Capital requirements for the insurance sector. The head of the Nation Authority at the top of this hour. And ruling himself out of running for the top job. Just who will lead europes biggest bank . Manus monday morning wake up reality check for markets. The expansion and contagion of equity market. Nasdaq futures are down. Hong kong morning that there is a tsunami like claddagh close facing them tsunami like facingthey that dad facing them. Gold. Ve i bugged hardline on the weekend story. Love the headline on the weekend story. It is warranted. Gold is in the midst of a perfect storm. Juliette saly is standing by to contextualize this new evolution in the coronavirus. The headline is that nonresidents are being able to leave the province. Good morning. Y are seeing these cases spread outside of china. Total to more than 160. Down 3 . Is you can see on my chart, heavy volumes. It is projecting changing hands for only the sixth time in the last 12 years. Samsung had to shut down a factory. Sentimentthe risk being reflected in korean assets. We seem to have this new evolution of risk. Let me bring it to you, to the Indian Markets that are just up and running. Reflecting. Down by as much as 1 . We are recording the seventh session of decline. There is some panic at this time. Is heavy selling pressure. This is after gains coming through last thursday. The u. S. Dollar is up by about one percentage point. For how theyok out put on influence. Manus thank you very much. Withtte saly in singapore the markets. Risksl assess the new from the coronavirus. The coronavirus continues to spread across the world. Cases in china have topped 77,000. The global account at 79,000. Italy has become the european outbreak center with 149 cases. G20king to bloomberg at the gathering, the french finance minister said the virus jeopardizes supply chains. We can no longer depend on the supply chain in china for our population. Trade andin fair we needity, but i think to have our own supply chain. Maire speaking there. Tom, good to see you this morning. Andyou wrap up the numbers the scale of this contagion . Tom yes. Absolutely. 77,000 infections reported in china. In terms of the daily increase, 400ave seen about additional cases outlined by officials. That compares to 630. It continues to moderate. Early fory it is too what we are seeing in china. Globally, you outline the concerns. South korea raising their alert to the highest level. They have more than 600 cases. In italy, they have more than 140 cases. A population of about 50,000 people. They may need to take additional steps to support the economy in italy and the eu. They are trying to tackle the virus that continues to take a hold. Deaths as been eight a result of the coronavirus in iran. That is an area that people are monitoring. Likeng about this tsunami cataclysm. It seems like a global disease at this point. The question is whether you need more coordinated effort in terms of the economics of this. Manus talk to me about policy response. They were flushing the system with liquidity last week. And a solidicy fundamental domestic economy. What is the update . Some of it is that reassurance. The other side of it is they do have tools to address some of the impact because they have rates relatively high. Kept some of it dry. Reduced by just 10 basis points. See a vshaped recovery. For many, that will seem surprising given the damage that we are seeing play out in china. Aty will potentially look reducing the benchmark. Maybe reducing reserve ratios for certain banks to assure kutty. Liquidity. Until june, Social Security payments reduced for Many Companies as well. President xi xiping held a conference with officials last week and stressed the need. More outlined in the days ahead. Manus talking about that that can become a solvency issue very quickly. Coanchor there in china, tom mackenzie. Ets bring in our guest he joins us from singapore. Good to see this morning. I caught up with a couple people this weekend. Rhetoric is critically important. What next . From a policy perspective, there have been many. It is more about a holistic response. We should not discount fiscal policy as well. The rate of growth is apparent. The policy response to that, not just monetary but fiscal. There trying to balance two. , that is a fairly balanced outcome. Move. The yuan is all the on the move. Here is what you are looking at. This is the level of liquidity, or the risk. To run oney it could turn into a solvency issue. Is this one of the biggest issues for the pboc . It is. Absolutely. Last the assumption week, it was a one quarter hit the market. This is the heart of the issue. It will play out over the next few weeks. Towould need more businesses come back you would need more businesses to come back then usual. Than usual. The return of Economic Activity which of theging two scenarios is going down. Manus in terms of the fx world, i look at what is happening with the aussie. Tough balance. This is the balance between ofervention and the reality haven status. What is next for the