And Central Banks are stepping up calls for help amid fears that they are running out of options. We are live at the imf meetings in washington. Sophie checking on the start of trade in sydney. Little change, after the drop of 200, halting a fiveday advance. Broadly speaking, we are setting up for a mix start in the agion, but looking to have second weekly gain. Chinese thirdquarter gdp numbers come, as corporate numbers on the mainland have shown little improvement after a bleak first half. Japanese inflation remains subdued, giving the boj food for thought at the policy meeting. Able back below 1. 29 on brexit deal hopes, pushing it to a sixmonth low to position for a negative outcome. Aussie bonds under pressure this morning as the rba governor said the economy is improving. Offshore yuan 7. 8 against the 7. 08 against the dollar after fixing. Jessica acting white house chief of staff Mick Mulvaney denies saying that President Trump withheld military aid to ukraine to persuade key have to investigate democrats. His statement contradicted earlier remarks where he acknowledged the president offered ukraine a quid pro quo with military help. Mulvaney said that the only reason they withheld aid was because of concern over corruption, and lack of support from other nations. We look back to what happened in 2016, that certainly was part of what he was worried about, corruption with that nation. Lira rally to do a oneweek high, on news of a temporary serious ceasefire. Turkey agreed to halt military action for 120 in the border area to without Kurdish Forces to withdraw. T news was due announced by Vice President mike pence after hastily arranged talks in ankara. He said that the u. S. Will remove sanctions on turkey if the ceasefire remains in place. With the ceasefire, the United States will not impose any further sanctions on turkey, and once a permanent ceasefire is in effect, the president has agreed to withdraw the economic sanctions that were imposed. Jessica britain and the e. U. Say they finally secured a deal, and there is no need for further delays to brexit. The lastminute talks in brussels produced agreement on key issues, including Northern Irelands status and the need for customs checks in the irish sea rather than on the irish border. However, Boris Johnson still needs u. K. Parliamentary backing, and his crucial Northern Irish allies have said they will not support the agreement. I do think that this deal represents a very good deal, both for the e. U. And the u. K. , and it is a reasonable, fair outcome and reflects the large amount of work being undertaken by both sides. This is a fair, balanced pursuant to our commitment to finding solutions. It provides certainty, where brexit creates uncertainty. It will protect the rights of our citizens and peace and civility on the islands. Jessica global news 24 hours a day, on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in over 120 countries. Im jessica summers. This is bloomberg. Inry staying with brexit, washington with our guest. Great to have you with us. Prime minister johnsons new deal, how different is this from theresa mays agreement that failed to pass . Alexis thank you for having me. It is important to acknowledge from the outset, the significance of the deal. This is an Important Development for the u. K. And e. U. But just as important in many ways for markets in the u. S. , and across asia, frankly. To behe deal needs approved, and at this point in the house of commons that is looking somewhat dicey, frankly. The deal, i liken this to theresa mayplus. There are a lot of similar elements to what was already cases, withevious some creative developments for Northern Ireland in particular. In many ways, limiting the effect of borders, if you will. So, a lot of work to be done, but a good first step and Important Development. Shery some people have said this is a harder deal than theresa mays one. Is that true . Alexis look, again, at this a longBoris Johnson has road ahead of him next week. He is in the minority party. He doesnt have the support of labour or the dup. So in many ways, this is the end of the beginning, if you will, rather than the beginning of the end to a deal. Theresa may had less than three agreements on the table. None of them were obviously agreed to. He has a long way to go in that regard. But just the fact weve gotten to this point in many ways is impressive, in and of itself, so credit where its due. Sophie what is the likelihood of a unity government being formed . Alexis you know, i think that frankly its an unlikely possibility at this point. In my estimation, if an agreement is reached in the house of commons, Boris Johnson calls a snap elections, in my opinion he wins those elections and his Prime Minister the next 35 yewars. Labour obviously doesnt want to facilitate that. On the other hand, members of parliament want to move forward, and get something done, so it is certainly a possibility. Frankly, i dont see it happening. Sophie the deal that home is running into problems with the Northern Irish party, the dup, pledging to vote against it. The e. U. Said they are shutting down talks about a fallback if the deal is defeated. Where does that put Boris Johnson, if that outcome happens . Alexis that puts him in a tough position, obviously. But i think what happened here, we moved from what was a policy debate, policy negotiation, to purely a political one. At the end of the day, the e. U. And u. K. Realize that theres no plan b, there was nowhere to go from here. Boris johnson realized that, just as much as juncker and e. U. Leaders realized that, so hes taken it up to this point and is doing the best he can. So it remains to be seen. Shery alexis serfaty, director of Global Policy at access partnership, thank you. Anna edwards will lead our special, 2 00 p. M. Sunday in new york, 2 00 a. M. In hong kong. Coming up next, the bank of International Settlements governor Agustin Carstens tells us where he sees the limits of Monetary Policy, live from the imf annual meetings in d. C. Sophie later, cpi numbers are due from japan at the bottom of the hour. Inflation continues inching to zero. This is bloomberg. Ry making the point that Central Banks can only do so much. Fiscal policy has to step in. But is anybody listening . Government for the to continue on their path, including in australia where there has been some stimulus and there doesnt appear to be a problem anymore. Are you concerned that nobody is listening . Gov. Carstens i think more and more people are listening. Many Central Banks are weporting this idea, and have to find a way this is done in a more efficient way. For example, a very large Monetary Policy has reduced Interest Rates a lot, for sovereigns. For manyof debt advanced economies has fallen dramatically. Wouldhing that would be be if they start to spend. Part of that is the effect of the Monetary Policy reinforcing. Thats what we need, how to reinforce growth, and slowly, fiscal policies have to be activated, not only from the point of view of spending, or reducing taxes, but from the point of view of spending in more growthfriendly areas. Kathleen another thing i asked Agustin Carstens about was the fact that the imf and its World Outlook raised some concerns about banks and others taking on too much debt, building their leverage. I asked if maybe part of the problem isnt for example that quantitative easing is buying bonds, and the policies in europe. Thats what countries have been encouraged to do, take on more debt. Is that going to be an issue in time . Here is what he said. Gov. Carstens we are reaching a point where monetary policies cannot can generate a small benefit in terms of economic growth, but might generate the probability of less growth in the future and Financial Stability in the future. Kathleen he did seem to say that risks are rising. Remember, hes someone who works with central bankers. When someone like Agustin Carstens says theres a risk, i think we have to realize, hes saying that is the downside