This BBC podcast is supported by ads outside the UK. It's time to see what you can accomplish with Shopify by your side. Can a royal visit help fix the so-called special relationship between the US and the UK? This week, King Charles is visiting America, but it's a tense moment for the US and the UK. I'm Tristan Redman. And I'm Asma Khaled. And we host the Global Story podcast from the BBC. We speak to the former British ambassador to the United States, who knows a thing or two about getting on the wrong side of President Trump. For more, listen to The Global Story on BBC.com or wherever you get your podcasts. Americans are feeling the pinch at the checkout and the pump. As soon as the conflict began, there was a surge in people spontaneously mentioning gas prices, and invariably they were all mentioning gas prices increasing. We see people showing up in our brick-and-mortar storefronts better than they have ever before. Our numbers are really up. It's World Business Report from the BBC World Service. I'm Vishala Sripathma. On the way, we're digging into why high costs are souring the mood for Americans and what's driving the anxiety, plus how China's BYD is racing ahead in the electric vehicle space and why board games are making a comeback. So we've got a snapshot of how Americans are feeling about their economy right now. And it's pretty downbeat. US consumer confidence has sunk to its lowest level on record, even after a ceasefire in the conflict with Iran. Now, new figures from the University of Michigan show households are still really anxious about rising prices and the cost of living, with many expecting inflation to get worse over the year ahead. Well, we spoke earlier to Joanne Hsu, who runs the survey, and she told us a lot of that concern is being driven by the Iran situation, not so much the geopolitics itself, but the impact it's having on fuel and energy prices. Overall, consumers have been feeling fairly subdued about the economy leading into the Iran conflict. They've been most concerned about the persistence of high prices. And with the start of the military conflict in the Middle East, they're now even more concerned with the increase in gas prices and the potential impact on inflation going forward. So has that been the main driver for this consumer sentiment to fall to a record low? That's right. Consumers have been loud and clear for the last several years that the top factor weighing on them is the cost of living And the prospect of continued inflation, a resurgence of inflation, as well as an increase in prices at the pump, that's not helping at all and is worrying consumers even more. And so with this in mind, what are people doing day to day to save money? Different consumers are doing different things. That's not something that we're tracking specifically on the survey. But one of the things that's really tough is that when it comes to buying, fueling your car with gasoline, if you are using your car to get to work or to drive your kids to school, there's not a whole lot you can do to reduce your consumption of those things, which means with gas prices that are 25% higher than they were before the conflict began, that means you have less money for the rest of your budget. And in the United States, driving season is upon us. So are people noticing then the price of gas going up? Absolutely. So we have a few areas in our interview where consumers can have the option to provide open-ended comments about whatever they like. When we look at the surveys from January and early February, it was kind of a mix of people who were saying that prices are expensive and they're weighing on me. But there were a lot of people who said gasoline is actually cheaper than it was last year or two years ago. And they noted that as soon as the conflict began, there was a surge in people spontaneously mentioning gas prices. And invariably, they were all mentioning gas prices increasing. It's pretty much impossible to miss how much gas has increased. It did improve a little bit over the last two weeks. But when it's just a few cents on the dollar, it's not enough to really provide any meaningful relief to consumers. In this scenario, because we've had similar situations not so long ago, what tends to happen to businesses, to economic activity? What are you expecting? A lot depends on how this military conflict, how the war evolves. It's really about when the Strait of Hormuz is going to reopen and when shipping constraints are going to be alleviated. If the strait were to completely reopen to shipping traffic tomorrow, the long-term consequences of this could be pretty mild. But at this time, there's no end in sight to that. And the longer that shipping is disrupted, that energy supplies are disrupted, the more likely that we could see a pass-through to overall inflation, that it won't just be contained to gas prices. It could proliferate because businesses are affected by fuel prices as well. A lot of shipping in the U.S. uses diesel and diesel prices have increased even more than gasoline has. It really depends on how long this Iran war continues. And even after