Brexit negotiations, Netflix earnings
Daniel Garrahan previews some of the big stories in the week ahead, including the second formal round of Brexit negotiations, Netflix earnings and the Bank of Japan's latest monetary policy meeting.
Produced by Dan Garrahan. Filmed by Rod Fitzgerald.
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. Officials from the UK and Brussels kick off the second formal round of Brexit negotiations. India's political establishment elects its next president. Netflix reports second quarter earnings. And the Bank of Japan holds a monetary policy meeting in Tokyo.
First, the Brexit-- UK Minister David Davis and European Chief Negotiator Michel Barnier resume official talks on Monday. The two big questions they'll be looking to make progress on are the UK'S divorce bill, and whether Britain will leave the EU Nuclear Agency, Euratom.
Hopes of fading that quick progress can be made on the priority issues, as our political correspondent, Henry Mance, explains.
HENRY MANCE: With money, Britain hasn't ruled out paying a divorce bill about its outstanding obligations to the EU. It's probably not going to want to pay 50 to 75 billion euros net, which is what we think the EU is asking for. Euratom. The nuclear agency, Theresa May said that Britain will leave. But she's facing resistance from some her own backbenchers. So that complicates the British position.
DANIEL GARRAHAN: Next to India, where the country's political establishment is set to Nath Kovind to the presidency on Monday. Mr. Kovind, a lawyer turned politician, with the ruling BJP, was nominated for the job by the government last month. In India, the president is elected by members of parliament and state level lawmakers, rather than directly through a popular vote. Our South Asia Bureau Chief, Amy Kazmin, has more.
AMY KAZMIN: Mr. Kovind is a former Supreme Court lawyer and two-term member of Parliament who is closely associated with the country's ruling Bharatiya Janata Party. He is also a Dalit, which is those on the lowest rung of Hinduism's rigid caste ladder. And they were formerly considered as untouchable.
Mr. Kovind was nominated by the BJP for the presidency last month, and is essentially running unopposed. The opposition parties haven't put up any candidate as an alternative. India's presidency is largely a ceremonial position, but the president can play an important role in the case of constitutional or political crises.
DANIEL GARRAHAN: Now, Wall Street expects video on demand platform Netflix to report a strong second quarter on Monday night. The company has been investing in original content, as it continues to drive to upend traditional TV network programming. Earlier this year, Netflix broke through the symbolic barrier of 100 million members across the world.
And it has been swept up in the broad tech rally so far this year. Its shares are up by more than 20%. Over the first three months of 2017, the company reported revenues of over $2-1/2 billion. Here's our San Francisco correspondent Tim Bradshaw.
TIM BRADSHAW: A new series of popular Netflix commissions, House of Cards, and Orange is the New Black, both started streaming in the last quarter, as part of what analysts have calculated was more than 300 hours of new content.
So that should keep up audience momentum after Netflix surpassed 100 million global subscribers in April. Overall, analysts consensus forecasts are looking for revenues of $2.76 billion dollars, with additional subscribers of more than 600,000 in the US and 2.6 million in the rest of the world.
DANIEL GARRAHAN: And finally, to Tokyo, where the Bank of Japan is set to keep policy on hold when it concludes a meeting on Thursday. Of quarterly update to its economic forecast will be at the centre of attention.
Japan's central bank is likely to upgrade its assessment of the economy, given robust data in recent weeks, and a weakening of the yen that helps exporters. But inflation remains weak, as our Tokyo correspondent, Peter Wells, reports.
PETER WELLS: The policy board may trim its short-term outlook for price rises in the year to March 2018. Overnight, interest rates, minus 0.1%. And the BOJ has pledged to keep 10-year bond yields around zero. Recently, it has had to defend that pledge by purchasing assets as a global rising yield pushed Japan's 10-year to 0.11%.
The fate of the BOJ's separate pledge to buy assets at a pace of 80 trillion yen a year remains under debate within the central bank. Many policymakers think it is now redundant, given the yield curve cap. However, some of others think the pace of purchases remains important. And the BOJ is reluctant to do anything markets might misinterpret as a move to exit from easing monetary policy.
DANIEL GARRAHAN: And that's what the week ahead looks like from the Financial Times in London. See you again next time.