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As royal wedding nears, brands benefit from ‘Meghan effect’

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Canadian fashion designer Bojana Sentaler stared at her television on Christmas Day to see if Meghan Markle had a gift for her.

She did. As Prince Harry’s future bride left a church service on the grounds of Queen Elizabeth II’s private country estate, Sentaler spotted a cuff detail on Markle’s camel alpaca coat that told her customers would be flocking to her website.

“I was looking for the ribbed sleeves, hoping it was a Sentaler coat,” said the designer, who met Markle when she was a mere TV star. “And as soon as I saw that, I was so happy and so excited and it was the best Christmas present I could ever wish for.”

The Meghan magic was almost instantaneous; Markle’s coat sold out, as Sentaler expected, and the publicity fueled sales of other designs. Now part of an elite circle of entrepreneurs tapped with the monarchy’s golden touch, the designer plans a boutique in London, though no firm dates are set.

Markle’s marriage to Harry isn’t just a trans-Atlantic love story linking the House of Windsor to Hollywood. The couple’s May 19 wedding is likely to have dividends for the designers, florists, bakers and tiara makers who are directly part of it, as well as for businesses much farther down the line of affection.

The glamorous bride-to-be alone is forecast to pump 150 million pounds ($210 million) into the British economy as consumers try to mimic her style, according to economists at Brand Finance, which produces an annual report on the monarchy’s economic contributions.

In all, the wedding is expected to generate more than 1 billion pounds of economic activity, including 300 million pounds in tourism, particularly from Americans eager to be part of the occasion.

Marketers see Markle as a bonus from the royal family, since her engagement to Harry followed so closely on the sensible but very stylish heel of the former Kate Middleton, who married Prince William seven years ago.

But Markle, whose pencil skirts and stiletto heels graced the hit U.S. television show “Suits” for seven years, brings fresh sparkle to the picture. Having her showcase a coat, handbag or service is like being associated with a fairy tale, just like when Grace Kelly married Prince Rainier III of Monaco in 1956.

Perhaps more importantly, she’s a biracial American who links the royal family to new countries and new cultures.

“The U.S. loves a princess,” said Pauline MacLaran, co-author of “Royal Fever: The British Monarch in Consumer Culture.”

“It’s something that the U.S. does not have. It’s the rags-to-riches story. It’s the whole Cinderella story yet again.”

The back story makes Markle of huge interest not just to Americans — who sometimes seem more fascinated by the royals than their own subjects — but also other royalty-loving countries like Japan, which marvels at the Windsors moving into the 21st century.

“The last time there was something like this was when Grace married Rainier, and he was just a petty potentate,” said David Haigh of Brand Finance.

The royals don’t advertise, but they do set trends and showcase whatever they might be wearing, seeing or doing. Whether it was Queen Victoria popularizing trees for Victorian Christmases or Princess Diana and her ruffle collars, people have long tried to emulate their style.

But these days, the royal effect is supercharged by social media. The internet offers a running commentary on everything the royals do, and their fashion choices are photographed, scrutinized and instantly identified. Websites such as whatkatewore.com and its sister site, whatmeghanwore.net quickly pinpoint the designer and sometimes tell a bit of a garment’s story.

When Meghan wore The Dina style jean from the Hiut Denim Company, there was worldwide publicity about a firm in Wales which started to re-employ workers displaced when the local factory closed. Handbag designer Charlotte Elizabeth, a small firm supported by The Prince’s Trust charity, warns of long waits and unprecedented demand now that Markle is part of the equation.

American Susan Kelley, founder of whatkatewore.com, said Markle has proved to be more cognizant of the impact of her choices than the Duchess of Cambridge. That may be because as a former actress, she brings to her new public role a greater sensitivity to the messages sartorial selections contain.

“I think Meghan understands sartorial diplomacy and understands it to the level that she wants to expose smaller artisanal brands to the general public,” Kelley said. “It’s a tremendous economic driver, a tourism driver and a platform to draw attention to the charitable endeavors they think are important.”

