I am Francine Lacqua in london. This is what markets are doing. These are the headlines from the International Energy agency. The oil markets are improving, they say, and we had hints of that from the biggest reducers in the world. Saudi arabia claimed they could put a price increase on asian markets. They say the oil market improving is continuing. We will have a look at wti futures to see what they indicate. The markets give us a good idea of what is to come. U. S. Futures are fluctuating. Investors are waiting for the jobless data. Treasuries gaining, the dollar is up as well. Lets get the bloomberg first word news from new york city. Spending more money to tackle the economic turmoil caused by the coronavirus pandemic will be rapid, that is the message of jerome powell. He calls on increasing stimulus, and he is backing down suggestions that the central bank should adopt negative rates. 130pandemic could push Million People into poverty in the next decade, according to the United Nations new study. The outbreak will cut 4. 5 trillion from the Global Economy. Lockdown restrictions lead to increases in job losses which could exacerbate income inequality. In the u. K. The government is getting a boost to plans to ease lockdown restrictions. Looksk. Health authority to identify people who previously had the virus, and they have a degree of immunity. Boris johnson previously described these Antibody Tests is a game changer. The coronavirus may have triggered a jump in cases of a rare blood disorder in children, according to an italian study. It is a disease that causes blood vessels to become inflamed and swollen. Children remain at low risk, but the risk is not zero. 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. This is bloomberg. Francine thank you. After months of lockdown, some countries hope to reopen and that the slow transition will get the economy up and running. The data shows signs of life, but a far ways off. Here is dani burger. The u. K. Joined other countries in relaxing lockdown measures. Have we started to see an activity pick up yet . Dani the progress is slow, but there are signs of life. This is most apparent in countries that have come off of lockdowns. You look at the mobility data for the u. K. And italy, some of the hardest hit countries, and people are not spending or moving as much. The act the Economic Activity is picking up, and issue is they are going to parks because they are fatigued of the lockdown. They are not doing anything that to spending adds and Economic Activity. That is why we have seen a pickup in cars. In the u. S. , europe and china, it will not make much of a difference in terms of getting the economy up and running. In the u. S. , when you look at staffing andnies, their headquarters is near at zero. Even though stock markets are pricing in normalcy, there is a long way to go. Some of these companies can function with employees at home, something small and medium businesses cannot afford to do. A goode power usage is way to track Economic Activity. What does that show . Dani in europe, it is a big market. We see signs of progress. In italy it was consistent falling power usage, but starting to climb up in the last month toward a normal level. It is equal to its normal amount at this time of year. , it has at germany started to come back, but it declines again. Fears of the second wave are hitting the economy. Then. K. Starts to lift up, stagnates. It emphasizes how many roadblocks there are for economies to get back up. Energy is a great proxy, and something traders trade on. If you are looking at this data for the macro picture, there are micro trades being made on this highfrequency data. Francine thank you so much, dani burger with things we need to look at to understand what economies are going through. Coming up, an interview with mark greco, professor of Infectious Disease dynamics, Imperial College london. That is next. This is bloomberg. Francine economics, finance, policy. This is bloomberg surveillance. Zurich insurance may have to pay out 750 million this year due to the coronavirus as it deals with rising claims in volatile markets. Joining me is mark greco, professor of Infectious Disease dynamics, Imperial College london. Thank you so much for getting bloomberg a little of your time. The allianz executive said the industry is hit. What are people talking about at the board level about the transformations the Insurance Industry will go through . Mark good morning. Mario good morning. This is what we do to protect damages throughout national events, and the pandemic is a possibility. We have been preparing for this for many years. When it happens, you are never fully prepared, but as it appears today, we cannot frank we complain. We are fully operational. From the beginning in january we shut down offices in asia and continue to work from home. We tested all of our applications. Europe, werted in confirmed we could perfectly work from home. Then we extended this to the u. S. Too. Financially speaking, we want to give an indication to the markets of what will be the impact in terms of claims. This is our estimate. It will change over time. Framework ofin the our capacity which is something that insurance managers, we are prepared to manage as soon as it comes. Think it willou lead to any strategic changes for the industry, either in the way you said you have dealt with natural catastrophes in the past will it accelerate consolidation . Will it change some of the way the