June 12, 2025 • 21 mins
Your morning briefing, the business news you need in just 15 minutes.
On today's podcast:
(1) As the pace of wealthy individuals leaving London quickens, the numbers are starting to stack up: Labour’s flagship “tax the rich” policy risks becoming a net drain on the UK economy.
(2) Rachel Reeves will pump billions of pounds into areas outside London as the Labour government tries to head off an electoral threat posed by Nigel Farage’s Reform UK.
(3) President Donald Trump said he intended to send letters to trading partners in the next one to two weeks setting unilateral tariff rates, ahead of a July 9 deadline to reimpose higher duties on dozens of economies.
(4) The US ordered some staff to depart its embassy in Baghdad and authorized families of military service members to leave the region, officials said, after Iran threatened to strike American bases if it’s attacked over its nuclear program.
(5) The Pentagon has launched a review of the Biden-era Aukus pact to develop nuclear-powered submarines with Australia and the UK, as the Trump administration looks to shift the burden for collective defense to allies and make sure the US has enough warships of its own.
(6) Northern Ireland has seen a third night of clashes between rioters and police, in violence that's been described by officials as racially motivated.
Podcast Conversation: Five French Countryside Escapes That Pair Perfectly with Paris
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
Bloomberg Audio Studios, podcasts, radio news. This is the.
Speaker 2 (00:10):
Bloomberg Daybacurate podcast, available every morning on Apple, Spotify or
wherever you listen. It's Thursday, the twelfth of June in London.
I'm Caroline Hepkip.
Speaker 1 (00:18):
And I'm Stephen Carroll. Coming up today.
Speaker 3 (00:20):
Exclusive Bloomberg reporting reveals a jump in the number of
business leaders leaving the UK in the past year.
Speaker 2 (00:26):
Rachel Reeves pumps billions into areas outside London in a
bid to counter the electoral threat Reform UK poses to
Labour's traditional heartlands.
Speaker 3 (00:36):
Plus looking beyond the ninety day pause, President Trump plans
to send letters to countries on the next fortnight, setting
his unilateral Tara frights.
Speaker 2 (00:45):
Let's start with a roundup of our top stories.
Speaker 3 (00:47):
There are fresh signs the UK could be on course
for the biggest exodus of wealth in the country's recent history.
At Bloomberg, analysis of five million company filings shows a
spike in business leaders leaving more than four thousand and four.
Andrew disclosed an overseas move in the last year, up
around twenty percent on previous years.
Speaker 1 (01:04):
Boomberg James Wilcock has more.
Speaker 4 (01:06):
The UK government is besting tax changes for non doms
will bring in thirty three billion pounds in extra revenue,
but that assumption is based on the vast majority staying.
Bloomberg's latest data suggests exits are on the rise. Charlie
Sosna heads that Michigan Private's wealth and tax teams. He
told us last month, the wealthy are leaving.
Speaker 1 (01:29):
Pretty safe to say.
Speaker 4 (01:30):
It's an increasing percentage every day that goes by, and
every year that goes by, and I absolutely wouldn't be
surprised if it's twenty five percent plus heading into the
forty percent mark. Sozna is one of more than a
dozen lawyers and other advisors to the ultra rich who
told Bloomberg between fifteen percent to two thirds of their
non dom clients are out or making plans to depart
(01:50):
the UK. The individuals who've already exited command or share
part of Fortune's totaling at least one hundred and ten
billion dollars. That's according to the Bloomberg Billionaires Index. The
full extent of the moves won't be known for at
least a year when official tax sat is published in London.
Speaker 1 (02:07):
James Wilcock, Bloomberg.
Speaker 2 (02:08):
Radio the UK government is investing billions of pounds meanwhile
outside of London in a bid to drive growth and
also to win back popularity. The Chancellor announced one hundred
and thirteen billion pounds worth of infrastructure investment yesterday, much
of it outside of the Capitol. Rachel Reeves says that
voters now need to feel the benefit of Labour's choices
(02:32):
on tax and spending policy.
Speaker 5 (02:34):
This government's task and the purpose of this spending review
is to change that, to ensure that renewal is felt
in people's everyday lives, in their jobs and on their
high streets.
Speaker 2 (02:48):
Chancellor Rachel Reeves also repeatedly attacked to the far smaller
Reformed UK Party during her announcement. The unusual prominence is
a sign of how concerned the government is about the
new challenger.
Speaker 3 (03:00):
US President Donald Trump says he's planning to send letters
to trading partners within the next two weeks to set
unilateral tariff freights. That move comes ahead of a July
ninth deadline to reimpose higher duties on dozens of economies
once the current ninety day pause expires. So far, the
White House has only reached a yet to be implemented
trade framework with the UK and a tariff truce with China.
(03:23):
Speaking to reporters yesterday, President Trump had this to say.
Speaker 6 (03:26):
We're rocket in terms of deals. Now at a certain point,
we're just going to send letters out. And I think
you understand that saying this is the deal. You can
take it or you can leave it. You don't have
to use it. You don't have to shop in the
United States, as I say.
