Transcripts For BLOOMBERG Bloomberg 20240704

Interest rate at 5. 5 . Of course, dave, it is widely expected all 20 economists we surveyed expected as much. But the question is really whether or not governor adrian orr will sound hawkish, given that inflation is still far from where he wants it to be, which is one, two, 3 right now. We had headline inflation in the Second Quarter at about 6 . So rbnz staying pat for a second time in a row at 5. 5 . Remember, this is the central bank that has done 525 basis point hike. It has been pretty aggressive ahead of the curve, way ahead of the fed. And now it is keeping its rate standing pat at 5. 5 for a second time in a row. Dave. Yep. Yeah. So were looking at, to your point there where there is some commentary on inflation and how restrictive rates are and theyre saying already restrictive and that should be enough to return inflation to target. Were just going through some of the phrasing here on the statement because that i guess in some ways, short of hearing from the governor himself, which rule, by the way, here from is perhaps the best indication of tone right now. A couple of more lines coming through. The activity slowing is more in rate sensitive sectors. Suffice to say it does look like its working in terms of the currency markets right now. Theres a bid coming through ever so slightly on the kiwi dollar. Some forecasts are now showing a small chance of another rate hike. So it doesnt look like theyre done. On that note, Kathleen Hayes has been tracking all the headlines for us. Kathleen, does anything stand out to you so far. Okay, kathleen, cant hear us okay. No. Okay. Were going to work on her mic right now and some audio issues right now. Pretty interesting, right . You take a look at what were hearing from the rbnz forecasting a small chance of another rate hike. We heard from the rbnz before adrian orr coming out to say that, you know what, were at the end of the tightening cycle, but it does look that inflation remains sticky and there is still more work to be done. Lets get back to Kathleen Hayes for more perspective about kathleen, your take on lets see if shes good on the rbnzs move. Im sorry. All right. Okay. I think were still having a little bit of issues there. I guarantee you, of course, by the way, for all our viewers who mostly perhaps watches with or with the audio down, you dont see a difference anyway, here we go. Let me break a couple of more lines coming through out of the rbnz right now. So i think this is whats key here, right . So we knew that they were going to hold rates for a second straight meeting there was almost no doubt there because all economists thought that you look at swaps, markets, what have you. Any indications right now . Now whats whats moving the market, i would imagine here is this is is some of the forecasts coming through on on on a very small chance so far that another hike has might be on the cards here. The kiwi dollar is catching a decent bid. We should also note, of course the context has been a really strong us dollar story thats basically pushed just about every single currency in the asia pacific, including the kiwi dollar, with the exception of the indonesian rupiah to year to date lows. Anyway, well know more about that revolves, if any, that reversal in the kiwi dollar is pretty interesting. Its been down for seven straight days. In fact its been down for four weeks. So that reversal, perhaps that could be a a pivot, a turning point for the kiwi dollar now that were hearing from the rbnz sounding pretty hawkish this time around, saying that there is a slight possibility of another hike. Lets take three, get it back to Kathleen Hayes this time around. Hopefully it will. Kathleen, your take on it . Fingers crossed. Here we go. Its those gremlins. They do it to me all the time. But no, seriously. Yes, this is what was expected. That they, quote unquote, wouldnt do anything. But the more its always been about the messaging at this meeting. Right. Because how hawkish would they tell . I would say this is reasonably hawkish. The fact that he they repeat what theyve said. Measures of core inflation remain too high. Echoing Neel Kashkari in the United States and when you say the measures are still too high, that means you they have to come down. So if they dont come down enough on their own, you central bank are going to have to do something. And you both did notice that theres a small chance, according to their own forecasts of another small hike. I think its also interesting that that they do see recession starting. Was it Third Quarter of next year . Im looking at all these headlines now, but they are. And again, the important that theyre focusing on the core inflation rate, we have a tendency always to look at the headline, right . The headline is at 6 . But the core inflation, thats the one that can be sticky. So again, yes, i think maybe adrian augie was a little bit of a surprise, just the extent to which hes not sounding very confident yet about inflation. Hes not promising. Hes not signaling theyre going to hike rates. Theyre going to be data dependent. Im sure thats what hell say. And when you when we talk about the slowdown, you guys were mentioning that, too. You know, the in the land of adjustable rate mortgages, when Central Banks start hiking rates a lot, youre going to get hurt. Youre certainly going to have your pocketbook hurt. And as someone was saying earlier, a lot of the jesuit mortgages in new zealand are 2 to 3 years, right . So in this in this period of time, the ones who havent had it adjusted up yet are going to get it adjusted up more. Thats going to put more pressure on the consumer. So again, this is going to make the presser all the more interesting, isnt it . Well, thats right. All eyes on the man of the hour, adrian orr. Bloombergs Global Economics and policy editor kathleen hays. Thank you so much for that. And of course, you can also turn to your bloomberg for more coverage on the rbnz decision. Go to t live, go to get commentary and analysis from bloombergs expert additives. And speaking of adrian orr, dont miss a conversation with the governor himself. Breaking down the latest decision. Thats coming up thursday at the times listed on your screen, of course, dave, this is the man whos been pretty aggressive and hes not afraid to raise again, it seems. And the question there, the play on words is hike or hold right. Okay. Moving into right now the markets, its a risk off tone and perhaps this kiwi Dollar Strengthening right now might take the sting off the strong dollar somewhat session lows in the asia pacific. Jakarta is coming online. Were down about 2 10 of 1 as far as thats concerned. And speaking of indonesia, thats the only currency, by the way, thats holding up so far year to date. Eight shares about 40 minutes into the session, 1. 2 to the downside here. Were seeing a little bit of a reprieve as far as this melt up in yields are concerned. So some dip buying, lets call it that, inflation is coming through out of the uk later today. And takes us into the the other big earnings story, which is ten cent where we are on technicals. If you look at these things, of course, 200 day moving average, weve broken below that. We closed below that here. Next in line is that low that we hit back in early june on. And then below that. I would imagine the march low would bring us very much in focus there. So were about 1. 2 right now on the regional benchmark. Its not just this left side global macro movers, equity markets, currency markets are your middle Commodity Markets are also feeling somewhat out of the pain right now, like zinc, for example. Its not about for 1. 4 , but the story is really the pain across equity markets. So far right now, 8 10 of 1 . In new zealand, the mining shares are really taking a hit in australia and were headed into the lunch break in tokyo just 20 minutes away and were down over 1. 2 . As far as that is concerned. Theres a great story, by the way, in tokyo as far as earnings are concerned, so we can talk about that a bit later on in the show. Okay. The other big story and this is her scoop and the breaking news we talked about has linda broke the headlines for you earlier on. So Zhongrong International has missed payments here on dozens of products and has no immediate plans to make clients whole. Lets bring in john liu, our Greater China Senior Executive editor right now. John, i guess before we get into the nuts and bolts of this, maybe give us a background of what this company is for our viewers so, john, john rong is a a very, very large chinese trust company. What they do is they they sell products. They pool together wealth from High Net Worth individuals here in china. And then they use that money to invest. A lot of that money has gone into real estate in the last week. On friday last week, we had three of their corporate clients say in Exchange Filings that products they had invested in were overdue payments that they were expecting were not made. That has resulted in a lot of concern about about the state of this company and whether they will be able to pay the debt that they have outstanding. They have about ¥1 trillion of products outstanding and ¥1 trillion of money. Theyre managing at the moment. John. It does seem like the troubles are deeper than most expected. You got to wonder, will there be others in the same situation. Well, so what we what weve understood now is that as many as 30 products issued sold by zong have are overdue or in some sort of payment conundrum. And the company has no plans as of now to make clients whole. Theyre saying that there is a liquidity problem. They have some long term assets. They cannot offload now to get money to pay off these debts. And so theyre asking people to be patient. And this is an issue that weve seen in the trust industry. There have been tens of billions of dollars of products that have defaulted already. Its likely that there will be more because there was so much lending by trusts in china to property. And with the real estate situation as it is, there is a great chance that there will be more of this in the future. Thats right. Contagion fears a Greater China Senior Executive editor john liu joining us from beijing. Thank you so much for that. Now, still ahead, we discuss Credit Rating risks for china and the rest of asia with Fitch Ratings managing director James Mccormick will be joining us later this hour. Keep it here with us. Plenty more ahead. This is bloomberg. Seven, 86 of 23 and me Health Customers surveyed reported taking healthier actions because they know health isnt just a future state Health Happens now start your powered Health Journey today with personalized insights from 23 and me. You automate sales tax with avalara. You dont have to worry about things like changing tax rates or filing returns. Avalara. I. I. I had a client once who was a respiratory care nurse during the covid 19 pandemic. Betterhelp quite literally provided her what she needed at the most pivotal time in her life. When the world of business is constantly changing, you need to stay ahead. So what about i . To generate new possibilities. Machine learning to predict what customers will like. 