industry operates . I think it will depend on how prepared you are when this happens. We were extremely strong at the end of last year. We concluded a threeyear cycle exceeding our targets. We were financially strong. Our capital was one of the highest levels we have had in moralet years, and engagement was high. Customer satisfaction was also high. We are taking this as not a change in the longterm view, but something we have to overcome in the short term. Andne who was less prepared in less of a healthy state at the beginning of this will have a further struggle. From that respect it can lead to changes, but it is the early stage today to understand. We want to wait to see what happens. We will be there when this is over, and we will be ready to go. He. To go full speed. Francine is there anything you have done on the investment side to mitigate some of the losses . Not really. It is about being prepared. Our investment portfolio is very prudent. Big bets, big risks. We balance out the exposures we have. , and we have no regrets yet. Seller situations before. I think we know how to behave in these situations, and you should not react with panic is panic makes worse consequences. Francine i understand you have seen it before, but the size of it and that it is so global is something that makes people worried. The youd of economy base your assumption on . Is it a big recession and a slower patchy recovery . I do not know if you look at a vshaped recovery, or have that filters to how you are managing your business. Mario yes, i know the debate pes, i am not going to get into this alphabetic discussion, but we respect that the u. S. And china will start in the second half of the year. It will probably be at the bottom of the crisis, and we think especially the economies will react faster, like in u. S. And china. They will start rebounding in the second half of the year. We expect a significant recession. We hope europe will take the contrast thes to recessionary crisis throughout european economies. Francine you have seen this before, especially with natural catastrophes, which are huge for in 2017. Ance industry what do you see as the main difference . The economic consequences is also manmade. Can you talk us through how this will play out differently from 2017 . Mario you are very right. By this crisis extension has not been seen for a number of years. No one has direct experience. The most important thing today is to manage the Health Crisis, and give confidence to people that their lives are not at risk. And this is something governments have to do, but also companies have to do. We have taken steps with our employees to start providing them with tests to understand who has been exposed and how, and we have been shutting down the offices very early on. The Health Crisis is the priority. The financial consequences of this can be fought by with actions to launch and support the economies. These actions will create that, and this debt these actions will create debt, and this debt will remain and should be the lasting issued over years. It is needed and helpful. I praise the governments who have taken immediate actions of some european governments have done, and definitely the u. S. And china have done themselves. Francine you switched 55,000 employees to work from home quickly in a short amount of time. Will it be difficult to get them back in offices, or will it be more Flexible Working hours . How do you think about getting back to work . Mario that is a very good question, because what we discovered with this crisis, we might not need to rush back to offices, because we are functioning very well from home. There is something you miss if you work from home, but our industry can continue working from home without too many losses of efficiency or opportunities. The thing you miss is human seeing otherd humans. Some of us fear that more than others. From the standpoint of serving the customers, and resolving their issues, providing them with what they need, we can continue doing that from home. We are not in a hurry to come back to the offices. Francine do you think it will change the workplace . General, do you think a percentage of your employees will stay at home for a long time . Mario yes, i think so. Not necessarily because they have to, but because we discovered this possibility, and it is an effective possibility. You can work well from home. Remain, ast will well as you do not need to travel so much which is helpful for the planet. There are good positive lessons out of this situation, and we are taking them as they should be taken, very seriously. Francine thank you so much for your time. Mario greco, chief executive officer of zurich insurance. At 3 30 we will get a little more on the Insurance Industry. This is bloomberg. You are going to see, this is going to be a bad order, then we will recover and we will have a sequence of better quarters. Our expectation is we will kill back to havingbe a great economy like we had before. The economic response is large, it may not be the final chapter given at the path ahead is highly uncertain and subject to downside risks. Economic forecasts are uncertain in the best of times, and the virus raises new questions. In many ways i call him my mip,. He has my mip. He has done a good job. I am disappointed in negative rates. The committees view on negative rates has not changed. This is not something we are looking at. Francine you heard there from Federal Reserve chair jay powell. Steve mnuchin sharing his views on the outlook. Lets get to the Bloomberg Business flash. Germanys merck sees the coronavirus holding back earnings this year. The Pharmaceutical Company says it took a heavier toll than expected. It sees the coronavirus peeking in the Second Quarter before things start to normalize in the third. The pandemic will have an impact through the year. A vaccine,ould get the u. S. Was first in line to fund research. A warning that europe risks falling behind unless it steps up efforts against the virus. Dividendsd to scrap as part of the merger deal. They bowed 1. 