Iran Ready to Escalate War, iPhone ‘Duo’ Revealed, More

0:00Every episode of Planet Money begins with a question. Can we help people rise out of poverty by improving the neighborhood where they look? What would you build on a piece of land when all the normal rules go out the window? What do robots that mean for the restaurant industry? Planet Money helps you find answers by going to places, watching people, and sometimes robots at work and asking questions. Listen to Planet Money on the NPR app or wherever you get your podcasts. News when you want to, with Bloomberg News now, I'm Stephen Carroll. And I'm Caroline Hepke. Oils move back above $100 a barrel as raising inflation risks and driving expectations for more interest rate hikes across Europe. The European Central Bank is expected to deliver a quarter-point hike today with your own inflation already above 3%. Jamie Rush is director of Global Economics at Bloomberg. Well, they're going to hike up because they've told us so. The key question is, what is going to happen thereafter? I mean, we know that like Ford guidance is basically dead in the US. I don't think they're quite ready to shed that in the ECB yet, so we may get something useful from the guard on the path ahead.

1:04Jamie Rush there as traders now pricing around 90 basis points of increases by the end of next year. That suggests at least three quarter-point hikes with around a 60% chance of a fourth. But some analysts say markets are pricing too many further hikes, given limited signs of broader inflationary pressures. Here's ING's Chief Economist, Mariah Kebelam. We would say that if you look at the inflation picture at the moment, that's still pretty well behaved. And also looking further ahead when we look at next year, we don't expect to see very high inflation. That's mostly because yes, energy prices are obviously higher, and that is coming through in headline inflation. But if you look at core inflation, surfaces, wages, and so forth, we don't see that much inflationary pressure, which is why we believe that one rate hike could be enough. Mariah Kebelam was speaking as markets also expect the Bank of England to deliver at least three quarter-point hikes by the end of 2027,

2:05with higher energy costs threatening to keep inflation elevated. Higher borrowing costs are already hitting homeowners, with the average two-year fixed mortgage rate in the UK now at 5.7%. And the state agents are warning today that house prices in Britain are likely to fall in the coming months. Now Iran is ready for a more intense war, and will escalate counter strikes if US attacks continue. This, according to a senior Iranian official, the official toll bloomboat that Tevan has no intention of backing down, despite mounting economic pressure from the seven-month conflict. President Trump also continues to downplay concern about rising oil prices. He told reporters he expects the conflict to end around November's midterm elections in the US, because Iran can't hold out much longer. Paul Wallis is our managing editor for politics and economics in the Middle East. I think it shows just how hard it is for Trump to wind down this conflict, which is increasingly unpopular with American voters.

3:06Iran is standing firm in saying that it can withstand American economic and military pressure, and we have a re-energizing source saying that they will even escalate if necessary. Paul Wallis, the comments from the senior Iranian official, comments hostilities between the US and Iran show little sign of easing. The Wall Street Journal reports Vice President J.D. Vance and Secretary of State Marco Rubio have raised the prospect of the conflict continuing beyond Trump's presidential term. Well, as Republicans face a difficult midterm election, President Trump has made voters an offer, speaking of the party's convention in Dallas. He promised a $5,000 payout to adults. If Republicans can retain control of Congress.

4:17The so-called Trump dividend would require a congressional approval and could cost well over one trillion dollars. The pledge comes as Trump tries to overcome voter concerns about affordability and the seven-month war with Iran. Treasury features barely moved after the announcement, suggesting markets see little chance of the payout becoming reality. Now to the UK. British police are investigating reform UK over potential electoral law violations. Deepening a fundraising scandal in gulfing Nigel Fowarge's party, the move follows a channel for news report showing senior party officials appearing to discuss how to circumvent rules on foreign donations. Without naming reform, London's much-pulsing police said on Wednesday that reports received after the boardcast would be added to the allegations in an ongoing investigation. The party denies anyone doing and says it will fully cooperate with the investigation.

