Transcripts For BLOOMBERG Bloomberg 20240704

May be over. Money markets and economists split as the rba policy tightening cycle nears its final stages. Haidi china criticizes the biden administrations latest arms deal with taiwan as the latest military footprint in australia expands. Shery Standard Chartered doubles down on earnings buybacks after an earnings beat. We hear from ceo bill when terms. Futures in the Asian Session, the start of the trading day under trading week, not necessarily seeing any movement at this point. This is after u. S. Stocks rose friday. The s p 500 gained three consecutive weeks. We are talking a 19 gain this year already. It was helped friday by key gauges of inflation showing further easing. Americans grown more optimistic about the Economic Outlook and we have plenty of earnings this week. 160 nine S P Companies reporting. 11 trillion of my get cap included market cap including apple, amd. The 10 year yield finish and just below 4 on the friday session. Yields fell friday after jumping toward an eight month by an eightmonth high the previous day. Concerns around the boj. Low yields shifting in an urban global bond markets. Oil prices at the moment still above 80 per barrel after five straight weeks of gains. The longest run of weekly gains in more than one year. Tightening global supply, not to mentions expectations fed tightening may be over has helped that rally. Lets dive into the fed. A top official expects further rate hikes that will allow job losses and Slower Growth ahead. Our Global Economics and policy editor Kathleen Hays is here with the latest. We heard from the minneapolis fed president. What did he have to say . Kathleen youll kashkari is a hawk, one of the people getting out front aggressive on the need for more rate hikes with the likes of jim bullard from the st. Louis fed. Today on cbs face the nation, one of the leading sunday morning programs in the u. S. When it comes to news, because obviously, everyone in the u. S. And around the world is concerned about inflation. Is it coming down . It is interesting he is more upbeat on the outlook, he said. He does see progress made on inflation. After seeing all that in more ways than one, saying it is not realistic to think you can continue to bring down inflation without some kind of cost to the labor market, bring down inflation closer to its 2 target on friday. We got the personal Consumption Expenditure report. That includes what spending is doing and what consumers are doing. This terminal chart also shows you that inflation, these are what the markets are watching so closely now. What you can see happening here is that the core pce cut down to 4. 1 yearoveryear. That is great progress. The headline got down to about 3 . On a monthly average, this is important because yearoveryear, look at the latest few numbers. What is the trend now . Even lower, as you can see there. The problem, as youll kashkari said, it still above the 2 target. The fed will hike rates more if needed and that is what they are watching now. So, a beat. Is the fed closer to the end of rate hikes . We dont know. Neel kashkari did not say. But it is data by data. There will not be anymore until september and jay powell said last week the fed chair, after the fed met and raised by 25 basis points, two more jobs reports, two more big inflation reports before the september meeting. When it comes to jobs, we are in fact expecting the payrolls number on friday for the latest month up to hundred thousand for about the third month in a row, showing resilience in jobs in spite of the rate hikes. Unemployment staying near a 50 year low at 3. 6 . Will that be enough coolingoff to the labor market to reassure the fed it can stop hiking rates . At this point i would say probably not. Like jay powell says, that is what we will get over the next few weeks. Haidi the rba this week has one more hike left in its back pocket. The question is whether it will deploy it this week. Kathleen that is the big split. Freighters are more inclined now to say they will not hike rates now, they will pulse again. But look at economists. They are more in that they are going to do more camp. 11 economists out of the 26 we surveyed see a hold. Look at retail sales. They sell a lot. 0. 8 in the latest report. That has been something chugging along nicely up in positive territory the last month. And most of the previous months. But rate hikes are starting to take their toll. The fact that Mortgage Rates have gone up. That is Something Else that eats into their pocketbooks. In terms of what happens next and what you are going to bet on in this meeting, 4. 1 has been held steady for this will be the second meeting in a row they do that. But inflation, while it came down in the latest quarterly numbers to 6. 0 yearoveryear from 7. 