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Weve made some progress. Some good progress. I feel good about that. Its still too high. The good news is the labor market has remained very strong, but its a little bit of a double edged sword because the question in my mind is have we done enough to actually get inflation all the way back down to our 2 mark, or do we have to do more. Neel kashkari there, hes not ready there in terms of bringing rates down. The current state of us inflation markets, though, have looked right or wrong, have looked through this already. In fact, interestingly enough, this latest bofa survey and one of the key takeaways, at least for me, was a sentiment is the least bearish since before right before the fed kicked off this very aggressive tightening cycle. Theyve gone slightly less in cash. Theyve gone overweight in tech, least underweight, and comes to stocks. For example. So it has been quite bullish as far as thats concerned there. It then takes us into where we are in the china story, which at the start of the year was okay, weve ratcheted up expectations on growth forecasts and guess where we are yet again with the latest ones coming through following the weak july numbers. Barclays, jp morgan and mizuho have now taken down those growth forecasts. As and as you can see, some of these are actually below the official guidance and target out of beijing has. And then you add all the worries about the property sector and we have chinas zhang rong missing dozens of payments as that fallout spreads. I mean, the picture isnt pretty and its just getting worse. Lets get insights perspective on how you want to play china or not for that matter. Lets bring in peter chia, head of macro strategy at academy securities. Peter, good to have you with us. Whats your take on it . I mean, just when you thought perhaps china is back to being investable, well, its not looking pretty. Yeah, we havent liked china all year. We thought the reopening. Trade was overhyped. We thought people. Would be disappointed with the chinese consumer. We saw that. But this definitely adds a new twist, right . The Real Estate Market has not been healthy but dont like it seeing anything creep into the shadow banking system. Now its the shadow banking system, not the actual banking system. But i think the fed learned one lesson from the great financial crisis is you have to respond quickly and aggressively to any hints of problems that can creep into the banking system, which is one reason when you look what happened in the states earlier this year with the regional banks, how quick the fed was to address it. Yes, Silicon Valley bank went under, but away from that, they were able to put a stop gap on that and move forward quickly. So this is a shadow bank. So the bank of china doesnt necessarily have to do something, but its going to create a lot of tension and pressure on the markets. Believe theres a lot of talk about contagion fears. And you know what . It could get worse from here. What do you do with china . Get all your money out, you know, and my view of china has been that they are going to take steps to maybe try and sell some of their brands. Weve been calling it a shift from made in china to made by china. And think theyre going to pursue strategy stages that help their Companies Sell their products globally, largely to the autocratic, resource rich nations that are shipping a lot of commodities to china and that will be kind of the quid pro quo. We buy your commodities, you buy our goods, but i havent i have a lack of faith that even if the Chinese Companies do well, Foreign Investors will do well. That, to me is kind of my fundamental problem. I come from a distressed debt background, and the one thing you always look for is distressed debt investor was the legal system. How sound is the legal system . How pure is the legal system . And im just worried that china will do things over time to hurt Foreign Investors if they see fit. Peter, david here, since you mentioned distress, i need to ask i was going to ask you something else, but i then need to ask you about some of the pricing right now in the off shore bond market here. Here in hong kong, you know, some of these Property Developers are trading at nine, eight, 0. 09 on the dollar, i think. Do you think thats a proper reflection of the risk out there . Do you think its still a functioning market is what im trying to get to to. Yeah, i suspect it probably is at that sort of level, right . Youre looking at the problems. Youre looking at these payments. And the one problem i think its always hard when you look at financial companies, but the recovery value tends to be very low, at least the postbankruptcy recovery value. So if theyre going to bankrupt themselves, you tend to get this flushing effect right . All these assets are underwater. There are forced seller. It often triggers some other similar sort of entity to file. So youve got their assets under pressure. No buyers, multiple sellers. So because of the leverage, recovery tends to be very low. Now over time, they can do well. You know, the lehman ultimately recovered 100 cents on the dollar plus accrued interest. I believe. So it can work out. But i think as a near term, yeah, its fraught with risk and id be loathe to touch it right now. Okay. That takes us into what an em strategy looks like. And i dont know, indirectly. Are you telling us you need to form an em strategy . Thats not exchina or chinas a separate strategy . Yeah, i would treat china as separate right now. I look at em, im much more comfortable. I think, with latin america, Southeast Asia. I think theres a little bit of risk there of how china decides to engage with Southeast Asia. So im kind of very negative on china. I treat Southeast Asia a little bit differently. Im much more comfortable in the middle east, north africa or africa and south america. I think thats where youre going to see real potential growth over time. Okay, peter, we had President Biden calling china a ticking bomb. Yellen says the slowdown in china will impact the us economy. Given the kind of macro environment, i mean, how should your portfolio look like . Where do you seek shelter . Where do you find returns . Yeah. So very briefly, academy has 17 retired generals and admirals that serve as our geopolitical intelligence group, and weve been fairly negative on our relationship with china going back four years. Its a bit unfortunate every time wall street kind of catches up with us, weve actually moved further and were still there. Were there with this friction with china. So i think what you want to do is look for countries that can benefit from china trying to sell into them, be a little bit more aggressive in their trade. So think parts of emerging markets will do. I think when you analyze japan, i think japan becomes interesting as people try and figure out where they want to do production. If they dont want to do it necessarily in thailand or vietnam or cambodia, japans could be a beneficiary. The japanese stock markets been doing very, very well. So i like that area and think you want to pick your portfolio of companies that is not at risk from, you know, doesnt need china for production and isnt at risk of being competed against by china. You say youre bullish rates still, but youre reassessing your longer term views. How so . Yeah. Guess im mildly bullish. Rates wouldnt you know, go crazy. Think the ten year should be kind of more towards 4 but i can see reasons for it to get to 425 440 thats the us ten year but you know there is so much negativity out there. People are coming across and questioning, okay, where is the us . You know, the fitch downgrade certainly makes people talk about where is the us headed, what dont like is, unlike past times, it feels like the us when good times are there. Were running a deficit. When bad times we run a really big deficit. So youre not seeing any discipline. I think thats a problem three, five, maybe even eight years down the road. But markets are starting to think about that. And it might be enough if everyones too complacent, like i might be that that could push us to 5 . Thats not my case right now, but im rethinking my kind of, you know, neutral, mildly bullish case on treasury yields. Yeah, peter, i guess we can blame just human nature and our proclivity for just to gravitate towards the negatives here. You know, look at that asteroid. Its coming. It could come today or or the next 100 million years. The reason i bring that up, interesting call from you here. Talk to us about commercial real estate in the us, because thats one area not a lot of people want to touch at this point. So we turned bullish on it. You know, sometime well after the Silicon Valley bank and partly was everyones just become so bearish on it. And theres almost a Cottage Industry around talking about how awful commercial real estate is. And i would agree, in some pockets its going to be very difficult. I think areas like San Francisco that had a lot of turnover at you know, peak valuations might have some problems. But i think as a whole, the country is doing well. The economy is doing well. And i think one trend weve started to see and i think its going to get more aggressive is people pushing away from work, from home to work to, you know, from office. I think ceos have want to do this for a while and theyre going to take every step they can. And all of a sudden, im hearing when i talk to whether its leaders at corporations, people are trying to figure out how do we get people in maybe three days a week, maybe its four days a week. So i think that could be the surprise, is one, how long it takes for things like commercial real estate online. Yeah. Speaking of figuring out, were trying to figure out why chinas been selling treasuries worth about 22 trillion at this point in time. I mean billion. By the way, whats your take on it . Why has china been selling treasuries . As you know, i think china and the us are separating. I think china has no real interest in working with us. And i think weve kind of lost our interest in working with them, certainly on anything thats high tech really important. Thats a national security. So it makes sense when china sell those treasuries. So they saw us weaponize russias dollar reserves, right . Theyve been whispering in the saudis, hey, why do you have all your holdings in dollars . Look what the us did to this to russia. So i think it makes sense. Over time theyre going to do it. It should put some pressure on the dollar, which may be china wants since theyre pegged to it. So i think thats a long term strategy. Theres this ongoing decoupling and china probably needs the money because theyre probably going to have to support some of these shadow banks or at least really get in front of it to support the Banking Industry. Yeah, there we go. Peter, thank you so much. Peter chair there live for us out of san diego there. Its actually not too late. As he points out, head of macro strategy at academy securities, just the context there on has this question right now. Holdings really of treasuries and china. Back to 2009. We have fitch by the way coming on to talk us through their take that the global head of Sovereign Ratings so someone you probably want to listen to right now, intel. This is the other story that were tracking right now. The headline is that intel is said to see this tower deal failing to win chinese approval. And the company is expected to call off the transaction as time runs out. It would have actually put intel in closer competition with tsmc. One stock to watch, of course, as we approach the us open on wednesday. Speaking of plenty more ahead, this is bloomberg. Dont let it clog gutter rain on your parade. Protect your home with leaf guard. The only one piece seamless gutter system guaranteed to never clog no matter the weather. Never clean your gutters again with leaf guard leaf guards. Patented seamless design keeps leaves, pests and sediment out while directing water away from your home, preventing wood rot and foundation decay, giving you peace of mind that your home and family are protected from water damage. With the industrys premier Maintenance Free gutter system, leaf guard is the smartest solution in gutter protection. 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To adapt, youll need Trading Technology that automates and scales us while our market leading data reduced fragmentation between teams. Well partner with you to define and deliver exactly what you need, helping you face change in ways no one else can. This is bigger thinking. This is bloomberg for the sell side. Learn more at bloomberg. Com slash sellside. Yeah, cyclicals are feeling the pinch. Oh, it doesnt hurt so good, does it . So were down across some of these Energy Counters here. Oil, by the way, guess is an undercurrent has been up seven weeks. Ditto to some extent and that correlation to Energy Counters so thats pulling back today. Do we get a week eight on Oil Prices Moving up . Thats thats still out. Were seeing some pressure right now here and also across some of the other cyclicals like mining, which really, if you look at across the asian equity spectrum today, this is really your pain point, which is why australia is really doing quite badly ahead of not related that match, of course, ahead of england against england later today for a spot in the world cup finals. Right now, materials index, as you can see, down about 20 . Okay, were headed into the tokyo lunch break. Well recap what that market looked like on the other side of this break. Theres plenty more ahead. Lots of good conversations coming up. This is wow, you get to watch all your favorite stuff. Its to die for. And its all right here. Streaming was never this easy, you know. This is the way. You really went all out didnt you . Um, its called commitment. Could you turn down the volume . Here, you can try. Get way more into what your into when you stream on the xfinity 10g network. 