it ends, it depends on how quickly the global market for energy can go back to normal. So is that the only impact on sentiment that you're expecting going forward? The primary impact through sentiment is going to be through prices and inflation. Consumers are expecting that to pass through to business conditions. So just the fact that gas prices are going up, consumers expect that to reduce their personal finances. They expect it to lower to worsen business conditions, but primarily in the short run. They're much more worried about short run impacts than long run impacts. So that was Joanne Hsu speaking to me earlier on. Our markets guest today is Jacob Chen, a financial advisor for Brighton Securities in Rochester, New York. Hi, Jacob. Hi. Welcome to World Business Report. You heard Joanne speak there. Do you feel that what she says is correct, that there is a concern amongst Americans about prices? Yes, absolutely. What we've seen with the lowering sentiment is really that the average U.S. consumer has a lot of uncertainty right now. We've had a lot of uncertainty to start out 2026 because the fact of the matter is we don't know when the Strait of Hormuz will officially open again. And we don't know when this conflict in Iran will officially end. And because of that consumers are very uneasy and they feeling it in their day to day expenses not just at the price of the pump currently being over a gallon But energy is really a sector where a crisis affects every sector of the economy. And that's what we're seeing right now. And that's what's led to a low sentiment for the US consumer. And Jacob, is it something that people talk about every day and in everyday conversation? Yes, that's what a lot of consumers are feeling currently. And because they experience it throughout their daily lives, you know, everyone needs to drive to work. It's a point of conversation. It's what has a lot of people feeling uneasy at the moment. Well, we mentioned the impact that might happen on businesses. And We can hear from now a retailer, Claire Chain, who's the founder of Curio Spice, which is a business that sells kitchen spices across the United States. We sell coriander from Afghanistan, turmeric from India and Costa Rica. We sell spices from Colombia and Peru. It's kind of mind-bending how many places spices grow on this earth. And in terms of your best sellers, what are they? Yeah, our best sellers generally tend to be the easy to use spices. We have a blend that's called Magic Salt, which is a chili and salt blend that just goes on everything. And it's kind of your one and done spice mix. So that plus pantry spices like cinnamon or curry blends, paprika, things like that do really well. And are people still buying them? We see people showing up in our brick and mortar storefronts better than they have ever before. Our numbers are really up for brick and mortar. And for online, you know, we're trying to figure out why online sales are slumped. But it's complicated and it's really hard to pinpoint. But there is that sense of on the national level, you know, people are generally spending less. There's still a steady flow of uncertainty that is coming at us. And how does that uncertainty impact you day to day? From a day to day standpoint, it is particularly associated with our sourcing and logistics planning. As an importing company that works to buy spices from countries all over the world, We have to be really careful about our spending and not lose money on spice shipments that are going to get trapped or that are extremely expensive due to the cost of oil. We haven't gotten anything stuck in the Strait of Hormuz yet, but it's only a matter of time. We heard today about consumer sentiment not being great in the United States. It's actually fallen to a record low. Are you seeing that through customers and their behavior? Yeah, it's mixed, I'd say, with our customers. We certainly have seen a drop in online sales. That is the channel that covers the national sales, because I think that study reflects a certain overwhelming negative sentiment in the US and people kind of clutching their purses because we don't know what's going to happen and food is getting more expensive. And so something that is maybe somewhat of a luxury, like spices and spice blends, are selling less. On the other hand, in our local community in the Boston area, where we have brick and mortar stores, we are seeing more people show up for the small business community purpose and feeling like, I want to support a socially responsible business, a business that is doing something good in the world because everything else feels horrible. And so that brings them some joy then by supporting a local community in a time of uncertainty. Yes, I think it does. So that was Claire Chain, founder of Curio Spice. Jacob is still with us. Clearly, we all need a bit of a spice in our life still, Jacob. A bit of a mixed picture, I think, there from Claire. Sales are doing well, but she's clearly concerned about where things are heading. Yeah, it's something where consumer sentiment and spending can sometimes be at a disconnect, where