The march figure was revised slightly to 3. 17 billion, a slight revision upwards. The aussie dollar falling on the back of those numbers. Imports fell 1 . The big weakness was exports, down 8 . We did get a sneak preview of that when we have the balance of payments current account, net exports would be a big drag on gdp, and that turned out to be the case. Result,a disappointing ,. 5 to recap the big mess billion dollars surplus as opposed to the 2 billion expected. Rishaad i will get it from here. Of course we have the market open in hong kong could lets get the sophie. More disappointing data on the economic front for asia and japan. The aussie did hit a onemonth high with the gdp update, that basedgains looking capped on softer economic momentum. It includes the aussie dollar on course for a second week of losses. At the equities markets, the asx 200 still lower, down. 2 . Taking a look at chinese stocks, the shanghai composite down. 1 at the open. We do have a strong rebound on the mainland on wednesday amid a surge in trading volume. Continued seeing that for the shanghai composite so far. 8 ,iring saying down by and stocks in tokyo higher, while stocks in seoul, korea down. 4 given the geopolitical concerns. I want to look at stocks in hong kong at the open. Yesterday, shortsellers to send shortsellers this sin, carson block saying it was a target for muddy waters. Foods was highlighted as a short target. Taking a look at asian currencies, most on the back leadingh the korean won the laggards given the offshore yuan paring gains after that slightly weaker fix from the pboc, the first a notch lower in the reference rate in seven days. Bank of America Merrill lynch sees the main message is that china does not want the yuan to be a source of instability. Haidi absolutely, styl stability is cheap here thank you for that. Lets get first word news with Rosalind Chin in hong kong. Will telljames Comey Congress that President Trump asked him and february 2 end investigations into michael flynn. The testimony for his appearance before the Senate Intelligence committee, he was say he never agreed to end the inquiry. You are also say the president demanded loyalty when they met on january 27. Irans revolutionary guard is indirectly blaming saudi arabia for two terror attacks in terror on. Meaningful that they took place so soon after President Trump criticized iran during his trump to readded. At least 12 people were killed in the two attacks. London, a controlled explosion outside the new u. S. Embassy. It is not terrorism related. The operation comes a day before the general election where security and terrorism have risen to the top of the campaign agenda. U. S. Of diplomats themselves have yet to move into the new embassy. By global ratings cut qatar one notch and put it on watch. Is now aa, the fourth grade. Investment s p will reassess the impact of the diplomatic row august 25. Global news 24 hours a day powered by more than 2700 journalists and analysts in more than 120 countries. This is bloomberg. Rishaad tensions boiling over between the reserve bank of india and the Modi Government as it tackles record low inflation and the week is growth in years. An independent committee to oversee interest rates, the government openly expressing frustration the bank chose not to ease the cost of borrowing on wednesday. The vote saw the first ever dissenter in the policy Committee Meeting there. The government to give its own assessment of the economy to the reserve bank, whether it is done orderly is immaterial. That an important input the Economic Division gives input to the central bank. Ultimately it is the authority of the central bank itself to decide the rates, and we always respect the jurisdiction. Guest expectsext the rbis next move may be a raise, not a cut, but not until next year. Welcome back, richard. What is this simmering tension . Dissenter on the board, well, you can have your own way the whole time. Why organize a Monetary Policy committee in the first place . Is normal stuff. He is the fourth r. B. I. Governor i have covered. There are always tensions between the finance ministry and the central bank. The finance ministry typically wants lower rates, and the central bank wants tighter fiscal policy. I thought it was interesting once again that they highlighted fiscal stimulus and upside risks to inflation, so it is a normal , theion, but for my money governor and the committee made the right decision, and they clearly are taking the new 4 target seriously. Inflation is seen as a key. This is a chart, 6162, there we go. We have been Holding Steady since september, 6. 