Speaker 3 (03:41):
Trump was speaking as new data showed that US tariff
revenue hit a fresh record last month of twenty three
billion dollars. Figure marks a two hundred and seventy percent
increase in the same month a year earlier. May's figer
helped to reduce the US fiscal deficit for the month
by seventeen percent to three hundred and sixteen billion dollars. However,
Treasury Secretaries and says he still expects the deficit for
(04:02):
the year to be between six point five and six
point seven percent of GDP.
Speaker 7 (04:07):
Well.
Speaker 2 (04:07):
The latest news on tariffs comes as the US Commerce
Secretary Howard Lutnik warned that the EU is likely to
be among the last trade deals that the US complete.
Speaking to CNBC, Lutnick said, I'm optimistic that we can
get there with Europe, but Europe will be probably the
very very end. Those comments come after European Union sources
(04:27):
that told Bloomberg that they believe trade negotiations with the
US will extend beyond President Trump's July ninth deadline. Lutnik
added that he expects to see deals with other countries
to quote start coming next week and the week after
and the week after.
Speaker 3 (04:43):
The United States has ordered some staff to leave its
embassy in Baghdad and authorized families of military service members
to leave the region. Officials say the decision is due
to heighten security risks after a round threatens to strike
American bases if it is attacked over its nuclear program.
The UK Navy also issued a rare warning yesterday stating
that increased tensions in the Middle East could affect shipping,
(05:04):
including through the Strait of Hormuz. Hormus is the world's
most important oil choke point, and Aran has frequently threatened
to close US during times of geopolitical strife. However, it's
never followed through on those threats.
Speaker 2 (05:17):
Now, the Pentagon is reviewing a pact to develop nuclear
powered submarines with Australia and the UK.
Speaker 1 (05:24):
Dubbed ORCUS.
Speaker 2 (05:25):
The twenty twenty one Biden era agreement was part of
a pivot by Washington and London to strengthen their presence
in the Indo Pacific region given China's military growth. According
to a statement, the Pentagon is now considering whether that
pact is quote aligned with the President's America First Agenda.
(05:47):
Australian Deputy Prime Minister and Defence Minister Richard Males says
his country is open to discussion with the US.
Speaker 8 (05:55):
We understand America seeking more from its friends and allies
around the world.
Speaker 1 (06:01):
The answer is that as a conversation.
Speaker 8 (06:03):
We are very happy to engage in and we will
and we obviously have engaged in a historic increase in
our own defense spending to this point in time, but
we will continue to have that conversation with the United States.
Speaker 2 (06:15):
Australian Defense Minister Richard Males speaking that any major revisions
or even scrapping of the Orcus Pact would be a
major blow to Australia's defense sector, which has already begun
preparations for the new submarines.
Speaker 3 (06:29):
Northern Ireland has seen a third night of clashes between
rioters and police and violence that's been described by officials
has racially motivated. The unrest began after alleged sexual assault
in Ballymena, County Antrum, but a sinse spread to other areas.
In the town of lar In, a leisure center which
was providing emergency accommodation to families displaced by the violence,
was set on fire by master attackers. Mayor of Mid
(06:51):
and East Antrum, Jack Minford, says there's growing fear in
the community.
Speaker 9 (06:55):
I spoke to local people in there who are very scared.
People are labeling their host that are in Filipino and
British or whatever. That should not happen in this day
and age that people have to label their house. But
there were a lot of probleties damaged randomly.
Speaker 1 (07:09):
Jack Minford speaking there.
Speaker 3 (07:10):
During the first two nights of unrest, thirty two police
officers were injured and six people arrested. Police have not
yet given any details about Wednesday night.
Speaker 2 (07:19):
Now, those are top stories for you this morning. Let's
get to the market. So stop futures are heading lower
for the US. We're down by three times of one
percent for both the S and P and NOWSTA I
many futures your stocks fishy futures are also down by
seven tenths of one percent. That is being propelled by
the headlines that we were discussing about President Trump handing
out effectively letters possibly around tariff rates in the next
(07:43):
couple of weeks. It also does mean that the dollar's weakening.
We are down by three times of one percent on
the Boomberg Dollar Spot Index. We had a number of
winners including the Japanese and the Euro as well against
that a softening dollar. Gold as people look for safe
havens around the uncertainties, that has also done well, so
by half of one percent for the gold Spot Prize,
(08:05):
and also the tensions in the Middle East that have
had an impact, it would seem on the oil markets.
So we see breakthrough features down by four tens of
one percent after we saw those prices jumping earlier on
Thursday or earlier this morning.
Speaker 3 (08:20):
Any moment, we'll bring you more on our story on
the ultra wealthy leaving London, plus the latest on what
Donald Trump has said about tariffs. But another story that
caught a eye this morning. If you're thinking about your
summer travel plans, France had a particular spike in tourism
last year of course linked to the Olympics one hundred
million visitors last year, which was a record, And Lindsay
(08:41):
Tremuta has been writing about some of the places that
if you're planning a trip to Paris course razy journey
on the Eerstar from London, maybe some places you might
want to visit as well. I like this because it's
it's quite easy, which I think is the yes, and
takes advantage of high speed trains around France, I think,
which is kind of a good option as well. So
there's a chateau that's, you know, thirty five minutes from
by from.