0 yearoveryear. It is still well above the rba target. That is why so many are still betting that at least one more hike. Then you see what all of the numbers do after that. For now it will be an exciting meeting. Thats what it looks like. Shery Global Economics and policy editor Kathleen Hays. We are watching the developing world. Talking about rate hikes in developed markets. Already in emerging markets we are seeing this jumbo rate cut by chile friday. The expectation was not for such a big rate cut of 100 basis points. It was decided unanimously by the chilean board. We are expecting a rate cut given that latin america has been really aggressive and much faster than the developed world when it comes to the rate hikes. Chile is now sending a powerful message after we saw traders cutting inflation forecast near the 3 target in just 12 months. The government is now forecasting growth near zero. Starting with july, these economies hike fast and much more than the developed world, seeing the benefits already of their economy stabilizing. We have brazils Rate Decision this week as well. Haidi peru and mexico seeming to follow suit by the end of the year and columbia is not far behind as well. As you said, the jumbo move sending a strong message this is the point of readiness when it comes to a lot of these may specially latin american, emerging market economies and Central Banks. That this is the point in the cycle are you are starting to see a turn. It is a powerful sign that the region is now benefiting from very early and aggressive rate hikes cycles that began early in the pandemic as price pressures continued to wane. Of course, the contrast is, center banks in developed economies including the fed, there is a question as to how much further we will need to see the fed move, but certainly, when it comes to the ecb, its a really tough place for Christine Lagarde to be. In between at germany already on a recession, most economies already showing very severe levels of weakness when it comes to data. Of course, inflation still staying high. Shery the bank of england is also expected to hike rates thursday. Of course, we are watching geopolitics this week as well. The u. S. Will be supplying taiwan with 340 5 million in defense equipment, services, and trading 340 5 million in defense equipment, services, and training. In the past this has been criticized by beijing. Vonnie this is a step further because it is the first time the u. S. Is providing arms directly to taiwan. Previously the u. S. Approved the sale of weapons to taiwan. The mechanism is basically the same mechanism as allow for the passage of weapons to ukraine. So, a president ial drawdown of authority. Essentially, congress authorized the divide into use as much as 1 billion in u. S. Inventory come already existing weapons, for taiwan, for the night island Democracy National Defense Authorization act. This year alone, so far, as anticipated, we have had a response from china, from the u. S. Embassy spokesperson. I quote china is firmly opposed to the u. S. Military ties with arms sales to taiwan. The spokesperson urged the u. S. To stop creating new factors that could lead to tension in the taiwan strait. We will see if there is further action this week. So far, criticism and efforts to get the u. S. To stay in its own lane and mind its own business, something we have heard before. We are not sure what will be in the package. It could include antiarmor and air defense capabilities. The stated intention for a long time now for the u. S. Is to bolster taiwanese selfdefense capabilities. The u. S. Said its not expect in china to invade taiwan or anything like that eminently. Lloyd austin the defense secretary repeated that this week. It said it is very concerned about chinas military capabilities, how quickly it is building them up. It has warned that president xi jinping wants at least the capability to do that by 2027. Shery this comes after a. Of improved efforts at communication between washington and beijing. Vonnie it does seem a little odd the two trucks can coexist. But the u. S. Administration would say no, its completely normal that we would have one stance on taiwan and one stands on where we want to be with beijing. Just the other day Antony Blinken was in new zealand talking about managing the incredibly complex and consequential we all have with china. I mean, the u. S. , again, has not expect long expect of expressed a Firm Commitment to support taiwan selfdefense and it also wants better relations with china especially when it comes to trade. Sanctions on individuals, action on taiwan, they would say this has nothing to do with the timing of this particular aid package to taiwan and the type of relation it wants with china in other spheres. Interestingly, heidi, early august of last year nancy pelosi taiwan unannounced. Really just this is arriving on the anniversary of that visit. That created ruptures. We will have to watch next week to see if there is any more reaction from china. The United States expanding its military footprint in australia. Both countries will step up integration of japan into military planning as well. Military exercises known as the talisman sabre got underway in northern estoril you. Northern australia. Paul allen joins us with details. This has been called strategic convergence. How much is about china . How is the relationship getting closer here . Paul we had the u. S. Army secretary on the eve