aussie and the yen . Very different drivers. What is interesting about the not quite get the demand haswe, where played out more strongly. A bit more balanced and how it could play out. Been one of the more oversold currencies. Only worry to me is the chinese stimulus. Think we shortterm,in the if you believe in the view, shortterm markets could get some policy response in china. And that sorte fx of policy outcome, at least in the shortterm. Manus everybody is looking at the policy response, which has been light. Ahead, our exclusive arabias with saudi governor. New strategies to reach the feds 2 inflation goals. Right here on bloomberg. Manus lets get the latest developments. Radar . On your good morning. It is Interest Rate decision day in israel and the bank of this week israel faces a conundrum. We have seen inflation falling quite a bit recently. A little bit higher on the end of your screen in the blue, but towardsfell back again zero in january. This is despite the fact that Interest Rates are at record lows. There is not much room to maneuver here. For the most part, they believe that we will see the central bank hold today. Expecting some from theseement oneyear swaps on the shekel. Ratestions on interest are easing a little bit further. If you flip the board, you will see what is likely on the notepad of the central bankers as they meet today. There is that new Coronavirus Impact that has come about and parliamentary elections on march 2. We will see if we have a surprise. Thank you very much. Federal reserve governor calling for the adoption for new strategies twisted to Percent Inflation goal. Shouldues policymakers seek above target price gains to make up for past shortfalls. Policyfectively means may have to remain accommodative for a long time. The argument is that they might have enough ammunition in the targeting,eld curve bank of japan style. Dollar,the risk to the if that is the next huge strategy from the fed . Follow the is if you bond yields, they are the best predictors in the longterm. It puts a downdraft on the dollar. Bonde there are yields simply follow. Important, what is interesting is focusing on how the fed should respond. A policy read from perspective, that they should be read together. That is about the overshoot. Where are we . It has been a torrid reality. We had a fairly aggressive run last week. What is it that makes the next leg lower in bond yields . 2016 on friday night. Is an interesting level. We have been here before and rebounded. Given the kind of rally we see so far, quite a bit. Need more news. At this point in time, i would like to see how the love you the level plays out. What the impact is on economic whether we see more demand for safe haven. Manus they said they would look through the data. This is one month versus one year. Deeper into inversion. Believer . I am a big believer. They do have a track record. You have examples in the past where they have not converted. To me, it is more pragmatic. The strategy is much more important. Gains and assets. Us, a balance in investment strategy. Better than panicking on one data point alone. Where do you see it very near term . Quickly. We are looking for about 1700. It has been moving faster than many forecast in the market. Until the in place drivers change. The point. T and to still to come on the show this monday, we speak to the ceo about its latest earnings. Exclusively. Eam this is bloomberg. Manus it looks like the equity markets are finally catching up with where the markets where last week. Excluding japan nearly down to percent. Being a 24 an increase in the numbers of coronavirus in the past five days. Italy has 140 cases. This is contagion. This is the equity market. While market, oil is down by 2. 44 . The oil market is checking itself and for a demand crash. 1 . Futures are down we are going to continue the conversation on the coronavirus. W . W . Uhiono manus a live shot of the like. You are seeing american equities taking a plunge. It is no longer a distance crisis. Coronavirus real contagion. The crisis is becoming more real. The risk to equities is becoming apparent to the dollar. You see the yield fall across the curve. You are seeing the dollar rise. It is best encapsulated by one or two of the commentators. Enefiting from risk aversion even though yields are falling come the dollar remains resplendent. First word headlines from around the world. South korea has raised its Infectious Disease alert to the highest level possible. Cases. 161 seven people have died. Central bank is do to hold an emergency meeting this afternoon. It will consider the economic impact. North of thein the country after a number of Coronavirus Infections rose to at least 140. The jump in new cases was linked to a hospital where a man who sought treatment is believed to have infected dozens of patients and medical staff. Bernie sanders has taken the lead in the democratic race. 46 of the votes. Joe biden was a distant second. He was just short of 20 . Pete buttigieg was third. Errors and inconsistencies. He received more than 200 reports of discrepancy. Lets check in on the markets around the world. Juliette saly is with me on the escalation of risk to the market. Juliette it has been an escalation. Back at levels that we have not seen since december. Announced a my in its cases. Some very strong volume today. Down by 1. 