of all these rate cuts, negative rates and more. And this is something the authorities have to take into consideration, not only to be also, more risks but broadly, for governments to realize that you push Central Banks too far with lower rates, and they have limited impact. More for skills fiscal stimulus, where it has to come from. Sophie kathleen hays, more with her ahead including an extrusive interview with the Philippine Central Bank governors. Quickly on aussie markets this morning, we see stocks extending thursdays drop with most sectors in the red. Financials weighing the most on the benchmark, but the aussie dollar steady, and cant yields on the rise after the rba governor said that the Housing Market is turning around and lower rates will make the economy gradually improve. Shery coming up, counting down to chinas latest gdp numbers. Growth may slip below 6 . We are live for a preview next. This is bloomberg. Sophie this is daybreak asia i am Sophie Kamaruddin in hong kong. Shery i am shery on in new york. China will be the spotlight on friday, with gdp and other data in the coming hours. Growth is expected to have weakened again. Lets bring in our china correspondent, tom mackenzie. Could we finally see gdp slip below 6 . Expectation for bloomberg intelligence. Their forecast is you will see gdp at 5. 9 for the third quarter. That would be the first sub6 print on record for china. ,hat they are pointing to pressures domestically in terms of a slowdown, but also external factors. Chinas main trading partner is the european union, but the u. S. Tariffs as well. The other headlines to look for today, reports from retail. Thats one reason we are at the headquarters of an financial, the Worlds Largest private Digital Finance company. They have their fingers on the pulse of the consumer. The forecast for retail sales, 7. 8 from august, but bear in mind that autumn sales have been under pressure for the last 15 months or so, and thats a key part of the dataset for retail. In terms of things like fixed asset investment, you are expecting to see that flat, because you have the private sector that just doesnt have the confidence to invest, and estate sector is stepping up to some extent with increased Infrastructure Spending. In terms of Industrial Production, thats expected to edge up marginally, but dont forget, back in august Industrial Production fell to a 17year low. The data today out around 10 00 is expected to show a continued slowdown. China, alsoces in in negative territory. It doesnt look like we will get a pretty picture. Shery perhaps even more worrisome, could be the services sector. Nonmanufacturing pmi hasnt done well. What can we expect from policymakers . We have seen tax cuts, Infrastructure Spending and so forth. Tom absolutely. You are right to point out the services data, because thats a concern for our inhouse team at bloomberg intelligence. Services and consumption makeup more than 50 of growth in china, and they are starting to see weakness. This is part of why the retail sales and the consumer are in focus. In terms of Monetary Policy response, most economists we speak to think the data today will underscore the case for additional stimulus, but most economists do not expect them to open the floodgates. Looking at targeted measures, more targeted tripler cuts, bond issuance at the local government level. We havent heard anything from the central bank about an appetite for opening the floodgates in terms of credit. We saw the latest credit data this week, which came in above forecast, and there wasnt anything there that really signaled a major shift in terms tf liquidity and, stimulus, bu we expect further measures on the back of this what is expected to be weaker data. They haveof credit, their own online bank and see credit growth continuing, lending about 400 billion u. S. Dollars. Sophie they have the pulse on the consumer, as you noticed noted. What else did they have to say . Broad,ll, this was a whitehaven ranging conversation. We talked it wideranging conversation. We talked about their potential future ipo, as well as the dealmaking, partners with platforms around the world, including in india, paytm, that countrys leading payments company. They are looking to raise another 2 billion u. S. Dollars we asked if they were prepared to extend their partnership and invest more in paytm. Take a listen to the ceo i think that our investment philosophy is straightforward. Were only doing strategic investment strategic that fully aligns with our overall strategy. We are focused on strategic investment, number one. We can really achieve that by working closely together. Tom one of your key partners is paytm, the leading mobile payments provider in india. Are you looking to increase your investment there . I think paytm is doing very well. Nersvery happy to be part with them. The company, it really liked it. I talked to the founder and company. E even if i didnt like the business of the company, i like him still. [laughter] very energetic, very passionate, with a strong vision. Wholel, ijn india, the healthy. S very in a very goods position to capitalize on that opportunity. Tom let me ask about future plans for the business. When do you plan to ipo ant financial . We just did a new round of financing. The company is very healthy, in terms of cash flow. We are happy with the overall business momentum. We dont have any plans for, i raising. The capital we dont have any plans for an ipo, for now. But when we have a plan, we will let you know. [laughter] tom would it be realistic to think you would be ready to pull the trigger on an ipo in 2020 . We dont have a timeline right now. No. When the time comes, it comes. We will let you know. [laughter] an ipo, itsto add, just one stage of the company. Told me he is open to more partnerships and deals, and was making clear hes not in a major rush for an ipo. Emerging markets are still a major focus for ant financial. Sophie thanks, tom. A quick check of the latest business flash headlines. Saudi aramcos mega ipo might be on hold, again. The launch of what could be the biggest offering in history was expected on sunday, but sources say it has been delayed and the decision was abrupt. Aramco was set to sell about 2 of the company at a price that would value it at 2 trillion, potentially raising 40 billion. Shery Facebooks Mark Zuckerberg repeated his mantra that the censored part of the internet in china could become the norm around the world if Online Companies dont fight for free speech. Companiesst chinese havent expanded globally yet, but the Tiktok Social Network is an example of how they can. Sophie Jeanclaude Juncker says a brexit deal has been reached. Shares in the owner of the jaguar luxury brand shout rally the most in a decade. A boost for the stock, which has lost over 20 in the last year despite thursdays big gain. We are just minutes away from japans september Consumer Price index. Will inflation continued to inch closer to zero . We will have the numbers next. This is bloomberg. Shery lets get you breaking numbers out of japan. We are getting cpi inflation numbers, with core inflation coming in as expected. Growth of 0. 3 for the month of september, excluding fresh food. The headline inflation, as expected, 0. 2 . Those numbers decelerating from the previous month. Cpi, excluding fresh food and energy, which grew 0. 5 , a deceleration from the previous month, bang in line with estimates. Of course, we have seen negative pressures on cpi from lower gas, electricity, oil prices, and now getting this deceleration in the core cpi year on year, growing only 0. 