even if the spending numbers look okay, that could be because of things like rising prices, right? Rising prices could lead to an artificial sort of look that spending is still strong, But sentiment focuses on what consumers expect to have happen in the future. And what you saw in that interview with Claire is that perhaps consumers are thinking that in future times, they'll have less money in their pockets and they'll have to save more and spend less on goods they want. OK, we're just going to pivot a little here, Jacob, because it's not just households and businesses that feel uneasy at the moment. And policymakers are sounding a note of caution as well. At the Bank of England, there's a warning that global stock markets may be in for a fall, with share prices not matching the risks out there, according to them. Deputy Governor Sarah Breeden says investors look complacent, even as worries pile up around the economy, credit markets and expensive AI bets. She says that corrections could come and that the possibility of several shocks hitting at once is what really keeps her awake at night. We expect that there will be an adjustment at some point. And what we want to make sure is that investors are ready for that. So that was Sarah Breeden from the Bank of England. Jacob, what do you make of her comments? Yeah, the concerns are absolutely reasonable. And a correction is always possible. At the end of the day, volatility is the price that you pay for premium returns. in the stock market. But there's also a saying that economists have predicted nine of the last five recessions, which is to say that there's always someone calling for a market downturn. In 2025, there were a lot of people calling for a downturn and the market was up 18%. In 2024, the market was up 25%. So that's not to say that a downturn is not possible. And if you have a short-term time horizon, the market is not the place to be because no one knows where stocks are going to be six months, let alone a year from now. But with a long-term time horizon in the market, you should be able to ride the ups and downs and be able to seek the higher returns that the market offers Okay Jacob it be interesting to see what happens over the next few months Lots of factors to be looking out for there Jacob Chen, our markets guest. Well, you're with World Business Report from the BBC World Service. Starting a business can be overwhelming. You're juggling multiple roles, designer, marketer, logistics manager, all while bringing your vision to life. Shopify helps millions of business sell online. Build fast with templates and AI descriptions and photos, inventory and shipping. Sign up for your one euro per month trial and start selling today at shopify.nl. That's shopify.nl. It's time to see what you can accomplish with Shopify by your side. Can a royal visit help fix the so-called special relationship between the US and the UK? This week, King Charles is visiting America, but it's a tense moment for the US and the UK. I'm Tristan Redman. And I'm Asma Khalid. And we host the Global Story podcast from the BBC. We speak to the former British ambassador to the United States, who knows a thing or two about getting on the wrong side of President Trump. For more, listen to the Global Story on BBC.com or wherever you get your podcasts. Well, you've probably heard of Deep Seek by now. it's one of China's best known AI companies and it's just unveiled a preview of its latest model. Now what's grabbing attention this time is that it's been built to run on China's Huawei computer chips rather than American ones. That's being seen as another sign of China trying to rely less on foreign technology. Well Bob O'Donnell is the President and Chief Analyst of Tech Analysis Research and he joins us now. Hi Bob. Hi Vishal, how are you? Good. So how significant is this move by DeepSeek to work with Huawei chips. Is it pretty symbolic or is it a real turning point? You know, look, I think it's a bit of a combination. DeepSeek had its big moment about, you know, a little over a year ago when it first came out and all of a sudden there was this model that was created that supposedly could compete with all the big models built in Silicon Valley and yet was done at a fraction of the price and was open source and it really kind of shook people up. This one is arriving at a time when, you know, the impact is not going to be nearly as large because while it's good, even DeepSeek themselves acknowledge that, look, we're behind some of the leading frontier models, but we're close. We're a couple of months behind. So it's not going to have that impact. But to your point, this notion of working with Huawei chips is a big deal. To be clear, they're still also going to run on some of the American chips. It's just they're going to have an opportunity to run on the Huawei chips later this year, is what they specifically said. And because of that, and this is the real question that you're asking is, what's the impact? Because the prices will be much lower. And therefore, people theoretically can tap into this big new model and do so at a much less expensive