England to raise rates today but is carney as committed to the height . Hike . Squeeze,s for credit the ceo tells bloomberg he is cautious on global markets. We are less than half an hour from the start of european cash trading. There will be some interesting stocks stories. This is what the story is on the fair value calculations. Slightly negative start. A lot coming out today. The fed chair announcement, the bank of england, payroll, a whole load of other things happening. A little caution is justified. Lets turn your attention to the gmm and get a sense of what is happening around the world. Germany had a solid today yesterday. By 1. 78 . S up on the mliv blog this morning, mark cudmore is talking about commodities touring, not drawing the line between nickel and the philippines. The philippines market of 51. 8 . Up. Philippine peso trading the aussie dollar moving up, the south african rand moving up, as well. Lets show you what is going on in the commodities space and the bond markets, clearly a big day for the bond markets. By 2. 22 percent of this morning. Here is juliette saly. The you ks defense secretary has become the First Casualty of the Sexual Harassment scandal engulfing westminster. He referred oblique leak allegations about his private life. On monday, he repeated admitted to touching a journalists leg. I relies that in the past, i may have fallen below the high that we require of the armed forces, but i have the honor to represent. Now on mylected position in government and i am therefore resigning as defense secretary. Manus u. S. President donald trump has said the suspect in the deadly terror attack in new york should be executed. Asked toweeted the man hang a Islamic State flag in his hospital room. Earlier in the day, trump called on an end to the visa program that allowed the suspect to the u. S. The catalan separatist president of a witchhunt. The entire leadership is due in madrid to face allegations of sedition after its declaration of independence last month. In a statement from brussels, he he called it a political trial without legal basis and with disproportionate penalty, usually reserved for terror or murder. Global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. This is bloomberg. Guy thank you. Will announce Jerome Powell as the next chair of the Federal Reserve according to four people familiar with the decision. Market reaction has been muted. Broad expectation that powell will provide more of the same. We expect the release of the house tax bill with investors focused on the timeline and the extent of the Corporate Tax cut. We are getting news about the and the tax rate that could be applied to foreign earnings. But ringing kathleen hunter. Good morning. Lets bring in kathleen hunter. And i start with the fed pick. Many metrics are not favorable to donald trump right now. One that is is the fact that the stock market has been on a tear. In some ways, by picking powell, he is alluding to the fact that is a very important aspect of how he sees his presidency going. Kathleen has one person put it this morning, powell is the pick that is janet yellen but not named janet yellen. Guy 2. 0. Kathleen i think that is in some ways a status quo pick. Powell seems pragmatic and that would be hopefully in trumps mind, that signals he is not trying to disrupt the tear the stock market has been on and keep the ship sailing in the direction it has been going and not try to take it off course. He thought about taylor, about gary cohn, a bunch of people who may have been more tails rather than the center. Is there any thinking on why he backed off from that . Wehleen it is partly what were just discussing. With Everything Else that is going on, it makes sense. If it is not broke, dont fix it. Leave it as is. I also think there is a degree powell was an obama appointee, someone likely to draw some support. He will still have to go through a Senate Confirmation process. It is widely anticipated he will get brought by artisan bipartisan support. Mainly because even some republicans that appointed him when he was opposed by opposed him when he was appointed by obama may not want to pick a fight. Taylor might have been seen as a more partisan pick. Guess that feeds into the tax story, because that is where the fight is right now. What are we going to get today, and how much of the fighting has already taken place that will shape what we get today and where are the key flashpoints likely to be Going Forward . Kathleen this is really the beginning of the process. I think we see republicans today crowing a lot about rolling out this bill and they will move quickly on it. We talked about this yesterday, but the fact they had a delay even by a day, shows there have been areas of this legislation that have been subject to lastminute we are early on in the process and have already had this already, which tells us a lot about the progression we will see from here. Kathleen absolutely, the next step is we will see the bill start to move in house. Goal that by thanksgiving, the third week of november, getting legislation passed through that chamber