3 , getting further and further away from the bojs 2 target. Lets discuss all this, sophie, with our guest. These numbers are really not doing much to inspire confidence that the Consumer Prices will kick up anytime soon. Sophie inflation pretty much going nowhere, as expected. Lets bring our guest from fujitsuartin schulz, senior economist. With this data, another shrug perhaps, but with the sales tax hike, could that spur some inflation going into the years and . Istin with the data, it rather clear theres not much confidence around the bank of japan overall going forward. You would have expected companies are raising prices before the tax hike on october 1, but they didnt. What happened in japan, shopping is being pulled forward, and companies are just building on it, trying to get prices lower, and now they might have to lower them again after the tax hike. So overall, dont expect much from inflation here. We need different measures. Sophie and what can we expect from the boj . Morea affirming that Balance Sheet extension would be undertaken to maintain the target, but this is even as the boj has tapered bond buying to stem the decline in yields. Where should the emphasis be for the Central Banks framework, on yield control or asset purchases . Martin well, the yield curve is really on the mind of all policymakers around the world, and the bank of japan is no exception. They want to steepen the yield curve, but it is almost impossible to increase longerterm rates, because the confidence is not in the market. The bank of japan will probably not buy much more. They will lower the short end of Interest Rates. The impact is limited. Right now, they are pushing the government for more fiscal measures, and the japanese government is open to this pressure from the bank of japan in the current situation. Sophie are we going to get that supplementary budget . Martin i do think so. There might even be a new election. The government is allout on stabilizing the economy, already overcompensating for the tax hike, now going in with another supplementary budget. We should follow this closely. Shery will this help Business Sentiment . The chart right now shows you Business Outlook for the future, when it comes to restaurant managers, taxi drivers, shopkeepers, really declining, a fiveyear low. When you have business indices coming down, what does it say about the future of the economy . Martin actually, they should, when you look around in europe, the u. S. , the rest of asia. But in japan, the sentiment is surprisingly positive. Companies think profits are down, but this is temporary. Japan is in talks with more free trade agreements, being courted by china in the current trade war. The u. S. Has become more open. Companies are optimistic for international trade, and the domestic economy is surprisingly stable. Consumers arent in a bad mood. Sales goinge retail to offset some of the pessimism we see in other parts of the economy . . Martin this is the story, and im quite surprised. It could change at any time, but ,he government coming out building further trade overseas, building more confidence in the domestic market by going allout, trying to stimulate the economy, and perhaps even some tiny reforms. The olympics next year will be another boost for the economy. Sophie martin, as you said, this is confidence. Not under pressure too much, so abe looking to expand fiscal stimulus, which is kind of ironic with the sales tax hikes. What is the likelihood of japan falling to recession by next or 2020 . Martin it has always falling into recession after a tax hike. This time, it is a tiny tax hike, because mostly the government is putting money back into the pockets of consumers, but they are extremely sensitive. Companies are cutting back with prices. I think we will have a drop, as always, but we will get out of it positively with the start of the next year. Im rather optimistic. All this could change, with trade wars, external forces, but so far japan looks surprisingly stable. Sophie what about the wage picture . Nominal and real wages have come under pressure. T does that imply for martin with the positive sentiment, and all the bad numbers coming in, incomes are falling all year. Prices are falling from june. But overall, companies are cutting back on bonuses, but base wages are still going up, so the impact of these negative numbers doesnt seem to be coming to households, employees. They are looking to next year. Shery but the discounts you mentioned from companies trying to lure consumers, really boost sentiment, wont that affect cpi again, and where does that leave the boj . Rtin absolutely. Companies trying to get consumers buying in august, september, as much as possible. Especially after the typhoon, when shops were empty. Companies will have to cut back, but they are used to it, and they will try to make up for i. There is little changing in japan on that side. Now the government is trying to catch the economy again. Lets see. Shery when will the boj act . What will be the breaking point for the boj to come in . They seem reluctant to do more, as you continue to see perhaps the benefit of more easing, not as big anymore, and being offset by the cost . Martin yes. So far, it seems they have been waiting for the exchange rate, for something bad to happen, but the situation on that site is positive as well. The pressure is not so high. At the end of october, they will have to do something. It will be on the short end. I do not expect a big change here, but they will do this in a coordinated way with the government, and they should have an impact on the economy next year. Sophie thank you so much. Fujitsu Research Institute senior economist martin schulz. Looking at how the yen is faring, after inflation coming in at the weakest pace since 2017. 108. 57, firm or by firmer by 0. 08 . Nikkei futures pointing higher in singapore. Asian stocks are overall set for the best week in a month. U. S. Futures this morning, fairly flat, but to the downside now. Lets get the first word news with jessica summers. Eyssica china says that th are staying in close negotiation contact with negotiators, as they work on a draft deal that could be signed at the aipac summit next month. The minister of commerce said the aim is to end the trade war and remove tariffs, but beijing indicated it wants more talks before being ready to sign an agreement. The nba says its recent crisis in china has already caused what it calls substantial losses. Commissioner adam silver admitted the financial consequences of a pro hong kong tweet by the general manager of the Houston Rockets might drag on. Thetweet was deleted, but subsequent anger caused nba chinese sponsors to cut all ties. Hong kongs Hedge Fund Industry has seen its biggest quarterly outflow since the global recession a decade ago. Net redemptions totaled 1 billion in september. Meanwhile, the citys property tycoons are even richer thanks to chief executive carrie lams new housing policies. The combined wealth of six of hong kongs biggest property billionaires jumped more than 3 , as shares of developers rallied. Its germany is cutting growth forecast through next year on expectation that it will continue to suffer from waning Global Demand and brexit. Gdp is seen expanding 1 in 2020, down from the earlier forecast of 1. 5 . That would be an improvement on the 0. 5 growth of 2019, but a notable slowdown from previous years. Global news 24 hours a day, on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in over 120 countries. I am jessica summers. This is bloomberg. Sophie dont forget, if you are away from a screen, you can find indepth analysis on Bloomberg Radio, now broadcasting live from our brandnew studio in hong kong. Listen in the app, Bloomberg Radio plus or bloombergradio. Com. This is bloomberg. Is daybreak asia. I am Sophie Kamaruddin in hong kong. Shery i am shery on in new york. President trump says he will probably sign an incredible phase one deal with china at a summit in chile next month. Thesked if this changes outlook for the Global Economy, speaking from the imf global meetings in washington. The arrangement did three things. First of all, it is an understanding of certain sectors and issues. Second, it stopped the escalation of the tariffs. Thats probably the more important consequence. Announced they will resume negotiations. So i think that the whole package is positive, is good news, but of course we have been very enthusiastic, and disappointed before, so we will see. Shery how difficult will it be to reverse the damage already done on Business Sentiment . The damage is already measurable, and that is more than 1 of the worlds gdp. A year ago, we were expecting the 2019, 2020 growth of the World Economy to be about 4 . Withst put out numbers, 2. 