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In fact, just about across the board, seeing some weakness across risk assets. You know, i kind of blame your real yields in the us hitting, what, 40 year highs and the ten year you had paper at 5 and the dollar just rampaging through this right. You have term premiums back to the lowest in the 1960s. So this markets out of whack in many, many cases. But i mean, well see. This is this these are the what were seeing right now has are the symptoms of the underlying economics at work here and really just incentive. So just leaving money in the dollar right now after that massive correction out of the dollar in the last four weeks or so. But anyway, i guess the china part of the conversation and the weakness there isnt really helping the m the case, does it pass . No, especially the fact that china is biggest trading partner for a lot of the emerging markets, especially here in asia. So whatever happens in china does impact the rest of asia. Now, dave, as you said, its been a busy day of developments coming out of china as the country seeks to boost its economic recovery. Lets get insights perspective, bring in managing editor for asia stocks lianting to lianting mean, gosh, the pboc tried, but it doesnt seem to be lifting sentiment. Yeah, actually not helping at all. The yuan is still very weak. Weve heard that state banks are actually asked to buy more by the yuan by selling the dollar to defend the yuan. And if you look at the stock market, just you guys just showed, its just a sea of red. I think people basically feel that the fundamentals of the economy is just too weak and the puny cut of 15 basis point in the yesterday was not enough. Some brokers are asking for more than 100 basis point cut to actually have an impact and plus people are actually have more and more stimulation or speculation. I should say that the government is going to have new quota for special bond sales. So far, what we have heard is the Central Government wants local governments to use up their quota for special bonds. But i think people are expecting actually a big number for the new quota to come. And also theres rising risks. We heard about Country Garden, you heard about zhong rong. Now you got wonder where the next Pressure Point will be. Yeah, so people are not really talking about banks enough feel because as you know, banks are directly linked to the slower credit growth and it has exposure to Country Garden or the developers and also it has links to the trust industry, three shadow Banking Industry as well. So according to jp morgan estimates, chinese banks actually have about 30 of their total assets linked to the real estate sector. And ubs is impacting the bad loan ratio in that sector to actually hit 14 this year versus 4. 3 last year. So overall, the result is were going to see a bit of a re rating in bank valuations. Bank shares actually have been holding up okay. But think worst is to come. Okay. You know what . You really have to wonder. Thank you so much what it will take for them to be revived right. Yeah. Yeah. Basically, as i said, i think people are expecting really big bank measures to come out. Okay, well, weve been waiting for big bang measures. I guess in aggregate, though, you get the drip feed. You know, you put everything together, you almost approximate a big, big bang, right. Lansing, thank you so much. Lansing to you there in in singapore for us joining us here on set to talk about just the risk profile really not just of china, just where we are here with higher yields, higher rates, maybe a softer Economic Outlook ahead. Its not all bad, though. Lets bring in james mccormack, managing director, global head of sovereigns at Fitch Ratings. Theres an elephant in the room we need to talk about in a moment. There. I need to start with china. Ill get straight to it. Is that Credit Rating at risk . A stable . Its been there since 2007, so its one of our longest standing ratings. It has not moved. I think the the factors that would move it are, you know, if there is some kind of increase not in Government Debt, which is around 60 , the way we measure it. But if some of these contingent liabilities in other sectors, the nonfinancial corporate sector and the banks themselves become real liabilities for the government. So if it really does extend its Balance Sheet to to support the economy, and i wouldnt say were expecting that certainly recent evidence doesnt suggest that that will be the case. Then we might think again, because the debt to gdp ratio is a little bit on the high side for for singlea credit. But were not really anticipating that kind of policy response from the authorities. Right. And just to clarify to 60 ratio that you look at, what what would that entail . Because if you add sort of the other complication that gets you up a couple of hundred. Yeah. Well, exactly. Economy wide debt is very high. We consider the 60 number to be reasonable. Well, estimate for what we call the general government. So the Central Government plus lower levels of government, you know, kind of narrowly defined in china. Thats always a little tricky. Where do you draw the line between the public and the private sector . Yeah, so you do see higher numbers, but we work with the 60 number, the bigger numbers, the much bigger numbers are economy wide debt. Okay. And how are you now approaching doesnt seem to be still, you know, like the the some of the shadow findings for example, local Government Finance vehicles, corporate debt debt with state banks, the cleaning up of some of that debt, they seem to be rejigging who pays that debt and extending the maturities. Do you think were at a point where it matters for from a Credit Rating perspective or not just yet . No, its mattered for some time. I think the authorities focus on derisking, if not deleveraging. You know, we were always of the view that deleveraging would be better than derisking, but were not really going to see a deleveraging. In other words, the debt to gdp ratio that that larger economy wide, one is probably not going to come down. We think that the derisking focus is is kind of meaningful and we think there have been some positive developments, not necessarily in the last three weeks or three months, but over a longer period of time. So thats been thats been helpful to to be fair. James, the markets, investors are very concerned in watching the property sector in china really closely. Yet we saw the government say that, you know, what the woes are just temporary. How are you reading that and what are the risks of such an approach by china . Look, you know, the property sector is the biggest sector of the economy in the second biggest economy. So for some time, weve considered it to be the most important single sector of the global economy. So we dont think that whats happening in the property sector is something thats temporary or cyclical. And we think theres a structural change underway. So it is not going to be the growth driver of the chinese economy the way it has been in the past. This is what the authorities had intended. So this is not an unintended consequence. Maybe some of the spillovers to to to the broader economy and confidence are unintended. But i think shrinking the importance in terms of the contribution to growth of the property sector has been the intention all along. So were not thats one of the reasons why were not necessarily expecting the government to sort of step in and provide massive support to Property Developers at all. Theres a theres a structural change thats going on in and that was an intended structural change to some degree. What does it all mean for that 5 growth target . We have quite a number of banks now, a string of banks down grading their forecasts for the year below 5 . Can you actually maintain that target of five . Yeah, its becoming increasingly difficult. So the target, dont forget, is around 5 . So a number that starts with a four could still be recognized by the authorities as having achieved that objective. If its somewhere between four and a half and five and a half, i think theyd be pretty happy with that. You know, the last number we published was was over 5 . Were going to publish a new one in a couple of weeks and were clearly going to be bringing that down. So you know, around 5 i think is still achievable if it starts with a five, that might be a little bit more difficult. Well, moves in the monetary Monetary Policy moves have not really worked, does it take big fiscal moves down . James . Well, were not were definitely not expecting to see massive fiscal intervention, certainly by the Central Government may be pushing local governments to do a little bit more and look through local government financing, vehicle debt restructuring or such things. But i dont think were expecting a big fiscal impulse. You know, the fiscal impulse that people are talking about and expecting or even, you know, monetary easing, those are responses to cyclical downturns. And as i said earlier, this is not a cyclical downturn. This is a structural change. So we really should be thinking and talking about some structural changes in the chinese economy to think about what could and would replace the property sector as a growth driver Going Forward. James, just to pivot to the us and the big headline, of course, a couple of weeks back was your was your downgrade of the us Sovereign Rating . Well, im not going to ask what caused that because thats been laid out quite, quite rationally and quite substantially. What would make you change your mind to move it higher or move it lower . Well, to move it stable. Its stable now. Its a stable. So we moved. We moved the rating lower. We did downgrade the upgrade. The outlook, lets put it that way. Okay. To put it back up, i think wed have to see a reduction in the Government Debt to gdp ratio and or an improvement in governance. And when i speak about governance, im really talking about the governance that surrounds the management of public finances. So the most obvious example of weak governance is what happens around the debt limit and the budgeting process. So were probably heading possibly heading, if not probably heading for another Government Shutdown in september, and there may need to be a continuing resolution. So these issues kind of linger. Theres no medium term fiscal framework in the United States, which is a little bit different than most triple as, even most double as. So one by one is kind of the annual budgeting process, which doesnt work all that well. So the fiscal challenges are are big and getting worse. So the real fiscal challenge is on the mandatory spending side. Thats not part of the budgeting process. That is the majority of spending, and thats where the big increases are going to be happening in the medium term. Its taking that medium term view that was really behind the rating action. So when we look forward and we see any plausible scenario that you kind of put together, debt to gdp of the Us Government continues to rise and if something continues to rise, especially debt to gdp ratios, we consider them to be unsustainable. So eventually the us is on an unsustainable debt path, right . It just takes a long time as japan can attest to, before it becomes problematic. But the path is not consisting it with retaining the triple a, so i think wed have to see a change in the debt to gdp, gdp trajectory and an improvement in in governance around public finances that would make us more confident to bring it back up to triple a. Ill add one more point, which is this is the ninth sovereign that weve downgrade from from triple a over the years is none of the others have got back to triple a so its so far been kind of a one way street. Its certainly a longer term story of debt burdens, what have you. So i guess my question there is there anything is this a structural story in the us . Is there any, any little smidge of indication that they might be able to come out of what seems to be a structural story . Yes, of just it might just be downgrades down the road, however long that might