Speaker 2 (09:00):
Paris, this Paris Plus so you get to do the
kind of museums and all the wonderful things in Paris,
and then you take a little mini break somewhere else,
although there is one further afield. And if you can't
be bothered with the trains, where did you just hop
on a flight down to the coach Desire which definitely
speaks to me. Lero was one of the recommendations. But
there are lots of lovely places. I mean, that's it's
(09:22):
got this very dramatic salt water.
Speaker 3 (09:24):
The swimming piol carved into the rockside on the on
the sea. So yeah, pretty spectacular views from there as well.
Great piece and lindsay very inspirational for this Thursday Morning.
Five French countryside escapes that para perfectly with Paris. Will
put a link to the story in our show notes.
Speaker 2 (09:40):
Now, more than four four hundred business leaders have left
the UK in the past year. This according to the
latest Bloomberg analysis as Britain accounts the cost of scrapping
the non dom tax status. Joining us now to discuss
is our ultranet Worth reporter Benjamin estupples Ben good morning.
So Bloomberg has analyzed five million company filing is to
(10:01):
get to this point? What does it actually show?
Speaker 10 (10:05):
Yeah, good morning and credit to my colleague, are very
talented colleague.
Speaker 1 (10:08):
Max Harlowe.
Speaker 10 (10:09):
That data analysis, what it really shows is that it
signals that the disruption that's going on amid the UK
business community. What it boils down to is the number
of departures. Number of individuals business leaders disclosing that they
are now living overseas was up from April twenty twenty five,
about seventy five percent from a year ago and the
(10:32):
highest in four years. And why is that important? That
month the UK scrapped it's centuries old nond regime and
that effectively allowed wealthy foreigners living in the UK to
get tax breaks for as long as fifteen years under
the system that existed up until only a few weeks ago.
Speaker 1 (10:48):
So what we can see is for the.
Speaker 10 (10:50):
First time a real attempt from us to ascertain the
damage that's going on and the ripple effects they're going
to continue for the foreseeable future at the very least.
Speaker 3 (11:01):
Yeah, of course, that that figure year on year, as
you say, a massive increase for that particular month, which
of course is related to the tax changes, but averaged
over a year, it's an increase of around twenty percent
on departures from those company director filings. The government has
put forward the idea of that attacks the Rich policy
would bring in more fresh tax revenue that at last
(11:21):
from those people who are leaving.
Speaker 1 (11:22):
What are we seeing on that CSAR A good.
Speaker 10 (11:25):
Question, Stephen. This really boils down to one crucial data point.
There're about seventy four thousand nondoms based on the latest
government data, and if the biggest category within that group,
if about if half of them go, then what the
UK has tried to do on the non reforms will
(11:47):
end up costing the government money. Now where where are
we there now? Some advisors are seeing as we heard
earlier just a few minutes ago from our colleague, some
advisers are seeing maybe forty as many as forty percent
of their clients possibly going. Some are seeing even more
than more than half of their clients who've specialized in
this space, and we interviewed them for our big take today.
(12:07):
We're not there yet or we can see the official data.
It will come out in at least a year's time.
But what we're seeing on the ground, the witnesses in
the private wealth community, an influential part of Britain services
heavy workforce, they're seeing the damage right now.
Speaker 2 (12:19):
Yeah, and this is also goes to the nove It
doesn't it that the official data comes out with a
big time lag, So it's about you know, what do
we know now how reliable the data is. There has
also been a tweak as well from the government and
a new four year tax system available to the most
recent non dom arrival, so there's also a question mark
(12:40):
about whether that change helps matters.
Speaker 1 (12:45):
Again, that's a good point.
Speaker 10 (12:47):
I think what we had before was fifteen years and
now We've got four other countries that arrivals to the
UK as wealth hubs, like Italy, Greece, Cyprus, they have
fifteen year regimes as well. They basically copy and pasted
the UK's former non dom regime, took the best parts
out of it, and a UK has gone right, we're
actually going to cut more than by half. So what's
(13:09):
happening now is the UK has already been seen in
this starkically different perspective. Whilst you might have come here,
for example as a foreign individual, set up a business
or run part of your business mpath from London, send
your kids to school here fifteen years, you've got enough time.
Now it's maybe being seen perversely, almost as like a
divin end extraction zone. Come here, have a great time
(13:31):
in London for four years, go to the West End,
go toal museums. But four years, you know, you can't
really get your kids through school in that time, but
maybe you can sell a business.
Speaker 5 (13:41):
And by the.
Speaker 10 (13:41):
Way, it takes about a year to set up in
the UK and maybe about a year to leave, so
really it boils down to maybe about two years. So
the UK has radically changed the way it's perceived by
the globally mobile.
Speaker 3 (13:51):
Okay, Ben, thanks so much for bringing us details of
your reporter this morning. Our alter net worth report of
their bands doubles.
Speaker 2 (13:57):
Now let's get it to the latest on the US tariff.
President Trump says that he will send letters in the
next week or two on unilateral tariff raids to the
US's trading partners. This ahead of the deadline of the
ninth of July. It's only US now to discuss. Has
been a big senior at US Economics and Government editor
Derek Wallbank, Derek, good morning. President Trump seems to be
moving away then from the idea of negotiating over trade
(14:20):
with all of the US's different partners, as he had
indicated before the.