9 . The imf put out numbers around 3 . Are mildly more positive than ours, but mostly in the same ballpark. So we launched we basically lost more than 1 of the worlds gdp in less than a year, and the reason is trade tensions. Why . Because the trade tensions affect the certainty and uncertainty is the worst enemy of growth, for a very simple reason. Why do you invest . You invest to produce. You produce to sell. And if you dont know whether you can sell, or what tariffs, whether you can access a market, you dont invest. Market this multiply this millions of times by people affected by uncertainty, who hold back investments, and then you have the drop in the growth of the world. Shery Central Banks are now easing again, to try to support growth. The imf this week warned of rising financial vulnerabilities. Do you see any risks . I think that central bankers are heroes. The only problem is, we cannot expect them to be heroes again and again and again, because even the Central Banks run out of ammunition. Right now, we have to complement their easing, which i find appropriate, because theres a slowdown in the World Economy. We have to avoid further slowdown, but we have to help out with fiscal policy. The countries that have room, that do not have a very big debt to gdp ratio, they should spend more, should use that room. Right now, their Interest Rates are going to remain low for a long period of time, sometimes even negative. So the countries have space. They could use that space, in order to invest it to do infrastructure, to do investments that will generate jobs and ultimately improve the outlook for the future productivity, etc. Shery secretarygeneral angel gurria. Indonesian president joko widodo will be sworn in on sunday, officially beginning a second and final fiveyear term. Ahead of his inauguration, he gave John Micklethwait an exclusive interview in his hometown in java. Jokowi said that his focus will be on jobs, infrastructure and attacking former invest attracting former investment. You said you would open up sectors like telecoms, education, but that has not happened yet. Do you have a timetable to open up those sectors, where you can fully buy companies in indonesia . It is in process. We will see a revision by the end of this year. For education, we will provide room for Foreign Universities to set up in special economic zones. Foreign hospitals with the latest technology will also be allowed in special economic zones. In the technology sector, we will provide room. By year end, we will see many sectors removed from the negative investment list to create more jobs. Shery you can see that at these inm full times over the inauguration weekend, starting noon on saturday hong kong time. Up next, saudi aramco delays its ipo launch again. Can the energy giant get to the Public Market after years of planning . This is bloomberg. Sophie this is daybreak asi. I am Sophie Kamaruddin in hong kong. Shery and i am shery on in new york. A look at the latest business headlines. Seesinancial says it optimistic signs in the u. S. China trade talks and that it is important for the Global Economy to reach agreement. Speaking exclusively to bloomberg, the Online Finance company ceo said that demand for credit remains strong. Ceo eric jing added that china has important worldwide try ties being pressured by the trade war. The relationships of the economy are very important, globally. I think we are seeing very good signs on trade talks. We are happy to see that. After seller growth last grew slower ricard than expected, prompting a selloff. U. S. Growth was stronger, but asia contrasted to a stronger performance by lvmhs division. Shery tsmc feels bullish, after numbers that Beat Estimates thanks to growing demand from apple and huawei. They will spend up to 15 billion expanding their operation, a 15 jump on their previous plan. Tsmc says ongoing trade conflicts could hamper a revival of the chip industry, but that is not being factored into growth plans. We did not put that kind of thee tension, you know, in world, into consideration, although we think that any trade tension, trade war, between any countries, has a negative impact on the semiconductor industry. Onagain,udi aramcos offget a megaipo is being delayed again, postponing the offering until they can provide clarity on the most recent earnings in light of last months attacks on two facilities. Lets go to sydney and our energy editor. Why the abrupt change . Heres the question. I think there were doubts in the Investment Community as to how aramco would reach the 2 trillion valuation. On it say, the spin put is that they want to incorporate results from the third quarter. That quarter was volatile for oil prices. Of course, we had the drone strikes on aramcos facilities in saudi arabia. While that took out a large amount of production, and obviously would have hit revenue in that sense, we also saw a large spike in prices, so it is unclear what the impact was on aramcos bottom line. I guess they are taking the view that they want to give investors clarity on how they have been performing. Thats all we have to go on. Sophie this turn of events, a headache for the banks in on the deal. But for the company, what about the bigger challenges they are facing . Jim its been an incredibly volatile period in the oil market, so we obviously have heightened tensions in the middle east between iran, saudi arabia, the u. S. Also involved, various flashpoints through the year. That has generally been positive for the prices, because people worry about the threat to supply lines. But offsetting that of course, we have the u. S. China trade ongoing throughout this year, and the ups and downs involved with that. It has been a hard market to trade, with Global Demand worries offsetting the potential threat to supply. And with that backdrop, it is hard for investors to put a macro evaluation on aramco. It possibly plays into the reason why theres been some delay here. Shery aramcos valuation has been a contentious issue from the getto. 2 getgo. Do we have more clarity on this front . Him not really. The line is they want to wait and see what the 3q results look like. In the broader context, the saudi arabia and stockmarket Saudi Arabian stockmarket market has been performing poorly, reflecting the global oil demand. That is feeding into broader worries, because oil is so crucial to the economy. Its not a particularly favorable environment in which aramco is trying to launch the ipo. It is only 2 of the company, but that is still reckoned to be worth around 40 billion, so it is a huge deal and they want to get it right. Thats probably why they decided to hold fire for now. Shery does that mean an ipo is coming in december or january, . If . We are talking about just a few more weeksjim it is difficult a few more weeks . Jim it is difficult to say. For any ipo, they want to be sure they will get a good price, so if the market isnt in a good place around december or january, it is possible it could get delayed further. They dont seem to be rushing to market. Out the risk on the other side, if the delay goes any longer, it would raise Investor Confidence issues, how confident they really are in the deal. Im sure they would like to get it done by the end of the year, maybe january if that does not happen, but it is a very uncertain market. Who knows what will go on with the trade disputes. More bad news on that could put markets under pressure. It is an open question. The reports are that they would like to get this deal done in december or january, but i dont think it is a done deal yet. Shery we will see how determined the saudi government is. Jim