and trump has said he wants to get a ofl to his desk by the end the year, which leaves december for the senate to act. There is no real sense for how much the House Republicans have been signed off on. That chamber, they are going to be trying to reach out to democrats, as well. Process put guided complicated time process process in a very short timeframe. We will have to wait and see. Lets discuss gary cohn for a second. Storyhe fed and the tax with him. What do we hear about him and his commitment to the future of this administration . Kathleen i dont know what he is thinking specifically, but if you are gary cohn, you are probably thinking there is not a orle lot of reason incentive for you to stick around a whole lot longer. He wasnt chosen for the fed pick, he has had a tense relationship with trump in the vanity fair story that came out yesterday about the mueller probe. It talked about how gary cohn leaves the room when they subject of russia comes up, and that is indicative of the level of concern around white house being in snared in this probe. There are a lot of factors to consider, but if i was him, i might be thinking of other options. Guy bloombergs kathleen hunter, thank you very much. Lets carry on the conversation. Strategist. Ld, mliv see powell asets a continuity candidate. Is there any risk in that assumption . In himot too much risk individually, but you have to remember, a vicechairman still needs to be named. There is a slight risk of a. Urveball in that some other candidates need to be replaced, as well. He is a big piece in the jigsaw puzzle and looking at his voting record, he keeps in line with everybody. Hasnt been a big dissenter. He looks like another janet yellen type. Is saying this. He is yellen two point zero. He is going to carry on. How much do we actually know about his views on Monetary Policy . The fact he hasnt dissented. How much does that really tell us . Mark it is difficult when you are in a Large Committee like that to be too much of an oddball when you have other people that call you back into line. Plus, there is so much scrutiny on fed members. It is not really a place for a maverick to stand out. If you look at the history of or 30d over the last 20 years, it has never really been a place where the chairman has ever done anything very unusual or dramatic. Ifwould be very surprising mr. Powell was to do anything like that, as well. Get onea while, you do or two fed members lower down the chain may be a bit on the extreme, but for the chairman to be so is unlikely. Guy folk are raised Interest Rates to 15 . He was followed a few years ago by ben bernanke who did the opposite. Monetaryaries of policy by those two gentleman got considered extended quite considerably. History will be the making of this. We dont know what history will throw up. Markets collapse, how would he react to those kinds of things . Mark you make a good point there. The thing they have in common is they both inherited crises. Volcker inherited a huge inflation crisis, bernanke. Part of the financial crisis. If mr. Powell found himself in a deep crisis, hell really find out what he is made of. He will probably have to make things up on the fly. We saw how well bernanke and his colleagues came up with new policies and powell could get the same situation. Read the in intellectual underpinnings they provide, but the market is pretty much fully priced in. The risk looks asymmetric. How do i play the bank of england Rate Decision . Is it about the distribution of the votes . Where do the risks lie in the market position . Isk i think the key today the forward spin. People will be looking very closely to see whether this is part of what they think is going to be a continuation process, more hikes next year, any kind of clues we have Something Like a dot plot plan from the bank of england. Or is it one undone . One and done. That could be damaging. Carney has to tread the fine line between not doing too much and doing more. Guy mark cranfield, joining us from our mliv team. Andcan follow these guys their fantastic coverage on mliv throughout the day. Top lives also today. Lots of coverage of the bank of england. We will run you through the details of what is happening there. Television extensive live coverage of President Trumps announcement of the next fed chair at 7 00 p. M. Decay time. Less common a host of former fed president s joining us including gary stern from many annapolis. We will get a sense of what is going on and how we should read this story. Next, will today see the first hike in u. K. Rates since the summer of 2007 . We will bring to the latest as the boe decides. This is bloomberg. 