of the operations saying its a significant deterrent effect by china if it is considering taking taiwan by force. The relationship between the u. S. And australia gets closer and closer. Of course, we had the signing of the subs deal. It now over the weekend lloyd austin talking about more frequent and longer visits by american submarines to australian ports, a regular rotation of the u. S. Navy, collaborative guided missile production, the Australian Defense minister mr. Richard miles says the u. S. China relationship has never been in better shape and lloyd austin was there too. Lets listen to what he had to say. Secretary austen we are about interoperability, about working together, about promoting a common vision of a free and open indo pacific. So, we will continue to stand by our allies. I and and it does exercise helps us strengthen our unbreakable alliance. Paul this is the 10th anniversary of talisman sabre. It is held every two years. The start of a just u. S. Australia. There are 30,000 troops involved from different countries, japan, france, germany, and other smaller Pacific Island nations as well that china has been courting. Shery four australian aircraft crew were killed during those exercises in a helicopter crash. Paul it cashed cast a shadow. The search goes on for the wreckage of the helicopter. There were helicopters over the area over the weekend. Looking for them, 50 pieces of debris were found so far, but nobodies yes. This is the second incident this year involving those type of helicopters. You cannot see them there. That type has been grounded while an investigation are underway. The taipans were due to be retired in 20 when he four. Now there is a real question mark over the future this year. Haidi paul allen with the latest. Lets look how we are shaping up at the start of the new trading week in asia. Looks like a pretty positive open in sydney futures. We could see a bit of a pickup in sentiment on the back of what we saw in the u. S. In the previous session. Futures relative to fair value look like an early gain of may be. 5 particularly, the sentiment boost coming after u. S. Equities saw a rise friday of inflation data showing some easing spending also picking up as well. Of course, quite a bit of caution going into what is a really split rba decision. The policy tightening cycle clearly nearing the end. The question is whether the rba goes for one more hike this week. 15 seeing the move. 11 predicting a hold. Money markets are pricing in no change at the cash rate to stay at 4. 1 . Watching the aussie dollar closely, 6657 there. Also watching kiwi stocks down pretty much flat at the moment. Watching dollars en close to the 141 handle. The boj surprised move was friday. The loosening of its grip on the tenure. The jgb yield could really see some reaction when we get into the start of cash trading in tokyo, particularly when it comes to developers and rate sensitive names in the japan session. I had, speaking ahead, speaking to the director of research at epfr at a big few days for central policy. What it all means Going Forward for markets. This is bloomberg. Etf are with everything you have on your plate, earning your degree online seems. Impossible. But at grand canyon university, we specialize in helping you fit a masters degree in nursing into your busy day. Achieve your goals with a plan and team behind you. Balance online coursework and inperson local clinical, practicum or immersion hours, as you work towards graduation while leaving room for what matters. Find your purpose at grand canyon university. Visit gcu. Edu haidi another big week for Central Banks. This is what we are looking for in the days to come. Now sleep. Asia turns the policy calls in pakistan, austria, and thailand. The rbas case tuesday bolstered by the inflation rate slowing more than expected secondquarter. When it comes to thailand, the bank of thailand decision is coming wednesday. The governor signaled more rate hikes. We will your from the bank of brazil that same day. In england, investors betting on another rate hike when the boe meets thursday. Its a tossup as to whether it is 25 or 50 basis points. Other data tonight. Chinas manufacturing pmi is out later monday. We will get Inflation Numbers from south korea and the philippines later this week. Plus friday, u. S. Jobs numbers to pass through. Shery in earnings expecting results from some big tech names as well. Qualcomm set to report its Quarterly Results on wednesday. Apple and amazon on thursday. Lets discuss what we are seeing in the markets with our next guest Cameron Brandt director of research at epfr. Great to have you with us. We have seen three weeks of gains for the s p 500 already. 