thornhill in sydney. Thank you so much for the latest on aramco. Checking on the asian markets, a little pressure. Kiwi, aussie stocks falling a second session. Asx 200 led lower by technology and utilities. Nikkei futures unchanged at the moment, but a little more strength for the japanese yen, which has seen the biggest gain in over a week. Kospi futures are slightly higher. Sophie in the next hour of daybreak asia, berkeley barclays chief asian economist will review the data coming out later today. And more from the annual imf meetings in d. C. , including our exclusive interview with the Philippine Central Bank governor. Shery i am shery ahnshery . Sophie i am Sophie Kamaruddinsophie . Asias major markets have just opened for trade. Welcome to daybreak asia. Shery our top stories, brexit breakthrough, Boris Johnson begins a hard sell of his new deal with the e. U. Ahead of the crucial vote in westminster. China is in close contact with the u. S. As they work on a draft deal. Gdp figures will show the effect of the trade war. Amid fearsiscal help they are running out of options, live with imf meetings in washington. Sophie chinas gdp, thirdquarter numbers are due for the mainland. In tokyo the nikkei 225 adding. 4 . The topix swinging to the downside and the yen edging higher for a third session, not much reaction to cpi data. Inflation is subdued in japan, the weakest since 2017. Be waiting onll the boj buying in the long end. South korean markets, the kospi adding be waiting on the a quarter of 1 , adding strength for the korean won below 1180. We are getting the finance ministrys assessment. They had not picked up last month. Antiquities, aussie shares are off, led lower with all sectors in the red except for materials. The aussie dollar steady after jumping 1 overnight for a third weekly gain and bond yields are on the rise. The Housing Market is turning around and it is working to his the australian economy gradually improve. Working to see the australian economy improved. Deal,129 on brexit traders pushing to position negative outcomes of this super saturday. Lets get to first word news with jessica summers. Thank you. Mick mulvaney denies saying President Trump withheld military aid to ukraine to persuade just persuade give. It contradicts earlier remarks when he acknowledged the president offered ukraine a quid pro quo for military help. He said the only reason the administration withheld aid was because of concerns over corruption and lack of support from other nations. We look back to what happened in 2016, certainly part of the thing he was worried about in the nation and that is reporter the lira rallied to a oneweek high on news of the temporary ceasefire in syria. Turkey agreed to halt the two reaction in the border area for 120 hours to allow Kurdish Forces to withdraw. The news announced by mike pence after a hastily arranged talk in ankara. He said the u. S. Would remove sanctions on turkey. With the implementation of ceasefire, the United States will not impose further sanctions on turkey. Once a permanent ceasefire is in effect, the president has agreed to withdraw the economic sanctions that were imposed. Reporter u. S. Factory output fell in september the most in five months, dragged down by the strike at General Motors and weak Global Demand and the trade war. Manufacturing dropped white hat. 05 . The was a revised rise in the previous month. Christian dior is facing a backlash in china. This is after a presentation which included a map of the country that missed out taiwan. They apologized after a video workerted showing an hr at a recruiting event being taiwan is not why included. They said it is not smaller than high nonwhich is not which was on the map. Map. Inan which was on the global news 24 hours a day, on air and tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. I am jessica summers. This is bloomberg. Boris johnson has struck his brexit deal with the e. U. , the next hurdle pushing it through the house of commons this is going to look at on a rare saturday sitting. Our reporter is watching this. The gtv chart showing the volatility on sterling has spiked. We have seen overnight one week implied volatility jumping but not necessarily the pound, under so much pressure given the dup said they would not vote for it. Why . The key thing is you got to think about what cable has been doing. Trading iswn, so difficult because based on the headlines. You never know when the headlines will come out or if it is good or bad. A better way to trade is to buy implied volatility. It you could your basic long options, you can take advantage of the swings when it goes up or down. Traders have benefited. Spot traders would find it difficult indeed whether long or short. Shery we have seen sterling touching a five month high before the downside pressure. How much of the risk premium of striking a deal has been removed . David some of it. There is still uncertainty. You never know. If a deal did get past, but is one issue but if it got passed from a market perspective it would be a positive. It takes no deal off of the table and you see table rally to 132. If it did not get past, the question is what happens. Very quickly, Boris Johnson is supposed to ask for extension. If he doesnt, you would expect a noconfidence vote on monday which could see him being ousted and a new caretaker government coming in to ask for the extension. The downside is limited because the market could assume one way or another the extinction an extension is the worst case. Sophie if traders have not put in a position on sterling, it could be too late with volatility. Options traders are the most bearish since april. Does the position this saturday . David one is to stay on the sidelines. They could swing one way or another. Complete bias, it will stay clear. The options now, the price is quite high. If it is, if a deal complete pau expect volatility to come off quickly. You could gain on the move but do you gain enough on the move to offset decline and implied volatility . Some people say i will stay clear. If you do work, there is potential with hectic trade again. Trade ahead. You could say i will buy implied volatility. Sophie brexit drama, never ending. Stay tuned to our Global Coverage this weekend. Anna edwards will lead our special from new york to 00 p. M. 2 00 p. M. And we get projections for growth amid the glowing desk growing global threat. Chinas latestat gdp numbers with the chief china economist. This is bloomberg. G. The reality is growth is slowing down. It is accelerating at the moment. It is because of tensions. Leading indicators. Macro economic factors. They are declining and deteriorating. Most countries are limited to manufacturing. Pressure on the manufacturing sector. Decoupling of the monthly manufacturing pmi and services has been noticeable. Policy easing we expect to see will come in slow motion. Using policy in such a modest and gradual fashion. Easing policy in such a modest and gradual fashion. It will be a mild one. The first half of next year. Economic and confidence perspective. Sophie some of our guests and what they pick from chinas numbers when the thirdquarter Growth Numbers are released. There is a look at asiang us is barclays chief pacific economist. We will look at how the thirdquarter may have ended. We will see a gradual decline one would expect given the trends we have seen. I want to focus on investment growth because it has been flat or slowing. The real estate sector, factory investment, we saw a pickup of late, that is on course for the weakest annual growth since 2004. Do you expect the government will pull more levers to generate more investment spending . Maybe allowing for a wider quota for other measures . If we look at investment there are three components. Any factory, housing and infrastructure. The last one was hit hard also because of the trade war and it has been running around 3 , weak. We have seen downward pressure. It is the area the government has been focusing on and trying to