Its stronger half of the trading. The korean won jumping most in five weeks and all of this ahead of the tariff deadline as well. A little bit of a risk on sentiment coming through in asian equities and assets today. Absolutely. And youre seeing it with futures trading in singapore. Having a look at what is going on there we are seeing an uplift. We could add to the near half percent gain we saw in the nifty session. Nfte. The dollar is falling against its Indian Counterpart the rupee , half a percent down in the last three trading days. The bloomberg dollar index erasing the gains we have had this year. 10 year yields a spike up as well. It is a time when we are seeing not just a lack of any Interest Rate cuts a perhaps a pause in Monetary Policy is the general feeling. Quite a few rate cuts priced in as the market is adjusting itself to factor in one or two next year. There are looking also at shadow banking and how some liquidity in the market is helping to unfreeze this troubled part of the economy. Ands get over to new york su keenan with the first word. Israel,ll start with which is heading for a third election in less than one year. This is after the countrys fractured parliament has failed to meet a deadline to find a lawmaker who could form a government. Neither Prime MinisterBenjamin Netanyahu nor the Opposition Leader pen against have been able to strike the Necessary Coalition deals and neither of the parties was able to secure a parliamentary majority. Votes laterwhich thursday in an election that will define its relationship with the European Union for years to come. Brexit has been the central issue in the campaign with a u. K. Prime minister Boris Johnson insisting that contentious divorce will only happen quickly if the conservatives earn a strong victory. The uncertain see surrounding brexit has left eu leaders hoping for a johnson victory purely so the drawnout negotiations can finally come to an end. Makersng now, the jet grounded 737 max will not be returning to service before the new year. Aviation regulators are now saying approval so fly is not imminent. The plane has been out of action since march, after two fatal crashes that are being linked to the pains the planes faulty altitude sensor. Boeing had hoped the faa would approve Software Updates before the end of the year that would have allowed the max back into the sky. Max, when it is returned to service it will be because safety issues have been addressed and pilots have received all the training they need to safely operate the aircraft. This process is not guided by a or schedule. Calendar or big schedule. In new zealand the number of People Killed in the volcano eruption has risen to 16 after two more victims died in the hospital. White island continues to vent steam and smoke and rescue teams are still unable to recover bodies of those unaccounted for. ,remors have intensified seismologists now calculating an increased risk of another irruption in the coming hours. Global news 24 hours a day on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. I am su keenan. This is bloomberg. The Federal Reserve surprised no one was his decision to hit the pause button after three Interest Rate cuts in a row paired what did make an impression is the strength of the current consensus that no rate moves of any kind are expected for one year on global when year. Heres our Global Economics and policy editor. What happened to all of that dissent . That is true. I do not think this has so much to do with the election as it does to do with the fact that the doves were pushing for more rate cuts and can see that the jobs report is looking pretty good. Consumer still spending. Maybe you do not need to do more. And the hawks, they have to be happy that they certainly cannot point a big move up in inflation to argue that the fed has to turnaround on the cuts that made. Jay powell made it clear at the pride cost press conference that the fed had done enough. Lets listen to what he said in his prepared remarks. Our Economic Outlook remains a favorable one. Despite global about mens and ongoing risks and as long as the incoming information of the economy is consistent with the outlook, current stance of Monetary Policy will likely remain appropriate. , on this going subtly, do not need to hike and do not need to cut. Jay powell is focusing also on the question of what would make you cut rates more . He was asked about this and he said we put it right in the statement paired we are looking at global development. Watching the trade war, but theres a point where they do not see global to veltman pushing in that direction. And it comes to hiking rates, he said he would have to see a persistent rise in inflation. He talked about how hard it will be for the fed to get there. So he does not expect that coming. One of my favorite on the bloomberg numeral showing you 2019, there were some dots in september that said they were not get this low, but they have cut them three times and everyone is on board with what has happened it is the next call that is so important. The bottom row, the total i should say, 13 out of 17 see the exact ending rate in 