47 minutes past the home. Lets get a business flash with juliette saly. WealthCredit Suisse management has propelled assets under management. We seem to have lost that. I might drop back to you, guy. Guy thank you, juliette. Lets hear what has to say about these numbers right now. Clearly lets pivot to Wealth Management this pivot to Wealth Management is helping out and he says the bank is wellpositioned for the next crisis. He is concerned about what is happening in financial markets. Been like the third quarter. It is not a very positive statement, low volatility. Very difficult. It is a tricky situation. Is good in icbm. The problem is the environment. Talking to francine locke, she will run us through those numbers later. The Wealth Management division is firing on all cylinders at the moment. Attention to what is happening and u. K. Sluggish economy mired in political uncertainty. But inflation above target. That is the backdrop to an by the banke hike of england today. If mark carney raises rates, it will be the first time we have seen that since 2007. How will the british consumer react . How will the markets react . Cehic, who is outside the bank of england, almost a 90 . Hance does the boe have any choice at this point not to deliver the rate hike to retain its credibility . That is one of the Big Questions today. In some ways, you could argue today all comes down to the credibility of the mpc. How it backed itself into a corner with what has it has marketying and the interpretation. Fully pricing in a rate hike to come today. Going tork carney justify that with a lot of people saying this is the wrong time to hike. Even more important will be the Forward Guidance from the bank of england. Is this going to be a hawkish hike or a dovish hike . There is the outside possibility of a no hike at all. There are a lot of shades of gray in between and mark carney will have to manage that in his press conference about the future path into 2018 and 2019 and manage how the markets react to that to an extent. If we get a dovish disappointment today, the pound could fall quite substantially. Covered so many of the issues, but lets talk about how the breakdown will grow. What would be considered a hawkish hike . When we see those numbers drop and look at how the pound will be reacting, is it going to be 6. 34, 6. 2 . What can we take away from the voting record . 63 votensus view is a. Dissenters, i heard it could be ,ave remsen, possibly 10 rahal as well. That is what markets are expecting on the voting front. On Forward Guidance, there are expectations the forecast might be raised for this year. Mark carney is expected to say the market is underpricing the potential for future rate hikes. That is going to be also what the market is very much focusing on, that future rate path. In terms of the hike today, what could justify it . Expected growth at 0. 4 percent, inflation running at three percent. A lot of questions over where the inflation is coming from. Is it driven by lower sterling, supplyside deterioration, and therefore is the bank of england hiking from a place of weakness rather than strength . This is the story mark carney will have to tell in the press conference and do markets react from what the mpc says or does . Guy thank you, plenty of coverage throughout morning from nejra cehic outside the bank of england. We will bring you the policy decision as it happens right on bloomberg television. Time, Jonathan Ferro and i will be working through what we get from the boe. Minutes from the start of cash equity trading. Credit suisse looks to open stronger. Shall numbers beat shale numbers beat estimates. On plenty of stocks this morning. A lovely day in london. The market open is seven minutes away. This is bloomberg. Guy minutes to the startup cash trading. Lets look at where the markets are going and which stocks to focus on. To be honest, the stocks story at a headline level, going nowhere. European equities will be on a standstill. The dax had a solid session yesterday. Today, Credit Suisse looks to pop higher by 1 or a little more. Keep an eye on the fact that Tidjane Thiam and its pivot to Wealth Management seems to be paying off. Francine lacqua a little later on in the program. The shale numbers look pretty good, as well. This is a big income payer, a big tv payer. Do not ignore the fact that these numbers have come to her. That will be a big part of income folios portfolios. Unilever is going ex dividend today, thursday. Phillips has a Capital Market today. That is fantastic, the market open is next. Who knew that phones would start doing everything . Entertaining us, getting us back on track, and finding us dates. Phones really have changed. So why hasnt the way we pay for them . Introducing Xfinity Mobile. You only pay for data and can easily switch between pay per gig and unlimited. No one else lets you do that. See how much you can save. Choose by the gig or unlimited. Xfinity mobile. A new kind of network designed to save you money. Call, visit or go to xfinitymobile. Com. Guy minutes to the startup cash equity trading in europe. The fair value not showing us much about the sense of direction. We drift sideways through the beginning of trading. The dax is up stronger yesterday. Up by 1. 78 . Equities, a strong session. This morning, less so. There are key things to focus on and that is what is happening with Credit Suisse this morning. Shale numbers look at a good if you are an income investor. Keep an eye on the phillips Capital Market today. Unilever goes exd today. Keep an eye on hugo bosque, the numbers out of germany recently point to the fact people were buying a lot of clothing. It looks like this morning they are confirming that. Lets show you what is going on. Here are the numbers as they get posted. 