1 billion euros this year. The boards of both manufacturers say preparations for the merger is advancing well, the deal is expected to end before the First Quarter of 2021. Airlines have cut my percent of its workforce. The bbc was told that airlines have no other alternative and cannot predict when the market will rebound. Social distancing measures will not really work on airplanes. That is your Bloomberg Business flash. Francine this is what markets are telling us. We are seeing a bit of fluctuations in u. S. Futures, and fluctuations in the currencies. Oil. Looking at treasuries also gaining with the dollar. Data showsemployment that the pandemic is continuing its toll. Coming up, President Trump disagrees with his health officials. We will discuss the science with the professor of Infectious Disease dynamics, that is next. This is bloomberg. Isncine this is this bloomberg surveillance. Heres ritika gupta. Ritika the pandemic will erase four years of Global Growth and may push 130 Million People into poverty in the next decade. That is according to the United Nations. It also sees locked on restrictions leading to increased automation and job losses, which could further exacerbate income inequality. Goldman sachs is warning the u. S. Jobless rate could peek at ak at 25 . E Steven Mnuchin is saying the economy will bounce back. The government is getting a boost to its plan to ease lockdown restrictions. The u. K. Health authorities cleared an Antibody Test from roche that can identify people who previously had the virus and may now have a degree of immunity. Prime minister Boris Johnson previously described these tests as a game changer. Italy has doubled down on its stimulus efforts, posing a much delayed 55 billion euro package. It aims to boost liquidity and aid families hit by the lockdown. Forncludes extra Funding Companies and tax cuts. It was originally pushed back after disagreements in rome. Global news 24 hours a day, on air and at quicktake by bloomberg, powered by more than 2700 journalists and analysts in im hern 120 countries, take a good to. This is bloomberg. Francine . Francine thank you so much. Lets get the latest development on coronavirus. A u. S. Study says the pandemic will remove four years of growth from the u. S. Economy and push 100 30 Million People into extreme poverty. Fauci warned reopening too quickly could lead to flareups and coronavirus cases. In the u. K. , an Antibody Test from roche has been cleared by the health authority. Public health of england has deemed it highly reliable. Steven riley is the professor of Infectious Disease dynamics. Thank you for joining us. The million questions that people will have on whether it is safe to go back to work or send their kids back to school, how many people do we know how much of a percentage of the population do we think have had covid and are immune to it now . Steven i think averaged across countries, the whole of the u. K. , it is a small percentage. On the order of 3 to 6 across the large population. But with an awful lot of uncertainty. But what we know from the other data and emerging serological data, there are indications that it might be higher than that. Francine what does that actually mean . If we reopen and i dont know whether it makes a difference if we reopen in a month or in four months unless we find medication that really works or a vaccine, is it going to spread like it has in march, or will it be more contained . Steven if we look back to early march, where it certainly was it was not appreciated how severe an infection it was. It spread very quickly. The differentch countries doing it in different ways. Closelyto watch very for signs of when it is increasing as we slowly get back contact. Ocial the very different main thing is that we have to reverse any of that of those relaxations. There are signals if there are signals that it is picking up again. Francine a lot of people have said the u. K. Strategy has been unclear. Would you agree with that, or is the only way of really finding out the optimum time of reopening an economy is tracking infections, and that in real time, as people dont socially distance as much as they have in the past . U. K. , thethink in the , itage around a lockdown was very well communicated about mobility and other kinds of behavior, people in the u. K. Understand they need to stay at home and we did really well. Community very much reduced the level of transmission. I am not an expert in terms of the message of the stuff, but i am but a much more difficult task is to say that we cannot stay in forever, and therefore there has to be some kind of risk and we are trying to manage that as best as we possibly can. It is much more difficult of a message. Francine do you trust Antibody Testing, and actually, would that be a game changer if it is rolled out significantly . It is reliable and what it actually tells us. Is thatoved test, what