get more support to the manufacturing sector, private enterprises. Hasnow the government shifted towards tightening the Housing Market. Housing has been among the most resilient parts of the economy. Investment was around 10 . Sophie one of the only sectors seeing growth. That will moderate. We are constructive and believe it is running at upper singledigit growth. The third part is the Infrastructure Investment. That has been area that has been growing below the government target, 7 to 8 . Three it was only at point 2 . The governments have already approved from loading the local Government Bond quarter into this year, we are expecting issuance of Government Bond towards the yearend which will support or should support Infrastructure Investment in the coming months. Overall it is difficult for infrastructure to grow average above five that is the forecast we put for next year, 5 . Sophie you anticipate other liquidity moves, but it kept rates the pboc kept rates unchanged . Jian on the money tree side, i cuts should be preferred because it is an effective tool to lower banks funding cost which will help the banks to feel more willing to lower the lending rates to the real economy. That is what the pboc is aiming at. Market is concerned about the policy rates. If we listen to the pboc governor, he said he is in no hurry to cut rates in late september. We noticed he highlighted cpi inflation as a key indicator to watch in july when he was asked whether china would follow the fed in cutting rates. Cpi inflation as we forecast to continue to break towards 4 by january could happen as early as december. That will clearly tie the Central Banks up, spending too strong. The pboc needs to be accountable for its inflation targets. How concerning is that we are seeing impact on the nonmanufacturing side of things . We saw that with nonmanufacturing pmi. If it is weakness in the services sector, is it a concern . Jian you are right. In july and august, the service alsort of the economy have been moderating. In addition to the sharp slowdown in investment production. We see Services Inflation has been falling rapidly. That has been i think a concern for the government but overall we would have chinese gdp growth entering into the five handle, if not this quarter it would be next quarter. That is part of the slowing of the economy and consequence of it. Shery i spoke earlier to the oac be secretarygeneral and he was not concerned about the hard landing for china but more about the implications of a slowing chinese economy. It is not they will be the cause of any major shock, but the reduction of demand, of a number of commodities, it does have an impact in many countries, latin america, asia and africa. Are the Global Implications we are seeing chinas imports dropping 8. 5 for the month of september . You are right. We have been highlighting that despite the slowing export growth and the trade tensions escalation, chinese import growth fell faster, doubling the pace of the exports decline. In the past 12 months, exports was slightly contracted while imports were down 10 Percentage Points overall. You look at the chinas trading partners in north asia countries, korea, taiwan, and commodity importers and europe has both been having a difficult time as on the back of it. Clearly the easing cycle is different. Chinese government is not announcing credit stimulus or monetary easing. They would be slowing into 2020. There is nearterm stabilization in q4. The globalhey would be slowg economy will be more severe down the road into next year. Sophie earlier you noted prices would top the target by the end of the year but on the ppi side of things we are seeing the remain under pressure, falling in the industrial sector which you anticipated during the summer with knock on effects on profits and makes devotee meant difficult. Attainment difficult nt difficult. What do you make of the credit risk and deflationary pressures for the corporate sector . Jian the corporate sector is facing a difficult time. They were squeezed on the back of the deleveraging since last year where we have seen a significant rise in the risk. On the back of a slowing economy ppi, prices and profits have been under further pressure. That has been said, i have to index,we look at the ppi the big part of the decline happened in the second half of last year. Month on month basis the ppi actually has been going up. This is an interesting trend. Corporate profits, corporate sector, they will continue to face a difficult time. Momentum wise, there is something more to watch. Sophie thank you for that insight. Sticking with china, the Worlds Largest tech firm is staying optimistic on the mainland economy. They continue to see strong Credit Demand in the 100 million enterprises that are the main engine of chinas growth. The ceo told us where he is reaching. We are focusing on underserved people, the little guys, ordinary people, daytoday spending. Very resilient. We think we are looking at the numbers, it is still that is also the past domestic consumption, china economy, we are appreciative that it is resilient after [indiscernible] that is also a good sign for the overall economy. For that report [indiscernible] i think the momentum is still strong. There has been discussion about decoupling between the u. S. And china. Is that something you have to take seriously now . Sustainabler relationship of the economy will be important on the whole global. Seeing we are [indiscernible] we are happy to see that. You mentioned the health of the Chinese Consumer which has been resilient. How would you characterize the health of the consumer . [indiscernible] still healthy. Holiday, week with the i think from public side, see the members are a good indicator of China Consumption overall. What are you seeing in terms of Credit Demand . Very strong. We are seeing the requirement is still strong. We have kept the economy strong meaning estimates are not ideas. [indiscernible] working capital to support the business. It is still strong. Zheng speaking to tom mackenzie. Another exclusive conversation, abb president discusses the impact of global risks on asias emerging economies. More from the World Bank Meeting in washington. This is bloomberg. Berg. Sophie this is daybreak asia. I am Sophie Kamaruddin. Of businesscheck flash headlines. The japanese cabinet approved a draft legislation with tougher rules on Foreign Investment in stocks related to National Security. Shinzo abe pushed this despite opposition from market participants. Overseas investors will have to report in advance if they want to acquire more than 1 of shares under the National Security umbrella. Shery saudi aramcos mega ipo is on hold again. What could be the biggest shareholding in in history has been delayed. The decision was abrupt. They were to seoul about to sell 2 of the company at a price which would be valued at 2 trillion and raise 40 billion and the clips the 25 billion alibaba raised in 24 and eclipse the 25 billion alibaba raised in 2014. If dominant Online Companies dont fight for free speech. He said while most chinese platforms have not suspended expanded yet, the tictoc social network is an example of how they can. I believe that people should decide what is credible, not tech companies. Now of course there are exceptions. Even for politicians we will not allow content which incites violence or risks harm. We dont allow voter suppression. Voting is voice. Shery we are seeing a mixed picture across asia. The asx 200 and kiwi stocks are falling. We are seeing tech and utilities leading the declines. This is after the jobless numbers came out yesterday and unexpected the showing a decrease. We are seeing the nikkei up since the highest since 2018. Energy and materials leading the gains while the kospi is up. 3 . That was a threeweek high. Goldman sachs is saying go along for the kospi with the short on if you want to bet on deescalation. Sophie we are back at the imf World Bank Meeting in d. C. Watch our exclusive, with a man