74. 87 is where the ftse is starting. Market makers not giving us any sense of direction this morning. 74. 80 is where we are trading. 7480 is where we are trading. You are not going to get a clear sense of direction from the bosses. You have the fed hit coming, the tax story out of the united states. Lot tos tomorrow, a think about. Equities arent giving us a sense of direction. Stocks might at a more granular level. Manus cranny what have you got . Manus a fairly hectic mix. Banks, the beasts of these equity markets and the final readings on the pmi. It is a mixed complexion. You are coming off a twoyear high in the you u. S. Equity markets. Shale is one of the big stories, the adjusted profit 4. 1 billion. Keep an eye on the debt levels. How that opens. Sanofi changing the guidance, that will be another key one. Credit suisse, the turnaround is a key player. Sanofi opening down 2. 4 , Credit Suisse up. That new money of 8 . Interesting how the market seems to be focusing more on the Wealth Management adjustment within the Credit Suisse story versus the under performance on the markets business. Small under performance and the question is put that in context relative the peers. , we will see 30 how they drift the rest of the day. The pound, where does it go . Round and round she goes. Dovish hike . Hawkish hike . One thing that is sure is that it has been a hard slog for the bank of england. Volatility, you hedging yourself in the pound. Go back to september, that was the Federal Reserve and go back to april and february and march of this year and we had little moments of volatility. The question is how hawkish will it be . They dont want to give up this ability tofought guide the market that they might not be one and done. They want optionality and credibility. It depends on who you speak to on the removal of stimulus with the optionality going into 2018. John from ubs was rather scathing in the necessary for the rate necessity for the rate hike. Atyear paper trading up. 5 . What happens to the curve once we get this 25 basis point hike hike . Twoyear paper trading up. 5 . Lets see what the outlook for inflation is. This would be the first time from the quarterly Inflation Report you would see a downgrade to growth. That is what is expected and about the inflation estimates, and who will perhaps a vote against a hike when it comes. Will it be the two deputies . That could send a more interesting signal to the market. I am off to radio with caroline caroline. Join me if you are coming in the car. Were on the radio. Guy manus is off the radio. Thes talk about where equities are. We talked about the granularity of the market being important. The storye outlook on looking softer than it was. Stock is down around 3 . Taking novartis with it, as well. Unilever has gone ex dividend. That is a mechanical story. Upside andto the show you what is going on in terms of performance. Royal dutchikes shale this morning. Up by. 8 . Calls suisse comedy early i saw this morning indicated up around 1 . We have outperformed that and it is up around 2 this morning. The net new money into the Wealth Management division looks very strong at this point. Francine will join us shortly. She has been talking to Tidjane Thiam to get his take. That is the picture with the big names of the stock market. The earnings story is the rayleigh really the main driver. The story level, centers around what is happening in washington today. President ell is trumps pick for the next fed chair according to four people familiar with the decision. What does the Investment Community have to say about this man . Experience is in private equity as a salesperson rather than investing. Im not sure what he knows about the interworkings of the financial system. I dont necessarily agree with bill grosss comments about this man coming out of left field. Has thew, powell equivalent of more than one phd i think you only have more. What do you think . President trump did not what i think. Was largely the guy the market affected it. I think we will see pic is. No idea. The talk among college was taylor. Thats a balance. That, we have to question his ability to get help over the line in congress. It has to be approved. That will be interesting. Orhink the market praying more of the same, somebody who will give the market what it wants. Thats why taylor was viewed as a scarier choice. Yellen was the best candidate. Guy he is yellen with a different name. That maybe a year to miss his yellen. Ofses yellen has a lot experience as an economist. Politically, she is not the trump camp. In terms of where she is now, she is fairly left leaning. Powell will be more compliant. Argue the reason is picked as the metrics working for the president. If youre going to take a metric, thats a good one right now. Is athink President Trump bull of his own metrics. Elevated market being by the central bank was one