19 rally this year alone. Are we seeing too much optimism when it comes to the stock markets and what are the flows showing us right now . Cameron the flows are short generally certainly confirming a rather bullish perspective. It does seem like people are willing if not to fight the fed to sort of tested them a little bit. You know, the fed has been fairly clear that it does not see inflation as having been defeated. But, certainly, the flows we are seeing are acting as if that is indeed the case. We are starting to see money come into commodity and Energy Sector funds. After a fairly lengthy absence. U. S. Equity funds are doing pretty well in recent weeks. And, the emerging markets picture is pretty supportive too. People really believe that china will ramp up stimulus in the second half of this year. Obviously, indias economy is a feelgood story at the moment. And, latin america is also getting much higher level of inflows of funds dedicated to that area that we have seen for quite some time. Haidi yet usually Cameron August and september are not great months for u. S. Equities. Over the past 30 years it has been the worst two months. Given seasonal patterns are we seeing some positioning . Cameron i think so. But as i said, there is almost, i think, slightly excessive, optimism at the moment. At the moment that the pessimism of earlier in the year was overdone. That u. S. Stocks, even with recent gains, still offer an opening. And, you know, the current earnings season where expectations were pitched pretty low, not, i think too many peoples surprise. We are seeing more beads than falling short. That is also adding a little bit of a tailwind. Haidi last week was really a milestone one for Central Banks and how that played into market volatility. When you look at the supplies from surprise from the likes of the boj, isnt there a sense investors are wellpositioned for potentially more volatility and surprises . Cameron i think all positioning at the moment has to sort of take volatility and surprises into effect. Really, since covid came down on us in 2020, the standard description of the current investment environment is one of the least predictable. And, easy to forecast that many experts have seen in decades. So, yeah, i think more surprises are coming. But, people seem to have adjusted to them. And, indeed, seem to be able to put them behind them very quickly. Two examples of that. We are starting to see money come back into cryptocurrency funds despite the pretty highprofile crash and burns this year. We are also seeing some interest in funds dedicated to u. S. Regional banks which, you know, in just a few months ago, they were widely seen as the next domino to go. Haidi are we seeing much in the search for havens at the moment . Cameron no. Be honest. You know to be honest. You know, i will qualify that by saying that, while the sort of perspective on the u. S. And emerging markets is really very bullish at the moment, europe is not included in that. And, we seem pretty we have seen a pretty relentless outflows from European Equity funds and i am guessing some of the money coming into u. S. Funds does represent a modest safe haven movement. Shery Cameron Brandt, great have you with us, director of research at epfr. Get a roundup of all the stories you need to know to get your day going in todays edition of daybreak. Terminal subscribers go to a bigo dayb. Customize your settings only get the news on the industries and assets you care about. This is bloomberg. Haidi this is what we are watching when it comes to fx. With the rba decision investors and analysts look pretty split at the moment. We know the rba potentially has one more hike in its arsenal. Whether that is deployed this week or they keep it in the back pocket, given the inflation readings have been a little more favorable to recent data prints we have seen. The author your dollar is at 68 for 6656 at the moment. Not much changed on the kiwi. The yen is the one to watch. Volatility seem as far from over with a big surprise from the bank of japan tweaking policy friday. We saw whipsaw action in a wild hour of trading following the boj decision. We are still releasing the impact of the bayeux j bu j shift on policy reverberating through global fx markets. The bloomberg dollar index seen the little softness, down. 1 . Shery look how u. S. Futures are trading. We had seen the impact coming from the boj policy tweak as well when it came to the treasuries markets. We saw a little stabilization in the friday session. U. S. Futures now pointing to the upside. Really, continuing the rosy outlook we saw on the friday session as well. Of course, key gauges of inflation or easing. Americans are growing more optimistic about the outlook, really helping to boost the equity markets. Theres plenty more to come. This is bloomberg. Shery locale commodities have been trading in this early Asian Session with oil prices under pressure. This after we saw wti and brent led five weeks of gains already on a tighter global supplies, not to mention, amongst optimism the fed might meeting might be near its tightening cycle ending very soon. All of that is being felt across commodity markets. Look at wheat prices. It was really a volatile week. Prices spiked monday on concerns about russia attacking a key rain poured. At the same time, towards the weeks end, we saw high supplies offsetting concerns that we will see a shortage of greens grains coming from ukraine. At the same time, copper prices and broader base metals here, given expectation and optimism about