Anyone who has been sucked into this vortex can vouch for the impact of even an unplanned product sighting. Just ask Raegan Moya-Jones, co-founder of aden + anais, a baby products company based in New York.

After the world got a 45-second look at newborn Prince George in one of the company’s signature muslin swaddles five years ago, aden + anais’ website crashed within four hours. The next day, the site crashed again, Moya-Jones recalled. The company had 7,000 orders — a 600 percent increase in sales — in nine days for the “royal swaddle” that popped up in search engines.

Moya-Jones, who is originally from Australia, said that while it is a wonderful thing “to be able to drop into conversation that you dressed the royal baby,” the tsunami of attention ended almost as quickly as it began.

“The royal effect doesn’t guarantee you success,” she said. “But it’s a lovely notch in the belt.”

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All-electric aircraft from Rolls-Royce completes maiden flight

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Matt Cardy | Getty Images News | Getty Images

Rolls-Royce’s first all-electric aircraft has completed its maiden flight, soaring across skies in the U.K. for around 15 minutes this week.

In a statement, the company said the aircraft’s trip on Wednesday marked “the beginning of an intense flight-testing phase” that would involve the collection of performance data on its electrical power and propulsion system.

According to Rolls-Royce, the airplane — dubbed the “Spirit of Innovation” — utilized a 400 kilowatt electric powertrain “with the most power-dense battery pack ever assembled for an aircraft.” Eventually, the firm wants the aircraft’s speed to exceed 300 miles per hour.

The Spirit of Innovation is the result of a program called ACCEL, or Accelerating the Electrification of Flight. Partners in the initiative include electric motor and controller specialist YASA and Electroflight, which Rolls-Royce described as an “aviation start-up.” YASA is a wholly-owned subsidiary of Mercedes-Benz.

In terms of funding, 50% has come from the Aerospace Technology Institute in partnership with the U.K. government’s Department for Business, Energy & Industrial Strategy and Innovate U.K.

In a statement issued alongside Rolls-Royce’s announcement, U.K. Business Secretary Kwasi Kwarteng said the aircraft’s flight was “a huge step forward in the global transition to cleaner forms of flight.”

Read more about electric vehicles from CNBC Pro

The environmental footprint of aviation is significant. According to the International Energy Agency, carbon dioxide emissions from aviation “have risen rapidly over the past two decades,” hitting almost 1 metric gigaton in 2019. This, it notes, equates to “about 2.8% of global CO2 emissions from fossil fuel combustion.”

Elsewhere, the World Wildlife Fund describes aviation as “one of the fastest-growing sources of the greenhouse gas emissions driving global climate change.” It adds that air travel is “currently the most carbon intensive activity an individual can make.”

Looking ahead, Rolls-Royce — not to be confused with Rolls-Royce Motor Cars, which is owned by BMW —said it would use and apply tech from ACCEL in products connected to the commuter aircraft and electric vertical takeoff and landing markets.

Alongside aircraft manufacturer Tecnam, Rolls-Royce is also working with Norway-headquartered airline Wideroe on the delivery of “an all-electric passenger aircraft for the commuter market.”

The last few years have seen a number of companies attempt to develop plans and concepts related to low and zero-emission aviation.

Last September, for instance, a hydrogen fuel-cell plane capable of carrying passengers took to the skies over England for its first flight.

The same month also saw Airbus release details of three hydrogen-fueled concept planes, with the European aerospace giant claiming they could enter service by 2035.

Back in 2016, the Solar Impulse 2, a manned aircraft powered by the sun, managed to circumnavigate the globe without using fuel. The trip was completed in 17 separate legs.

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Retail sales post surprise gain as consumers show strength despite delta fears

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Retail sales posted a surprise gain in August despite fears that escalating Covid cases and supply chain issues would hold back consumers, the Census Bureau reported Thursday.

Sales increased 0.7% for the month against the Dow Jones estimate of a decline of 0.8%.