Speaker 1 (14:25):
End of this ninety day period. Is fast approaching.
Speaker 7 (14:28):
Right that Trump had had put out all of the
tariffs on Liberation Day, the ten percent global minimum baseline
for almost every US trading partner, and then several more
reciprocal tariffs calculated based on trade gap, and then the
negotiations start. Right now, we've got the United Kingdom on
(14:50):
the board, and after that we're still waiting for the
next one to drop. There's several countries that are in
advanced talks, India, Japan, there are others, but we're still
waiting for these next deals to come. And the idea,
I think has been from Trump administration officials that at
(15:11):
some point, when you get close to the end of
that window in early July, you might see a whole
lot of them kind of go together. Maybe they might
come in some of a similar form. And we're getting
to the end of this process now now. I think
that it has been a daunting thing to take on.
I think every analyst that I've talked to has said
(15:33):
that it is a sort of mission impossible to try
and come up with, you know, ninety plus individual trade
deals or however many it would wind up eventually being
all in a ninety day period. At the same point,
the Trump administration has to figure out what this end
game is and what they're going to wind up with,
(15:54):
what they're going to settle with, and how that's all
going to work. I think that there has been a
thought that that they're not signaling that there's going to
be a massive extension. That is always possible, but this
is all toward how do we get to this endgame?
How do we try and wrap things up? And the
idea that there might be some sort of template that
(16:17):
everyone kind of draws from or hughes close to. I
think that's kind of where this is signaling.
Speaker 3 (16:24):
Yeah, and look at, as you say, a lot of
signals being read at this point, as it is a
story that is evolving. Some of the signals we have
gotten in the past twenty four hours have been around
the progress made with China, Donald Trump saying that there
was a deal done with China awaiting sign off.
Speaker 1 (16:42):
Do we know what's in it?
Speaker 7 (16:44):
If you listen to the exact words, it's sort of
like a framework to implement a consensus reached in the
Geneva talks, now decided in the London talks. It still
has to go through and get signed off by Trump
and she Trump is seeming very positive on this. We
haven't heard the same exact thing from the Chinese side.
(17:04):
That will take the time that it will take, but
that's trying to get the Geneva agreements on track. We're
also hearing, you know, from from Howard Lutnik and Jamison Greer,
who were two of the key negotiators from the United States,
that this is kind of intended to pave a way
towards a resolution over rare earths and over magnets and
(17:30):
things of that nature, and that that that in turn
could unlock some things that the Chinese want as well.
I think one of the big things that came out
of Geneva, one of the one of the big sticking
points with the implementation of easing the rare earth shipments
and getting those sort of back on track. The US
very much did not feel that China was living up
(17:54):
to its agreements and rapidly escalated in response. Everything sort
of went back went off track. Trump and you have
a call, they go and talk for two days in London.
Now that's kind of back on track. That's where we
are in sort of this framework. Do we have text
of that framework now, but that's what's been described to us.
(18:15):
And the other thing that I should mention when I
say that is that when the Chinese side came out
and read out their version of what happened, and then
when the American side came out, it wasn't that they
were different. I mean, that's something we've talked about. We
have to judge whether or not they're the same or different.
But the US side has been way more expansive on
what they say was in this the Chinese have very
(18:37):
much stuck to the idea of tone tone.
Speaker 2 (18:40):
Yes, okay, that is an interesting point, isn't it. In
terms of the concrete numbers, though, the tariff revenue that
the US is generating is quite significant, a record twenty
three billion dollars in May. That's also helped to shrink
the deficit just for that one month. Again, it's quite
(19:00):
uncertain about whether those revenue streams are reliable, whether they'll remain.
Speaker 7 (19:06):
Well, yeah, no, and that and that's that's one of
the things that I think that Trump administration has been
clear about that tariffs are an anchor of their revenue
strategy as they're going forward. Trump has been really clear
about this that tariffs were meant to help pay for
his one big, beautiful bill of the tax cuts and
other policy moves and uh and and they have been
(19:28):
expecting big revenue to come in. Even as that is
quite a large amount of revenue, it is, i should say,
nowhere in the ballpark of being able to offset the
costings the projected costings of the tariff bill or not
the tariff bill of the tax bill. So that is
(19:51):
that still remains a gap there. So so when you're
when you're sitting there looking at this, that that winds
up being a dis connects. So even as there is
quite a lot of revenue brought in, it's not necessarily
quite enough to do that offset. And it bears mention
that these tariff collections are still not the fullness of
(20:12):
what of what the Trump administration has talked about, has threatened,
has put forward, because we have seen sort of again
and again through the first you know, six month window
of this administration, a lot of threats of where they're
going to be, and then a pullback, and eventually they
land somewhere much softer than where they were aiming to
(20:34):
do so. So I think one of the things to
look for as we go through here is that if
all of this tariff level kind of settles out somewhere
well short of where the administration had threatened, they're also
not going to get the revenue that would be implied
by those sort of maximalist tariff policies. This is Bloomberg
(20:57):
Daybreak Europe, your morning brief on this worries making news
from London to Wall Street and beyond.