more support coming in the chinese housing sector billy leading to the commodities gaining ground. Haidi lets get some more analysis. Daniel hyne a senior commodity strategist at anz joins us now. Lets start with oil. How much is this a supplyside story . Daniel totally it is something the market has been keeping its eye on for some time and they have seen it the last few weeks filtered through. The uncertainty on the Global Economic backdrop has not really provided anything for oil traders to really grab onto. Clearly, there are signs of lower exports from russia in particular. I think also, saudi arabia and the broader opec group. It is the sign we are now starting to enter that phase that we have all been anticipating that have but have not really seen yet. I think that will be the primary driver for oil prices shorter term. Haidi if you are looking at shale what are you looking out for are watching for in terms of guidance . Daniel i have looked at the u. S. Shale industry for a while. Obviously it has been a bit of a signal to win things are getting a little bit of easier and freer. They are still providing, or have been up to this point, a fairly cautious tone. I think i that uncertain economic backdrop will probably keep them from boosting supply too much. Though, they are seeing rising costs and the like shrink margins as well. They are more financially driven with their decisions now. That means lower margins probably. Relatively low output growth for the meantime. That adds to that story. Of supply tightness. Shery how are you seeing the dynamic between with the fed is doing, the stronger u. S. Dollar, and on the other type, the expectation of more stimulus to come from china being felt across the commodities space . Daniel look, i think it has gone a little bit unnoticed, but obviously, the strength in the u. S. Dollar has been a significant headwind for commodity markets, certainly oil in particular. I think that sits above the fundamental drivers for the moment. And if we do see the fed pause, i think that should provide some strong support. Certainly from the currency side. Also what it means economically. I do note the market seems to have slightly shifted its tone around. The growth goals over that exit far 612 months, took a much easier landing. I think that will provide a much better boost to sentiment where the issues around gasoline demand in particular in the u. S. Have been a factor in keeping that outlook for demand relatively weak. Shery what are you seeing in terms of demand specifically across asia . We are seeing chinas carbon price hit a record high and asian coil coal prices also running higher. Daniel i think the Energy Complex is in an interesting position at the moment. Certainly, when you look at more industrial fuels, coal and gas, we are seeing really Strong Demand come through primarily driven by the extreme weather we are seeing in the region. You know, china has been concerned about Energy Shortages for several years now. Certainly, the onset of the el nino, with the droughtlike conditions it is producing in some of its key hydropower generating provinces, that does provide a bit of an issue for them. So, they have been boosting coalfired power output quite strongly. Certainly, imports of lng have been relatively robust as well. So, that will be an issue for the broader markets, certainly, playing out in terms of higher carbon emissions, as you mentioned, the carbon price in china has rallied strongly off the back of that. I think it is a clear sign that the Energy Complex is under stress at the moment. Certainly demand is exceptionally strong. Shery when it comes to extreme weather you talked about drought. We are also seeing flooding in parts of chile and peru that produce a lot of the world cover. Where you expected see the biggest impact from el nino later this year . Daniel i mean outside of the agricultural markets, clearly, the heat will diminish yields across many crops. Certainly, in the industrial commodity complex i do think metals will most likely see the biggest impact. You know, south america has, over the past four el ninos, experienced quite sharp kids to supply. And if that comes, as the Global Economy is starting to improve poorly stabilized, then, that could have much bigger impact to that we are seeing have seen in the past. I am looking at what it means for chilean copper output in particular, which has not been performing greatly of late anyway. So any further hit to that, as the Energy Transition really boosts demand, that will certainly result in a much tighter market than i think people are expecting. Haidi the Energy Transition hit by the impact as well. Greece and canada seeing off the scale emissions as a result of wildfires. How does that play into water Market Dynamics . Specifically for australia . We are still on el nino watch, really. Daniel its interesting. In some cases it is quite positive. The solar powered generation in europe at the moment is at record highs. But, it is producing, add certain points, negative electricity prices. So, the incentive to then increase or invest in solar further down the track