2020, where we are right now. Only four c one hike which is not that much and the former president of the Federal Reserve bank of atlanta agrees, they are not going to do anything for a while. The economy overall is in a very good place. The growth number could be stronger but i think realistically and in todays environment, global environment, a 2 rate of growth is really a quite decent performance of the economy. And i really cannot see today that changing over lets say the course of 2020. It,t is interesting, isnt we have had a couple years of rate hikes than a dramatic pause and then rate cuts and now we are not going to get anything . I think there will be a lot of fed rate move withdrawal in the markets. Ecb becausee to the Christine Lagarde is holding her first meeting. What is expected . Christine lagarde is limited in what she can do. Certainly people expect her to some sense ofive how she sees the economy. The hope for Christine Lagarde of course, she is a savvy politician and can get governments across the European Union to spend more money to boost the economy. Because negative rates people are complaining about are hurting the banks. Bond purchases, yes they will continue until 2021, but they are not having that much impact. People are also expecting that maybe she gives clues as to how she sees the Strategic Review of the ecb shaping up next year. Will they look at their inflation cart target . Do they need to settle with that . The ecb will change its economic projections, but the numbers are not Strong Enough to make a big difference there. It will be interesting to get Christine Lagardes sense of how she sees where the economy is now and where it is heading next. Global economics and policy editor Kathleen Hays who will be watching that closely. Thank you for joining us from the ark. Here in singapore is the cio and chief economist at saxo bank. On the comments by the fed. I think it is an excellent summary by kathleen. It is interesting what the fed says and what in reality is doing. Your reporting all of this not changing for one year. But look at what are they doing . They expanded the Balance Sheet by three under 50 billion since september. They pretend still that the repo is not going to be issued at the turn of the air. And there now accepting that the inflation rate can go about 2 . Really what theyre telling the market is that we will go more into negative territory on real rates and at the same time while we talk up here about the fact that we are not going to change, actually we are floating the system with liquidity. Despite this, i think from my investor hot putting it on, i think it is interesting that ccc junk bonds are going see nick atlee up. There is a liquidity situation involving, where the time where they are boosting the Balance Sheet. I think theres a lot of disconnect in the narrative and the actuality, the actual Monetary Policy theyre pursuing which is super dovish but not dovish enough to get the ccc bond and index to jump up. What assets will benefit from this fed outlook . The s p 500 is on a chair on a tear. We have the macro environment a blow off. It is not about the fundamentals. The worst economy gets the stock market because the policy response will be a loosening of the Monetary Policy and the rhetoric. One way thats on the market now that the equity will benefit. But i want to warn your viewers that there is a disconnect in the leverage place could private equity in 2019 is returning less money than the liquid stockmarket. That does not make sense. Private equity is liquid it is leveraged. In an environment where we have seen a significant cut by the fed it should outperform it. There warning signs in the system but shortterm into the turn of the year, into more liquidity of the fed despite the headlines yesterday it is going to be supportive of the market. And i guess President Trump got what he wanted. The bloomberg dollar index falling to the five month low. We have seen a lot of dollar dominance happening. You say though, because for what you wish for, america with a weaker dollar. Arees because now we talking more shortterm and we are talking medium longterm there is a dedollarization effort going on on the side of the world. As the u. S. Does not want to be the reserve currency country of the world, you are opening a door to making investors seek alternative harbors. The counterargument, course in the world now is that the only market deep enough to take all of the excess saving the world has been the u. S. But as markets develop, as europe, the dax is performing in europe, with lagarde over the next when he form on tour neutrality on Monetary Policy easing and the Federal Reserve. You can parse the dollar out. Ironically from a political point of view at least, or from central banks, what they really want is a weaker dollar because that is the only thing, as long as you do not change, that makes up a monetary and fiscal policy, the only teething that can help the world on emergingmarket commodities. To give a false sense of relief to the marketplace would be that weak dollar. Your outrageous productions for next year and a second. But i