Damage assessment economists expected payroll reports to show 22 million job losses, taking unemployment levels to their highest since the 1940s. Neel kashkari says the impact will be devastating. And customer orders slump. We speak to the ceo. Lots still ahead in the trading day. We will talk about siemens numbers and the lack of visibility. We also get plenty of analysis for the jobs report which we expect to see later today. With that in mind, lets take a look at futures. It seems we have found plenty of reason to be cheerful this friday. We will not have any trading in london because it is a Public Holiday, but we have plenty of positive trading coming in from the Asian Session and indeed, in the futures, we see that reflected. Futures point higher by around 1. 3 while european futures, where we see moves to the upside. Euro stocks futures up by a similar amount. Of focus on reopening, which seems to be taking place or being planned for in various parts of europe and in some cases in the United States as well, and a lot of focus on the trade story out of the u. S. As chinas trade relationship with u. S. Lets get into that conversation now. Talk trade negotiators pledge they will create favorable conditions for the limitation of a bilateral trade deal and cooperate on the autonomy and public health. According to a statement from Chinas Ministry of commerce, chinas vice premier spoke on the phone to u. S. Trade representative Robert Lighthizer and trade secretary steven mnuchin. Fromng us with the latest new york is Annmarie Hordern. Good to speak with you. This positive movement between the u. S. And china very important, given the fallout have seen around coronavirus and its origin, and also talks around implementation of the trade deal. This sets the stage for something positive, i guess. Yeah, definitely a positive dialogue, and also it comes ahead before they were even supposed to speak to. They are talking and talking earlier. I think the crucial part of the statement was when they said both countries fully expect to their obligations in a timely manner in spite of the pandemic. I think that is important for two reasons. The deal is calling for china to buy an additional 200 billion dollars worth of u. S. Goods and services over two years compared to 2017, but because of the pandemic, those purchases so far have been behind the pace that they need to reach, so it was a positive that they said in spite of the pandemic, they are going to do what they can to meet the requirements of a deal. You look at where the rhetoric has been the last few weeks, considering what the pandemic has done to the relationship, quite deteriorating the trumpet ministry blaming china for misleading the world about the scale of the epidemic and from survivor himself was threatening more tariffs as punishment, and the market is certainly looking at this is definitely a positive relationship a positive direction for that relationship. That yeah, you wonder how relationship progresses as we head closer to november and regardless of who ins up in the white house, no doubt anybody concerned wanting to look tough on china at this point, or certainly that is the message we have been getting from the trump administration, and many people say joe biden would be the same. House has blocked cdc guidance over the reopening of the economy. As we watch the interplay between the white house, the state, and the cdc putting in howr thoughts about prepared businesses and various facilities need to be. And mary yeah, and i just read part of the 17page document the Associated Press had posted. It is a version of this guidance. It details everything childcare programs, summer camps. Even in the summer camp section, it was how you should be placing beds and how you should be watching certain things children would share. This is what the cdc was putting out, and according to trump officials, the concern was that the recommendations were just too prescriptive ended not account for businesses or camp or place of worship and a hardhit part of the country like new york over one like montana that is not suffering from the pandemic and a much severe place, but this is definitely potentially going to be controversial because this is the cdcs job, to protect americans from these kind of health bets, and it has been sidelined during the virus response. As you said, weve seen a lot of mixed messages, and the cdc has declined to comment on this, but we are seeing businesses the trumpet menaced ration really pushing for businesses to reopen, but at the same time, the United States is adding more than 20,000 new cases a day. I sit here in new york and neighboring new jersey, and they appear to be on the downslope, but Governor Cuomo said yesterday be the the decline of the spread is not a steep is the incline. New york state alone has suffered more than 26,000 deaths. That is more than spain as an entire country had, so these numbers are agonizing, but these numbers will certainly be controversial, given that they are potentially blocking this cdc guidance. Europe, we are looking at places a little ahead of the u. K. Opening up in the u. K. A little behind, opening up on the lockdown conversation. Yesterday, we woke up to newspapersrom u. K. Saying lockdown would begin on monday and there has been a lot of backpedaling from the u. K. Government around exactly what is going to change, if anything, by monday. Speed with what we know. And mary it is interesting. You will know this more because you are in london, but newspapers talking about you could potentially go back out to the pub. I think maybe they were getting ahead of themselves and too optimistic about what the government plans to announce, but it is clear the government is going for a more cautious approach. Top scientists are warning the hastrys infection rate quested upwards. Borisnson and the johnson telling the cabinet they want to proceed with maximum caution. Sunday will be interesting. This is where they are going to map out their version of phase ii, but people familiar say the rules may not change much until june when small shops may be allowed to reopen, so potentially newspapers are just reopening, talking about what you can do. It sounds like they do not plan to lift too much in terms of the lockdown. Anna british media getting ahead of itself perhaps a little bit there. Thank you very much, reporting on the global virus story. Coming up, bracing for the jobs report. We will look ahead to Employment Data out of the United States after initial jobless claims came in above 3 million for a seventh straight week. Andill get that analysis what that means for the fed. This is bloomberg. Anna welcome back to the European Market open. A few minutes to go until the start of the equity trading day, and futures do point to a positive start to that trading day. Word