of his policies. From a market of, it sees more of the same. A i think thats why the will be interesting. The market wants to see how compliant is going to be. He wouldve learned a lot on the job. Not a phd. What it does for you revise and intellectual underpinning of an understanding. We knew what hernandez phd was. We understood his economics, similar story with janet yellen. She is a labor market, you thats grounded in where she is. Do we have the same here . I think this world its not important. Once important financially is the market and he will be more of the same . I think that is the assumption. Fact they are going to hike. Give us more of a sense going to happen further down the road. History is the final arbiter of all this. Lets see if it is congress first. Guy there are other things as congress that are more controversial than this. Ive got dealing your voice to be dealing with is yellen for a few more months. Ive got a sense that this process will be extended. Guy you. People can help out and hang around. Its not like they want to be there the next five years. On. Old people have to carry guy we are trying you what is copper. Mean it is that confirmed. Confirmed. Janet yellen has shot her candidacy in the point of jackson hole, when she said Financial Regulation is here for a reason and you got to look at recent history to understand why you why. Trajectory of the mark is that kind of stuff. The market leaves and i think donald trump probably believes one of the numbers starts the credit function. One of the ways to do that help the banks. Worried about regulations and think about worried growing balance sheet. This is a different thing. Its a plank of his success if he can get the credit function going. Guy hes got money of history and these markets. What coming uput later on on the show. We have live coverage was happening in the rose garden, the new fed chair is coming up 7 00 p. M. U. K. Time. We have our interview with the Credit Suisse ceo or in is talking to francine lacqua. Well have that in just a minute. Guy we are 14 minutes into the session in europe. Profitt is third order quarter profits. Loss spoke with the loss earlier this morning. Some decent inflow into the well management division. He has a cautious outlook of the Investment Bank. Its not what we can convey. Positivea very statement. Its very difficult. Its a tricky situation to describe. The problem is not a willingness to make decisions. Good conversation in public trigger. Could pull the trigger. Thats good news. Granting one final question. Is one part of the business doing better than others . Guy francine, and you think about done with this bank. Market, butus on the division and hide your now. I year now. I year now. Francine things are starting to shape up. What or ify in there is a change of tack. Seems revenue is up. There is caution on the Investment Bank outlook. Hand. Are out of his satisfied with the progress so far. Guy with the market is doing what its doing now, hes got disciplined with the application of capital or the business. He didnt say he was going. For the moment, he is using position to work what he says is the high network work individual or in when you look at the Capital Markets, his vision for the future is a onestop shop. I asked him a wide range of issues. He thinks the strategy working. A you have a privately wealthy individual. You can service that client through the Investment Bank ipo. Moment, a lotthe of the trading numbers were not that. Guy absolutely. Thats why the market is taking the stock of this morning. Thank you very much indeed. Francine will be back later on with surveillance. This problem. This is the volatility index. They are all telling same thing. I couldnt hear the conversation. The issue terms of low volume and what are revenues, its real. Thent know what conversation was about headcount thinkst management, i its clearly something that management will focus on. Guy you just hunker down and wait . At some point, its going to come back. Compression is going to be over and financial repression. Partly. You manage your cost is aggressively and you use technology as much in. The other critical thing, you heard the story. Its your friend you have no positioning into the. What will happen, most of the Investment Community is going to be along the same stuff you when you an event, it may not be our anymore. They are ticking up a little bit. Everyone is selling volume. Most people know its not industry. How big hole, a 5 down day, liquidity is getting ready for this. Everyone is the same way around. Not doing the presence anymore. It would be a significant price fact in market. The issue for me is treasuries and liquid benchmark indices, even the fix goes from 10 to 20, you can still trade that. Down a lot. Marked thats my worry, that kind of liquid waste could become the real turning point. Everyone is chasing yield. Its going to be down the credit spec from. See what happens. We will come back with bob will later. Of next, will be the first hike in the u. K. . It feels like summer of their today. We will get the latest on the