want to get a sense of where you think the biggest risk is out there . Are people being far too complacent at the moment saying, recession, no chance of one . The bull would tell you all of 2019, all the last 20 years we have climbed a wall of worry. But as i was saying here in the studio, the disconnect i see now is that leveraged money. The very part of this sector entrance and allocation the market that should benefit the most from easing Monetary Policy from this change in the Federal Reserves inflation targeting, they are not been entertaining they are not benefiting. There actually falling behind. When you see a change to the established consensus, it was be driven by some sort of illiquidity risk. That is what you need to be on the outlook for. I think repo on the turn of the year is a bigger deal than fed makes out to be. Overall the next policy response from the central bank in the world will be to easing Monetary Policy again. Because the green feud is not reflected in the talks ive had with cios around the world in the last three months. If anything is dramatically worse in terms of the global trend. By the green feud, by the fed pause, we are going to get more and more liquidity at the leveraged part of the economy, which is the private equity and the junk bonds and the new ipos which have failed miserably to attract real capital, may be part of what we saw yesterday. Inside arabia. Lets get one of your Outrageous Predictions if you well. This is asia launching a new reserve currency to break its dollar dependence, that is outrageous. That would be really out of left field. When that . What into it . Ldnt it . May be but look at the trade war and worstcase in 10 years can be two separate platforms. Im talking about technology platforms. If you have to do from platforms, the nonus dominated platform will be looking for a way to draw themselves away from a dollar dependency. Again, the theme here is d dollarization. The way to create a credible alternative is not to put the remember at the forefront. It would be to pull not to atthe remember the rmb the forefront. That would be to pull asian currencies. Together. That weit is natural will call the adr, the asian drying right which is a basket thehe sdr, you put all of gold reserves and cash reserves and create a new trading zone similar to the European Union and ask on that. Not not think it is revolutionary because there is actually a trend in place. But calling the endgame is of course slightly outrageous. Us. Tick around with i will take what else we have on the way. We will look at indian lawmakers as they approve a controversial that a cinch of law. Have a look at the next apps and assess the implications on that. A citizenship law. And will Boris Johnson be given the mandate he wants to get brexit done when the u. K. Votes today. This is bloomberg. On tenterhooks as we get voting kicking off in the u. K. Later this morning and looking at the pound this is what we have. Finally the pound has broken through its 200 weekly, not day moving average. The only time it is done that before is here, the second time since 2015 at that stage. Taken by some is indicating we have some Pound Strength in the pipeline, whereas others are saying the path of least resistance now is how far the pound has come as to the downside. Get our guest from saxo bank. Whered you see the pound go as we await this election . Give me the result tonight and i will give you my direction. A crystal ball. Everything indicates there will be a majority and the market has taken that is a positive. Not have a broken the 200 day but the 130 wasnt line in the sand. So 140 becomes the medium turn target the mediumterm target for a lot of sterling traders. The risk is a Hung Parliament that young people will turn out in bigger numbers than expected. What changed materially the outcome of the election in 2017 and the u. K. I think it is a minor impact. A binary impact. What we are seeing is that the tories are lying about this in plessy a brexit trade on the reality on the 31st of about the simplicity a brexit. Of the take all parliamentary time in 2020 and i do not think they will be able to to finish that in 2020. And the labour party is lying about the ability of having fiscal and checks and nationalization. The risk here is that we have already seen. And indicating the top is in place. If you look at the other exit, and never materialized to go higher. Im concerned it is too strong and trading is about status. I went to get to this time last year and your outrageous protections and productions then. And see what you are saying. And this is still germane. What you said is that Theresa Mays Brexit deal would die in the british parliament. In effect, the one that Boris Johnson also negotiated was very similar to that deal. Forcing a snap election. That is what we have. You are predicting perhaps a Labour Party Victory that is well. That anges production that outrageous per action could come off. Prediction could come off. The outrageous call from last year that labor would win the election is close to zero. Nothing has zero ability. I think it would be seen as a victory for