5:19Apple has launched its first foldable smartphone betting a major iPhone redesign can help energize growth. The iPhone Duo opens into a 7.6-inch display. The largest screen ever offered on an iPhone. Prices start at $1,999 in the US, rising to almost $3,200 for the version with two terabytes of storage. Here is Bloomberg Intelligence's head of global technology research, Mandi Psiang. When you're talking about a two-grand price point, I think it's going to be hard for people, a lot of people to upgrade. And look, I can see why they had to price it at that, you know, $2,000 because all of their component prices are going up. That's Bloomberg Intelligence as Mandi Psiang there. On the Duo device, which will be available from the 23rd of October in more than 70 countries, Apple also unveiled new iPhone 18 Pro models, AirPods and watches while raising pro iPhone prices by $100.

6:22European car producers are facing more direct competition from Chinese brands, according to Bloomberg economics, auto makers are set to lose even more ground in the coming years. Bloomberg's cheaper adabaya has more. 10 years ago, China's city streets were congested with Volkswagen's and Audi's. Now it's domestic brands like BYD and Glee sitting in traffic, while Germany's VW announces 50,000 job cuts. According to Bloomberg economics, the cost of Europe's lost market shares to China since 2018 made up about 0.7% of GDP last year. That's up from 0.5% in 2024. The news comes as Beijing's share of global imports falls, whilst its domination in advanced manufacturing sectors is skyrocketing. And that impact looks set to grow. China's exports have continued to rise in 2026, especially when it comes to key European export goods like automotive and some chemicals. In London, T-Watabaya, Bloomberg Radio.

7:30UK Prime Minister Andy Burnham and Chancellor John Healey as the government considers higher taxes on banks. The talks come ahead of Healey's first budget on 28 October. Burnham is declined to rule out a windfall tax following strong profits at Britain's biggest lenders. Daimler's warned that higher taxes could deter investment and forced JP Morgan to rethink plans for a major new London headquarters. Now it's reported the government will set out plans to give mayors in England the power to introduce a levy on tourists later today. Bluemakes you in pots has more. Dubbed the tourist tax, the plan was first mooted by Kierstarmas government last year and in similar to a scheme running in Scotland. It's widely reported the government will today lay out plans to allow mayors in England to levy a fee on people staying overnight in their areas. Local leaders would then be free to decide how the money should be spent. The levy will be charged as a percentage of the cost of accommodation rather than as a flat fee. The government argues

8:31that will protect cheaper holidays in London. I'm your impots Bloomberg Radio. And those are our top stories for you this morning. So Brent crude in the markets has climbed as high as $101.94. We've paired a little bit of those gains, but it really is $100 oil. The sequel, the cost of natural gas here in Europe has also surged. Looking at the bond markets yields in Europe have also gained significantly ahead of the ECB rate decision. German benchmark yields hovering around 3% this morning in terms of those two year front month yields. Also in the US despite Scott Bessens warning, 10 year treasury yields have shot up to a fresh 3 year high, 4.85%. That $5,000 check, that potential $1 trillion or more cost in the US could be very inflationary potentially, but not much market reaction. The dollar near a four month low. And in terms of stock markets, you have seen a

9:35cell of an Asia MSCI Asia Pacific index down six tenths and you have so 50 futures gaining just two tenths this morning. Those are the markets. That's news when you want us with Bloomberg news now. I'm Stephen Carroll. I'm Caroline Hepka and this is Bloomberg. Gain insight on the innovators, disruptors and tech-driven trends shaping today's complex economy. I'm Carol Maser and I'm Tim Stenevek. Wrap up your work day with the Bloomberg Business Week Daily Podcast. We bring you deeper dives into the story shaping your world from the evolution of AI to the shifting priorities of global business. Plus Silicon Valley power players and the latest tech trends. Catch up on the conversations you missed during the day. Subscribe to the Bloomberg Business Week Daily Podcast on Apple, Spotify or anywhere you listen. Hi, I'm Barry Rittultz inviting you to join me for the Masters in Business Podcast. Every week we bring you conversations with the people who shape markets, investing and business. I speak with CEOs, Nobel laureates, market innovators and legendary investors. Whether you own

10:39stock bonds, real estate commodities, even crypto, these are discussions you absolutely need to hear. Subscribe to the Masters in Business Podcast on Apple, Spotify or anywhere you listen.