Russia's war games, Apple launches new iPhone
The FT's Daniel Garrahan previews some of the big stories in the week ahead, including Russia’s war games striking fear into its neighbours, the launch of Apple's anniversary iPhone at its new headquarters in California, and the Bank of England's September Monetary Policy Committee meeting.
Filmed by Rod Fitzgerald. Produced by Daniel Garrahan
Hello and welcome to "The Week Ahead" from the Financial Times in London. Here are some of the big stories we'll be watching this week. Russia's war games strike fear into its neighbours; apple launches its 10th anniversary iPhone at its new headquarters in California; and Bank of England holds its September monetary policy committee meeting. First to Moscow's military exercises in western Russia, Belarus, and Kaliningrad.
These are the first big scheduled military exercises in Russia's Western District since 2013. Moscow says the drills will only involve around 12,000 troops, but the true figure could be closer to 100,000, which would make them the biggest in Europe since the Cold War. Russia has in the past skirted around commitments in the so-called Vienna Documents, which oblige it to invite large numbers of foreign observers to drills involving more than 13,000 personnel. It does so by running multiple nominally separate manoeuvres in parallel.
Moscow felt compelled recently to pledge it wouldn't use the drills as cover to invade one of its neighbours, but with its annexation of Crimea is still fresh in the memory, Russia's neighbours are jittery. Our Eastern Europe Editor, Neil Buckley, has more.
Countries like the Baltic republics-- Estonia, Latvia, Lithuania, Ukraine, even Poland-- have been very concerned that these exercises could be cover for something else. Now, we haven't seen evidence that that is the case. Russia hasn't been preparing the way through information warfare, propaganda, whatever for any kind of attack. It hasn't created the pretext for war.
So it seems unlikely that that will happen, but there is always the danger when you have large scale military exercises that there could be mishaps or provocations or something could go wrong. So there's nervousness about that. There's also been the suggestion they could be used to leave behind some troops or equipment in Belarus.
Next, to the Steve Jobs Theatre at Apple park. The 175-acre campus, which will eventually house more than 12,000 people and which cost a reported $5 billion. As well as unveiling its new home, Apple will be showing off a new range of iPhones, which if you believe the hype could be its biggest product launch in years. After the move to larger screens unlocked a huge wave of growth for the iPhone 6 back in 2014, Tuesday's event at Apple's headquarters will mark another shift, not just in design but in strategy, too.
A new addition to Apple's lineup will be an iPhone Pro model, featuring more advanced technology, as our US Technology Correspondent Tim Bradshaw reports.
Even if you don't quite believe the hype, I think it will be the biggest shift in design and technology that we've seen since the iPhone 6 brought two new screen sizes onto the same in 2014. The biggest changes in the technology will be to a new Pro model, which will be a more expensive version of the iPhone, much the way that Apple segments its iPads into iPad Pro and the regular model. And it will see the inclusion of a new screen and a new depth-sensing camera that will provide new security and augmented reality features.
The key question is for investors who've already seen a 40% gain in the stock over the last 12 months are whether it can make enough of this new device to meet demand and also whether it can persuade enough of its loyal customers to spend $400 at least more than they would normally spend on a new iPhone.
With many of the product details already leaked and with Apple shares trading close to their all-time high, some investors might be hoping Apple reveals one more thing to prevent a post-launch hangover. And finally, to the Bank of England, which on Thursday will publish a decision and the minutes of the September meeting of its Monetary Policy Committee. This will be the first meeting attended by Dave Ramsden in his new role as deputy governor for markets and banking, which brings the committee back to a full complement of nine members.
Sir Dave was chief economic adviser at the treasury until very recently, and he hasn't made his views or monetary policy known publicly. But it would be highly unusual for him to vote against the majority at his first meeting, as our Economics Correspondent Gemma Tetlow explains.
The data that's come out since the August meeting if anything suggests a slightly weaker picture for the economy and slightly lower inflation than we've been expecting back at the beginning of August. So there doesn't seem to be a lot to push them towards any greater impetus to raising rates more quickly. But it will still be interesting to see what language they use in their statement.
In August, the financial markets took the vote for a rate hold as being quite dovish signal, but actually, the detail of the statement from the bank suggested that they were trying to send a more hawkish signal that even though growth is quite sluggish, that actually reflects a new normal for the UK economy. So they may be pushed into raising rates even if growth doesn't pick up to levels that we've experienced in the past. So it will be interesting to see if they try and reinforce that more hawkish message this time.
And that's what the week ahead looks like from the Financial Times in London. See you again next time.