Speaker 2 (21:03):
Look for us on your podcast feed every morning, on Apple,
Spotify and anywhere else you get your podcasts.
Speaker 3 (21:09):
You can also listen live each morning on London DAB Radio,
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Speaker 2 (21:15):
Our flagship New York station, is also available on your
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I'm Caroline Hepka and.
Speaker 1 (21:24):
I'm Stephen Carroll.
Speaker 3 (21:24):
Join us again tomorrow morning for all the news you
need to start your day right here on Bloomberg Daybreak
Europe
Bloomberg Audio Studios, podcasts, radio news. This is the.
Speaker 2 (00:10):
Bloomberg Daybacurate podcast, available every morning on Apple, Spotify or
wherever you listen. It's Thursday, the twelfth of June in London.
I'm Caroline Hepkip.
Speaker 1 (00:18):
And I'm Stephen Carroll. Coming up today.
Speaker 3 (00:20):
Exclusive Bloomberg reporting reveals a jump in the number of
business leaders leaving the UK in the past year.
Speaker 2 (00:26):
Rachel Reeves pumps billions into areas outside London in a
bid to counter the electoral threat Reform UK poses to
Labour's traditional heartlands.
Speaker 3 (00:36):
Plus looking beyond the ninety day pause, President Trump plans
to send letters to countries on the next fortnight, setting
his unilateral Tara frights.
Speaker 2 (00:45):
Let's start with a roundup of our top stories.
Speaker 3 (00:47):
There are fresh signs the UK could be on course
for the biggest exodus of wealth in the country's recent history.
At Bloomberg, analysis of five million company filings shows a
spike in business leaders leaving more than four thousand and four.
Andrew disclosed an overseas move in the last year, up
around twenty percent on previous years.
Speaker 1 (01:04):
Boomberg James Wilcock has more.
Speaker 4 (01:06):
The UK government is besting tax changes for non doms
will bring in thirty three billion pounds in extra revenue,
but that assumption is based on the vast majority staying.
Bloomberg's latest data suggests exits are on the rise. Charlie
Sosna heads that Michigan Private's wealth and tax teams. He
told us last month, the wealthy are leaving.
Speaker 1 (01:29):
Pretty safe to say.
Speaker 4 (01:30):
It's an increasing percentage every day that goes by, and
every year that goes by, and I absolutely wouldn't be
surprised if it's twenty five percent plus heading into the
forty percent mark. Sozna is one of more than a
dozen lawyers and other advisors to the ultra rich who
told Bloomberg between fifteen percent to two thirds of their
non dom clients are out or making plans to depart
(01:50):
the UK. The individuals who've already exited command or share
part of Fortune's totaling at least one hundred and ten
billion dollars. That's according to the Bloomberg Billionaires Index. The
full extent of the moves won't be known for at
least a year when official tax sat is published in London.
Speaker 1 (02:07):
James Wilcock, Bloomberg.
Speaker 2 (02:08):
Radio the UK government is investing billions of pounds meanwhile
outside of London in a bid to drive growth and
also to win back popularity. The Chancellor announced one hundred
and thirteen billion pounds worth of infrastructure investment yesterday, much
of it outside of the Capitol. Rachel Reeves says that
voters now need to feel the benefit of Labour's choices
(02:32):
on tax and spending policy.
Speaker 5 (02:34):
This government's task and the purpose of this spending review
is to change that, to ensure that renewal is felt
in people's everyday lives, in their jobs and on their
high streets.
Speaker 2 (02:48):
Chancellor Rachel Reeves also repeatedly attacked to the far smaller
Reformed UK Party during her announcement. The unusual prominence is
a sign of how concerned the government is about the
new challenger.
Speaker 3 (03:00):
US President Donald Trump says he's planning to send letters
to trading partners within the next two weeks to set
unilateral tariff freights. That move comes ahead of a July
ninth deadline to reimpose higher duties on dozens of economies
once the current ninety day pause expires. So far, the
White House has only reached a yet to be implemented
trade framework with the UK and a tariff truce with China.
(03:23):
Speaking to reporters yesterday, President Trump had this to say.
Speaker 6 (03:26):
We're rocket in terms of deals. Now at a certain point,
we're just going to send letters out. And I think
you understand that saying this is the deal. You can
take it or you can leave it. You don't have
to use it. You don't have to shop in the
United States, as I say.
Speaker 3 (03:41):
Trump was speaking as new data showed that US tariff
revenue hit a fresh record last month of twenty three
billion dollars. Figure marks a two hundred and seventy percent
increase in the same month a year earlier. May's figer
helped to reduce the US fiscal deficit for the month
by seventeen percent to three hundred and sixteen billion dollars. However,
Treasury Secretaries and says he still expects the deficit for
(04:02):
the year to be between six point five and six
point seven percent of GDP.
Speaker 7 (04:07):
Well.
Speaker 2 (04:07):
The latest news on tariffs comes as the US Commerce
Secretary Howard Lutnik warned that the EU is likely to
be among the last trade deals that the US complete.
