and the President of Microsoft
00:08:07Microsoft has told the BBC that work
00:08:10work on AI regulation needs to start start immediately. He was speaking
00:08:14speaking on the BBC's Big Boss Interview
00:08:16Interview podcast, saying that the
00:08:18the current system just is not working.
00:08:21working. We should always worry that
00:08:23that regulation can become too heavy-handed.
00:08:26heavy-handed. It can slow innovation innovation and I think President
00:08:28President Trump is right to remind
00:08:31remind us to think about even worry
00:08:33worry about those concerns. But right
00:08:35right now I'd argue that AI is moving
00:08:38moving forward faster than the speed speed of safety. That's not good
00:08:42good for the protection of the public. public. It's not even good for the
00:08:46the industry itself. And usually usually what happens and you take
00:08:49take I'll just say our Congress in in the United States, if a product
00:08:53product moves faster than the speed
00:08:54speed of safety accidents happen
00:08:57happen and then Congress moves faster faster than the speed of thought.
00:09:00thought. And then you just end up up with a dynamic where everything
00:09:04everything comes to a halt. I don't don't think that should be our goal
00:09:07goal either. AI is an extraordinary extraordinary resource to grow the
00:09:11the economy, to solve societal problems, problems, or at least help. Let's
00:09:14Let's strike the right balance. OK?
00:09:17OK? Beauty is more than skin deep
00:09:19deep because new research from the
00:09:22the British Beauty Week and Oxford Oxford Economics has shown us that
00:09:25that the sector actually contributes
00:09:29contributes £28.3 billion to the
00:09:30the UK economy, and it supports nearly
00:09:34nearly 600,000 jobs. Boosting confidence confidence encourages social connection
00:09:37connection and also helping to bring
00:09:39bring customers and spending to local local high streets. Well, Millie
00:09:43Millie Kendall is CEO of the British British Beauty Council and Millie,
00:09:46Millie, you joined us now. Thank Thank you very much for your time.
00:09:49time. Thank you. So all those benefits benefits then what do you want of
00:09:53of the government for your sector? sector? I mean, I think recognition
00:09:57recognition of an industry that contributes contributes almost £30 billion to
00:10:01to the economy is vital. And that's that's more than aerospace. But I
00:10:05I think that people sort of take take for granted that the beauty
00:10:08beauty industry is just fluffy stuff stuff that girls play with. I mean,
00:10:11mean, essentially it's an economic economic driver. We employ almost
00:10:15almost like you said, 600,000 people
00:10:17people up and down the country. Its
00:10:20Its beauty is available in every
00:10:23every postcode, pretty much everybody everybody gets up every morning, morning, has a shower, brushes their
00:10:26their teeth and leaves the house
00:10:28house looking and feeling good. OK.
00:10:31OK. Is it beauty? Is it well-being
00:10:33well-being or is it a luxury? Oh,
00:10:35Oh, no. It's definitely I mean, actually
00:10:38actually in the report that we did did with Oxford Economics, The Impact
00:10:41Impact of Beauty report, only 7%
00:10:447% of the respondents and this was was a nationwide survey by YouGov
00:10:48YouGov actually thought that beauty
00:10:50beauty was a luxury. Only 7% thought
00:10:52thought it was a luxury. That's of
00:10:54of 93% the population know that it's
00:10:56it's an everyday essential. Why is is it essential? Millie, let's go
00:11:00go straight to why? Because this this jumped out at me when I looked
00:11:04looked at your data. I instantly
00:11:06instantly thought loneliness, the the loneliness. Is really important.
00:11:09important. I mean, 86% of the respondents
00:11:13respondents go to the high street street predominantly because they they have booked a hair and beauty
00:11:17beauty appointment. That's really
00:11:19really important. 42% of young men,
00:11:22men, when they go to visit a service service provider, that's a hair or
00:11:26or beauty service provider, they they are going there because that
00:11:29that might be the only conversation conversation they've had in a week.
00:11:33week. It's really important for us
00:11:35us to be recognised for the community community and you know, we're anchors
00:11:39anchors of the high street. OK. It's It's interesting, isn't it? It's
00:11:42It's maybe something that AI can't
00:11:45can't touch in its current form in in terms of those social connections.
00:11:49connections. So where does the so so where does the beauty industry
00:11:51industry then sit when it comes to
00:11:54to reviving the high street? Because
00:11:56Because in terms of profitability profitability that supply chain,
00:11:59chain, you know, a lot of these products products are actually made in Asia.
00:12:02Asia. Millie. Well, there's a lot lot of products made in Europe as
00:12:05as well. So there's a lot of products products made all over the world.
00:12:09world. Essentially the hair and beauty beauty salons are part of our supply
00:12:12supply chain. They need a lot of of help because obviously they are
00:12:15are footing the bill for the space space that they rent for the rates
00:12:19rates and all the additional taxes taxes were a labour intensive industry.
00:12:22industry. That's very important to to understand. You know, you as you
00:12:26you said, you know, AI is not going going to replace your hairdresser. hairdresser. So we need to be able
00:12:30able to employ people and we need need to be able to afford to employ
00:12:32employ them. So I think that's really
00:12:35really critical. And we do make products
00:12:38products here in the UK that we sell sell locally, but products are made
00:12:42made all over the world. OK. And And yeah, yeah. Sorry. Millie Kendall
00:12:46Kendall thank you very much indeed. indeed. Thank you. Yeah. We all love
00:12:50love a natter don't we? At the hairdressers.
00:12:52hairdressers. Well do stay with us us here on BBC News because plenty
00:12:55plenty more coming up shortly. Ben
00:12:58Ben is standing by. MUSIC
00:14:19how social media has shaped the story. story. It's all on The Media Show
00:14:23Show on BBC News. MUSIC
00:14:37Being able to inspire someone
00:14:39is always the greatest joy. I saw
00:14:42saw Souza one time at the Grammys Grammys and she said that she studied studied some of my songs for their
00:14:46their songwriting and I thought that that that was the biggest compliment
00:14:48compliment ever. My support for Ukraine
00:14:52Ukraine is unwavering. It is 100%
00:14:55100% when the big names talk, they
00:14:57they talk to us.
00:15:09Hello there, I'm Ben Brown and
00:15:11you're watching BBC News and a BBC BBC investigation has revealed that
00:15:15that the world's biggest accountancy accountancy firm helped falsify documents
00:15:19documents that allowed the former former Chelsea Football Club owner
00:15:23owner Roman Abramovich to hide his
00:15:30Wealth and to evade tax. BBC Panorama has uncovered hundreds of of documents that were backdated backdated by the Russian billionaires
00:15:34billionaires advisers. Many were were drawn up with the help of Deloitte,
00:15:37Deloitte, while Roman Abramovich Abramovich denies any wrongdoing.
00:15:40wrongdoing. Deloitte says it complied
00:15:42complied with applicable laws. Richard.
00:15:46Richard. Things have changed for for Roman Abramovich. He has been
00:15:50been sanctioned because of his links links to Vladimir Putin. He's been
00:15:53been forced to sell his beloved Chelsea
00:15:57Chelsea and now revelations from from inside his financial empire. empire. If