the labour party to not be eradicated here. Thehe end of the day dynamics is what happens next. If theres a Hung Parliament, i do not think corbyn will survive. A change in later slip would set up exactly what used as the intro to this question. You still have a parliamentary situation in the u. K. , the population is not split by party lines. Its not split by anything but age group and focus on what is important. The youth wants to talk about climate and the tory classic voters wants to have more of the same. Briefly, the outrageous prediction the caught my eye for the airhead is hungry for the year ahead is hunger leaving the European Union. Quickly, the base of that . Hungary leaving the European Union. It is not north versus south by east versus west. Hungarysion into performance as a member of europe in article seven, the pushback from hungry has been to be aggressive against this. They say we are only doing this to control immigration. Rex it happens and we think one of the outliers could be hungry if brexit happens one of the outliers could be the country of hungary. We will have extended coverage of the British Elections so join in. At 6 00live from london a. M. Hong kong time 9 00 a. M. If you are in sydney. This is bloomberg. We are looking now at the stock of the hour. Petronas fang at gagan if im pronouncing that right. I will not try either. Exactly having a very big jump in 22 years. E most the Trading Volume surging here. This is after we heard that petronas the Parent Company is raising 1. 4 billion, cutting some of its listed unit stake. The cell downs will rank among the biggest ever block trades in malaysia according to data compiled by bloomberg. Petronas trying to raise capital to find to find overseas expansion after finishing a 27 a 27dollar refinery billion refinery and petrochemicals project. We have two buyers eight holds and to cells. Trading ball in very high, more than 150 times the average for this time of day. Day. Is the stock of the to get a glimpse of this and other stocks of interest in his most go on your uber terminal. On your bloomberg terminal. As he had to the lunch break sessionhai, a diffident , showing some gains. Perhaps a gut check as we look to that deadline for tariffs on sunday. A couple of stocks one with a gain of 10 . And that is shanghai. This is bloomberg. Is almost 11 30 a. M. In singapore. Watching this move and a lot of currencies as the dollar weakens. The weakest and almost five months as we continue to see this bearish momentum. The Federal Reserve will stay on hold through 2020. We are seeing the dollar heading for a day of losses. Lets get the first word headlines with su keenan in new york. We will start with the Federal Reserve and the u. S. It left Interest Rates unchanged, as expected, a signal that it would remain on hold through 2020 in the face of a solid u. S. Economy. 10 year treasury yields fell below 1. 8 in the dollar decline as stocks edged higher. Jay powell says the fomc may consider adjusting purchases to ease liquidity strains but the overall economy is holding up well despite a tough year. Output hasuring declined over the past year. As has been the case for some time, sluggish growth abroad and trade of elements have been weighing on those sectors. Even so, the overall economy has been growing moderately. The ecb, Christine Lagarde hosts her first centralbank policy meeting with investors uncertain about the direction of the bank. Under her relatively new leadership. Markets see a 30 chance of a rate cut even though Christine Lagarde has given little away since taking office five weeks ago. Central bankers amid a slow euro zone economy and the uncertainty of brexit. Theralia, boosting resources of the competition regulator and googles new privacy laws. Social unit will monitor digital platforms and a scrutiny of online advertising. A report has called for a crackdown on tech. Company owned by jeff bezos has scored another success, launching and landing the same rocket. The suborbital flight took off from west texas carrying nasa experiments, artwork, and a grapevine. Shepherd rocket coming into land just ahead. Global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. I am su keenan. This is bloomberg. Markets, asianto stocks, a bit of a mixed bag. Certain positivity in hong kong. We have just come back off of the 2700 level. Nikkei coming back to business after the hour long lunch break. Investors shrugging off the bad news on machine orders, which were way worse than had been anticipated. The Australian Market is under pressure. The prospects of the indian adding day, we could be to the near half percent gain we saw in the session wednesday. The rupee has been appreciating against the dollar which has been depreciating across all major currencies. Yields, six and three quarters of 1 . Theyre than likely see what happens with the last round of Interest Rate cuts. Over in india, we have lawmakers approving a controversial bill that will determine citizenship based on religion. Values ofconcerns the the country secular constitution. Thank you very much for joining us. This is hugely controversial and really goes