federal reserve believe interest rates are at or near their peak, even going as so far to signal of three possible because next year as us inflation continues to receive from its ao—year high. during his frescoes, jerome powell suggested as much. we his frescoes, jerome powell suggested as much.- suggested as much. we are seeinu suggested as much. we are seeing strong _ suggested as much. we are seeing strong growth - suggested as much. we are seeing strong growth that l seeing strong growth that appears to be moderated, a labour— appears to be moderated, a labour market that is coming back— labour market that is coming back in— labour market that is coming back in the balance by so many measures— back in the balance by so many measures and we are seeing inflationary progress. this is what — inflationary progress. this is what we _ inflationary progress. this is what we have been wanting to see _ what we have been wanting to see. y . ., what we have been wanting to see. .., ., what we have been wanting to see. ., , see. the official forecast size with the decision _ see. the official forecast size with the decision to - see. the official forecast size with the decision to leave - with the decision to leave rates on hold, potentially marking the end of a rate cycle that has included 11 increases to ease rising prices. government data showed it had dropped from the peak of 9.1% in mid—2022 tojust dropped from the peak of 9.1% in mid—2022 to just 3.1% in november. that is above the target of 2%. jerome powell cautions the committee had not ruled out raising ways again in the future. for wall street, all three major markets finish higher. the dowjones industrial average on more than 500 points to a record close. this is the third time in a row after all the central bank decided against another rate hike. for investors, satisfied they are done, the only question on their minds is when will they start cutting them? let's turn our attention to the uk now. because after raising the cost of borrowing to its highest in 15 years, the bank of england has been sticking to the message that it will stay there for the foreseeable future. the rate of price rises or inflation is still more than double the bank's 2% target. but financial markets are increasingly betting the bank will have to start cutting the cost of borrowing early next year as the economy weakens. that view was boosted on wednesday after growth figures came in worse than expected. here's our economics correspondent andy verity. it was one of the wettest october is on record, as a storm battered the coast flies involved towns in yorkshire, one of the biggest reasons why the economy shrank faster than most thought it would. as a shoppers cow would indoors, and across the economy, a little less was spent. in october, the value of goods and services produced, gross domestic product, shrank by 0.3%, a smaller drop in some in the pandemic. the monthly figures came with a health warning, they wobble around. over three months, there was no growth at all. that matches the series of companies like this used car dealer. business boom to the pandemic of a shortage of microchips that to a shortage of new cars and that means fewer new cars now, keeping prices high. most buy on credit which cost £100 a month authors interest started rising. in 2005, we have £5 million and last year we had a £41 million turnover that we have green of the business considerably. that growth has slowed down over the last couple of years and that is purely because of the uncertainty of the market at the moment.— the moment. some of the slowdown _ the moment. some of the slowdown is _ the moment. some of the slowdown is to _ the moment. some of the slowdown is to deliver - the moment. some of the slowdown is to deliver a i the moment. some of the - slowdown is to deliver a policy to fight inflation. the slowdown is to deliver a policy to fight inflation.— to fight inflation. the top -riori to fight inflation. the top priority this _ to fight inflation. the top priority this year - to fight inflation. the top priority this year has - to fight inflation. the top | priority this year has been to fight inflation. the top . priority this year has been to halve inflation and as a result of that we had to make difficult decisions on the bank of england has had to drive down inflation by tight monetary policy, high interest rates, and that inevitably has an impact on growth.- an impact on growth. many households _ an impact on growth. many households are _ an impact on growth. many households are not - an impact on growth. many households are notjust - an impact on growth. many - households are notjust wasting high interest rates, they are paying more tax on their wages, leaving them less to spend on everything else. fix, leaving them less to spend on everything else.— everything else. a set of growing. _ everything else. a set of growing. the _ everything else. a set of growing, the homily - everything else. a set of growing, the homily is i growing, the homily is shrinking and that has a real world impact because it means less money in the pockets of ordinary families, less investment opportunities for business. ., ., ., . business. for now, the economic headwinds _ business. for now, the economic headwinds remain _ business. for now, the economic headwinds remain fierce, - business. for now, the economic headwinds remain fierce, with i headwinds remain fierce, with households buffeted by higher bills, taxes and 14 rises of interest rates in the the city now expect the bank of england to play screws before christmas with another one. wei li is global chief investment strategist at the world's largest asset manager blackrock. lovely to have you with us. let's start with the us, the federal reserve did we expected, they kept rates in the world's biggest economy on hold but it was interesting to hear whatjerome powell had to say. hear what jerome powell had to sa . ., ., hear what jerome powell had to sa. ., ., , say. your thoughts? absolutely. a fascinating _ say. your thoughts? absolutely. a fascinating time _ say. your thoughts? absolutely. a fascinating time in _ say. your thoughts? absolutely. a fascinating time in the - a fascinating time in the markets, the federal reserve used to give forward gardens and guide the markets and for now they are taking guidance from the market. the surprise yesterday was not so much about the hold or most likely already at the rays, we knew that already, but it was markets going into the meeting were already pricing in aggressive cuts. 120 basis points for 2024. the fed essentially gave them permission to do that yesterday. essentially started talking about rate cuts and this contrast was this beach thatjerome powell made when he said he was sure to conclude with confidence and that the policy is efficiently restricted or to speculate when policy would ease. the flip—flop narrative is really feeding to strong market volatility. it is in characterising the whole of 2023. 