take. No, theres always hope. Theres always hope. And the hope in this case is theres discussion around washington dc, of establishing a Fiscal Commission and a Fiscal Commission would take hold of these medium term fiscal issues and present solutions to them. And then and congress would then vote yes or no, not tinker with those solutions, but adopt them or reject them as a as a whole. And that would address the mandatory spending issues, which are really around Social Security spending and Health Care Spending. There are, you know, Social Security is simply arithmetic. Thats mathematics. Thats not very complicated. Its politically difficult. Health care. There are clearly some solutions. Theres a lot of discussion around Health Care Spending in in washington, dc. So theres plenty of, you know, issues to work with in solutions to hand. And if congress cant get there, a Fiscal Commission might identify and specify those issues for them, put them in front of congress, get an agreement and get the fiscal house back in shape. James, your us downgrade prompted investors to buy treasuries simply because theres a lack of alternatives out there. Are you concerned perhaps that in the future that will impact the impact you may have on such moves . No. Look, i think in the us we fully recognize that the dollar remains the worlds reserve currency and the treasury market is the risk free asset of choice that i dont think we dispute at all. We would concur with both of those things if we felt that either one of those was at risk. We probably wouldnt have the us at at double a plus. Given the problems i was outlining before. So we dont really think that theres any risk to the dollar, risk to the treasury market. What we were trying to to to signal was that the challenges that the us face left us in a position that we thought the difference between where the us was headed and where the other triple as were headed was just too great to to to to continue with the us at triple a, what else are you busy with when it comes to anything else that we should be watching out for and expecting . Look, i think the big issue for governments around the world is higher Interest Rates. So were starting to see that now in terms of public finances, just the cost of servicing the debt, the us is a good example. Uk is a good example. France, much of western europe as an example. So you know, Government Debt numbers and just in nominal terms. So not as a ratio of gdp has been increasing. You know, for the last 15 years. But Interest Rates have been in decline. So the cost of servicing that debt has stayed roughly the same. Thats over. We think that thats over definitively over. So as Interest Rates move higher and debt ratios continue to and debt in nominal terms and debt ratios go up, it becomes much more expensive. So were starting to see some of the impact on public finances, Interest Payments as a share of revenue rising Interest Payments as a share of gdp, rising. This used to be an emerging market story only because they didnt benefit from lower rates the way developed markets did. Now its a global story. So i think that will be the thing to watch. If Interest Rates continue to move up and we expect they probably will. Right. Final question for you. You mentioned a few economies. There is and im not going to ask you what the next ratings action is going to be because youll get to that at some point. But is there any specific economy that youre watching very closely on these metrics that its getting slightly more unsustainable . Well, the uk remains on a negative outlook, so i think thats one to to sort of keep an eye on. We put that negative outlook in place when there was the previoUs Government and some mixed fiscal issues. But i think thats one to focus on. I like how you put that all right, james, thank you so much. James mccormack there, managing director, global head of sovereigns at Fitch Ratings. Theres plenty more ahead. Were talking about big tech, by the way. Theres some decent earnings coming out today in terms of large caps. 0. 10 out later today. A preview is just ahead. This is bloomberg. Butcherbox. You never have to worry about whats for dinner. We deliver grass fed beef, organic free range chicken, humanely raised pork, wild caught seafood and so much more. Get high quality meat sourced from trusted partners with Free Shipping all this so you can always be prepared and enjoyed the important things. Sign up for butcherbox today has the chicken not the prawns are delicious. Ill have a shellfish allergy. One prawn. Very good. Did i say chicken wrong . Tired of people not listening to what you want. Its truffle season. Thats never enough. Truffles. How much are they . Its a lot. Oh, okay. Im good. That its like a priceless piece of art. Enjoy them. Or when they sell you what they want. Yeah. The more we understand you, the better we can help you. Thats what us bank is for. Huge relief. Yeah. Oh. Oh, oh. Nope. Constant contact delivers the Marketing Tools your Small Business needs to keep up, excel, and grow constant contact. Helping the small stand tall. Right. Welcome back. The end of this regulatory crackdown in china is expected to show up in earnings yet again. So weve seen it to some extent in alibaba. Tencent and jd. Com are on deck today. Lets bring in our chief north asia correspondent, stephen engle. Hes here with a preview for us. And whats expected, this is a very big company, so i dont know where to look sometimes. Yeah, i mean, its tough to get excited about these tech stocks because, look, alibaba, when they had their earnings, they posted better than expected Revenue Growth across their major divisions. But the stock really hasnt been going much higher. And youre seeing today the market is not really anticipating a blowout. Numbers from either tencent or jd. Com, which theyre both reporting later today. So tencent is down another 1 , but still, were expecting the analysts expecting consensus gain in revenue in the june quarter of. 13. 4 would be better than the 11. 4 or 11 point roughly 11 rise in the calendar. First quarter. So again, theyre benefiting from, you know, the lack of a regulatory overhang and the confidence in the, you know, that crackdown on the platform economy is over. So its been lifting up. But most economists that weve spoken to and analysts weve spoken to, Bloomberg Intelligence says the second half of the year is going to be a little bit tougher to keep that revenue momentum going, base effects, but also because the Macro Economy is simply stuck in the mud right now. So well have to kind of see what kind of guidance theyre going to be giving for the second half and maybe even into next year. Also, analysts are looking for any kind of guidance on their Yuan Foundation model, which was locally produced. But again, tencent say i laggard, if you will, against some of the other competitors. So theyre not expecting much material gain in revenue from the division, at least for the next 12 months or so. So well wait for these numbers. Steve jd. Com, what can be expected . Well, again, its a similar story to alibaba as the chief rival to alibaba in ecommerce jd. Com actually is going to be benefiting from, you know, cost savings. You know, over the last three years is the regulatory crackdown really changed the landscape for these companies, including alibaba . I think alibaba had to cut back about 6 of its workforce over these years. And that, you know, paid off for them in their latest results, jd. Com is expecting demand for physical goods recovered likely in the last quarter, and that should support what Bloomberg Intelligence says is high single digit growth for gross Merchandise Sales overall sales estimated to increase. Not a lot, 4. 3 in the Second Quarter year over year, up from just 1. 4 in the first quarter. But again, well just kind of have to see how they are weathering and what guidance they give and outlook they give for the broader macroeconomic situation in the second half of the year. Thats where it seems like theres going to be continued deterioration of this revenue momentum. Stephen angle, a preview of whats to come will really only find out when they report and well debrief you guys. Of course, this time tomorrow, if not slightly before that. Theres plenty more ahead. Well talk more about this Rate Decision out of the reserve bank of new zealand. Some minor surprises there. Well leave that to your imagination. So you stick with us because theres plenty more ahead. This is bloomberg. I want a future in technology is always for people. I wonder like mark won innovation. Its been amazing for apollo businesses to reimagine the future. We innovate with technology to challenge the status will soar to new heights. How can you sleep on such a firm setting . Yeah, mine is almost the same as youre almost just another word for it. Not as good as mine. Say 50 of the sleep Number Limited Edition smart bed plus free Home Delivery. When you add a base shop now only at sleep number third kid. What if she likes playing golf . Its expensive. Were outlawing golf. Wait can still play since we work with empower, we dont have to worry about planning for a third kid. 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It was at 6 and it is far off from that one, two, 3 target for governor or he says that he will keep rates elevated for some time. Theres a small chance, perhaps of a rate increase piece, and thats supporting the kiwi dollar at this point in time. Yeah, absolutely. I think that was youre right, that was really what what what what tilted the markets into this hawkish reaction on those forecasts not just in recession. Would you see bottom of your screens those forecasts in the cash rate Second Quarter, Third Quarter of next year, which were well, based on the forecast and where we are on the cash rate, because they kept it unchanged, you know, about ten basis points above the current levels. Right . So well get more clarity really when we speak, in fact, to adrian or so stay tuned for that. And of course, in the next hour or two, well be getting that briefing, of course. And then laying out the ideas of whether or not there really is a rate hike or is that simply just a, i guess, an expression of of rates will remain higher for longer, as they say, as i speak, though, as you can see, markets repositioning for perhaps more tighter policy ahead or tighter policy ahead here. The kiwi dollar is one of the only currencies right now actually seeing or catching a bid across asia. Were looking at the benchmark right now at 159, 160, which takes us right below some key moving averages. And weve in fact broken below a support level. And well see whether or not this takes us then before this back to the lowest, i think since about july, that trough anyway, session lows and a couple of markets coming online, thailand and india. Just in terms of sector moves and sector moves across the sort of cyclicals, its really an energy and materials. If you had to pick two that are really feeling the pinch. But its virtually everywhere really, with the exception of a few bright spots out there, its a quiet time of the year too. So just keep that in mind. Were not seeing a lot of volumes across most of these markets has at this point in time has. Thats right. Equity benchmarks pretty much in negative territory under pressure. Tracking the losses overnight of course, inflation concerns back in full view. China not helping either with the. Asx down 1. 