what they are telling us is very reliable. What they are telling us is very reliable. Mean you are likely to have had the infection. But what it doesnt tell us is exactly what happens if you come into contact with an infected person in the future. Most scientists would believe that if you got a strong antibody response, you will have similar protection for april 2 of time. We dont know how long that period of time is that for a period of time. We dont know for a period of time. We dont know how long that period of time is. We dont know the likelihood of transmission or not. It tells us reliably that you have had the virus. Most people think that there will be some level of protection for a period of time, but we dont have good data on that and we definitely dont have good data on how long any protection lasts, and that is just where we are. We need time in studies to figure that out. Francine professor riley, if there is one thing you would like to figure out as soon as possible, what is it about the virus that we dont understand about the virus . A number of reports say this could lead to strokes or blood clots or immune diseases and certain children. How much do we understand about this virus . Folks at my research, the dynamics the clinical science around this is very difficult because we can have the best scientists in the , the best protocols in the world, but we only have so much time. Human only been in the population for a few months, so are going to learn what how this virus has infected has affected people who have had it. I think in that kind of area, i would most want to see the , the systematic sharing of detailed data in a way that protects officials, that doesnt risk any kind of sharing of information, which allows bigger and bigger it wille studies to be difficult to spot for anyone. I think that is where i am hoping we will get lots of large numbers. Francine professor riley, thank you so much. Steven riley, professor of Infectious Disease dynamics. Coming up, jay powell says the u. S. Faces unprecedented risks from the coronavirus if fiscal and Monetary Policy makers do not rise to the challenge. We will discuss the fed chairs reaction to the Global Economy next. This is bloomberg. We are talking about the u. S. Economy following on an annualized basis in the Second Quarter at 45 . It is much more looking like, from an economists up inside of a u or v shape. How long will it take for the level of the economy to get back to where it was before the virus . Inare talking about some not two years. That looks like a u to me. Francine that was david blum on what kind of recovery we can expect. Thats get to the Bloomberg Business flash. The virus sees it took a heavier toll than expected last quarter. Its ethan pandemic peeking in europe in the u. S. In the Second Quarter. Before things started normalizing the third. The company is not optimistic about a quick vaccine. We are not as optimistic regarding that we are quickly that wefind a vaccine will give to millions of people within the next couple of weeks or in the very close future. I think looking for antivirus, to look for antibodies, but a Vaccine Development can take longer time and should also be dosed in a way that highrisk groups of patients should come first. Do not think you make sense to apply this to millions and millions of people. French the pharmaceutical giant says the u. S. Will get it first because it was in first to fund research. That is your Bloomberg Business flash. Francine . Francine lets get the latest on the Global Economy. Fed chair jay powell says the u. S. Faces unprecedented risk from the coronavirus if fiscal and Monetary Policy makers dont rise to the challenge. Here is what he said. Rates view are negative has not changed. This is not something we are looking at. The evidence on the effectiveness of negative rates is an unsettled area. I would call it i know there are fans of the policy, but for now it is not something that we are considering. We think we have a good tool kit, and that is the one we will be using. England bank of governor Andrew Bailey says that it is pretty clear investors expect quantitative easing. Lets go to simon kennedy. We definitely had some pushback from jay powell on negative rates. Are we going to end up with negative rates in 2021 in the u. S. . Simon it is imprecise in terms of negative interest rates. Speculating at some point at the fed will have to drop below zero, but the fed and jay powell , for many months now have pushed back against that notion. There are worries that negative rates impact profitability, money markets, in theory, and in some. S. That there is space for them to be seen as illegal or will need the support of congress to do. If you remember, in the last recession, there was lots of criticism from u. S. Lawmakers about low rates there. Agitating,et may be donald trump may be calling them ift, but at least for now and never say never but for now the fed will not be taking its rates into negative otherory, and they have things they can start using before that. Francine we also heard from Andrew Bailey about keeping options open for more monetary action by the bank of england. The markets are definitely pricing and more action in june. What could that action look like . Noted hey certainly have not waived the markets off that idea. With the expectation of investors and economists, we will see more quantitative easing from the bank of england. They paused most recently. Open to more action in the