Speaking to CNBC, Lutnick said, I'm optimistic that we can
get there with Europe, but Europe will be probably the
very very end. Those comments come after European Union sources
(04:27):
that told Bloomberg that they believe trade negotiations with the
US will extend beyond President Trump's July ninth deadline. Lutnik
added that he expects to see deals with other countries
to quote start coming next week and the week after
and the week after.
Speaker 3 (04:43):
The United States has ordered some staff to leave its
embassy in Baghdad and authorized families of military service members
to leave the region. Officials say the decision is due
to heighten security risks after a round threatens to strike
American bases if it is attacked over its nuclear program.
The UK Navy also issued a rare warning yesterday stating
that increased tensions in the Middle East could affect shipping,
(05:04):
including through the Strait of Hormuz. Hormus is the world's
most important oil choke point, and Aran has frequently threatened
to close US during times of geopolitical strife. However, it's
never followed through on those threats.
Speaker 2 (05:17):
Now, the Pentagon is reviewing a pact to develop nuclear
powered submarines with Australia and the UK.
Speaker 1 (05:24):
Dubbed ORCUS.
Speaker 2 (05:25):
The twenty twenty one Biden era agreement was part of
a pivot by Washington and London to strengthen their presence
in the Indo Pacific region given China's military growth. According
to a statement, the Pentagon is now considering whether that
pact is quote aligned with the President's America First Agenda.
(05:47):
Australian Deputy Prime Minister and Defence Minister Richard Males says
his country is open to discussion with the US.
Speaker 8 (05:55):
We understand America seeking more from its friends and allies
around the world.
Speaker 1 (06:01):
The answer is that as a conversation.
Speaker 8 (06:03):
We are very happy to engage in and we will
and we obviously have engaged in a historic increase in
our own defense spending to this point in time, but
we will continue to have that conversation with the United States.
Speaker 2 (06:15):
Australian Defense Minister Richard Males speaking that any major revisions
or even scrapping of the Orcus Pact would be a
major blow to Australia's defense sector, which has already begun
preparations for the new submarines.
Speaker 3 (06:29):
Northern Ireland has seen a third night of clashes between
rioters and police and violence that's been described by officials
has racially motivated. The unrest began after alleged sexual assault
in Ballymena, County Antrum, but a sinse spread to other areas.
In the town of lar In, a leisure center which
was providing emergency accommodation to families displaced by the violence,
was set on fire by master attackers. Mayor of Mid
(06:51):
and East Antrum, Jack Minford, says there's growing fear in
the community.
Speaker 9 (06:55):
I spoke to local people in there who are very scared.
People are labeling their host that are in Filipino and
British or whatever. That should not happen in this day
and age that people have to label their house. But
there were a lot of probleties damaged randomly.
Speaker 1 (07:09):
Jack Minford speaking there.
Speaker 3 (07:10):
During the first two nights of unrest, thirty two police
officers were injured and six people arrested. Police have not
yet given any details about Wednesday night.
Speaker 2 (07:19):
Now, those are top stories for you this morning. Let's
get to the market. So stop futures are heading lower
for the US. We're down by three times of one
percent for both the S and P and NOWSTA I
many futures your stocks fishy futures are also down by
seven tenths of one percent. That is being propelled by
the headlines that we were discussing about President Trump handing
out effectively letters possibly around tariff rates in the next
(07:43):
couple of weeks. It also does mean that the dollar's weakening.
We are down by three times of one percent on
the Boomberg Dollar Spot Index. We had a number of
winners including the Japanese and the Euro as well against
that a softening dollar. Gold as people look for safe
havens around the uncertainties, that has also done well, so
by half of one percent for the gold Spot Prize,
(08:05):
and also the tensions in the Middle East that have
had an impact, it would seem on the oil markets.
So we see breakthrough features down by four tens of
one percent after we saw those prices jumping earlier on
Thursday or earlier this morning.
Speaker 3 (08:20):
Any moment, we'll bring you more on our story on
the ultra wealthy leaving London, plus the latest on what
Donald Trump has said about tariffs. But another story that
caught a eye this morning. If you're thinking about your
summer travel plans, France had a particular spike in tourism
last year of course linked to the Olympics one hundred
million visitors last year, which was a record, And Lindsay
(08:41):
Tremuta has been writing about some of the places that
if you're planning a trip to Paris course razy journey
on the Eerstar from London, maybe some places you might
want to visit as well. I like this because it's
it's quite easy, which I think is the yes, and
takes advantage of high speed trains around France, I think,
which is kind of a good option as well. So
there's a chateau that's, you know, thirty five minutes from
by from.
Speaker 2 (09:00):
Paris, this Paris Plus so you get to do the
kind of museums and all the wonderful things in Paris,
and then you take a little mini break somewhere else,
although there is one further afield. And if you can't
be bothered with the trains, where did you just hop
on a flight down to the coach Desire which definitely
speaks to me. Lero was one of the recommendations. But
there are lots of lovely places. I mean, that's it's
(09:22):
got this very dramatic salt water.
Speaker 3 (09:24):
The swimming piol carved into the rockside on the on
the sea. So yeah, pretty spectacular views from there as well.
Great piece and lindsay very inspirational for this Thursday Morning.
Five French countryside escapes that para perfectly with Paris. Will
put a link to the story in our show notes.