4' characterising the whole of 2023. ~ , characterising the whole of 2023. 4' , ., 2023. the thinking is that the race will be _ 2023. the thinking is that the race will be coming _ 2023. the thinking is that the race will be coming down - 2023. the thinking is that the race will be coming down in i 2023. the thinking is that the | race will be coming down in the us. when you think they will start cutting rates and will the uk and europe be following suit? ,':,': the uk and europe be following suit? iii: ., the uk and europe be following suit? ,':,': ., ., ~ suit? 433 to give the market ricin: suit? 433 to give the market pricing that _ suit? 433 to give the market pricing that already - suit? 433 to give the market pricing that already is - suit? 433 to give the market pricing that already is very i pricing that already is very aggressive, this is big, especially given the uncertainty, especially given inflationary pressure in parts of the economy. in the us, course service housing is still a 5% on a annual basis. this is a 5% on a annual basis. this is a big bets but certainly open the door yesterday to cutting rates and we think the rates cut will start. still the second half of next year be potentially may be potentially maybe even earlier than that after yesterday's comment. looking ahead, from now until the end, it is hard to see catalysts on the market momentum and the barfor the central bank not to take the lead from the fed is high. especially given both economy, european and uk, are stagnating and inflation has been falling as well. we certainly expect them to take the lead. the bottom line in terms of investing, it is important to stay with investors and right now we're seeing a rally into the year and, let's set up the new year on a bit more selective footing when it comes to evaluation, which is why we continue to advocate on a selective basis over 6—12 months. selective basis over 6-12 months-— selective basis over 6-12 months. ~ ., , , ., months. we need to stay smart, that is what _ months. we need to stay smart, that is what you _ months. we need to stay smart, that is what you are _ months. we need to stay smart, that is what you are saying. - that is what you are saying. thank you. the markets had a real rider wall street. you can see the other represent. japan was up significantly yesterday. if we look at wall street, people call this time of year the centre rally time and we are certainly seeing three days in a row, the market is hitting year highs. craig erlam is senior market analyst at the foreign exchange trading company oanda. good to see you. what is your take on all of this? just hearing about the market reaction. your thoughts? the market reaction _ reaction. your thoughts? the market reaction was reaction. your thoughts? t'ta: market reaction was strong which is not surprising. markets were priced aggressively going into the fed meeting, no—one expected the fed to meet market expectations and to be honest, going into it, my personal view was they may offer a couple of rate cuts next year my potentially even maintain just one rates cut next year. just australia considering the pivots while not actually moving at this point in time, to suggest the markets with a massive concession, as something that investors understandably got very excited about and then pushed the boat out further to five rate cuts now been priced into the market. this is a massive change from a fed only three months ago said the next level be a rate hike, probably this year, so clearly a lot has changed in this time and it has. the data softens, wage growth has slowed, inflation overall has slowed, much more sustainable levels. still a work to do, particular the service aside but i think you can see progress in the last three months has been substantial and substantial enough for the fed to make quite a drastic move in terms of the expectations. this quite a drastic move in terms of the expectations.- of the expectations. this is jerome powell _ of the expectations. this is jerome powell trying - of the expectations. this is jerome powell trying to - of the expectations. this is - jerome powell trying to manage a soft landing in 2024. if we look ahead to the bank of england and european central bank, do you think andrew bailey are envious of the position in the us, where it is a little bit clearer, simpler, maybe? t a little bit clearer, simpler, ma be? ., , ., maybe? i would say they are envious to — maybe? i would say they are envious to an _ maybe? i would say they are envious to an extent - maybe? i would say they are envious to an extent in - maybe? i would say they are envious to an extent in thatl envious to an extent in that christine lingard, they have their own issues and probably already in recession, so they are probably also going to have to cut rates a few times next year. notjust because year. not just because inflation year. notjust because inflation is falling but also to support the economy. markets are pricing in five or six because next year from the european central bank and interesting to see how much the ecb gives later on, whether they will go full fed and .2 3— four ray because next year and a itself with the markets than has been for a next time. the bank of england is in a different situation, still seeing higher levels of inflation here in the uk, markets positioning for a summer start to rate cuts and only a few next year, so slightly behind the curve. the difference today for the bank of england unlike the federal reserve yesterday, we will get any forecast today, comes in november and february, so we will get any forecast wasn't a press conference and was not expecting any big announcements from the bank of england today. we will have to wait a couple of months. i will not be surprised with the ecb if we see a repeat of the fed yesterday. see a repeat of the fed yesterday-— see a repeat of the fed yesterday. see a repeat of the fed esterda . ., ., yesterday. have a good day. good to see _ yesterday. have a good day. good to see you. _ to the war in ukraine now, because european union leaders begin a two day summit today to discuss a 50 billion euro aid package for kyiv over the next four years as well as the