5 . Plenty more ahead. Keeping you with us, this is bloomberg. This is mariannes first time visiting paris. Will you, before marianne packed her bags, before she attempted her first sentence in france, she downloaded babble. So when it came time to tell the cab driver to take her to the hotel pierre shimmery ali lhotel pierre babble focuses on natural conversation. You can speak and pronounce with confidence. Start speaking in new language in three weeks at babble. Com dot com avalara we can calculate sales tax automatically. Avalara. What if tax rates change . Filing sales tax returns business license guidance. Cross border sales item classification. Does it connect with. The omaha steaks anniversary sale is here right now. Were offering 50 off site wide. The only number that hasnt changed is our 100 guarantee that youll love every bite. And if youve never tried omaha steaks, save an extra 30 with promo code first time visit omaha steaks. Com tv today. Why wouldnt you want to save 50 on 100 satisfaction in just a little bargain hunting wis wa. Its all we say when you break free. Easy peasy done its so easy. Its just so easy. Butcherbox you never have to worry about whats for dinner. We deliver grass fed beef, organic free range chicken, humanely raised pork, wild caught seafood and so much more. Get high quality meat sourced from trusted partners with Free Shipping always so you can always be prepared and enjoy the important things. Sign up for butcherbox today. It is almost 11 a. M. In singapore and shanghai. Welcome to Bloomberg Markets asia. Im haslinda amin. And im david ingles here in hong kong. Your top stories today. A chinese shadow bank, part owned by zhonghua enterprise, said to miss some payments here on dozens of products intensive buying worries about this 130 billion asset manager. For now stocks extending their losses not just in china but pretty much across the region right now. Thats despite a stronger fixing out of the pboc. Also a big injection also from the pboc. New data suggesting here that home prices are continuing to drop. In fact, dropping at a faster pace month and month in july. And the rbnz is on deck. Decision was 60 minutes back. We get more meat on the bones this hour from adrienne or flagging things like the slowdown in china as it hold rates again holds rates again and signaling perhaps a small risk of another rate hike pass while asia extending losses down for a fourth day in a row. Tracking those losses on wall street overnight on concerns about inflation, about growth and of course, about china. Now we have more banks cutting their projection for gdp for china to below 5 . Those cuts in triple are not helping either. Also plans to cut that stamp duty for stocks, not helping chinese stocks. In fact, the msci asia index in negative territory down about 3 10 of 1 . Losses do pretty much across the board. Red across the board losses of 1. 5 for australia, down by 1. 4 for the cosby and japan nikkei 225 not spared the darling for investors, but today down about 1 in the space dollar pretty steady, but were seeing some asian currencies emerging market currencies under pressure. The one down by 6 10 of 1 . And the chinese yuan, despite that fix that is stronger by 800 pips. In fact, the strongest in this round of fixing it is still lower, currently down about a 10th of 1 . 729 day. If it does look like the pboc cant do much to lift sentiment out there, though. Absolutely, because theyre not just looking at shoring up sentiment. You know, theres you know, theres a real yield in the us at a 14 year high. So thats, i guess, the economics are not really on the side. It is hard to imagine where the Exchange Rate would be without a fix stronger of 800 pips relative to estimates. Right. In any case. So this risk aversion is likely to carry through into the the other opens this hour. So as you can see already in the opening minutes, thailand is down. Indias probably going to fall as well. Weakness, ditto on the currency front in both those markets right now. As far as some of the sort of big sector movers. And well get more on this later on in the show. Its really cyclical. Its financials in there, too. So Energy Stocks are feeling the pinch. You have some of the big mining stocks in australia, which is perhaps why the standing the standout to the downside is the asx 200in australia. Oil is down three and a quarter of 1 . Mining stocks very briefly here, a busy news day in china. Well get to that. Right now. So we talked about that fix, almost 800 pips on the stronger side of estimates. You have a massive injection out of the pboc. Then you have home prices coming out. And in the last hour or so, weve also learned that this large chinese shadow bank, Zhongrong International, actually missed some payments here. All this were discussing right now with our team here and set our china editor, jill disis is with us and also tanya chen, of course, who looks overseas and rates for us. I dont know who to start with. Jill, lets start with you here. These downgrades which we woke up to barclays, jp morgan, on this growth forecasts. Yes. So i think at this point, we saw jpm drop their forecast to 4. 8 for 2023. Barclays a bit under that, even 4. 5 . I think whats really relevant here is the fact that you know, a lot of these banks were projecting growth above 5 , even higher. Jp morgan was north of 6 as late as early may. You know, originally earlier this year, when the government set its growth target of around 5 for 2023, a lot of economists thought that that was a very, you know, very conservative growth target, wasnt very ambitious. But now were not only coming more in line with what the government is set, were actually seeing banks start to see growth below that. I think its also important to remember that this is also coming as a lot of policymakers are taking a look at whats happening in china right now as we just said earlier, rbnzs warning that the that chinas Growth Outlook has some concerns for them there. You know, we saw janet yellen say earlier this week that maybe the us is a bit more protected against, you know, some of the broader effects of a chinese slowdown. But ultimately, you know, a lot of economies in asia might have some issues there. So i think all of this is, again, is just kind of coming together as were getting some really underwhelming data out of the country. And that poses some really serious concerns for whether this country can, first of all, hit its growth target. But also if were in for an even longer slowdown to worry about. Yeah. And tanya, its a conundrum, right, because you need to support the economy, but also things that you would do to support the economy, like cutting rates are negative on the currency, which is why theyre coming in today with quite a strong fixing. Yes. And i do think, though, that at the end of the day, they are trying to stabilize the currency. That is still their primary objective. But as i was just listening to jill speak, i mean, its just so overwhelming. Like we cant even catch our breath about all of the negative sentiment that is just piling on. And what you mentioned about the liquidity operation today, yes, its a little bit outsized. That could be potentially due to some seasonal tax payment issues as well. But some analysts are saying that theyre probably preparing to have a you know, a deeper liquidity bench because of the trust and the property sector issues and the real estate issues. So its all linked, you know, at the end of the day. Yeah. And you know, our Attention Span this week has been on july data, which to some extent is backward looking. But you get a home price number like this and its not really helping sentiment, is it . No. And i think that just as tanya mentioned, you know, were looking at again, its really that circular motion. Right. But again, so home price is dropping a month on month for a second consecutive month really speaks to, again, this ongoing issue within the property, the property market, this crisis that now is sort of creating a lot of these contagion risks. I mean, you know, we look at some of these issues within, you know, the shadow banking sector, missed payments. I mean, how much of that is related to, you know, Investment Products and such that are you know, related to real estate, for example . I mean, i think that all of that kind of comes together to show that, you know, this this economic slowdown at this point is really does feel like the property sector and sort of all of those related industries and all of the like, you know, sort of pieces of this that come together thats such a huge overhang on the chinese economy right now. And, you know, you mentioned that a lot of that that july data is backwards looking. Sure. But i think that at this point, its really just become about, you know, what policies is china going to introduce Going Forward and how long is it going to take for some of that to come into effect . And then ultimately, what is it going to look like getting into the end of this year, getting into 2024 . Are we actually going to see a reversal of the slump thats been going on for such a long time at this point . Yeah. And i think youve youve highlighted this week its really the credit numbers that we got on friday, which arguably was the most favorable forward looking indicator that didnt that sort of fell in line to the bad data in terms of just tools that the pboc or authorities might use to stabilize the currency. Yeah. Do we have to be on the lookout for for something more than the fix or dollar buying, for example . So i think offshore bill issuance is going to be something to watch for. Okay. Increasing more dollar liquidity into the system. And then also punishing the people who short the yuan obviously right. They can increase the cost of those trades. But i was just also thinking about what jill was saying about these. What is the kind of policy that is needed now to boost this confidence . And one analyst was just saying its just going to cost a lot of money at this point. Monetary policy is only going to do so much. It might have to just be helicopter money, you know, because the the negative sentiment is so deeply entrenched. So i dont know. I was just thinking about that. Jill, just final thoughts here. Any more policy tools that we could see them put in place to support growth or even to support sentiment . Sure. I mean, i think at this point, you know, i know that the rate cut yesterday was a surprise. It didnt really do much to boost sentiment at the time, but we have talked to some economists who have said that, you know, that coming a lot earlier than we had initially expected, maybe indicates that theres future rate cuts to come this year. I think, you know, weve talked to several economists who have pointed to they could they could trim the reserve requirement ratio. Ultimately. Maybe its that you see more in the Monetary Policy side in terms of looser policies that could eventually open the door to some additional fiscal policy as well. So that was at least an encouraging sign among a few economists that we did speak to. And well end on that positive note, of course. Jill, thank you so much. Tanya, well let you get back to your desk and dragged you on to set today. Thank you so much, by the way. I appreciate it, too. Okay. As we have some breaking news out of new zealand right now, the central bank decision. Thats right. Rbnz governor adrian orr speaking after keeping the rates pat for a second time in a row, though he did say that there is a slight chance of a rate hike, some lines coming through. He says that the economy is evolving broadly as anticipated that it is pleasing to see inflation declining. But heres the thing. Core inflation remains too high. Second quarter core inflation, by the way, at 6 , which is way off the target of 1 to 3 . So hence that hawkish tone from rbnz governor adrian orr. Lets bring in our Global Economics and policy editor, Kathleen Hayes. And kathleen, of course, you know also that he is on watch, worry and wait mode. I mean, how do we read that . Im read it to mean that if theyre looking this is an asymmetric decision. This is a decision where they held their rates steady. They said theres a small chance of another hike and so the question isnt, are they going to cut rates . Thats for darn sure. I think its more of a decision between can we stop hiking rates or do we have to do more . And they are keeping the door at least ajar to that possibility. I mean, you hit on all the main points. I like the, you know, the watch worry. Wait mode. So that doesnt sound like anybody who is is confident that that 6 inflation, which is where it is now, well above their 1 to 3 target now, you know, their forecasting by the end of next year, itll be down to just over 5 . And then the following year, i think gets something closer to in the twos, which is the middle of that range. But see, thats a forecast. And right now they are seeing signs. Theyve got the you know, they did say theres about three quarters. Guess theyre looking maybe for the recession to start. But again, theyre accepting. Im interpreting, right. Theyre accepting that theyre going to get some kind of recession. Theyre not saying, oh, we cant we got to stop hiking rates because were the economy is going to is going to slow down and even contract a bit. I think the point is we know we have to get inflation down and were going to do it. And i think this is becoming a story around the world. And thats what theyre all afraid of when do you get a persistent inflation, sticky inflation . You cant let that happen because thats when you see your Inflation Expectations starting to rise, etcetera. And thats another thing the rbnz has seen recently, and thats another reason why theyre theyre not taking the foot off of the pedal yet. And theyre just wondering if theyre going to have to press down a little further. But kathleen, just to pivot to the uk because its been a i wouldnt say massively turbulent, relatively topsy turvy session in sterling. You know, this time yesterday, we were going into some wage numbers that led to a spike in cable. Were back down, but yet again, we could see something moving up in the form of this inflation print thats coming out today. Well, yes, yes, yes and yes. And the wage numbers, you know, they were so extreme. I mean, average uk pay excluding bonuses, up 7. 