What can the Preakness Stakes tell us about the economy?
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Hello, I'm Nick Koreshi in Fort Leanna, Berne.

The United States is reviewing its multi-billion dollar submarine deal with the UK and Australia. Under the AUKUS pact, Australia would get its first nuclear-powered submarines from the US. Washington officials told the BBC they wanted to ensure the project was aligned with President Trump's America First agenda.

In Singapore, the BBC's Katie Silver can tell us more. Hi, Katie. Hi there, Nick. As it stands right now, what are the terms of this deal? Sure. So it's a trilateral pact between the US, UK and Australia, basically believed to be aimed at countering China. Under it, Australia would get its first nuclear power subs from the US.

And then the allies would create a new fleet by sharing their cutting edge technology. Now, the agreement, which was signed back in 2021, was obviously signed under three different governments. All three countries have since had elections and it's worth a quarter of a trillion dollars. How are Australia and the UK reacting to these possible changes?

Both countries have been facing pressure from the White House to increase their military spending, something that we've seen the UK agree to do more so than Australia. The US wants its allies to be spending about 3% of their GDP on defence as soon as possible. Australia says it will be lifting funding, but not by that same extent. We're also hearing from Australia's defence minister saying that if you look geographically on a map, for example, you can see why Australia needs these long-range subs.

In terms of the UK's response, they similarly say that it's understandable that a new administration would look at the deal just as the UK did last year. But they have called it, this is to quote a UK defence spokesperson, a landmark security and defence partnership, the two of the UK's closest allies. And they do say that it's very strategically important in terms of the partnership there. Katie, thanks for joining us on Marketplace. Thanks for having me. All right, let's do some numbers.

The British economy contracted 0.3% in April, a steeper drop than analysts predicted. That's after growing by 0.7% across the first three months of the year. Oil prices have slipped but held most of Wednesday's surge of between 4% and 5% after Donald Trump said some US personnel were being moved from Iraq due to heightened US-Iran tensions. And in Japan, Toyota's chairman has been re-elected against the backdrop of a $33 billion buyout bid.

The United Nations says there are nearly 138 million children working worldwide. That's despite an aim to end child labour. The BBC's Max Horbury reports. More than one in every 12 children works. This represents, the United Nations say, an improvement. But it still means that 138 million children aged between 5 and 17 work, equivalent almost to the entire population of Russia.

Nearly 40% of those children have been risking their health, working in mines, factories or fields. Sub-Saharan Africa has the highest number of child labourers, while most progress has been made in the Asia-Pacific region. There had been an aim to bring the global number down to zero by 2025, but at the current rate it will take hundreds of years before the world is free of child labour. Max Holbury.

Now, President Trump's economic policies have rattled markets and sent consumer confidence to record lows, despite his promise to rebalance the economy. Few corners of the American market have been spared, from fast food chains to high-profile horse racing events. The BBC's Brandon Drennan went to the Preakness Stakes in Baltimore, part of the Triple Crown Race series, to check the mood.

The Preakness Steaks shows off all things Americana. There are hot dogs, hamburgers, french fries. Punters have been coming to Preakness Steaks since 1873. Whether it's testing the limits of how much color a single outfit can display or how much money can be won or lost in a matter of seconds, it's wild, it's glamorous, and it's expensive. Go, two! Go, two! Go, two! Go, two!

Ticket costs this year range from roughly $100 to over $4,000. There are multiple races on the day, but the main event is the Battle of the Thoroughbreds racing to win the Preakness title.

In recent years, average attendance at horse racing events has been shrinking. Roughly 60,000 attended this year's Preakness Stakes, down from the 131,000 that attended in 2019. Attendance may be lower, but wagering at these races has been record-breaking.

This is one everybody came for right here. Trainers, horses, owners, and fans. Who are you betting on? I think I'm going to go with American Promise, D. Wayne Lucas. Yes. I bet it across the board, so I got second and third place. So I got some of my money back. There you go. You know, my case, $50, $60, $100, it's not that much, right?

Professor Justin Balthrop from the University of Kansas studies human behavior in gambling. He says the uptick in betting reflects the market instability. People are looking for shortcuts to be able to increase their wealth or the money that they make. Sports betting is really an interesting avenue for them to at least potentially do that. It's very hard to find a traditional stock market type investment.

or you can even have any remote chance of doubling or tripling your money in a single day, which is what many sports bets are seeking to do. Like the alcohol, money at this year's Preakness Stakes seemed to be free-flowing. The mood was celebratory, but for some, it was also a bit somber. The historic Pimlico race course that Preakness has called home for over a century will be demolished.

A half a billion dollar facility will be erected in its place. And it's here that the economic uncertainty really begins to rear its head. State officials responsible for the rebuild told the BBC they are bracing for the rough economic road ahead, expecting costs to go up. In Baltimore, I'm the BBC's Brandon Drennan for Marketplace. And in the UK, I'm Nick Koreshi with the Marketplace Morning Report from the BBC World Service. Thanks for your company.

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