A separate economic report showed that weekly jobless claims increased to 332,000 for the week ended Sept. 11, according to the Labor Department. The Dow Jones estimate was for 320,000.

Economists had expected that consumers cut back their activity as the delta variant continued its tear through the U.S. Persistent supply chain bottlenecks also were expected to hold back spending as in-demand goods were hard to find.

The pandemic’s impact did show up in sales at bars and restaurants, which were flat for the month though still 31.9% ahead of where they were a year ago.

However, sales were strong for most areas during the month, when back-to-school shopping generally results in a pickup in activity, especially so this year as schools prepared to welcome back students after a year of remote learning.

The headline number would have been even better without a 3.6% monthly drop in auto-related activity; excluding the sector, sales rose 1.8%, also well above the 0.1% expected gain.

With fears rising over the pandemic, shoppers turned online, with nonstore sales jumping 5.3%. Furniture and home furnishing also saw a healthy 3.7% increase, while general merchandise sales increased 3.5%.

Electronics and appliances stores saw a 3.1% drop, while sporting goods and music stores fell 2.7%.

The numbers overall reflected a more resilient consumer, with sales up 15.1% from the same period a year ago.

The retail upside surprise was tempered slightly with a disappointing read on jobless claims.

Initial filings increased 20,000 from a week ago after posting a fresh pandemic-era low. Still, the four-week moving average, which accounts for weekly volatility, declined to 335,750, a drop of 4,250 that brought the figure to its lowest point since March 14, 2020, at the pandemic’s onset.

The claims total came under heavy seasonal adjustments, as the unadjusted figure showed a drop in filings of 23,331 to 262,619.

Continuing claims also declined, falling by 187,000 to 2.66 million, also a new low since Covid hit. The four-week moving average nudged lower to about 2.81 million.

However, those receiving compensation under all programs actually increased just ahead of the expiration of enhanced federal jobless benefits. That total, though Aug. 28 and thus before the expiration, rose by 178,937 to 12.1 million.

In a separate economic report, the Philadelphia Federal Reserve reported that its manufacturing activity index rose 11 points to 30.7, representing the percentage difference between firms reporting expanding activity against those seeing contraction. That number was well ahead of the Dow Jones estimate of 18.7.

This is breaking news. Please check back here for updates.

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StanChart chairman still sees opportunity in China as regulations tighten

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Tourists visit the Bund waterfront area on May 10, 2021 in Shanghai, China.

Wang Gang | Visual China Group | Getty Images

But overall, I think China continues to be a tremendous source of opportunity for the private sector.

Jose Vinals

Chairman of Standard Chartered

“There’ve been some articles in the media about — is China becoming uninvestable? I don’t think so,” Jose Vinals told CNBC’s Hadley Gamble on Wednesday.

A number of sectors may be “a little bit more challenged now” and investors need to look more carefully at what investments they are making, he said.

“But overall, I think China continues to be a tremendous source of opportunity for the private sector,” he said, pointing out Beijing has slowly opened up its financial sector, granting some international firms access.

The regulatory crackdown in China has been interpreted differently by big names in the financial world, including Ray Dalio, George Soros and David Roche.

Inflation expectations

Separately, Vinals said he doesn’t expect inflation to be a big problem.

“I still subscribe to the view that inflation that we’re seeing in the United States and in other Western countries in particular … has an important transitory component,” he said.

Read more about China from CNBC Pro

Fed Chair Jerome Powell similarly believes that inflation will soon subside and has said he wants to see more strong employment reports before the central bank starts paring back its bond purchases.

Vinals said many Western countries are operating below their maximum economic potential, adding the Federal Reserve is likely to hike rates early next year.

“My baseline is that inflation will not be a big problem. But there is a risk that it may become more of a problem than we think,” he said, acknowledging that it would “complicate things” for the world.

“But I see [inflation] more as a downside risk to the global economic recovery, than as the base case for the economic outlook,” he said.

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