rate than they would if they were using Google Gemini or OpenAI or Anthropics, Claude, etc. Right. And so how does this new model stack up against the big American AI systems? Well, I mean, it's still early days and the final testing will be done by third parties. But, you know, again, by DeepSeek's own acknowledgement, they said, you know, we're competing, but we're a little bit behind on certain areas. General knowledge, for example, they're a little bit behind. Apparently does well on coding, and that's obviously a very hot area. So the big thing is it does reflect the fact that, A, open source models are keeping up with the proprietary models we've seen from, again, the Google Geminis, the OpenAIs, what have you. And of course, that China is still keeping up to some degree with these big models. And that's important because, you know, there is obviously in this huge battle, more political than anything, in terms of where does China rely on and how do American companies choose to work with Chinese companies and how does all this play out geopolitically? so you know i think it's fair to say that it will do very well in china i think you'll see some usage of it here in the u.s but there will also be some caution and particularly because it's not at the bleeding edge it's as i said earlier i don't think it'll have as large of an impact as certainly the first release did so bob is this a case of china closing that gap in ai well it i wouldn't say they're closing the gap. I think what they're doing is they're maintaining a strong position in AI model creation. One of the big questions moving forward, however, is how they're going to train future models. Because while they're going to run some of their models on the Huawei chips, it's not clear that they did the training on the Huawei chips. And they are way behind the performance of NVIDIA and AMD's latest. So it's an interesting marker. It does show that from a software development perspective, they're still keeping up. But it also may be the beginning of a sign of the inability to maintain that pace, if in fact, they can't get access to some of the American chips. So certainly gonna be interesting to watch. Yes, it'd be interesting to hear from the videos on how they feel about the whole situation. Bob O'Donnell, thank you so much for joining us. It's great to have you, President and Chief Analyst of Tech Analysis Research. Well, we're staying with China because as oil prices surged, Chinese electric vehicle giant BYD says it's positioning itself at the centre of the global shift away from fossil fuels. The company is now the world's largest producer of electric vehicles after overtaking Tesla in sales last year and is expanding rapidly overseas. Our Asia business correspondent, Surinjana Tawari, spoke to Stella Lee, Executive Vice President at BYD at the Beijing Auto Show. Actually, we're now suffering the capacity and our demand is much higher than what we can supply. There is intense competition within China. What's the plan going forward? Our flash charging technology. And now with flash charging, finally we can really play in 100% market. This will be a huge game changer. This also builds up a very deep, strong protection river for BYD. make us very different from any other competition. So is it less about the cars now and more about the charging infrastructure? Yeah, less about the car, it's more about the ecosystem, it's more about the total solution. This also makes BYD different. That's always, in my speech, I say, BYD is not a car, it's a BYD. Is Western leadership in terms of the global auto industry over? Have Chinese companies taken over? I think if you go back to 50 years ago, 60 years, when the Japanese went to Europe they have similar skills oh Japanese will take over but in the end no maybe just one or two Japanese companies survive because in auto industry you talking about this long term strategy It not about the car It not about the price It about the long term commitment I would say now you just repeat it like it sounds like a Chinese will take over. It's impossible. So that was Stella Lee of BYD. Listening to that is Tu Lee, Managing Director of Sino Auto Insights in Detroit. Thank you. Welcome to the program, Tuli. In terms of what this means for the US and the electrical vehicle market there, what does it mean for them? What are the implications? Well, it means that as we kind of turn away from clean energy vehicles, the rest of the world has really embraced it. And it just seems like we've missed the memo on that. The Iran war really highlights that. And with a gas price approaching $5 a gallon, we don't really have that many alternatives to go to because we restrict Chinese vehicles from entering the US market. Right. And so our sales of electric vehicles have rocketed worldwide, as you alluded to there. Do companies like BYD even need to sell in the US? So BYD's ambitions are very grand. Stella Lee will tell you that herself. And I think their ultimate goal is to be the number one automotive sales brand in the world. Last year, Toyota sold almost 11 million units. Last year, BYD sold 