8 . Cket a lot of we in australia. Also because of the 129 rooms that reported result. Lets have a look at the other asset hit today. Down. 7 . Course, blowing through the commodities market with a big law and oil. Heading towards 1700. Significant Downside Risk for Raw Materials and u. S. Futures isket sold off on the nasdaq reflected caution after news that we have been further down with the global economy. Thank you very much. More breaking news coming through now. Ithave australia raising advisory. South korea and japan on the buyers. Madecomes as south korea the Infectious Disease alert the highest level after a 20 fold increase. What would call a travel lot down. This is about human from contagion. More on the outbreak. It dominated conversations that we were having at the g20. Use if and myself spoke to a variety of. About the regulation. Threat humanity. Assess. O early to it is one economy in the world that is well connected to the rest of the world trade and financial market. Coming be seeing will be in the near future. Much of the discussion has been about the need for government to step up their spending. In saudi arabia, you have spending. Help withu have to Additional Support . The monetary policy, we have rules to support. We use the tools that we have used in the past. Intervention in this case should come from the fiscal side. The stance of our situation is good enough. We have a good entity of spending, as it in the market and some stimulus impacting the private actor. Is impacting the option side as well. Yousef in the past, you made it. Lear we have not released many of the Companies Teaming up. What is holding up the process haveer what i said, we too many all company. If we have Bigger Companies in the market, any better way, that would be good, but what is going on insurance sector is not just supplyside of the companies but also the demand side. With regard to mergers, we already had one take a month ago and we had one announced just last week. We are hoping that we will see more mergers. Yousef a lot of investors were asked that austin. What are you seeing in the numbers . Greatmco ipo was a access. Did say it inctor a nice way. Monitoring the situation ahead of the ipo and after the ipo. There will be an impact on the sector. And. Main so round capital flow is coming as a result. Seeing, we have seen more and more inflows and still see it as. Yousef what about private sector credit . Is an important metric for the government. Year, we had a pickup on the market side. And a slightup pickup in the corporate side. Is thatan tell you would be a continuation of pickup as a result of the strong support of the housing strategy coming from the government and a pickup as it is the goal of the enhance. Sector to some credit, but it is probably not going to the private there, to the buying of support and bond of the government. Yousef let me followup. We saw double digit growth in mortgage lending. How sustainable is that . It is growing at a rapid clip. Thats have started to flag there was a demand in the housing get. Market is including the low and enforcement. Job strongal a support coming from housing to subsidize the Interest Rate for the individual, in order to own houses. Monitoring the situation and we know there is a collateral. A lot of the cases, valerie is also collateral. We apply what we call lending. Speaking to my cohost yousef there. The country confirmed a coronavirus case. Lost 2. 5 andndex change yesterday. Yesterday, it was easy to thist that the whole about right of the coronavirus in israel had on the stock market. We checked the stock market, we are highlighting the past month of trading in tel aviv. In january, we had the virus news starting to spread to the market. It was another day of sharp impact, as we heard from the israeli government. Around 200 israeli citizen quarantine after having contact with south korean toys. You had those on the cruise ship havingn, confirmed of the virus. A clear impact on trading yesterday. It was done by the most early way. Surprising for this negative reaction ticket to be more pronounced israeli market, which tends to track with local market, especially the otherore than regions. Manus so, where are we with the pressure in our market . News. Re is a lack of good byre is nothing coming out and on the opposite hand, you have this as the market more closed those flows the emergingmarket. We had air arabia now. News coming from have the region. With everything going on with the coronavirus, it is the one being penalized the most. Nameurse, we have a big here. Everyone has been bullish because of a series of reason. Been now, there has not enough to hold investors. The stock was down yesterday and ushering. It would not be