8 in the Second Quarter. Thats really high. And it just keeps getting higher right. In fact, its a record rate there. And i think that thats thats been the problem. Again, this whole thing of a wage price spiral, heres what happens. Okay. You get a raise, you say great, i got a raise. Oh, boy, im going to catch up. You know, it cost me twice as much to go home with a bag of groceries. Well, now i can pay for it better. And you get your raise, and then all of a sudden, prices keep going up. Oh, well, then im going to push for another. Oh, another wage hike. I have to. Thats the wage price spiral kind of thing. You know. Bailey governor Andrew Bailey has kept the door open as well to more rate hikes. Theres a rate hike expected next month, 25 basis points. And if by march, maybe another 50 basis points worth of hikes, that would take the uk up to 6 . Thats a lot compared to where they started, right . It was actually like negative. You know, a year or so ago. But again, its its something that im sure jay powell is worried about. You know, we heard Neel Kashkari from the minneapolis fed. Theyre worried about it. You know, after the rbi move non move, actually just last week when the they did not hike rates. Krishnamurthy subramanian was on with us. Hes the former chief adviser, Economic Advisor to modi, and hes the imfs executive director for india. And he was he was, you know, saying he was more confident that they could allow inflation to go up in higher up their range. Well, inflation went above their range. Its thats what i see. I see a world where for a lot of countries its not that good to be that easy at all to bring down inflation, let alone and particularly in the uk, keep it from going higher. Thats right. 6. 7 . Still triple the target for the boe. Its going to be tough. Bloombergs Global Economics and policy editor kathleen hays, thank you. And of course, dont miss our conversation with rbnz governor adrian orr. Hell be breaking down the latest decision. Thats coming up thursday at the times listed on your screen. Still ahead this hour, we take a broader look at Indias Economic picture and ask Access Capital what to expect when it comes to Monetary Policy and the outlook for equities. Dont miss that. This is bloomberg. Without the ones like you who work tirelessly to keep things running, everything would suddenly stop. Hospitals, factories, schools and power plants. They all depend on you no matter the weather, emergency or time of day. Youre the ones who get it done. At granger, were here for you with professional grade industrial supplies. Count on real time Product Availability and fast delivery. Call click granger dot com or just stop by granger for the ones who get it done. Fabulous surroundings. But everyones looking at their phones for Financial Insights from merrill. Is he hailing a ride to the concert hall . No, hes making sure his portfolio and retirement plans work in harmony. They want to adopt a child and build a new home. So theyre talking numbers with their merrill advisor. Shes not researching her next role. Shes learning how to handle market ups and downs without the drama. Personalized advice so impressive your money never stops working for you. With merrill, a bank of america company, what would you like the power to do . Butcherbox yes, you never have to worry about whats for dinner. We deliver grass fed beef, organic free range chicken, humanely raised pork, wild caught seafood and so much more. Get high quality meat sourced from trusted partners with Free Shipping. All this join and get free bacon for a year. Butcherbox makes betterhelp takes the stigma out of getting counseling. Theres so many people who still have that stigma of going to a physical office or a location to see a therapist. If im a client and im looking for help, sometimes it feels like something we should be ashamed of or we shouldnt want others to know. Betterhelp is important because it reduces the barriers for people getting access to Mental Health care for. While the dollar under just a bit of pressure, well call that flat actually the kiwi dollar currently up by 2 10 of 1 from the hawkish tone from the rbnz. Governor adrian orr speaking about how that could be a slight chance of a rate hike after standing pat for a second time in a row. The yuan. Well under pressure, down a 10th of 1 . 729 investors obviously brushing off all the efforts by the pboc to lift sentiment. In fact, that fixed of 800 pips is not working at all. China has a lot to do when it comes to supporting the currency, the economy as a whole. Now, lets continue to talk markets, bring in lin jin liang, senior asia sovereign fixed Income Research at columbia, threadneedle. Lin, good to have you with us. Well, weve been talking china all day long, all morning long. I mean, this is yet another piece of news thats negative for the outlook for its assets. Yeah, pretty much. I mean, at this current juncture, youve got both the property sector in turmoil and then youve got, you know, the trust sector in slight turmoil as well. Slight property is understating it slightly. And, you know, for us, you know, when youve got both of the events really sort of dampening further home buyers confidence in the market and also the sort of, you know, Wealth Effects on on a lot of these investors in these trust funds. Its undoubtedly that weve got to push our outlook lower for our Growth Outlook lower. And so undeniably, you know, were looking at further depreciation in the cny, but it could bode slightly well for bonds front end bonds especially. Weve got a bull steepener there. But yeah, they will have to put more fiscal policy at work. Lets pick up on the yuan. You talk about further weakness. How much weakness mean . Whats fair value for the currency right now given all the negativity that were getting, i its hard to tell where fair value is given. I mean, you know, you sort of think about the the medium term outlook for chinas growth, right . Were looking at anything between 3. 5 to 4. 5 growth for china over the next 2 to 3 years as it transitions this growth drivers. So its going to be a struggle. So fair value is still undetermined at this point. But, you know, by and large, everyone likes China Growing at 6 . The fact that were starting to talk about 3. 5 growth tells you exactly the direction of travel. Its going to go. Right. And the fact that we are at subpar growth is the to your other point earlier, i mean, its good for bonds. If you could clarify because you mentioned both steepening, were you describing the move or do you expect the curve in china to bull steepen . In other words, would you lean into the rally . I id lean into the rally, especially in the front end, the back end, the steepener is really more from the fact that the front end is were going were seeing a few more easing coming through from repo rates and and lpr ratios. But on the back end of the curve because the truth of the matter is every ten basis point cut at this juncture where theres really no demand for credit really doesnt do very much for the economy. So fiscal needs to come in and thats whats going to lead to the next well, the steepening of the curve. That is when issuances come through. Okay, then guess at that point well just have to talk about that. When that happens because weve been waiting for it and it hasnt come. That takes me into, i guess, an ex china conversation, if thats okay, because inflation is not a problem in china. Its still a problem in other parts of the region. Are we under playing the risk of inflation coming back as my question, we are i mean, you know, you look at em on a whole and, you know, a lot of asia countries at the moment have priced in a lot of rate cuts and we still have el nino as a risk. So for us at this point, you know, sort of transitioning some of our initial allocation into those markets out of that region or out of latam really, or south africa into asia is actually quite good. We are probably underpricing el nino risks somewhat, but by and large, a lot of Asian Countries havent priced in any rate cut expectations and a few countries here like india and indonesia has had a relatively good track record over the last round of el nino that showcases how government can use things like import export tariffs, moves. Et cetera. You know, storage food storages to help dampen that risk slightly. So for us, this is probably somewhat safer relative to other regions at the moment. So when it comes to expectations of rate cuts among perhaps asian economies, i mean, indonesia comes to mind. Is that realistic . And how soon do you think indonesia can do that if you just if lets say we dont get the el nino food inflation risk and the fed starts to turn a little bit more dovish in terms of rhetoric, they can probably start by this year, but given the fact that, you know, Bank Indonesia is quite strict with regards to to where idr is going, i think they will hold off for now until they get a more clear picture from the fed where is the idr headed . I like the resilience of of idr. I think its not going to head positively, too dramatically. I think its going to stay around here stable. And thats on the back of the fact that the current account is quite resilient. Now, you know, the good work theyve done in terms of export bans with regards to raw material, i mean, you know, higher value added manufacturing has grown by 2. 5 times from precovid levels. So thats shifted. What current account deficit from what used to be two plus four plus percent, i think five, six years back to what is now almost balanced. Thats a very resilient current account. So it bodes well for the currency from lets talk inr and pick up on your current account sort of theme there. Energy and food prices have been going up. Is that a problem for the current levels here on on dollar rupee . Because were already at 83 last night. Yeah, 83. Yeah. You know, the broader asian currencies are moving with Dollar Strength at the moment. But i think idr and inr both should, you know, should stay quite resilient. You mentioned Energy Prices. Im always very excited to talk about Energy Prices when it comes to india. Go you know, the fact that, you know, a big part of the the oil import share at the moment is from russia and they are holding on to the rule that you should not buy oil at higher than 60 a barrel. And so, you know, theyre sort of stuck at around 70 a barrel for oil. Thats very good news for indias current account. You know, were expecting indias current account deficit to sort of come in at around 1. 5 or even lower the percent of gdp deficit this year. So that should keep, you know, inr quite resilient and the and the central bank does have quite a fair bit of reserves still left in their coffers. So very positive there. We like high carry, you know, sort of well say hi carry depends on what it is. But we like both indonesian and indian bonds unhedged at the moment, taking advantage of the fact that, you know, the currency should stay quite stable or relatively more stable. Okay. Yeah, its all relative, isnt it . So apart from everything weve talked about, any other trade that youd recommend right now, the floor is yours short peso is definitely one trade we recommend at the moment. You know, we we okay. For us, philippines is also a positive structural reform story problem is there are quite a hit. Well in the early parts of their game and so theres been a lot of plans announced. So execution remains a question mark but they are quite convict with regards to using Infrastructure Investments to boost growth. So on that front, were expecting more Capital Imports to come through, which will widen out the current account deficit and so short peso is definitely the one for us at this point. Lynn, always a pleasure to have you and well get you back to talk about oil in india. Oil prices. Lin cheng leung, columbia threadneedle, plenty more ahead. Keep it here with us. This is bloomberg. 