to, some would argue, the fabric of the indian constitution. What are critics saying about the new law . Basically, critics say it goes against the constitution because the constitution is a and treats all of its citizens on par. Citizenship would be excluded for a particular religion and that is religion. Commission on religious freedom suggests the home minister, who is responsible for bringing this bill, should be subjected to sanctions because this is discriminatory. We have been saying protests in the northeast saying the bill is widely contentious. Are these protests likely to spread . As we speak, the border states on the eastern side are already lots of clashes happening between police and students, business groups. There is suddenly an influx of people. Apart from that, right now, a real fear amongst people, especially the muslims in india. Expecting this to spread. Protests to spread. Thank you so much for joining us. Lets take a look at Indias Economic prospects. Me next guest is here with in singapore. Expecting growth to end on a somber note. Why do you see that . Yesterday, we had the Asian Development bank cutting the forecast for india for the following year as well. They are still above or the consensus is for the fiscal year. Ds in march 2020. Between the starting of the here and now, it has impacted the main engine of consumption. Consumption showed signs of strain. Numbers from the Third Quarter were better but still trending on a softer note. The next one or two quarters will be a bit challenging. Expect some demandside measures from the government that will help the growth to stabilize and had higher. Had higher. You mentioned consumption and that has a massive impact on the economy. Also the credit crunch. What type of stimulus measures do you expect to come through . From the central bank, the r. B. I. The first and foremost in terms of providing support. An aggressive easing cycle. Government, the most of the measures taken the year, taken this expectations of that will lead to a demand impetus. It might not eradicate the problem but it might provide a shortterm boost. I think the sentiment and the consumption are two things they will be looking at very keenly. Rishaad there is not much fiscal room. Policy,ance on monetary a policy measure is barking up the wrong tree. Consumption is the problem. Most people in india dont have mortgages, car loans. They do not even have loans. One of tory policy is a blunt instrument Monetary Policy is a blunt instrument. There is a transmission issue. Banks,role of particularly nonbanks and supporting consumption has been going up in the last few years. They are the ones closest to the consumer. Fees they have seen in the past year, the standards have Lending Conditions lending standards have gone up. To some extent, the easing cycle transmission has been very important. Now that the central bank seems paused, emphasis will be on transition. We saw the largest Public Sector bank lower its lending rate by a notch earlier this week. Require theo government and you will see much more support required from the fiscal policy side. That is the theme that will play next year. Certainly not much room but we do anticipate a slight slippage in the fiscal deficit target. As 3. 6. Going into the next fiscal year, we do think the consolidation plans, there will be a higher fiscal deficit target. The growth slows and revenues are not immune to it. You kind of see a cascading effect. Click 1 one quick one about the structure of the shadow banking, there are some reforms in progress. Are they enough . Is it really a problem like whacking a mole . Question, how do we address the stress in the nonbank sector, has been a question. There is some type of asymmetric information so that will be dealt with. The other suggestion, should the onus be on the central bank to take up the bad loans and run with it . Take the official more waitit will be and watch and solve the problems one at a time. Nonbanks, the stronger ones will remain in they will be able to get the required funding. They are providing some funding avenues. Balance sheet contraction is something you will see. Lets move to risk europe, some risk there. What do you see for the eurozone . Overristine lagarde taking a governing council that is divided because of the accommodative policy by the predecessor. Knowarkets will be keen to what the ecb president makes of the economy. That sheto suggest acknowledges the negative impact of the accommodative Monetary Policy. To go ahead and provide stimulus going into 2020. You have the weaker euro as well hurt germany narrowly avoiding that recession the weaker euro as well. Germany narrowly avoiding that recession. Datae cheerier ration of the tier the deterioration of data. 1. 2 this year and 1. 