via we next. Boe next. Bloomberg. Pick rack up with bob. Talking break about six and if you are outside day. We carried on the conversation. Lets expanded a little the you , how do iity so far make fiction on a day when the market goes down percent or percent im on top of making that decision. Bob that mentality. It in the right strategy. I think you change when we did central bankers tightening policy and mean it. Draghi pulled off a wonderful trick. Like. And using. What point youre not trying to change policy. Once the point . That momentre sure when central bankers talk about tightening and mean it, when they start to get ahead of the curve. Is he going to be around . Thats why its relevant. In completely destroyed the concept, the phillips curve will begin and they will have to get ahead of the curve. Guy bob is going to stick around. We will talk about the bank of england next to will they or wont they western mark is next. Investors expect the bank of england to raise rates today. In for aows and ceo. He tells bloomberg he is cautious of markets. Youre watching bloomberg markets. This is the european open. Lets take a look at the breakdown from a sector point of field. Headline levels not telling us a great deal. What are we saying . Bt generating, good numbers. Real estate on the front as well. One of thedit suisse main to be focused on. Where is money rotating out from . Trevor and leisure, losses. Health care, watch out, down by half of 1 . Lets get a bloomberg first word news update. Here is at ludlow. Dish ad load low. Ed the u. K. Michael fallon announced his pregnant resignation yesterday, referring to allegations about his private life. On monday, he admitted to repeatedly touching a female journalist leg during a dinner. That was prompted by women speaking out about their experiences and politics amid the wide Harvey Weinstein scandal in hollywood. I may have fallen below the we requirerds that of the armed forces that i have the honor to represent. I have reflected now my position in government. As defenseing secretary. He was President Donald Trump has said the suspect in the deadliest terror attack in new york city in 2001 should be executed. He also said the man wanted to hang an Islamic State flag in his hospital room. From called on congress to end the visa program that allowed the suspect to enter the country, and said he defended a countrys leader has accused spanish authorities of staging a witchhunt against him and his cohorts as he remains in selfimposed exile. After hisllegations independence last month. In statement from brussels, he said its a political trial without legal basis, and with disproportionate candidate penalties reserved for terrorism. Global news 24 hours a day, powered by more than 2700 journalists and analysts, in more than 120 countries. This is bloomberg. Guy. Guy ed, thanks very much. The bank of england Rate Decision due at noon. Alongside economic forecasts as well. Mark carney will speak at the first Dutch Press Conference at half an hour after the decision is made is announced. He can follow this on bloomberg television. Lets get some great analysis right now on what is going to be happen with the bank of england Going Forward. We have an advisor from numeral still with us. The market, is priced in in the shortterm, near 100 probability that the bank raises rates. I could see the need for small hike. The market is interested in is what happens Going Forward. Is it onea few of a few . Is a one and done . Is it one and done . The voting split could inform the market. We donte other thing know about yet, but we will know soon, as the statement. This is the statement the u. S. And eu, you cant separate fiscal policy for Monetary Policy. U. S. , if there was a high certainty of trumps fiscal plan coming through, we do have a much more hawkish fed. Same in the u. K. If this loose and, perhaps with Something Like stamp duty guy isnt the danger with that story, if they were to reduce stance, that would be seen as regressive, i. E. , what not favor the portions of society which the politicians are most focused on right now . Those are younger people and those that are struggling financially. He can be quite and limited here. I think its relatively easy to quite easy. When people one thing you can do is go after people of a certain age group. Up to a certain age you dont need this. Yes. I think we can increase to a significantly higher level we have now. This so this would all be kind of progressive. The back end of the market, i. E. The higher Value Properties billing we are making this work. This is raising revenue. Actually, the market is clogging up. T raising more revenue what would be the impact for the u. K. Economy, the average consumer . 