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Better decisions is an he snores like an angry rhino. Youve never heard of angry rhino baby here one every night. Every night. Okay, ill work on that. Say 50 of the sleep Number Limited Edition, smart bed plus free Home Delivery. When you add a base shop now only at sleep number. If you have employees, you need to check out the program, chef. Wonderful. Why, mr. Wonderful . Because its cash flow that you dont have to pay back. Good to know who this guy so smart and so handsome go to wo trust dot com to see if youre eligible. There you have it. The kiwi dollar getting a bit of a lift from a pretty hawkish well call it hawkish rbnz governor adrian orr who says theres a slight chance that there could be another rate hike. Well, kiwi dollar has been under some pressure of late down about four weeks in a row. In fact, four days in a row and four weekly drops as well. So it has been under pressure on the back of a strong dollar somewhat, of course, the rbnz kept rates steady for a second time in a row. It says that inflation, core inflation in particular, remains elevated at about 6 . The target is 1 to 3 . Itll be elevated for some time. And on the possible tax cuts being mooted by political parties, adrian also says the rbnz has to play the hand its dealt when it comes to fiscal policy. So there you have it, dave. I mean, the man making it pretty clear that inflation remains a concern and is willing to fight it, even if it takes some time. Plenty more ahead. Keep it here withtrust and wille process of creating your will and made it easy. Like while youre lounging on the couch. Easy. All documents are state specific, legally valid, and start at just 159. Find the plan. Thats right for you at trust and willkomm. Heres your parachute. Certain its okay. Are you foreign prince . Certain. Certain t matters. So congratulate coworkers or say thank you with Promotional Products from four imprint. Com for imprint for certain. Yeah. Does anyone remember the film the brave 300 . There we go to csi down about a 10th of 1 , 2 10 of 1 right now. Not a lot in fact, were just coming off session highs right now going into the break. Theres a lot of talk around the brokers and whats happening there. And, you know, stamp duty, tax cuts, what have you. And really incrementally more support measures to lift not just sentiment, guess incentives and align that really with a market that really hasnt gone anywhere. At least its gone somewhere, but its come back almost full circle to pre politburo meeting levels hang seng index 1. 2 to the downside right now. So weve were at the bottom of the recent range. Theres nothing to suggest at this point. We are breaking below that and hitting new lows. Weve had a very busy morning here on on china, as always, a very strong fix. You had weaker than expected home prices coming in overall 70 cities, and yet a really big injection out of the pboc in terms of the 77 day reverse repos, all things equal, stocks not doing really are not responding as much. But this is really has a a regional region wide story here of this aversion to risk at least today. Yeah. Dampening sentiment even in japan which has been a darling and you talk about you know Chinese Markets not really going anywhere. Well japan we know, has gone pretty gangbusters, but not today, down about 1 , coming back from that lunch break in the negative territory. Of course, were keeping an eye, by the way, on some of those japanese companies. Theyve just posted blockbuster earnings in a sign that the nascent inflation in the country is having a positive impact on the corporate bottom lines. There you have it on your screen. Inflation fueling positive japan earnings surprises. So good news there, i suppose. Dave, question is, how long for now pivot somewhat to thailand, the thai constitution royal court will decide on wednesday whether to accept or reject a petition by the move forward. Party leader to re nominate for Prime Minister. Lets bring in bloombergs peter tanaka suppipat in bangkok. We call her best now best. Bring us up to speed. Whats whats the case here about what the implications are and what todays Court Decision is likely to be. So last month, the parliament held a vote that pizza cannot be nominated for the Prime Ministers job for a second time after his first attempt was blocked by the military appointed senators and conservative lawmakers. So this case is essentially asking the Constitutional Court to determine whether that decision by the parliament was unconstitutional because the constitution, which is the highest law in the country, does not limit how many times a Prime Minister candidate can run for the top job. Now, this the third parliament, third Prime Minister vote has been delayed already twice, pending more clarity on this case. So any decision by the court today will have an implication on when the next Prime Minister vote can take place. If it accepts the case, then there might be further delays to the Prime Minister vote until there is a ruling. If it rejects the case outright, then that clears the path for the parliament to hold the next vote as early as this week or next week. And, you know, one of the best efforts right now to form a government that weve seen so far, best. Yeah. So put is now forming a coalition after it parted ways from move forward thinking that it might have a better chance of forming a government after the senate has made it clear that the senate will not back any any coalition that has peta or his move Forward Party in it because of its opposition to their reformist agendas. So now a coalition that is putting together now has about 238 lawmakers from nine parties. But thats still short of a majority in the lower house and very well far below the threshold of a successful Prime Minister vote. Now, in the latest twist, though, the move Forward Party said that it will not support a thai coalition and it will not support its Prime Minister candidate, taweesin. So that means that partys choices are narrowing and it may have to seek the support of the military backed parties of the current outgoing government. And we can expect the next we can expect conservative parties to play a greater role in the formation of the next government Going Forward. So party said that its confident that it can win the next Prime Minister vote and form a government by early september. Best we have a line here from governor chetput saying that the thai political stalemate is leading to, you know, the bot weakness. Give us a sense of how markets have reacted to the political deadlock. Mhm. Yeah, its been three months since the election, so the political deadlock since the may 14th election has rattled markets and put investors on edge. Foreign investors have sold nearly 4 billion in thai stocks so far this year, according to data compiled by bloomberg. And Political Uncertainty is also putting pressure on the baht, as well as the thai stock index. The bad has lost 33. 8 sorry, 3. 5 so far. This month, the most among Southeast Asian currencies and the thai benchmark stock index is extending a slump to nearly 9 this year with with analysts expecting more losses as this Political Drama drags on. Yeah, and we also have to be to at this point more lines coming through to your to your point to their best that theyre going to do as much as they can to manage all this volatility that were seeing in the currency markets. Thank you so much, by the way. Great stuff and a great round up there. Papicha tanaka and pippa, theyre live for us out of bangkok, staying in Southeast Asia. In case you missed it, there was a really good debut overnight here. Vietnamese ev maker vinfast soaring in its first day of trading in new york, going public, of course, as a spac deal, 255 . Check that out there. In fact, giving vinfast at this point a bigger market cap than gm. Ford and vw. Bmw essentially. But theres 1. 3 million shares are available for trading, with most of it locked up, though, by the companys founder and his family. Now the ceo told us about some of the feedback that that theyre actually getting on some of their products in the us market. Have a look. Actually, if you look at the reviews of the publicity about us, most of them are positive or at least neutral, right . Lets lets wait and see. There have been some like negative reviews. We we take them very close to our heart. We reflect on the feedback of from from those reviews. And we make our vehicles better. We update the software when we make the vehicles better. We actually really appreciate the feedback from from the public, from the consumers, because its a way for us to to become better and it affects your own workforce. Talk to us about the us workforce. Youve consolidated it, saying goodbye to certain individuals put together north america more broadly. Are you going to expand . Because i know youre going to put manufacturing here . Well, i think vinfast and vingroup, we always continue to optimize on our resources and restructuring of north america was just part of the optimization of of the resources we always try to become better here in in the us with the North Carolina plant. We we started expanding. We started hiring people. I think we at the early stage of building the the plant out. But as the plant go into getting closer to opening, then we will start bringing in more people. Your founder committed about 2 billion of his own personal capital to vinfast. Will the founder have to put more money in . I just want to go back to this idea of sovereign wealth funds as well as you know, in terms of a capital need. Where are your priorities to raise . We we have the commitment from our shareholder, vingroup and our chairman up to to 45 billion. So that will help us continue on our path. We have been talking as part of the traditional ipo. We we were talking with a lot of the investors. And after becoming public today, we will continue the dialog with with a lot of investors sovereign wealth funds but many other Institutional Investors as well when the time is right for an for another transaction or for for the transaction to bring in significant funding for vinfast, we will do so. Meanwhile, we we we have very regular conversations with our with potential investors. And that was vinfast ceo lee twe speaking with bloombergs ed ludlow as well as caroline hyde. Lets take you to the markets again. Do a check on how China Developers are doing at this point in time. Were seeing green pretty much across the board. Sinoocean land surging by almost 15 . Sunac china Country Garden Country Garden services all in positive territory right now. Lets dig spite the fact that china home prices dropped at a faster pace than anticipated. Theres been a downturn there and it is worsening, but were seeing those developer stocks surging at this point in time. Still to come, economists raising their price gains forecast in india for the year after retail inflation hit a 15 month high. We have details just ahead. Keep it here with us. This is bloomberg. All eyes on me cause im making it easy. God, with the top down. Yeah. Make it look breezy like a busy is just too easy. Make it look easy. You automate sales tax with avalara. You dont have to worry about things like changing tax rates or filing returns. Villa right. I. I. Fabulous surroundings. But everyones looking at their phones for Financial Insights from merrill is he hailing a ride to the concert hall . No. Hes making sure his portfolio and retirement plans work in harmony. They want to adopt a child and build a new home. So theyre talking numbers with their merrill advisor. Shes not researching her next role. Shes learning how to handle market ups and downs without the drama personalized advice so impressive, your money never stops working for you. With merrill, a bank of america company, what would you like the power to do . What is an its a variable. A symbol of flexibility, solving for the needs of todays investors. Finding