Speaker 2 (09:40):
Now, more than four four hundred business leaders have left
the UK in the past year. This according to the
latest Bloomberg analysis as Britain accounts the cost of scrapping
the non dom tax status. Joining us now to discuss
is our ultranet Worth reporter Benjamin estupples Ben good morning.
So Bloomberg has analyzed five million company filing is to
(10:01):
get to this point? What does it actually show?
Speaker 10 (10:05):
Yeah, good morning and credit to my colleague, are very
talented colleague.
Speaker 1 (10:08):
Max Harlowe.
Speaker 10 (10:09):
That data analysis, what it really shows is that it
signals that the disruption that's going on amid the UK
business community. What it boils down to is the number
of departures. Number of individuals business leaders disclosing that they
are now living overseas was up from April twenty twenty five,
about seventy five percent from a year ago and the
(10:32):
highest in four years. And why is that important? That
month the UK scrapped it's centuries old nond regime and
that effectively allowed wealthy foreigners living in the UK to
get tax breaks for as long as fifteen years under
the system that existed up until only a few weeks ago.
Speaker 1 (10:48):
So what we can see is for the.
Speaker 10 (10:50):
First time a real attempt from us to ascertain the
damage that's going on and the ripple effects they're going
to continue for the foreseeable future at the very least.
Speaker 3 (11:01):
Yeah, of course, that that figure year on year, as
you say, a massive increase for that particular month, which
of course is related to the tax changes, but averaged
over a year, it's an increase of around twenty percent
on departures from those company director filings. The government has
put forward the idea of that attacks the Rich policy
would bring in more fresh tax revenue that at last
(11:21):
from those people who are leaving.
Speaker 1 (11:22):
What are we seeing on that CSAR A good.
Speaker 10 (11:25):
Question, Stephen. This really boils down to one crucial data point.
There're about seventy four thousand nondoms based on the latest
government data, and if the biggest category within that group,
if about if half of them go, then what the
UK has tried to do on the non reforms will
(11:47):
end up costing the government money. Now where where are
we there now? Some advisors are seeing as we heard
earlier just a few minutes ago from our colleague, some
advisers are seeing maybe forty as many as forty percent
of their clients possibly going. Some are seeing even more
than more than half of their clients who've specialized in
this space, and we interviewed them for our big take today.
(12:07):
We're not there yet or we can see the official data.
It will come out in at least a year's time.
But what we're seeing on the ground, the witnesses in
the private wealth community, an influential part of Britain services
heavy workforce, they're seeing the damage right now.
Speaker 2 (12:19):
Yeah, and this is also goes to the nove It
doesn't it that the official data comes out with a
big time lag, So it's about you know, what do
we know now how reliable the data is. There has
also been a tweak as well from the government and
a new four year tax system available to the most
recent non dom arrival, so there's also a question mark
(12:40):
about whether that change helps matters.
Speaker 1 (12:45):
Again, that's a good point.
Speaker 10 (12:47):
I think what we had before was fifteen years and
now We've got four other countries that arrivals to the
UK as wealth hubs, like Italy, Greece, Cyprus, they have
fifteen year regimes as well. They basically copy and pasted
the UK's former non dom regime, took the best parts
out of it, and a UK has gone right, we're
actually going to cut more than by half. So what's
(13:09):
happening now is the UK has already been seen in
this starkically different perspective. Whilst you might have come here,
for example as a foreign individual, set up a business
or run part of your business mpath from London, send
your kids to school here fifteen years, you've got enough time.
Now it's maybe being seen perversely, almost as like a
divin end extraction zone. Come here, have a great time
(13:31):
in London for four years, go to the West End,
go toal museums. But four years, you know, you can't
really get your kids through school in that time, but
maybe you can sell a business.
Speaker 5 (13:41):
And by the.
Speaker 10 (13:41):
Way, it takes about a year to set up in
the UK and maybe about a year to leave, so
really it boils down to maybe about two years. So
the UK has radically changed the way it's perceived by
the globally mobile.
Speaker 3 (13:51):
Okay, Ben, thanks so much for bringing us details of
your reporter this morning. Our alter net worth report of
their bands doubles.
Speaker 2 (13:57):
Now let's get it to the latest on the US tariff.
President Trump says that he will send letters in the
next week or two on unilateral tariff raids to the
US's trading partners. This ahead of the deadline of the
ninth of July. It's only US now to discuss. Has
been a big senior at US Economics and Government editor
Derek Wallbank, Derek, good morning. President Trump seems to be
moving away then from the idea of negotiating over trade
(14:20):
with all of the US's different partners, as he had
indicated before the.
Speaker 1 (14:25):
End of this ninety day period. Is fast approaching.
Speaker 7 (14:28):
Right that Trump had had put out all of the
tariffs on Liberation Day, the ten percent global minimum baseline
for almost every US trading partner, and then several more
reciprocal tariffs calculated based on trade gap, and then the
negotiations start. Right now, we've got the United Kingdom on
(14:50):
the board, and after that we're still waiting for the
next one to drop. There's several countries that are in
advanced talks, India, Japan, there are others, but we're still
waiting for these next deals to come. And the idea,
I think has been from Trump administration officials that at
(15:11):
some point, when you get close to the end of
that window in early July, you might see a whole
lot of them kind of go together. Maybe they might
come in some of a similar form. And we're getting
to the end of this process now now. I think
that it has been a daunting thing to take on.