coming months and the markets would be disappointed if that is not forthcoming. Francine how difficult is it to be a central banker right now . I know we keep talking about it, but is it because everyone is doing a lot and you are trying to work in concert with treasuries around the world . Is it easier now than in 2008, or more difficult . Layn what 2008 did was some to make sure that Central Banks would never have thought possible. This time around they know they are possible. During the banking crisis it was a bit slower, off the mark. Now there is a toolbox come if you would like. Banks,banks central there is negativity in japan and with the euro. There is a greater understanding. Also this time around, certainly the fed is being elusive in trying to help out with its actions, and it delved into markets that it did not previously want to touch. And there are downsides. Is the debate about moral hazard and pouring incentives into markets. The banks are focused on writing their economies. Jay powell yesterday talked about permanent scars that will the a risk if they do not get on top of this, the fed releasing 40 of households in america making 40,000 a year or less, they want that to go in the opposite direction as soon economies are reopened. There is definitely that message from Central Banks that they are ready to act come and do so aggressively. Much,ne thank you so simon kennedy, the executive editor for economics. We speak to the european transport commissioner about what it looks like. That is coming up next. This is bloomberg. We had experienced when the lockdown is starting to loom, that the lack of coordination andght a lot of congestion issues across borders. So now everyone is looking to say, ok, what are they putting in place, when are we going to open up . But the ultimate decision because everyone is asking when, it realizes the Member States because the ecological situation and Member States is so different. It is up to national authorities, under the guidance from the European Centers for Disease Control to decide when they are opening up and from what destinations are they going to open up. What i can do and we are doing is say ok, when you open up, these are the rules you should willn place so that people feel safe to travel by plane or train or buses or whatever, and of course it is a nobrainer, but it is good to have in place coherent and equivalent rules all over europe because we are a Single Market and they really want to have the same rules in place all over Member States. And many of your countries depends to a largest and on to a large extent on tourism, and depending on what country youre talking about, from greece, to italy, to spain and so on how much of the 2020 season can be salvaged in tourism . Is,a well, you know how it we are so different in europe actually. There are country like italy where from an epidemic logical situation they are not so bad. There are others, again, political destinations, where the situation is not quite stable yet. So there is a difference between judging thes, and speed they would like to open up. But i think we are going to witness an opening this summer because i have noticed i have witnessed already there is a reopening in a destination, for example, with airlines, and i think with our recommendations put forward today, in what kind of at least to being observed for hotels, for transport modes. Some will be more encouraged to open up for tourism purposes. Vonnie commissioner, how concerned are you and your colleagues about a resurgence of coronavirus if you allow with s to continue adina it is hard to say. There are worries overall with the situation, and the fact that we do not have a vaccine or a treatment puts a lot of burden on the decisions to be taken. On the other hand, we are observing what is going on, how things are evolving, and until, again, we have a vaccine or a treatment, a think we have to learn to live with the virus. We have to learn to travel with the virus. Purposes weother have learned to observe more security features. ,f you think it is yourself travel by plane, how that looks nowadays and how it looked 20 years ago, it is much more different. But i think with some rules in place to limit and minimize the risks, people will learn how to protect themselves and continue to do their Economic Activities or the travel, leisure activities, and i think it is a learning i would say that first we will learn to live with it, and then at some point we can think of weng to more freedom and how relate ourselves to this issue. Francine that was the european transport commissioner, adina lean. Y and adina va this is what your markets are doing. The last couple of minutes, stoxx 600 is extending losses down almost 2 . Bloomberg surveillance continues in the next hour. Tom keene joins me out of new york. This is bloomberg. Francine most improved President Trump softens his criticism of jay powell, but says the two still disagree when it comes to negative rates. A easy does it. The bank of england sets to boost its program. Is or bailey says it italys government signs off on a 55 billion euro stimulus package as Angela Merkel bows to defend. Good morning, everyone. This is bloomberg surveillance. Tom, a bit of pressure on the markets. They are looking to find out more about the situation in the u. S. The numbers have been horrific, and they are bracing for another difficult set of numbers. Andrew bailey from the bank of in june. Ay more action tom there are two major