is diminished. But overall, it is pushing extreme pressure on, you know, those, that baseline power that for the moment is still coal and gas. I think for australia we obviously had some issues last winter, in 2022 shortages. With seeing some coalfired power plants being pulled off the market over the next 18 months as well. So, that good, add quite a critical time. I think that if we do not see renewable energy, in particular, stored power, through batteries, then, you know, there will be some shortages as well. Haidi daniel hyne a senior commodity strategist at anz. China is dealing with flooding telling local officials in beijing another Northern Areas to deal with flooding brought on by typhoon. The emergency level was raised to level two, the secondhighest. It covers beijing as well as other provinces. We also saw Flight Cancellations for a number of those cities. All of this is culminating in a story we have been watching with some degree of i think harder. Because we are, as the entire globe, except said for the hottest month on record. In sydney, in the middle of winter, we saw temperatures of 25 reads celsius, almost 80 degrees fahrenheit. The bureau of meteorology said in some parts of australia we are looking at temperatures eight Degrees Higher celsius then what you would normally see for this time of year, in july, in the middle of winter. At the same time we have been seeing unusually warm weather really across the globe, right . July is on track to be the hottest runs ever recorded. We heard from the United Nations saying this is the end of Global Warming and the start of global boiling. Shery its really scary. We are talking about the first 21 days of the months, the hottest three week timeframe on record, following the hottest ever june. That puts 2023 on course to be the warmest year. Remember, we have the warmest year on record back in 2016 when there was a strong el nino event. This is the first el nino weather pattern in almost four years. What does it mean . Yes, its hot. It is also about the Climate Crisis affecting bringing on a food crisis potentially. We are seeing protectionism rise again. India banning key rise exports among drought fears. We have seen flooding from new delhi to new york and violent storms with hailstones larger than tennis balls in northern italy. So really, that puts all this into perspective. When we are talking about the real, human cost that is warming of the earth will really need to. We will be discussing more on the Climate Crisis and what it means for markets as well with commodities prices now surging. We have more to come on daybreak australia. This is bloomberg. Wake up, achievers. Youre making the most of every hour of your life. Except the hours that youre sleeping. So why do we leave so much Untapped Potential on the table . This is a next level bed, for a next level you. My circadian rhythm is kicking your circadian rhythms butt its not a competition. I know, but im still winning so it is a competition. Save up to 500 on the new sleep number® smart bed. Plus, 60 month financing on most smart beds. Shop now only at sleep number®. Shery i joke of the top political stories. Tensions between gulf states and israel rising three years after the historic u. S. Negotiated saudi peace pact. Sources say the United Arab Emirates expressed frustration in highlevel contact with israel. Concerns are largely due to israels worsening relationships with the palestinians including the recent deadly raid on a refugee camp on they arrest bank city west bank city. West African Leaders ready to use force to restore democracy in niger. So far they have imposed economic and diplomatic sanctions on the country after a military junta rose to power last week in a coup. The group is giving them one week to reinstate the president that is being held captive. Italys defense minister says the government needs to get out of its investment pact with china while avoiding what he calls a disaster. The strongest on record signal yet that rome will resend resend the controversial order with beijing. The deal renews automatically this year unless italy abandons it. Haidi we are watching what is happening in the chinese economy as well as we continue to see pressure on growth. We are talking about china force issuing measures to bolster the economy focused on by industry such as home goods, food, paper, plastic, leather, batteries, last week they issued more measures to bolster growth and the plan was published friday by three agencies. Also friday the China Securities Regulatory Commission unveiling proposals to loosen limits on Market Makers of the beijing stock exchange. So, really, we are seeing this series of policies implemented by the chinese government. Or announced at least over the past few weeks to revive the economy given of course that it seems now they are five that their 5 growth target could be at risk. Haidi it feels like when it comes to how investors feel about this, we may see chinese equities and risk assets finally see an Inflection Point for the week. Four point 5 , the best performance since november. We saw tech shares in hong kong