UK set to suspend parliament, Apple launches new iPhone
The FT's Daniel Garrahan previews some of the big stories the FT is watching in the week ahead, including more Brexit turbulence in the UK as parliament is set to be suspended for five weeks, Apple launching its latest iPhone, economic data out of the US, while the European Central Bank is expected to cut interest rates
Filmed by Nicola Stansfield and Bianca Wakeman. Produced by Daniel Garrahan
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DANIEL GARRAHAN: Here are just some of the stories the Financial Times will be watching in the week ahead. The UK Parliament is set to be suspended for five weeks in what could be another tumultuous week in Westminster. Apple launches its latest iPhone in Silicon Valley. We've got economic data out of the US. And markets expect the European Central Bank to cut interest rates.
First, to Westminster, where the coming week in UK politics promises to be just as turbulent as the one it follows. The confrontation between Boris Johnson and Parliament shows no signs of abating. The new prime minister has managed to secure a suspension of Parliament, starting on Tuesday, but he hasn't managed to block a bill to prevent a no deal Brexit. And that's led him to fire more than a score of his own MPs, including veterans, such as Ken Clarke and Sir Nicholas Soames, while his brother Joe Johnson resigns. The prime minister had been planning to call a general election and fight a populist campaign.
MIRANDA GREEN: Over the next few days we'll be watching to see how much the opposition parties can unite to continue to not only block a no deal Brexit, which so far, they've been quite successful in trying to do in the House of Commons, but also to stop Boris Johnson holding a snap general election. This is what he would very much like to do, but it looks as if we're going to see an election a bit later in the autumn. That's one thing to look out for.
The other is that it's emerging in court papers in the UK that the Johnson government would like to see a very different final relationship between a post Brexit Britain and the rest of the EU. They're looking for a free trade arrangement, not regulatory alignment with a single market. There will be a lot of pressure on them to explain their plans.
DANIEL GARRAHAN: Now, Apple will unveil its latest iPhones this week in Silicon Valley. The 13th iteration is expected to come in a new iPhone Pro model that features a new third camera lens on the reverse and wireless charging capabilities. But despite the introduction of new colours and finishes, the overall look of the latest iPhones will be broadly similar to the iPhone 10.
While there's always a chance Apple surprises with a brand new product, the odds of it unveiling new smart glasses or an autonomous car seem slim this time around. Many iPhone owners are holding onto their handsets for far longer than they used to, seeing little in the latest releases that will encourage them to upgrade. All of this coupled with a declining smartphone market puts extra pressure on Apple to impress this week.
TIM BRADSHAW: Rivals such as far Huawei, Google, and OnePlus are producing really high quality Android devices that are testing iPhone owners' longstanding loyalty. Samsung is relaunching its folding phone, which is pioneering a whole new category. And the iPhone is looking like it will be the only flagship smartphone without the option of 5G connectivity this year. One of the strongest messages that Apple has used to make itself stand out from the competition is privacy, but even that has been threatened by recent revelations that iPhone owners were vulnerable to a hacking attack for more than two years.
All this means that we will have to wait until next year for a bigger leap forward in iPhone innovation. So Tim Cook and his team have a lot of work to do this week to whip up the usual iPhone hype.
DANIEL GARRAHAN: With markets widely expecting a 25 basis point rate cut from the US Federal Reserve in September, economic data leading up to the meeting are expected to face closer scrutiny. Consumer prices on Thursday are expected to have climbed 0.1% month on month in August. Investors will also scrutinise retail sales for signs of cooling consumer spending, a major driver of economic growth in the US. Retail sales are forecast to have increased 0.3% month on month in August.
MAMTA BADKAR: American consumers have remained resilient despite recent trade uncertainty, but concerns are mounting that they may begin to retrench spending amid fears over the outlook on trade and slowing domestic growth. Investors will closely watch August retail sales figures out next week for an update on the health of the US consumer. Inflation readings are also on the radar, drawing attention to consumer and producer prices as well.
Sluggish inflation has proved a conundrum for the Federal Reserve that has previously noted the difficulty of reaching its 2% inflation target. This further complicates the task of the Fed, which has faced growing pressure from Donald Trump and markets to lower interest rates and support growth amid the ongoing trade turbulence and as market indicators have begun flashing recession warnings.
DANIEL GARRAHAN: And finally to Frankfurt, where Mario Draghi is this week expected to go out with a bang as the president of the European Central Bank. The question that matters for investors is how big his bazooka will be before he hands over to Christine Lagarde at the end of October. On Thursday, markets expect him to cut eurozone interest rates further into negative territory and to restart the ECB's quantitative easing.
MARTIN ARNOLD: There are dissenting voices. We've already heard from the heads of the German, Dutch, and French Central Banks, that they aren't sure that the restarting the QE programme is the right thing to do. But given how bond markets have anticipated this move and sovereign bond yields have fallen, prices have risen. Ahead of the meeting this week, one thing's for sure is that if the ECB does not restart the QE programme, we're likely to see a sell off in those sovereign debt markets.
DANIEL GARRAHAN: And that's what the week ahead looks like from the Financial Times at London.