who says inflation and growth will hit targets this year. This is bloomberg. Omberg. From the couldnt be prouders to the wait did we just winners. Everyone uses their phone differently. Thats why Xfinity Mobile lets you design your own data. Now you can share it between lines. Mix with unlimited, and switch it up at anytime so you only pay for what you need. Its a different kind of Wireless Network designed to save you money. Save up to 400 a year on your wireless bill. Plus get 250 back when you buy an eligible phone. Call, click, or visit a store today. Asia. this is daybreak i am jessica summers. Britain and the e. U. Have secured a deal and there is no need for further delete. Further delay they produced agreement on key issues including Northern Ireland status and the need for customs checks in irish the rather than on the border. Boris johnson still needs to win u. K. Parliamentary backing and alliesrucial i weres will not support the agreement. Irish allies will not support the agreement. I think it is good for the u. K. And e. U. And is a reasonable, fair outcome. Reflects the large amount of work that has been undertaken by both sides. It is a balanced agreement. A testament to our commitment to finding solutions. It provides certainty where brexit creates uncertainty. It protects the rights of our citizens and it protects peace and stability on the Ireland Island of ireland. Reporter germany is cutting its growth forecast on the expectation it will separate from waning Global Demand suffer from waning Global Demand and brexit. It would be an improvement on the half of 1 growth in 2019 but a notable slowdown from previous years. Hong kongs Hedge Fund Industry has seen its biggest quarterly outflow since the recession a decade ago. Redemption totaled 1 billion u. S. In september according to your raqqa eureka hedge data. The property tycoons or even richer thanks to the executive carrie lam s new housing policies. Carrie lams new housing policies. Developers rallied. President trump sparked accusations of conflict of interest on news he will host the g7 summit at his golf resort in florida. The white house greater triggered criticism he would be violating a constitutional prohibition against properties. The Administration Says it named Vice President putin to the event and Climate Change were not be would not be on the event. Global news 24 hours a day, on air and tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. I am jessica summers. This is bloomberg. Sophie in tokyo we are seeing the nikkei resume gains with Energy Materials seeing the biggest percentage. The yen is looking little changed. Since 2017. Lowest in seoul, the korean won has rallied, fluctuating around 1180 after Stephen Mnuchin said he would look at auto tariffs exemptions. The kospi is led higher, and in sydney stocks under pressure but the aussie dollar is study, yields are higher after the rba governor said the economy is turning around. The british pound moving up. 1 , going back from a five month high as traders position for a negative outcome at the Parliament Session in the u. K. Imf and World Bank Annual meetings are continuing in washington. Kathleen hays is there for us. Is it all doom and gloom . I think everybody says it is not as poignant as it has been in the past. Looking at every country in the world with 2019 growth forecast downgraded, sure, people are cautious. In the philippines the Central Bank Governor admits the economy will slow this quarter but is confident there is enough rate cut evidence cutting the key rate will not be necessary again. Optimistic we will hit 6 . We hit a bump in the first budget wascause the not approved on time and secondly because of the elections. There was uncertainty. Creating a wait and see attitude for investors. It has been going since then. Optimism, can we conclude you are done cutting rates for the end of the year . Is there any chance you could cut again . Likely the rate cutting is done, but the reserve requirement ratio, look at it, we have several scale up meetings, and that is possible we will still cut because it is so high compared to right now it is 18. We have cut it by 300 basis points since i took over seven months ago. Maybe we will consider another cut. Kathleen what are you watching to see . What data to make you same we will do that reserve requirement ratio . There is a lot of information we need but the most important and need will be inflation rate. We hit 0. 9 september. We will probably hit another in october. That came from 6. 7 last year. It was, there is a dramatic drop in inflation. That is the primary consideration. Think Consumer Prices have brought them down and they will start rising . The fullyear inflation will be in the neighborhood of 2. 5 this year. Is target, our target range three plus or minus 1 . That is 2. 5 this year and we expect it to be around 2. 9 next year and in 2021. Kathleen what is the biggest risk to the economy . Right now it is the global slowdown because of the and thena trade war increasing protectionism of other countries area most studies which show that the philippines probably one of the most resilient among the emerging economies. Kathleen it is true the philippines economy has suffered some stress and strain like others. It is true inflation is low but with the rate cuts and the extra tool they can employ, the reserve requirement ratio cut, it sounds like benjamin is satisfied they have done enough and they will wait and see what happens next like so many other banks. Shery kathleen, thank you. Continuing our coverage from the imf, the president of the Asian Development bank said any gained it any benefit from shifting supply lines in asia will be offset by slowdowns in china. I asked about the impact slowing growth is having on asian Central Banks. I think there are also theirl banks to lower policy rates further. The philippines and india and the countries are already decreased the interest rate. I think there are still rumors to do that. Room to do that. Shery how much room does beijing have given there is so much debt . China has already tried to boost the economy by monetary policies from macro policies. Some of the policies are more accommodative to have more investment in the countries. I think there are still rules but the challenge is from trade in lower investment issue for them. Chinasing debt level over prevents them from taking measures. Shery lets talk about the trade concerns. How would a mini deal, if it was signed this year, how would it help asia . Asia has certain resilience to this dispute. Although it is effective, countries excluding those growing at 6 , and according to our forecast, down by 0. 2 . But it is in the face of 6 . The economy will double if we can keep it. Valueis a concern about chain disruptions. The risk is being managed. Shery supply chains are being redirected away from china and towards other developing countries. Will growth in those countries helped offset the weakness we see in china . Course there is relocation of investment from china to such countries like vietnam or bangladesh. They gain, but they are also suffering from lower growth in china. Although there can be a shortterm gain, but the future of the economy of the region, it is true. It is not really policy. At this moment there is a kind of support to the economies. Sophie asia Development Bank president. Dont forget our tv function tv. You can watch us live and catch up on interviews and dive into security functions we have been talking about and become part of the conversation by sending us instant messages. This is for subscribers only. Check it out at tv go. This is bloomberg. We have a deal. This deal represents a good deal for the e. U. And u. K. It is a fair, balanced agreement. We delivered together. Everyone should be convinced. The irish Prime Minister is content with it. It is an important sign for me. Where they want deal. Your permanence are to deliver now a vote at your parliament. Speaking of elective representatives, my