entering a bull market after a lot of stop start reactions from the markets on the back of these various announcements. This comes at a time where potentially the resilience of the Chinese Consumer is starting to waiver. Consumers in the country are cutting back on spending except for everything spending on everything except for travel and restaurants. Sales of travel, food, and drink increased. That trend is still defined as revenge spending according to the china beige book. The economy continues to lose steam as the consumer is clearly allelic more a lot more selective. We did not see export orders improving in the reading. Increased demand out of asia. Demand out of the u. S. Almost contracted. For europe a sharp contraction. Physical activities increased. That could be seen as a bullish signal to investors. I hope there is potentially more stimulus to come now. Shery despite chinas choppy economic recovery Standard Charter is upbeat about Growth Prospects for its asian business. The ceo bill winters told us he expects chinas troubled Property Market to bounce back soon. Bill the asian market is where markets where we operate are doing relatively well. We have heard about the slowness in china. Which, thats true. The recovery has been sporadic. But fundamentally, the region is opening up and Economic Growth is strong. That is the backdrop for all our colleagues. We have added thousands of people over the course of the past year. We are also aggressively digitizing our business. Of course that means people are coming and going all the time. Netnet this was a growth story. Haidi asian markets are usually important for you. You say its positive. Your cfo said chinas Property Market is not getting materially better. Since it then there has been a lot of public support for the private sector. Are you saying there is no further pain in chinese commercial real estate and you are seeing improvement . Bill we took pain second quarter. We took impairments against china real estate. We have taken a provision against risks that have not materialized yet and we fear might. We feel very well provided against further downside. But basically it feels like things have stabilized, albeit at a lower level. The public support, the Government Support is picking up. That is encouraging. But it has not really lifted the market yet. It will probably take another 612 months before we can say this market is back on track. Lizzy the Credit Suisse takeover by ubs. How much are you benefiting in Wealth Management . Bill we had really good inflows of net new money the first half of the year and some of it came from Credit Suisse and some is the organic growth we have experienced for years now. Wealth is rising across asia, middle east, and africa markets where we operate and i think we are picking up some market share. You have to see whether we are really picking up share but it feels like we are. The combination of some of the Credit Suisse money diversifying away from combined ed ubs, some combined chinese and other asian investors accumulating wealth wanting to invest it in high Quality International product. The general underlying Economic Trends are all boding well for that business. Haidi bill winters theyre speaking exclusively to bloombergs lizzy burden. Turn into bloombergs Bloomberg Radio to get indepth analysis from the Daybreak Team there broadcasting live from our studio in hong kong. Much more ahead. This is bloomberg. Grand canyon universitys rn to bsn Online Degree Program with local inperson clinical hours makes earning your bachelors in nursing possible from wherever you are find your purpose at grand canyon university. Visit gcu. Edu shery watching intel shares this week after they jumped friday. The chipmaking pioneer declared an end to the pc slump and gave a positive secondhalf outlook. The intel Ceo Pat Gelsinger said they were looking forward to a new era using pcs using ai technology. Pat on the pc side inventory levels are not healthy. Everything we have seen, a lot of the issues we work through, q4, q1, q2 were over inventory levels by the oems and the channel. Now everything is healthy. Our roadmap is very good. We have gained share multiple times in a row. I think we are now at five out of six quarters where we have gained market share. I say in the pc business, healthy. Our position is good and we are looking forward to the ai pc. With our launch of our next generation product meteor like later this year we believe it ushers in the ai pc generation. I have compared that to likes into reno and wifi. Two decades ago. A major new use case for why the pc is the best platform. So, we are quite excited about that. On the data center side, you know, we still saw the inventory levels still persist. China was weaker than expected. There recovery is going slower. And, we see this shift towards ai. You know, these big training with siege. Training missing machines. Those three things are leading to a bit of a longer recovery cycle on the data center. Like i said, we performed a bit better on the data center q1 and q2. So we feel like momentum and execution is rebuilding despite some