I think every analyst that I've talked to has said
(15:33):
that it is a sort of mission impossible to try
and come up with, you know, ninety plus individual trade
deals or however many it would wind up eventually being
all in a ninety day period. At the same point,
the Trump administration has to figure out what this end
game is and what they're going to wind up with,
(15:54):
what they're going to settle with, and how that's all
going to work. I think that there has been a
thought that that they're not signaling that there's going to
be a massive extension. That is always possible, but this
is all toward how do we get to this endgame?
How do we try and wrap things up? And the
idea that there might be some sort of template that
(16:17):
everyone kind of draws from or hughes close to. I
think that's kind of where this is signaling.
Speaker 3 (16:24):
Yeah, and look at, as you say, a lot of
signals being read at this point, as it is a
story that is evolving. Some of the signals we have
gotten in the past twenty four hours have been around
the progress made with China, Donald Trump saying that there
was a deal done with China awaiting sign off.
Speaker 1 (16:42):
Do we know what's in it?
Speaker 7 (16:44):
If you listen to the exact words, it's sort of
like a framework to implement a consensus reached in the
Geneva talks, now decided in the London talks. It still
has to go through and get signed off by Trump
and she Trump is seeming very positive on this. We
haven't heard the same exact thing from the Chinese side.
(17:04):
That will take the time that it will take, but
that's trying to get the Geneva agreements on track. We're
also hearing, you know, from from Howard Lutnik and Jamison Greer,
who were two of the key negotiators from the United States,
that this is kind of intended to pave a way
towards a resolution over rare earths and over magnets and
(17:30):
things of that nature, and that that that in turn
could unlock some things that the Chinese want as well.
I think one of the big things that came out
of Geneva, one of the one of the big sticking
points with the implementation of easing the rare earth shipments
and getting those sort of back on track. The US
very much did not feel that China was living up
(17:54):
to its agreements and rapidly escalated in response. Everything sort
of went back went off track. Trump and you have
a call, they go and talk for two days in London.
Now that's kind of back on track. That's where we
are in sort of this framework. Do we have text
of that framework now, but that's what's been described to us.
(18:15):
And the other thing that I should mention when I
say that is that when the Chinese side came out
and read out their version of what happened, and then
when the American side came out, it wasn't that they
were different. I mean, that's something we've talked about. We
have to judge whether or not they're the same or different.
But the US side has been way more expansive on
what they say was in this the Chinese have very
(18:37):
much stuck to the idea of tone tone.
Speaker 2 (18:40):
Yes, okay, that is an interesting point, isn't it. In
terms of the concrete numbers, though, the tariff revenue that
the US is generating is quite significant, a record twenty
three billion dollars in May. That's also helped to shrink
the deficit just for that one month. Again, it's quite
(19:00):
uncertain about whether those revenue streams are reliable, whether they'll remain.
Speaker 7 (19:06):
Well, yeah, no, and that and that's that's one of
the things that I think that Trump administration has been
clear about that tariffs are an anchor of their revenue
strategy as they're going forward. Trump has been really clear
about this that tariffs were meant to help pay for
his one big, beautiful bill of the tax cuts and
other policy moves and uh and and they have been
(19:28):
expecting big revenue to come in. Even as that is
quite a large amount of revenue, it is, i should say,
nowhere in the ballpark of being able to offset the
costings the projected costings of the tariff bill or not
the tariff bill of the tax bill. So that is
(19:51):
that still remains a gap there. So so when you're
when you're sitting there looking at this, that that winds
up being a dis connects. So even as there is
quite a lot of revenue brought in, it's not necessarily
quite enough to do that offset. And it bears mention
that these tariff collections are still not the fullness of
(20:12):
what of what the Trump administration has talked about, has threatened,
has put forward, because we have seen sort of again
and again through the first you know, six month window
of this administration, a lot of threats of where they're
going to be, and then a pullback, and eventually they
land somewhere much softer than where they were aiming to
(20:34):
do so. So I think one of the things to
look for as we go through here is that if
all of this tariff level kind of settles out somewhere
well short of where the administration had threatened, they're also
not going to get the revenue that would be implied
by those sort of maximalist tariff policies. This is Bloomberg
(20:57):
Daybreak Europe, your morning brief on this worries making news
from London to Wall Street and beyond.
Speaker 2 (21:03):
Look for us on your podcast feed every morning, on Apple,
Spotify and anywhere else you get your podcasts.
Speaker 3 (21:09):
You can also listen live each morning on London DAB Radio,
the Bloomberg Business app, and Bloomberg dot Com.
Speaker 2 (21:15):
Our flagship New York station, is also available on your
Amazon Alexa devices. Just say Alexa Play Bloomberg eleven thirty.
I'm Caroline Hepka and.
Speaker 1 (21:24):
I'm Stephen Carroll.
Speaker 3 (21:24):
Join us again tomorrow morning for all the news you
need to start your day right here on Bloomberg Daybreak
Europe
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