surprising to see a continuation of this negative performing. Manus thank you very much. The latest on market in the region. Coming up, australias treasurer says that their country is resilient, even though the Virus Outbreak is taking a toll. Bloomberg. Manus the economy is proving resilient despite the effect coronavirus is having on china. Sideline inthe riyadh. You heard the reserve bank may it would affect the economy depends on howt long the travel restrictions are in place. Major sectors across the economy. There is some disruption to the supply chain the supply chain. We will continue to monitor the situation, but we know that they are resilient. Yousef some of the voices coming at the g20 saying they would be able to reflect on the dependent on on china. One of the countries at the top of the list. You agree is to begin with . Embraced the economic excess. Australia has been able to what to china and increasingly, our service as well we welcome the fact that china has become such an economic powerhouse. They are the number one source. In 2003, the chinese economy is fourtime figure. The impact of the coronavirus will be more significant. We recently have entered a freetrade agreement with. We supported and embraced and concluded the multilateral trend the Big Partnership and had freetrade. Yousef do you have a timeline mind reaching an fta with them . Be off the rank in terms of working through the details for a formal negotiation process. Ande minister Boris JohnsonScott Morrison have talked about the deal. We have concluded a for of round. No doubt, that will wait. The freetrade agreement will be in the interest of the european union. Yousef what is realistic in terms of the timeline . As soon as possible. Issues. E obviously they may need to be negotiated. Yousef it has come through with the results that they were hoping for. By 2. 5, unemployment up is it time for the government to start taking steps . It is the lowest on record. ,n terms of the Housing Market stabilized process has begun to confident, they are more confident across the economy. We have brought forward 4rastructures ending, over billion. It is done prior to christmas. We recently announced a bushfire recovery fund. There is a number of programs. Successfulo been reading the Unemployment Rate down. Smiley need to be prepared for all virus scenarios. That is next. Manus the coronaVirus Outbreak dominating conversations of the g20 meeting. Yousef spoke to the finance minister about the impact of the epidemic. There will be in impact. That is for sure. , there is a need for a day by day monitoring. That is what we have decided it is the g20 and right step in the right direction. Ensure that we can take all the required decision, if needed. Yousef the equity markets believe a vshaped recovery is the most likely scenario. Do you think they are getting ahead of them will . Any kind of scenario, i think there will be an impact on growth. Do not know what will be the next step. I cannot say anything about that. We have to be prepared. That is what we have knighted among g20 members. Andave to be prepared it at the level of the imf and g20. Take a do you expect to more prominent role if the domination is needed you are running out of. There is a necessity to better use the fiscal stance. We had a very accommodative fiscal policy and there is no more room for maneuvering. Either from the fed or the. It is time ecb. It is time to support growth. Isley the cave that actually the case that is esp ecially the case. With then be satisfied current level of growth. Yousef how much more progress tax you been aching on the front . Where are you at the moment with that . Was successful. We have made a major step forward. The consensus on the necessity of having the new international based on digital taxation and a memo taxation for corporate tax. The fact that there is a can consist among the members on the necessity of this new International Taxation system is clearly an improvement of the political situation. Now, it is time to move on and decide. On in one will be july to get a consensus on the key features of the digital taxation. Then, at the end of 2020, we new decide on the overall International Taxation system, based on digital taxation and minimal taxation. We cannot wait the more. Manus speaking with yousef over the weekend. That was at the g20. Asian markets, excluding japan, down nearly 2 . Australia is warning about travel to japan and south korea. Is what ket hi were glad you came in, whats on your mind . Can you help keep these guys protected online . Easy, connect to the xfi gateway. What about internet speeds that keep up with my gaming . Lets hook you up with the Fastest Internet from xfinity. What about wireless data options for the family . Of course, you can customize and save. Can you save me from this conversation . That we cant do, but come in and see what we can do. Were here to make life simple. Easy. Awesome. Ask. Shop. Discover. At your local xfinity store today. 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