25 , this is what, printed cpi, core cpi, 4 . Combined, 3 , record low by indian standards. You dont need to cut, do you . What is the efficacy of a cut when it comes to an economy with the structure of indias . A good point. There are two critical issues. One, and this is a mistake a lot of forecasters have been making, what doesnt really matter is current inflation. What matters most is the Central Banks inflation forecast. That is their intermediate target of policy. Whereflation reflects Monetary Policy was 1218 months ago, so the fact they have low inflation today, Monetary Policy one year ago. R. B. I. Tters most is the forecast and they expect inflation to pick up. Secondly, again, this feeds to your point, the Banking System after demonetization remains awash with excess liquidity. Than threere trillion rupees and liquidity, which the r. B. I. Is doing its best to mop up. Strongl means quite downward pressure on lending rates, and this is something a lot of people have been missing. Rbis own data, the benchmark weighted lending rate has fallen by 10 basis points over the last month. Deal, but at the margin, and excess liquidity means monetary conditions are still easing and therefore no real reason for the r. B. I. To haidi i want to add to that point. You are talking about demonetization and this liquidity in the system. I want to throw this chart up, 15 05, master banking loans close to a quarter century low, so is it your point that you can have these political big rings about whether they should ease or not, but there is no point for them to cut . Thats right. If you look at that blended lending rate which i highlighted, that has now come down over 100 basis points in the last year, so effect of rates are coming down. One of the most exciting developments on the Indian Economy is the fact that rates, particularly the Affordable Housing segment, are continuing to fall. This will be a key growth driver for the Indian Economy over the mediumterm, much as it has been for china. Rates, particularlyeffective r. The problem is the demand for credit from corporates because the Banking System is clogged with bad loans, is not there. This is not something the r. B. I. Can do anything about in terms of lowering the repo rate, the policy rate. Haidi you mentioned the bad loan situation. Is it basically china all over again . Are we looking at the same types of circumstances and risks . India is way behind china in the development arc. What is different in india be on that is that indian authorities have tried to be very transparent and are trying to work as proactively as possible to get their arms around the situation, so they have been clear and trying to recognize the scale of the problem. That was one of the big achievements of the governors predecessor at the r. B. I. , and there are increasing attempts at resolution. Recently, the r. B. I. Has been given greater powers to step in and force the banks to take haircuts. This is a problem that will be fixed over time. It will unfortunately not happen overnight. That area of the economy will stay sluggish, but again, Monetary Policy can be affected come the answer is a straight no. Rishaad what are the monsoons going to be like, but you are an economist, what will be the strains and pressures from the introduction of this general sales tax . This is the interesting thing. Two big unknowns. That have been forecasts as we get deeper into the season, the monsoon will get worse and worse with the potential for an el nino phenomenon. What we do know in the here and now that inflation is low, particularly where we are seeing record deflation. If you are looking forward a year, will that persist . No. Rishaad that is the biggest game in town. We just dont know. If historic expense for a lot of economists has been a temporary uplift to inflation, may be a percentage point or so. We will have to wait and see. This is one of those inflation thede risks that beholds r. B. I. To stay on hold and wait and see how much inflation does pick over the next 12 months from these current very low levels. Rishaad no known unknown, in other words. Anyway, thank you very much indeed. Right, and lets tell you what we have come of for fame and fortune. Experience, he will share that. This is bloomberg. Rishaad this is Bloomberg Markets asia. I am Rishaad Salamat in hong kong. Haidi i am haidi lun in sydney. The latest business flash headlines. Meg whitman has told bloomberg she still has work to do as ceo of hewlettpackard enterprise. Says commodity costs and acquisitions are to blame for diluted margins in the Second Quarter and she plans to do more to reduce overhead. Moreincludes working on a costeffective structure in the services business. Our margins in the Enterprise Group was down in q2. The reason is we had stranded costs from the vested cheers. We had done some acquisitions initially eluded of, and we had significant commodity cost increases, but we anticipate that margin will go back up to historic levels in q4. Rishaad airbus may be thrown a lifeline as emirates talks about building 20 more planes. Biggest a 380e operator in the world, worth 8. 7 billion before discounts. The carrier has not decided how many aircraft it wants. Consultancy firm eca says hong kong has overtaken tokyo as the most expensive asiapacific city four expats and is now number two in the world. The local dollar pegged to the u. S. Currency has made it more expensive. Tokyo remains at number seven. Singapore dropping to 24 through the sterling postbrexit fault makes london 132 on the list, now cheaper than bangkok or rio. Well, disneys virtualreality startup is teaming with xiaomi and building a studio and beijing. We are building a technologybased company in to focus onanghai, developing and creating some of the most amazing vr content for the global audience. In addition, we are building a studio in beijing where we are bringing in a Creative Team to produce some amazing vr content. What are the hurdles you need to get over to get vr to the