britain's ecomomy is expected to have gone into reverse — shrinking by 0.1%. and if that continues for the rest of the year — two quarters of negative growth — that would constitute a recession. the bank of england has raised the cost of borrowing to a 15—year high, to try to rein in soaring prices, and that's weighing heavily on many businesses and households. on thursday, official data showed a steep jump in the number of people falling behind on mortgage payments. our cost—of—living correspondent, colletta smith, reports. good morning, donna speaking, how may i help? with rates on the up, more people have been struggling to pay their mortgage bill... don't worry, i'm sure we can get this sorted out for you. ..and an increasing number are now officially in arrears. you know, nobody wants to send debt collectors to your door. nobody wants that. that's not what we want. we want to help you, we want to get a solution in place with you, but we can only do that if you give us a call and let us know. the number of people falling into arrears has been climbing throughout the year, tracking those interest—rate rises. now anotherjump betweenjuly and september, with more people tipping overfrom managing their bills to suddenly not. the sadness that you feel you're helpless, you feel absolutely helpless in our situation. it's just really difficult and we keep trying to plug away, you know, paying off what we can when we can, trying to pay that bit extra each month. but obviously, because of the interest rates just soared and soared, you know, it's really, it'sjust tough. moving home isn't an easy option for lisa, who is wheelchair—bound because of ms, and extra government help towards her mortgage is a loan she's struggling to pay back too. i'm disabled, my husband's my full—time carer, and when you're in that situation, you know, it'sjust demoralising. if you're struggling to make your mortgage payments, there are things that can help. if you extend the term of your mortgage, or if you switch to interest only, that will reduce your monthly payments. and don't forget, there's also the option of breathing space, which is a couple of months off from debt collection, which often gives people enough time to have a headspace to sort their finances. there's more information and advice on the bbc news tackling it together pages. repossessions are still very rare, but figures also show an increase in the number of cases reaching the first stage in that process. like those in mortgage arrears, it's a small, but growing number, as the impact of the last year's mortgage rate rises play out across the country. colletta smith, bbc news. george buckley is chief uk and euro area economist at the investment bank nomura, here in london. thank you forjoining us here. what are your expectations for 03? what are your expectations for q3? ~ ~' , what are your expectations for 03? ~ ~ , ., 03? well, we think it is going to be very _ 03? well, we think it is going to be very weak _ 03? well, we think it is going to be very weak and - 03? well, we think it is going to be very weak and i - 03? well, we think it is going to be very weak and i think. to be very weak and i think what is interesting is the bank of england just last week when they made their decision to keep interest rates on hold also published forecasts for economic output and they think it will be broadly flat over the course of the next couple of years. it is a very weak forecast indeed. it reflects the fact that we have had a lot of things thrown at this economy over the course of the last couple of years, higher inflation and higher energy prices. wars in europe, all of these things are bearing down on economic growth. but i think one thing to say is even if economic growth is very weak, it is actually looking like it is going to perform better than all of those things suggest it could have done. we have managed to avoid a recession so far. that might not be the case over the coming quarters, but know when is really expecting a very deep recession like the ones we saw during the global financial crisis or may be the early 1990s. financial crisis or may be the early 195m— financial crisis or may be the early 1990s. the rate at which rices early 1990s. the rate at which prices are _ early 1990s. the rate at which prices are rising _ early 1990s. the rate at which prices are rising has _ early 1990s. the rate at which prices are rising has remainedj prices are rising has remained largely unchanged, 6.7%. but when we look at the food prices, that is really stubborn. what is going on there? . �* , stubborn. what is going on there? ., �*, there? that's right. food rices there? that's right. food prices have _ there? that's right. food prices have slowed. - there? that's right. food prices have slowed. they there? that's right. food - prices have slowed. they are not rising as quickly as they were. but of course, inflation overall at 6.7 is still well beyond what the bank of england would like to see. their target is 2%. the good news is that when we get the inflation print out next week for the month of october, it will be a lot lower, but that is largely because year ago, we saw such high increases of energy prices that anything which happens this year will pull down on that rate. so that will be some good news for the government ahead of what will be potentially quite a difficult backdrop when they are publishing their autumn statement in a week the prime minister rishi sunak has pledged that he will get the uk economy going by the end of the year. economy going by the end of the ear. ~ ., ., i. economy going by the end of the ear. ~ ., ., ., year. what would you say to him? well, _ year. what would you say to him? well, i _ year. what would you say to him? well, |think_ year. what would you say to | him? well, i think conditions are very tricky. _ him? well, i think conditions are very tricky. you - him? well, i think conditions are very tricky. you have - him? well, i think conditions are very tricky. you have the | are very tricky. you have the bank of england which is really caught between a rock and a hard place. it is really trying to limit the negative fallout on the economy. but it has to raise interest rates or keep interest rates high at least because inflation is so strong itself. so i think the key thing would be to try and do things in the autumn statement which are designed to help people and help businesses. so encouraging investment for example. encouraging investment for example-— example. and very quickly, george. — example. and very quickly, george, wages, _ example. and very quickly, george, wages, are - example. and very quickly, george, wages, are they i example. and very quickly, - george, wages, are they largely keeping up with inflation? it has been surprising how many people have had pay increases. they are, they are more than keeping up at the moment because inflation is slightly under 7%. because inflation is slightly under7%. but because inflation is slightly under 7%. but the official measure of wage growth is over 8% so they are at the moment, but they haven't for some time before that so i think people are still trying to catch up from what we have seen in the past, these huge increases of prices we have seen in the past. prices we have seen in the ast. , prices we have seen in the ast., �* w' , prices we have seen in the ast. �*, , past. judge buckley, pleasure, thank you _ past. judge buckley, pleasure, thank you very _ past. judge buckley, pleasure, thank you very much _ past. judge buckley, pleasure, thank you very much indeed. i past. judge buckley, pleasure, | thank you very much indeed. -- thank you very much indeed. —— george buckley. to the us now, where treasury secretary janet yellen has been holding talks in san francisco with her chinese counterpart, vice premier he lifeng, who's in charge of economic policy. they've been trying to ease tensions between the world's two biggest economies, ahead of a meeting next week between president biden and president xi. michelle fleury has been following the story. the us is hosting this year's asia—pacific economic cooperation summit, an annual event to promote trade between its members. ahead of next week's gathering in san francisco, there's already been a flurry of diplomatic activity, including a meeting between america and china's top finance officials. at a time of intense competition between the two nations, janet yellen had this message for china's new economic tsar, he lifeng. the united states has no desire to decouple from china. a full separation of our economies would be economically disastrous for both of our countries and for the world. we see a healthy economic relationship with china that we seek a healthy economic relationship with china that benefits both countries over time. janet yellen�*s comments come ahead of a potential meeting between us presidentjoe biden and chinese president xijinping next week. since the leaders of the world's two most powerful nations last met in bali, well, a lot has changed. despite us restrictions on high—tech products over the last few months, us—china relations have actually improved. both sides keen to find more ways to cooperate on economic issues. translation: thank you, madame secretary, for your remarks. - and it gives me great pleasure to meet with you again here in the beautiful city of san francisco. it is less than four months since we last met in beijing and we had in—depth discussions on topics of mutual interest. and the efforts of these two superpowers to stabilise the relationship comes against an increasingly complicated backdrop, a sputtering global economy and geopolitical tensions in other parts of the world. russ mould is investment director at aj bell. hello. first, what do you make of the timing of this meeting? because there is a lot going on, a lot is about to, both within the financial but political arena as well. yes, we have _ political arena as well. yes, we have this _ political arena as well. yes, we have this big _ political arena as well. yes, we have this big summit. political arena as well. yes, we have this big summit in | political arena as well. yes, . we have this big summit in san francisco next week which could involve the meeting between president biden and xi jinping. it is kind of the third step in an attempt to thaw relations which got very heated after that spy balloon story in february. so in the summer, treasury secretary janet yellen and national security advisor sullivan and commercial secretary romano went to china and set up a working group to establish ways forward and this is a third step, meeting in san francisco. america looking to address issues such as what they see as unfair chinese subsidies, chinese —— china using debt to bring countries into its sphere of influence and its lack of contribution to net zero policies. china will be looking for progress and access to american technology, and what it sees as unfair american tariffs on its exports. american tariffs on its “porte— american tariffs on its exorts. , , american tariffs on its exorts. ,, , , exports. this is the third step in this easing _ exports. this is the third step in this easing of _ exports. this is the third step in this easing of tensions. - in this easing of tensions. what are they building on, what was achieved in those past meetings? i was achieved in those past meetings?— meetings? i think we will probably _ meetings? i think we will probably find _ meetings? i think we will probably find out - meetings? i think we will probably find out in - meetings? i think we will probably find out in the l meetings? i think we will. probably find out in the next few days potentially, but the fact they are talking at all after the very hot conversations they were having after that spy balloon affair in february is clearly a sign of progress and i think in the back of everybody�*s mind, we know china is not meeting its economic targets at the moment, america still clearly concerned the american economy could soften going into the american election next year. behind that, everybody knows or a lot of economists would argue that the i930 of economists would argue that the 1930 imposition of tariffs by america made things an awful lot worse in what became a very difficult decade, so avoiding a trade war is in the interest of everybody. he trade war is in the interest of everybody-— trade war is in the interest of eve bod. ., , _ everybody. he was hit worst by the tensions _ everybody. he was hit worst by the tensions and _ everybody. he was hit worst by the tensions and the _ everybody. he was hit worst by the tensions and the trade - everybody. he was hit worst by| the tensions and the trade war? that is a good question. —— he was hit worst. you could argue there were probably not any real winners if truth be told, china possibly you could argue has come off worse because its economy was very heavily reliant upon infrastructure spending and also exports of cheap goods to the west. it now has a property bubble that is deflating and it has too much debt it needs to solve and it needs to promote domestic consumption. so america can definitely apply some pressure. but equally, the us is now looking at inflation problems which you could argue is partly the result of de—globalisation, ensuring good things in terms ofjob, but it may bring different pressures in the form of prices. different pressures in the form of rices. , ., of prices. janet yellen, looking _ of prices. janet yellen, looking through - of prices. janet yellen, looking through some l of prices. janet yellen, l looking through some of of prices. janet yellen, - looking through some of the comments she made, she said herself that the united states will continue to take targeted actions to protect themselves and their allies national security. that is almost sending mixed messages. because they are also saying they are looking at future collaborations. in terms of the areas where there could be a future potential collaboration between the two nations, where would that be? i between the two nations, where would that be?