opportunity varies across asset classes. Is investing to sustain growth ahead of the unknown. Thats the power of emma. Templeton. I want my fellow citizens to feel as little burden as possible of inflation. We have to take more steps to minimize this burden and we will definitely take these steps. And that was indian Prime Minister Narendra Modi on the countrys high inflation. Lets talk inflation. Bring in bloombergs south asia economy editor, ruchi bhatia, who joins us from new delhi. Ruchi, will the price gains outlook improve any time soon. Well, a shocker of a number for the print that we saw for the month of july, haslinda. And the hope is that some of the seasonality that weve seen in tomato prices, in fact, tomato inflation was. Almost 200 up for the month of july. So some of the seasonality there could be addressed in the months to come. But the but the big worry could be cereal inflation in the months to come. And that will have both political ramifications as well as monetary ramifications as well. If you look at the july print food inflation that accounts for over half of the cpi basket rose almost 11 . Vegetable inflation up 37 . As i told you, tomato prices, inflation was up about 200 . The government is taking various measures. Theyve called for imports of pulses and some of the vegetables from some of the other countries. And theyre hoping that the situation will ease. But the big concern continues to be cereal prices, because rainfall continues to be deficient in some parts of the rice growing regions in northeast and eastern part of the country. And as i told you, that could have ramifications Going Forward for the administration as well as for the central bank. In what way should we expect the central bank to act on . It sounds like a very weird question. You know, Monetary Policy and, you know, tomato inflation. Is there a connection there. Well, the central bank has so far said david, that they will be looking through this, you know, this inflation print because they were expecting, you know, a number on the higher side. But this print has clearly topped all market expectations. And the big worry this time around is that what happens if cereal inflation also continues to shoot up and that is one of the reasons that various economists have already started talking about a possibility of that. One last rate hike that the central bank could perhaps take if this inflation trend continues to be more persistent, if supply side shocks continue to happen. So thats something that we should, of course, keep an eye out for. Many economists have already pushed their rate rate cut forecasts deeper into next year. And as far as the government is concerned, theres going to be political ramifications because as we all know in india, people are extremely conscious of prices. Governments have fallen when inflation and when Inflation Numbers very were very high. You heard the Prime Minister there yesterday talk about more measures that could be coming in. So lets see how the government and the central bank both look to ease the pressure on the common man. Ruchi, thank you so much. Great stuff. Our south asia economy editor ruchi bhatia on just a shocker of a number really mean things are okay until you get an outlier like that a few seconds to the open will be opening lower, about a quarter of 1 here. Just looking at the benchmarks, most down, not all. Yeah. And there we go, about a third of 1 to the downside, which is fairly consistent anyway with the downdraft were feeling across the region at the moment. Banks are pulling this one slightly lower with a bit more hot sauce on that to the downside. 1 lower than nifty, 100, a half of 1 . Lets go back to the inflation outlook and really talk about whether or not this was was this a game changer . Should we look through this number . Joining us now out of india is neelkanth mishra, head of Global Research at axis capital. Good morning from hong kong and singapore. Thank you for joining us in the shows. I mean, your thoughts . I mean, it was an outlier of a number. How how closely do you think we should be watching this moving forward or was that a one off . Good morning, david. I think we should be looking through this number. This was well above what we expected. We also expected a number closer to six and a half, but this came out to be almost 1 point higher. But remember that the core inflation, which is what effectively policy and Interest Rates can target, actually declined for the month. So, yes, 89 of the the the increase in overall prices came from just vegetables. So this is this is something that you can look through. Tomatoes are a very short cycle crop and i dont know if its worth it but when i bought tomatoes yesterday they a kilo instead of looks like thats ending and that should help bring down the headline numbers. Yeah, it should also maybe help uric acid problems there because it has a lot of uric acid tomatoes. Anyway, i digress, dont i . Rbis done hiking. I dont think theyre going to hike. But people who are expecting a cut also think mistaken. The rbi is very very clearly stated that they are looking at 4 inflation as the midpoint there was this view earlier that that instead of a four plus minus two, the rbi was perhaps more anchored to four plus two, meaning that they would start cutting when inflation reached 4 . But now theyve said they are focusing, they want to see clearly signal to the markets that theyre targeting four plus minus two. And therefore inflation has to go well below four for the rbi to start thinking of cutting. I dont expect them to cut anytime soon. Nikhil khan, what does it mean for the rupee then, which is close to record lows . The rupee has a very strange problem. India is running balance of payments. Surplus is now an and this means that the rupee should be appreciating. It is starting to get capital inflows again. The current account situation has been addressed by very rapid growth in services, exports, business services, exports, not Just Services at and and the fact that, you know, the the imports of energy, including things like edible oil, have actually been in control. So in this situation, the rupees tendency would be to appreciate. I dont think that will be allowed to happen. What we have seen instead from the central bank is that they are rebuilding reserves and the recent decline that we have seen is just an, i think an opportunistic depreciation because the dxy has the trade weighted dollar has appreciated. So when you see a period of global uncertainty, the availability of dollar shrinks and this allows the rupee to to come down a bit. But i must say that rupee is being one of the most stable currencies in the world over the past one and a half years. You talk about it being a stable currency, the least volatile unpacked currency in the world. Can that continue . I think so. See, the it is very hard for a central bank to control all the depreciation of a currency, meaning that if there is a negative balance of payments condition, the situation, it is very difficult to to stop the currency from depreciation. You will have to start burning reserves. And then there is a limit to how much you can do that. But any central bank can control the currency from appreciation. So if you have a balance of payments surplus, it is much easier to control the level of the currency and thats the situation we are in. And therefore, given the level of reserves that the rbi has think the rupee would remain in a stable band. If i was trying to predict like a Market Participant where the rupee may be headed, i would perhaps even track where the rmb is going. Interesting. Interesting correlation there too. If we could pivot to the equity market. If you dont mind. Well, a couple of related questions here. We pulled back about three, 4 on the benchmark. One is that a buying opportunity . And number two, just figuring out valuations. What do you make of the last earnings season, last earnings season was was very good. In fact, very strong evidence that the economy is is doing much better than was feared six, seven months back. There is clear evidence that the independent homebuilder remember that construction is a very large part of the indian gdp and quite a bit of construction is of real estate. And quite a bit of that is done by independent home builders. Its not commercially built, so very strong evidence that construction has started to pick up and overall earnings seem to be quite robust. What the market though i would be a bit cautious as we think about the next 6 to 12 months. The biggest headwind in my view is whats happening globally. The indian market, even the top 100 stocks are quite a bit more exposed to Global Trends than they are to local trends and therefore more as we see concerns intensify on china as we see the effects of sustained high Interest Rates in the us, there is going to be a, i think, volatility in global markets. So the headline indices in india also are likely to be either range bound or maybe moderately declining as we think about the next 12 months. Melkon thank you so much for that. Neelkanth mishra, head of Global Research at axis capital. Well, plenty more ahead. Keep it here with us this is bloomberg. Butcherbox. You never have to worry about whats for dinner. We deliver grass fed beef, organic free range chicken, humanely raised pork, wild caught seafood and so much more. Get high quality meat sourced from trusted partners with Free Shipping always. So you can always be prepared and enjoy the important things. Sign up for butcherbox today. The biggest ideas to inspire new ones. 30 years ago, state street created an etf that inspired the world to invest differently. It still does. So what can you do with spy. Access the financial world on demand. Hear from leading economists, policymakers and industry experts. Be alive and on demand webinars only from bloomberg. Start exploring to see whats moving the markets. Visit bloomberg. Com webinars. And nightgown index bangunan manusia menjadi. Plus, while were taking you to indonesia, where indonesian president joko widodo is delivering his state of the nation speech, of course, this would be his final speech as it is his second term and the final time of him being in office. And of course, questions about who he will support in terms of the next president ial race. He says it is not his prerogative to pick president ial candidates and that the president s role is to bear the peoples mandate. He warns that political courtesy fading away as election draws near. Now were going to leave it there, but bloomberg subscribers can continue to watch at live go. You also get the big diary entries coming up today, later this week, as well as some of the events you may have missed earlier. Dave. Yeah, from that, lets you know, the worlds attention shifts to this match thats going on. If the schedule is correct, in about four hours from now has between oz, australia and england. Thats for a spot in the in the world cup finals. I mean oddsmakers have england slightly ahead but i mean, that could go really anywhere. Weve had a look olympic. Com and its almost split also. So theres really no indication of past performance on future guarantees. But i guess if we compare some of these metrics, has inflation and some of these other things, its kind of mixed. Yeah. But you know what, bear in mind that australia will be playing on home ground. 80,000 strong expected to be a full house. So, you know, england could be the favorites. Australia are you cant undermine the support of home turf right . So there you have it. And you know what, waltzing matilda, i say dave oh, there we go. Yeah. Time to crack open a can of fosters. Okay, thats ahead of that match. Coming up, global macro movers for you. Risk aversion across the region coming up here and thats it, by the way, from Bloomberg Markets asia, daybreak, middle east and africa is just ahead. And the hand of is an equity market thats off 1. 1 . Well see all tomorrow. This is bloomberg. Oh, booking. Com. Somewhere here, anywhere. I just want to lie motionless in a chair. Booking. Com. Com. Booking. Com. Yeah. 76 of 23 and me Health Customers surveyed reported taking healthier actions because they know health isnt just a future state. Health happens now start your powered Health Journey today with personalized insights from 23 and me. This is mariannes first time visiting paris. 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