50 are on variable rates, if we got a hiking cycle, rather than a one and done. Thats typically going to get any cycle anywhere. But it will get more of one. The u. S. U. K. Gs economy, will be so weak we been through strong and grooming times if these economies cant handle 25 basis points, we are run. Lets find out. The other way is in the u. K. , the house, europe, or u. S. , the only source of wealth for most whereolds in a country homeownership is still 6570 , is the housing and sent. Income growthre is flat or negative globally, give or take, the only sort of kind of source of wealth is that market moving again. I understand its too narrow, but we dont, apparently, care about speculative levels anywhere else either. Housing for the u. K. , in particular, is important. Ay dont we and the in situation where we widen the gap growth . E at the moment, and you talked about the phillips curve earlier on, theres no evidence of which growth in the u. K. This very little evidence of it anywhere in the developed world. Its a global phenomenon. In that complex, the discussion is about globalization. Guy ep. Yep. They talk about it being global. Its hard to do that calculation. Data we get has the out of the u. S. Or u. K. That, that, that, thats what we have to do with it. Guy thank you very much for spending time with us and bloomberg television. Are done with him quite yet on bloomberg, though, we like to get our moneys worth. Hes going to be joining the bloomberg daybreak asia on radio for the next 20 minutes bloomberg daybreak asia team on coming up, we will continue the u. K. Conversation. When we another take him what this man is going to deliver later on. Crunch time for carney. We will join nejra cehic and get her take and our guests take. Thats next. This is bloomberg. Guy we are 41 minutes into the equity markets session. This is the open. U. K. Arket expect that the will get its first rate hike in 10 years. Hear from the bank on its economic forecasts, what will like . Ting record look what if they fail to deliver on . He rate hike today nejra cehic is down at the bank of england. Good morning. Nejra good morning. The big question today, thats right. Entering by a senior economist at asset a mess investment managers. Has the bank of england backed itself into a corner, where it has to hike rates . I think it doesnt have to. It has given its self itself some flex ability. They do have positioned themselves in a place where, it would be a big surprise to markets if they dont move. There is a position they maintained for themselves. What he can do for distribution there are five members with talked about assigning themselves to the to the majority. Theyve talked about an open question. A think he will probably go with this as well. I think it will be about seven or so. This clearly another decision more than the market has given credit for. Is it one and done, or will we have signals of a further rate hike . I think, the market seems less torn over whether it is this one and done story. From may, they have been talking about a gradual increase. But the market believed them i think its going to be difficult. He will talk about growth today. On the one hand, the governor is not going to want to suggest one and done. Knows marketshe have a glorious tradition of overreacting. This talk about Monetary Policy. Thats the message were trying to say, whether he succeeds is remains to be seen. We can have a hawkish hike, dovish hike, none at all. How do you see sterling and rates reacting . \if there were no hikes, there would be a significant fall. No hikes, there would be a significant fall. Markets continue to think one and done is more likely. You also see some relief in some way, people easing lower. Yields could be lower as well. It is successful in conveying to you that able have a policy over the next few years. I think yield will pick up on that as well. You are having another conversation 2019, that is right . Yes. We know that this process will be pretty subdued. The bank thinks it will be picked up. We ourselves see it more around 1. 5 . Even with growth this year, unemployment has fallen. At 4. 8 last year, 4. 8 four point oh percent now. 4. 0 now. Inflationaryt pressures further down the line. The bank has the proposition that unlike the fed, it doesnt know specifically where this is going. We will watch to see how the data,articularly, market will have further hikes down the line, but i think it is likely. On the fed, is there any sort of risk about how the bank of england might feel to hike this hike faster to keep up with the tightening globally, including with the fed . Only if there under pressure. Governor carney said theres three things on supply, aggregate can demand, serling,. If fiscalate supply an stimulus in the states has the fed committing to it, they are then finding a new fed chair euro rises and sterling comes under more pressure to read them, the bank might think it might have to find more inflationary pressures. By and large, the bank has a had to react too aggressively with sterling. The bank has, so far, look through this we think its more what they see incoming. Point, in terms of there being a one and done or not if you think these inflationary pressures are tragedy as a result of weaker sterling you could argue this policy mistake, particularly with brexit ahead. You dont think this would be a policy mistake, do you, in terms of this hike . We dont. The supply potential is weak. You are we work going