— would that be? i think in terms ofthe would that be? i think in terms of the steps — would that be? i think in terms of the steps treasury _ would that be? i think in terms of the steps treasury secretary janet yellen is taking, they will not go and say, everything, let's start again and put everything on the table. they will adapt, adopt an initial position and try and step back from that. the issue is both countries will be looking for, america will look for what it views as subsidies and china will look at what they view as tariffs and they will be the early pressure points, i think. will be the early pressure points, ithink.— will be the early pressure points, ithink. finally, and who would _ points, ithink. finally, and who would be _ points, ithink. finally, and who would be china's - points, ithink. finally, and i who would be china's favoured us president? because we have got the elections coming up. would it set everything back to square one depending on who is taking up residency in the white house?— taking up residency in the white house? ., , , , ., white house? that is probably a auestion white house? that is probably a question for _ white house? that is probably a question for president _ white house? that is probably a question for president xi - white house? that is probably a question for president xi and - question for president xi and the vice—president. donald trump was the person who impose the tariffs during his presidency. equally, president biden has kept a lot of them and has indeed raised the pressure, temperature and pressure, temperature and pressure in other areas, particular technology. so i think they will be following who the candidates are ones we go through the primary is in the spring and what the result is in november very closely. but at the moment, the biden administration does seem to be reaching out, which i'm sure they will take as a positive. russ mould. thank you very much. around the world and across the uk, this is bbc news. bbc news, bringing| you different stories from across the uk. the golden—topped tower on the edge of bath — rescued from decay with almost £4 million of heritage lottery money. beckford's tower today is wrapped up for renovation, but nearby in the grounds, a stone grotto has been excavated. the team have removed almost 100 tonnes of soil to reveal it. most people won't know that this is here, so they will be able to discover this, they will be able to visit it when the tower reopens in the spring, and they will be able to come down and see this amazing arch above it. it's so beautifully built. it is a perfect arch, with bath sewn on the sides of it. but why did the writer and collector william beckford collect it? well, beckford was a very private man. he didn't like interacting with the public. so he had a footpath built up to the tower. by going under the road, via this tunnel, he just kept away from the general public. you're live with bbc news. the collapse of wework — once the biggest tenant of office space in new york and london, before being forced to file for bankruptcy this week — has sent shivers through the commercial real—estate industry. but is it part of a bigger problem? many employees are now hybrid working, rather than returning to the office full—time. vacancies in london offices hit a 30—year high in september, and offices across europe are barely more than half full — according to figures from savills. coupled with soaring borrowing costs, some analysts have warned of a potential crash in the commercial property market, worth $20 trillion globally, and that could impact the wider economy. ruth colp—haber is ceo of wharton property advisors — a new york—based real—estate consultancy. hello and welcome to the programme, thank you for joining us. just how much of a crisis are we in or are we on the edge of one, how bad is it? well, you really highlighted the main points. the landlords of the office buildings in the central business districts across the world are facing a perfect storm. and they are an extremely troubled bunch. you have on the one hand, increased interest rates and notjust increased interest rates, but also now almost no availability of funds for refinancing of commercial mortgages. and then you have on the other hand, a real decrease in the demand for office space due to working from home in large part. i understand that using the eggs —— using the glaxo smith kline building in the uk is an example, many organisations are rethinking where they base themselves and it is coming back down to location, location, location. is this how they will navigate their way out of this crisis?— they will navigate their way out of this crisis? yes, we are definitely _ out of this crisis? yes, we are definitely seeing _ out of this crisis? yes, we are definitely seeing a _ out of this crisis? yes, we are definitely seeing a lot - out of this crisis? yes, we are definitely seeing a lot of- definitely seeing a lot of firms cutting back on the amount of space that they take when they have to sign a new lease. i mean, the fact is a lot of people like working from home so firms feel, well, we don't need so much of the space. but we are going to get good office space that is going to be convenient because there is a real battle going on between employers and employees. and the employers want those employees in the offices so they have to make it easy and as attractive as possible. easy and as attractive as possible-— easy and as attractive as ossible. ., , ., , , possible. so what is happening to a lot of _ possible. so what is happening to a lot of these _ possible