start of talks on the country's eu membership. all 27 leaders are in favour except hungary's viktor orban, who has been threatening to veto it. but on wednesday, the eu unblocked up to 11 billion euros of funding for hungary, which had been frozen over concerns about the rule of law there, leading critics to say it had �*given in to blackmail�*. european commission president ursula von der leyen said this week it's vital for europe to keep backing ukraine. as the war drags on, we must approve what it means to support ukraine for as long as it takes. ukraine is not only fighting against the invader but for its. joining a family will be ukraine's ultimate victory. forthis, will be ukraine's ultimate victory. for this, we have a decisive role to play. john e herbst is former us ambassador to ukraine and now senior director of the atlantic council's eurasia center. good to have you with us. has a summer treat? good to have you with us. has a summertreat? do good to have you with us. has a summer treat? do you think a vote in favourfrom hungary summer treat? do you think a vote in favour from hungary is now in the bag? tt vote in favour from hungary is now in the bag?— now in the bag? it is in the ban but now in the bag? it is in the bag but i — now in the bag? it is in the bag but i expected - now in the bag? it is in the bag but i expected to - now in the bag? it is in the i bag but i expected to happen. by bag but i expected to happen. by and large, hungary, and in helpful activate the eu and nato, grails and growls but when the organisation, be it nato or the eu, moved decisively in the right direction, hungary decides it is better to get out of the way. it is obviously here. from victor or— way. it is obviously here. from victor or mana's _ way. it is obviously here. from victor or mana's point - way. it is obviously here. from victor or mana's point of- way. it is obviously here. from victor or mana's point of view, | victor or mana's point of view, from what they gain of being in the eu, that is very important fundamentally? they get for their economy? they don't want to risk it. , ., ., , to risk it. there is no doubt hungary — to risk it. there is no doubt hungary is _ to risk it. there is no doubt hungary is benefiting - to risk it. there is no doubt. hungary is benefiting greatly from being in the year. without it he would splutter substantially and he understands that but his abridgement and he might say that maybe he has been successful in threatening action on ukraine to get the two overlook that it is not politically democratic tendencies at home. —— a brickman. tendencies at home. -- a brickman— tendencies at home. -- a brickman. �*, ., ~ ., , brickman. let's talk about this meetin: brickman. let's talk about this meeting and — brickman. let's talk about this meeting and how _ brickman. let's talk about this meeting and how important i brickman. let's talk about this meeting and how important it| meeting and how important it is. the eu has to show unity and its backing of ukraine after a very tough year with the offensive starting injune seemingly not delivering and also vladimir zelensky in washington did not get the funding he wanted from the us either this week?— either this week? look, this aid is essential, _ either this week? look, this aid is essential, especially l either this week? look, this | aid is essential, especially in light of the political games under way in washington. we are at the most dangerous moment in moscow's war on ukraine. as long as they are provided the ad, ukraine will ultimately win. the fact that the aid is in doubt in washington is very dangerous. the eu stepping up is also a reminder to washington it has to play the same role. washington it has to play the same role-— washington it has to play the same role. ~ ., _, ., same role. will the outcome of these two-day _ same role. will the outcome of these two-day meetings i same role. will the outcome of these two-day meetings have l same role. will the outcome of. these two-day meetings have an these two—day meetings have an impact? tt these two-day meetings have an im act? . , . , impact? it has indirectly. there has _ impact? it has indirectly. there has been - impact? it has indirectly. there has been a - impact? it has indirectly. there has been a false i impact? it has indirectly. i there has been a false urban agent that eu and europe is not done its part in supporting ukraine and we note from data that in fact europe has sent more aid to ukraine than the united states so this decision will once again bring home to the american public that the eu is more than pulling its shape so that is a positive. {lin is more than pulling its shape so that is a positive.— so that is a positive. on cue for your— so that is a positive. on cue for your time. _ so that is a positive. on cue for your time. interesting i so that is a positive. on cue| for your time. interesting to get your perspective on this. my get your perspective on this. my pleasure. thank you. let's get some of the day's other news now. energy suppliers in the uk will have to help customers struggling with bills after new rules come into effect today. the regulator ofgem now requires companies to contact vulnerable customers if they miss two monthly or one quarterly payment and check to see if they are having financial problems. they must help by offering affordable payment plans or repayment holidays if appropriate. etsy, the online marketplace for home—made goods, is cutting about 225jobs, or 11% of its workforce. chief executivejosh silverman has told staff the cuts are needed as sales have been essentially flat for two years. etsy�*s shares are trading at well under a third of their peak during the covid pandemic. former bp boss bernard looney will forfeit up to £32.4 million pounds after the oil giant found he committed "serious misconduct" in failing to disclose relationships with colleagues. ——£32.4 million after the oil giant found he committed bp says mr looney is to be dismissed without notice and will not receive further salary or benefits. he resigned in september after admitting not being fully transparent about his past personal relationships. tesla is recalling more than two million cars after the us regulatorfound problems with its driver assistance system, autopilot. it follows a two—year investigation into crashes which occurred when the tech was in use. the company says it will send a software update over the air to fix the issue coming up, which of the world's top firms are most ready for the future? 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