to see weight pressures emerging we recognize the risks around that. I think theres more than a hike today. The labor market, where will look for that, maybe it will start with wage growth. Secondly, it will go with unemployment. There is a distinction between growth that is obvious, and the supply potential. Unemployment continues to fall, that will suggest there is mark domestic generated inflation. Thats pushing that way today. Their weight pressures. We will see what they say about that today. Thank you so much to the senior economist. Great stuff, thank you very much. , the cash flow for shale. Did cash flow crown . Its been taken away from exxon. They will join us to talk about the markets next. This is bloomberg. Come back. We are 50 minutes into the markets session. Worth paying attention to this morning, Credit Suisse rising sharply this morning. Trending up by nearly 4 . Number suggest this earlier on. This is not having a bad session neither. By 2. 2 6 . Up German Market have a strong day yesterday. Up and down on the bt story. This is trading softer as well. 20 . Is down by bp is up by around half of 1 this morning. Shale is up a touch. Exxon mobils tax flow cash flow crowd. Europes company has reported a 40 7 47 rise in thirdquarter earnings. This. Is on track for thats the first time thats happened in around 20 years. Lets be to have a blast. . Olid numbers, yeah yes. Adjusted net income, cash flow generation, 10 billion, theres working capital movement. Blas its a Strong Quarter for shall, and has been for the big five mayor of major oil companies. One of them has been a 30 increase on stability. Everyone has been a strong signal. Its exxon, total vp bp. They were able to generate enough to leave. This could look very, very well. Thats what ceos have been repeating. Price ofuestion, the 60. Low, when youding look at dividend yields. This is delivering a dividend yield of 6 . Theoretically, share price could be more reasonable. Now, we see the share prices rally. These are not getting in love with oil. The key question is when those get in love with oil. They are probably going to want to see what opec is going to do. Ae extension is whether 60 barrel is less likely. I am assuming you have to. Its less likely. Theres a reason with 60, because the market is expecting we will get an extension. We need extension to the end of the year, and saudi arabia the if they dont understand, we dont get this. Not only are we covering whats happening in the inter energy space, we are also covering whats in the mental market. It is emily week in london. In the metal market. It is mle week in london. Uts reallyebody at moving strongly on the upside. The upside, this is telling you the exact opposite. One part of this complex will be here, or is it more nuanced . There could be more new ones, but essentially, you are right. In every big party, we have been talking about electric vehicles, and the demand that we look at copper, nickel, etc. They were told there was electric vehicles. This will not be as much as we expect. It doesnt take a lot of electric to create supply shortages. Theres a contradiction. You should talk to oil companies. You talk to the minors, their talking up that, saying its going to benefit us. It somewhere in the middle. Is there enough lithium all of these resources, to generate these numbers . Electric vehicles, probably the answer is no. Fast. Chnology advances so the chemistry is so we can see, the pride, we saw some of the problems. It will force engineers to come up with new solutions. Engineering, people coming out of university, Bright Future on that front. This is amazing etf. Flying. Ly having a blast. Thank you very much. Great reporting. I just want to say, we are getting data coming out of germany german manufacturing. Previous number 60. 5. Anything north of 50 is exceptional, 60 is exceptional. Bloombergs Television Coverage continues throughout the day, 7 00 p. M. U. K. Time. This is bloomberg. Is this a phone . Or a little internet machine . It makes you wonder shouldnt we get our phones and internet from the same company . Thats why Xfinity Mobile comes with your internet. You get up to 5 lines of talk and text at no extra cost. So all you pay for is data. See how much you can save. Choose by the gig or unlimited. Xfinity mobile. A new kind of network designed to save you money. Call, visit, or go to xfinitymobile. Com. Drum house inspected to be the new fed chair named by trump. Connie watts spikes rates and Interest Rates for more than decade. What if the government doesnt have a hike . And, the pivotal Wealth Management pays off. Were from the cbo an Investment Bank, brexit, and others. This is bloomberg , im francine lacqua. Tim tom keene as always in new york. Its a busy day. We look at the fed yesterday, i know we are looking at the rose garden later on. A lot going on. Nejra cehic outside the bank of england. Of course, not only the festivities for the new fed chair, the Real Movement today on tax reform. Even in last night, and contentious debate. We will get an update on the tax reform discussion. We certainly will