level where any shopper, any consumer, can go out and get involved. Hardware, itthe doesnt give you the freedom. You have a cord around your head. If you are using a phonebased system, it is not a comfortable headset. It does not give you 360 degree motion or interactivity. What google has done with daydream and what microsoft is coming out is a step in the right direction. The other part is the content. Now, the average link is five minutes muscle how do make it longer and make the experience is more compelling so people look at the are as a new medium and appreciate it above the tv or cinema . The third piece is the business model. How are we going to make money with the are . Give us a timeframe and how much money will be spent . I dont know the exact money, give a historical perspective. In the early days of internet when no one was making money, people were burning in ecommerce before the was a prophet. This is a platform, an ecosystem, that if you pick the right partners, it could pay for itself. Is there a risk of a bubble . I think a bubble already happened, and people are talking about avr winter here in china. Of people have exited the market, and those who have stayed have a strong conviction that this is the direction we want to go and there is a very Bright Future in the market. We are looking forward to trade data out of china, the u. K. Of election, also the ecb, and james comeys testimony as well. You are watching bloomberg. Valley venture capitalists gained famed and fortune for backing startups that have gone on to become household names, tesla, hotmail, and skype. Draper,ing about tim the billionaire founder of draper associates. He joins us exclusively from jakarta. What are you looking for in indonesia . This is a great time for the unbank. This is a huge opportunity. Unbanked, there is a huge opportunity through bitcoin and block chain to bank all these people and make sure they can pay their bills, and there is a huge rising middle class. This is a major, major opportunity here in indonesia. We are working with our wave , and they are taking me around and showing me all the great entrepreneurs and great opportunities here. On thei want to pick up most recent headline making comments you made about not focusing on china because of capital controls. Isnt that part and parcel of doing business in some of these emerging markets . I love china. I love all the Chinese People i have gotten to know, and i love the country and all the great things that have happened there. It is just the government is not letting money out. I have money owed to me that they are not letting out of the country or do i am i cannot invest more money in which they are not letting money out. It is like putting money in a black hole. Why yourhe only reason writer picked up on that. Something which could change in the future, but lets look at what you are seeing in jakarta with wave maker as your partner. What is the most compelling idea you have seen . Are just getting started. They will take me on a bus tour through jakarta, and i will be pinched by a whole bunch of different entrepreneurs, but i am pretty excited about what is going on. Jackll meet the team at go , and i have met the ceo of grab. I think that is one of many, many, many applications that inl start happening here indonesia, and i think this is just a great place to be. I can see the excitement. I have been stuck in the traffic. I get the whole thing. There is going to be a lot going on here. Another thing i want to say is that when you are in a country like this, the infrastructure is not there, but that is a good thing for entrepreneurship because you can set up a new infrastructure. Instance, wefor an had land lines, and so we were stuck with land lines and slow to bring on the smartphone, but china did not have land lines, so they could jump right into the smartphone. Same thing hashe happened. They dont have very good banking services, so now they have an opportunity to use it bitcoin, and make that their currency. Suddenly we have this major opportunity that is not going to be around for those countries that already have strong we areructure because ready to leapfrog that, so i always look for these countries where the population is really of all and they are free those burdens of infrastructure, i guess. Please stick around with this, so much to talk about. It is a very exciting part of the world there, looking at the opportunities. Also, asking about the economy as a whole. What you feeling back in the united states, and perhaps talking to a bit about, well, what is the next big thing. We have the sharing economy one thing. How much more mileage is there in that . What is likely to be the next thing in this whole the sea space . Pc space . Announcer from our studios in new york city, this is charlie rose. Charlie we begin this evening with politics. Former fbi director james comey will testify before the Senate Intelligence committee thursday. It is one of the most anticipated hearings in recent history. It also marks comeys first public appearance since being fired by President Trump last month a central question is whether he believes that trump tried to obstruct an investigation in russias ties in the u. S. Campaign. We look from a global perspecti
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