fellow mps in western in westminster do now come together to get brexit done. In you reacting to the leadersit deal e. U. Reacting to the new brexit deal. News that they got a deal. Very enthusiastically i invite parliament to approve all of this. I believe it is a very good faith effort by all of the parties involved in order to avoid a no deal brexit. To do isre trying avoid further damage. There have been great losses, investment confidence, the Banking System already with the question of the trade tensions we are paying a mostly the price is being paid by the u. K. Shery the u. K. Had one quarter of negative growth. According to other economic metrics the u. K. Is already in a recession. Should the bank of england do more . The bank of england has done so much. We oh it to the bank of england and the central bank as i said before that we dont have an even worse situation and we are not in a bigger hole. There is only so much the bank of england can do. The question of brexit or no brexit doesnt depend on the bank of england. It can react positively to attenuate the impact but it will not depend on the bank of england. It depends on the government and the parliament eventually. And of course in the european union. So i hope that this deal actually happens and that we can continue to work on the brexit socess in an orderly fashion we dont have further disruption. The oecd secretarygeneral. Debte seeing the japan coming under pressure with a benchmark set for a third weekly drop. 10year back at levels not seen since august. This as traders digest inflation data and what it means for boj policy with governor to committing to massive easing. People looking at buying 30year yields not far off. Topht Division Earnings on today. Can the company fight off market share after it was among those looking to expand . This is bloomberg. Sophie this is daybreak asia. Shery lets get a look at the business flash headlines. Optimistic signs in the u. S. China trade talks. It is apartment it is important for the economy of the world. The Online Finance house said chinas domestic economy is resilient. Demand for credit remains strong. The ceo added china has important worldwide ties being pressured by the trade war. Healthy or sustainable relationship of that economy would be very important. Seeing a good sign on that last trade talks. We are happy to see that. Company losing its sweet spot in china. First Quarter Sales grew less than half of expectations, prompting a selloff of shares. Growth in the u. S. Was stronger but the selloff in asia had a Strong Performance by a rival. As itdismissing concerns has a stronger performance in the second half. Shery Quarterly EarningsBeat Estimates thanks to boeing jim demint growing chip demand for apple and while way. They are going to spend 15 billion u. S. Expanding operations. It is a 50 jump on the previous investment plan. Ongoing trade conflict would hamper revival in the trade industry the chip industry but it is not factored into growth plans. We did not for that kind of a althoughn in the we think that any trade tension or trade war between any countries who have negative impact to the Semi Conductor industry. Sophie one of the chinese tech firms targeted by a u. S. Blacklist will report earnings today. The company said it doesnt expect a big impact on his production and business. Our editor joins us. What impacts have we seen . Reporter it will take time to filter through. This one like many other Chinese Companies placed on the entity list has been preparing for this. They have been stockpiling inventory, american highend chips they need to make their products. In the shortterm, we dont think there will be any major impact. What about the longterm . Reporter it depends on a wealth of factors, not least chinas Semi Conductor industries to get into highend chipmaking. Canmakers within china successfully replicate some of the higherend component that buy from thepanies u. S. , it will help hike vision. Also seeing american chipmakers finding ways around the prohibition to keep supplying chinese like listed firms including huawei. Intel and micron are among them. There is a complex interplay. There are various ethnic minorities. When you have trade tensions in play, what is the longterm prospect for this getting resolved . The trilliont is dollar question. U. S. Chinese tensions, with the company, it of this is the first time the Trump Administration has used human rights as justification for blacklisting. How it all plays out depends on a geopolitical dynamic. David what does it shery what does it do to chinas tech aspirations . They have a plan for 2020. How will this curtailing affect the broader plans . Think a lot of outside observers see this as an asset or campaign to contain chinas ascendancy including its tech industry. You mentioned ai. Hikvision is a player. Others were placed on the entity list at the same time. Those are supposedly companies that are the vanguard of chinas ai ambitions. It is interesting and it is curious to see how it all plays out. Haslinda sophie giving us a preview. Before we hand over to Bloomberg Markets asia, lets look at how markets are trading now. In tokyo there are gains for the nikkei 225 up. 5 . They are resuming this after falling into the red thursday. In seoul, the kospi led higher by autos and chipmakers and the asx 200 nudging lower, half a percent with all sectors in the materials. For overall it looks like asia is set for the best week in about a month. Shery pretty positive although a mixed victor with ozzy and qe stocks. U. S. Futures under a little bit of pressure, down. 1 . This after u. S. Stocks climbed. At one point topping 3000 and closing at the highest level in three weeks. Look at china a 50 futures which. Ere higher. 2 four hours ago they are seeing pressure for the isnese offshore yuan which at the 7. 07. This after we saw pressure this past week as the chinau. S. Tensions continue to escalate despite the fact we are moving towards a little trade deal between President Trump and president xi jinping. Indonesian president will be sworn in on sunday as he officially begins a second and final fiveyear term ahead of his inauguration fiveyear term. He gave us an exclusive interview in his hometown in central java. He told us his focus will be on developing natural resources, jobs and infrastructure and attracting Foreign Investment. Pointed out, indonesia has lots of advantages. One big problem is the labor laws. That is the main obstacle. The world bank has said so, you have. Will you reform them . We compete against other countries to attract investors, create jobs. Complaints are always expressed to me especially for laborintensive sectors. They also express the need for some provide licensing. We will work on these as soon as possible. Sophie you can see that interview in full in a conversation with the indonesian president at these times over the inauguration weekend starting saturday hong kong time. Shery coming up in the next hour, we are counting down to china thirdquarter gdp and speaking with jp morgan senior china economist. Daybreak asia. Coverage continues as we look at shanghai and shenzhen. This is bloomberg. Everyone uses their phone differently. Thats why Xfinity Mobile lets you design your own data. You can share 1, 3, or 10 gigs of data between lines, mix in lines of unlimited, and switch it up at any time. All with millions of secure wifi hotspots and the best lte everywhere else. Its a different kind of Wireless Network, designed to save you money. Switch and save up to 400 a year on your wireless bill. Plus, get 250 back when you buy an eligible phone. Thats simple. Easy. Awesome. Call, click, or visit a store today. Beijing. S 9 00 a. M. In welcome to Bloomberg Markets china open. Yvonne we are counting down to the open of trade. David we will get your top stories of the date. We are an hour away from chinas gdp figures. Yvonne chinas leading online fintech giant is more optimistic. The ceo speaks exclusively to bloomberg. David