4.6. So to get to 11 million units is still going to take quite an effort. But BYD is slowly but consistently building momentum around the world. They're in over 100 markets. And I see them really approaching the Toyota numbers over the next several years. OK, Tee, thanks for joining us. Tuli there, Managing Director of Sino Auto Insights in Detroit. And you can actually read more about that interview on our website. Well, tabletop gaming has pretty much gone mainstream in the US lately. Dungeons & Dragons, for example, keeps popping up in shows like Stranger Things, for example. So it all feels very of the moment. But there's another game riding that wave too. Warhammer 40,000 is a sci-fi war game from the UK, first created back in the 1970s, and it's gaining new fans. It's detailed, intense, and not exactly cheap or easy to play either. Leslie Thompson has been finding out more in Nashville. So this army is the Adeptus Mechanicus. Local game shops are one of the few remaining third spaces, those places people gather that aren't home or work. And these shops are the central location for many of the most popular gaming IPs, like sci-fi war game Warhammer 40,000, which uses 3D miniature models to build armies and play against other armies on a tabletop. This is the deployment boundary. Your units need to be behind the line. And this activity is growing in popularity. Manufacturer Games Workshop reported 18% profit growth in 2025, much of that driven by the Warhammer 40,000 IP, which is expanding into video games, film, and television licensing. While Warhammer 40,000 originated in the UK, its largest market is now North America, which makes up the biggest share of Games Workshop's revenue. But Warhammer 40,000 comes with a particular drawback. Its expense. Warhammer isn't cheap. This is Ron Wagoner, owner of the Game Keep shop in Nashville. He told me that contributing to the expense of the hobby is that unlike other tabletop games that come with pre-built models, Warhammer 40,000 models come unassembled. This follows the wargaming tradition of Games Workshop, which means the cost to play includes more than just the models themselves, which are also more expensive than other IPs like Dungeons and Dragons. Like if you were to go to the D&D models, you just take them, you paint them, you're done. It's that quick. They come in price like $4.99 all up to $15, $16.99. It's not that expensive. But GW's models have more detail. They have more refinement. Your average box or squad is like between $65 and $95. And human psychology plays a role in this too. The quest to play 40K is a never-ending quest. It's a never-ending sinkhole of money. The armies are going to change. Your desires for your armies are going to change. You're going to want more. You can't spend enough. And this quest can rack up quite a price tag. This right here would probably be about $1,000. I spent maybe five, six grand on it. But it probably cost me $900 to $1,100. Gamer Jeff Smith has been playing since age 12. And in the past five years alone, he's spent over $10,000 on his armies. Christmases, birthdays, stuff that's not, you know, okay, so I'm spending money on my son and family and bills. And I'm a type 1 diabetic, but my expense money is, some people might even affectionately call it plastic crap. If you haven't heard that yet from a Warhammer guy, you will. But this shop in particular is working to lower the barrier for entry for those who are interested but don't want to shell out thousands. Like offering tables for free, and even stocking an army and all the materials needed for a game. It's all got painted by people in the community. We provide all the mats for the guys to run. I got 12 crates of terrain for them to use at no cost to the players. Warhammer 40,000 will continue to grow in the United States with Hollywood's Henry Cavill, a devoted 40k player himself, on board to produce a film series for Amazon. So despite the cost, these self-proclaimed nerds will continue to play the game, if only for one simple reason. We all want to do something we enjoy. And on a hobby is an expensive hobby, I think. Jacob, you're still with us. You're into some tabletop gaming, apparently. Yeah, I actually do play some Dungeons and Dragons with my friends. It's a great excuse to get together and it really just lets everyone showcase their creativity. you're really imagining an entire new world and new story together and unlike a lot of board games with just a strict set of rules you can really do anything you'd like to in Dungeons and Dragons and that's why playing it with friends is a good experience and a lot of fun. You're selling it Jacob, I might give it a go, who knows. Well that's it from World Business Report. Thank you to Jacob Chen for joining us. Don't forget to subscribe wherever you get your podcasts and you also get the daily edition of World Business Express, which brings you the latest money and work news every weekday. United States who knows a thing or two about getting on the wrong side of President Trump. For more, listen to The Global Story on BBC.com or wherever you get your podcasts.