headwinds that persist in that area. We are speaking to pat guessing your Pat Gelsinger the intel ceo. You forecast gross margin of 43 in the current. Periods. A long way from the 60 gross margin level. Wall street used to look at intel and say 60 and sure you are a leader in that space. Can you explain to our global audience the timeline and the path to getting back at the profit at that level . Patrick we are working our way back to margins. Obviously a nice speed q2 in margins. We forecast q3 and q4 a bit better. Pardon event is part of it is the cyclicality of the Semiconductor Industry is brutal on margins. When we had an oversupply situation, with inventory, that depresses margins. The factories cost the same whether they are full or empty. You end up with charges that burden the price points and depressed the margins. Haidi that was the intel Ceo Pat Gelsinger there speaking was with ed ludlow. An investments worth of 2. 2 billion over three years in portfolio of Generative Ai Services signing partnerships with google cloud and microsoft and Training Staff to integrate ai in their operations. The global ip id and consulting giant will provide Generative Services for started, customer experience, software engineering, and enterprise. Medical records of over 600,000 people in the u. S. Medicare program may have been exposed after a data breach. The information was on symptoms systems belonging to Maximus Federal Services using the File Transfer Service movers. Authorities are contacting the affected patients intending to offer free credit monitoring and services on how they can replace compromise parts. Lets look at the set up of this brandnew trading week coming off what was a milestone week for risk assets. Certainly investors are positioning for more volatility that could be said to come. Set to come. Global Central Banks shifting to more dated dependent giving way to greater volatility and less predictability. Sending futures of about. 3 , and early gain of perhaps. 5 when the start of cash trading begins in about one hour. The aussie Dollar Holding Steady at 6655. The dollar, the, the yen, the aussie all in focus as markets reopen this morning in sydney. The aussie in particular in focus this week as we get to the pretty contested rba decision. Shery 20 of the economies surveyed, 15 ca hike and 11 ca hold. A key event we are watching for bond markets. Right now the aussie and kiwi bond yields are reversing the jump we saw review session. In fact, following treasury yields are lower after the global bond set off we saw the bank of the bank of japan surprise decision to loosen its grip on the yield curve. We had treasury yields a stabilizing friday after jumping towards an eightmonth high. It is all about concerns around the boj. That shift in the last of global anger of global yields unnerving global markets. As you said, heidi, it will really be about the rba policy decision tuesday. Though, that case to stay on the path for australia has been bolstered by the inflation rate slowing more than expected. I did the next hour we speak to moodys analytics about why they think inflation in asia is past its peak. Also, gree joining us. This is bloomberg. I dont want you to move. Im gonna miss you so much. You realize well have internet waiting for us at the new place, right . Oh, we know. We just like making a scene. Transferring your services has never been easier. Get connected on the day of your move with the xfinity app. Can i sleep over at your new place . Can katie sleep over tonight . Sure, honey this generation is so dramatic move with the xfinity 10g network. Every business thats why comcast business de is launching theal. Mobile made free event. With our business internet, new and existing customers can get one year of unlimited mobile for free. Its our best internet. Powered by the next generation 10g network and with 99. 9 reliability. Plus one line of free mobile for an entire year. Its the mobile made free eventhappening now. Get started for just 39 a month. Plus, ask how to get one free line of unlimited mobile. Comcast business, powering possibilities. announcer enough with the calorie counting, carb cutting, diet fatigue, and stress. Just taking one golo release capsule with three balanced meals a day has been clinically proven to repair metabolism, optimize insulin levels, and balance the hormones that make weight loss easy. Release works with your body, not against it, so you can put dieting behind you and go live your life. Head to golo. Com now to join the over 2 Million People who have found the right way to lose weight and get healthier with golo. That eu. The Companies Need to obey regulations. Often the Companies Choose they will extend the european standards across their Global Contracts and Global Production because they want to avoid the cost of complying with multiple different regulatory regimes. There are benefits to standardization and uniform production. So all the eu needs to do is regulate the single market. Then, the business has Global Companies that transform the eu role. Shery welcome to daybreak asia counting down to asias major market open