3 next year. Not that strong but signs of stabilization. The u. S. Seems at a much stronger place than the eurozone. Thank you so much. Have a great christmas break as well. Aramco soaringi on debut. We will bring you our coverage. Indias markets have just open for the trading day. Lets get to mumbai. What to expect from todays session. Markets closed in the green. Yes, following the asian markets today, after the fed policy. We have a positive start for indian markets. Think traders will be watching for the 20 day fiscal moving average. You have the banking index, which has opened with gains. For the broader markets, despite the markets being higher yesterday, not looking good in the last three or four days. Meager gains seeing right now. Data, markets will be taking cues from the cpi inflation numbers, which will be coming out. A will be keenly watched by traders. Stocks me some of the you are watching for today. The company has been ,ighlighting how they plan which has been a dent in the recent past. Improved they came to by march 2021 and this can be equal to 10 of their margin. All of the steel stocks have underperformed. The company is meeting investors today and tomorrow. On january 3, there is a board meeting. Becausel be in focus this was the most prescribed ipo in india this calendar year. Rishaad thank you. Lets have a look at some of the stocks. There we go. Its presentter tribulations, a 2. 8 gain. Turn to saudi aramco surging by 10 on its debut in riyadh. Adding 200 billion to its value in seconds. I think the test today has proven with the number of from aramcosed investors, the market has opened smoothly. Trades were executed smoothly. Done all of the required tests before we come out and say, we are confident. This is what we have proven today. A big part of the rationale was to try to bring Foreign Investment into the exchange. What role will aramco have now . Basically, there are two factors. The economy of saudi arabia as well as the attractiveness of the market. You have to supply the demand of investors by good companies. Adding aramco today with the performance and demand of aramco think this is what we aim to do. , more more Companies Successful companies to the exchange will bring more helptors in general and the International Investors decide, which is something we are focusing on. Talking to more active investors, edging educating them. Hasco listing has put us accelerated our promotion process. Plenty more ahead, stay with us. This is bloomberg. A quick check of the latest is this headlines. That it is truly sorry may have exposed people to harm after australias Financial Crimes Agency alleged it failed to detect transactions linked to child abuse. The bank is reeling from allegations that it breached antimoney laundering laws. Board and as individuals, we are devastated that anyone might have been exposed to the risk of harm as a result. For this, we are truly sorry. Hsbc search for new chief executive soon to be ending where it started, with interim boss. Internal and external communications have dropped references to him as interim. Back in august, he did not see himself as a caretaker. Indonesian ridehailing is said fore close to buying moco about 120 million. The deal would be part of the plan to become a leading player in digital payments. The app lets merchants accept debit and credit cards. The former president of General Motors seems to be biting the hand that fed him. End of carng for the ownership. Vehicles areowered a fundamental problem behind pollution and its current job is to promote electric or s built forcards ridesharing. Rishaad we will be followed by bloomberg daybreak middle east. He is head of Equity Research for asia. There you go. Later today, bloomberg will have a special coverage of Christine Lagardes first ecb policy decision and subsequent News Conference from 8 45 p. M. Hong kong time. You can see the other time zones there for new york and london. We are also going to have special extended coverage of the u. K. Election as the results role in. You can join us live from london from 6 00 a. M. Friday singapore and hong kong time. The markets are focusing and on what we heard from the fed overnight. Feelings that investors would be cautiously having a look at what is happening. Seeing that hang seng approaching that 27,000 level, which is a key psychological mark. Machine orders are done month on month 6 . Year on year, 6. 1 . We were expecting a moved to the upside. Looking at those currencies, hurtve risk assets today this could fade gradually as the day wears on. Traders might turn their focus to some of the key risk events. Election, the pound 200weekout of a moving average. Bloomberg u. S. Dollar index might be slightly responsible for that. That index has a raised the gains we have had thus far this year. Hong kong dollar, one of the reasons we may be seeing hong kong stocks moving to the upside. The strongest side of the band. That is the deal. Moment. The deal at the bloomberg daybreak middle east is next. Taylor im taylor riggs in san francisco, in for emily chang. This is bloomberg technology. Coming up in the next hour, here is an earful Silicon Valley is listening to your most intimate moments. We will discuss the Smart Speaker craze and how vulnerable users are to the conversations being transcribed. Plus, the best in tech facebook and google drop out of their top 10 best places to work list, but docusign makes the glassdoor list. We talk to the ceo about what makes that company so unique