newsto the first update. China and the u. S. Have agreed to cooperate and work toward and limiting their phase one trade deal. In a readout from recent talks, the u. S. Said both countries early expect to meet their obligations under the deal. The most unprecedented economic crisis in peace time that is what we are living through according to the European CentralBank President , Christine Lagarde. She says policymakers will do whatever it takes to help the economy weather the shop. She spoke on a webinar organized by bloomberg. They have to go beyond the normal including the normal and conventional tools to use things that are of an exceptional nature, and that has to be designed, calibrated with the appropriate level of deviation and with room to maneuver in order to actually deliver on that mandate. The in the u. K. , government is playing down expectations the lockdown will assignificantly rolled back the countrysn infection rates could edge back up in the next few days. Prime minister Boris Johnson plans to address the nation this sunday with plans for a way forward. Sources tell us the rules may not change significantly until june. Global news 24 hours a day on quicktake by 2700 bloomberg analysts and more than 120 countries. Futures pointing higher despite directly to, so lets get to that conversation. Applications for u. S. Unemployment benefits topped 3 million for a seventh straight week as the economy remained under lockdown in the u. S. That takes the total during the coronavirus pandemic more than 33 million jobless claims. This ahead of the jobs report that later on today is expect it to show a record shattering loss of jobs equivalent to the last nine u. S. Recessions combined. Joining us now is the founder and chief economist at pantheon macroeconomics. Great to have you with us. With the numbers. This might be important in terms of the markets positioning around this number. We got initial jobless claims to work. Just how many jobs will have been lost in the month of april . We are taking a fairly different approach to normal because usually, about half the people who make a jobless claims do not given month follow up because they find another job within the given month. This time it is quite different because it seems the vast majority of people who lost their jobs between march and april did not find another job. I think most of those people will fall off the number, and in theans 22 millionish headline. There is some scope for deviation either way because there was them hiring, but there also have been some people who lost their jobs but did not make a claim, maybe because they thought they were ineligible or perhaps our undocumented workers. That it could be even more hideous than the 22 million most people are looking for, and it would not surprise me if it were 25, which is also unimaginable. Unfortunately, there will be another big hit in may as well before we start to turn the corner in june. Anna give us the historical context. These numbers are worse than we have seen since records began, i understand, on this particular measure. When do you expect to see the bottom . Will it be next month . I think it will be next month. Were going to take out all the gains from previous cycles and probably lose another 10 million or 12 million, and then i think we will see the beginnings of an upturn. Euro states are opening up. It has been patchy, and so far the evidence is people have not flopped back to the businesses that have been patchy. They have seen a little bit of an uptick in activity in the restaurant sector. Hotels and travel have risen a little bit. Numbers are still absurdly low by any previous standards, but they have moved a little bit. Some people will be needed to be pulled back into their previous jobs in order to do that work, so im hoping the gym number will be up a little bit, but we are not going to see really big increases until we see the big states california, new york, new jersey, massachusetts opening fully. I dont see that happening until june, which probably means the july payroll number will be the first big one. Even allowing for that, we are not going to recover these jobs any time soon because even businesses that are reopening are not opening at full capacity. They will not need as much staff as before and that means the Unemployment Rate will be elevated unfortunately for quite a long time. Anna i read a couple of pieces of analysis that talk about the strange goingson in the average Hourly Earnings number that we might see today, and this is highly reflective the sad fact that haveof the jobs been lost are in businesses that were paid. Are literallybers that, the average. They have not made any adjustments, and normally it does not make much difference, but for this number today and april, we will probably see a lot of lowpaying jobs in retail and leisure, hospitality, restaurants, and bars. When you take that out of the sample, youre left with remaining people who on average earn a lot more. Effectively, there will be a break in the series. I do not know what they will do then. They might make an adjustment, they might make an announcement, but if they stick to their usual method, monthtomonth Hourly Earnings will be Something Like plus 6 not 0. 6 , 6 . That will be completely absurd and will tell you nothing about the economy but tell you about the break the covid virus has caused. They might print something more normal, but they will not see in an they will not say in advance what they are going to do. Anna maybe we will get two numbers, the adjusted and unadjusted. Fromve heard many times various fed officials that negative Interest Rates, they do not see any reason to go down that road. They have not seen anything in the european experiment that has impressed them in particular, but it seems this may be part of the fed funds futures market. We see for the first time negative Interest Rates being priced in for 2021 in the u. S. Do you think that is at all likely . I dont think it is very likely. I will not say it is impossible, but i dont think it is likely. They have made the argument many times, several officials, that they can control the yield curve with much more confidence than markets perhaps believe, and them to showed they need a more sustainably yield producing policy. Doinguld argue they are it de facto anyway by saying they will do whatever it takes to keep the market liquid and functioning normally. Why would you then need to apply negative Interest Rates . With the danger it would panic people and scare businesses and cause untold chaos in the banking system, it is completely unnecessary. The fed fund future, looking out at 2021, it is pretty illiquid. Theres not a lot of trading going on. It does not take many transactions to move it in quite a long way. I dont think those moves yesterday are genuinely indicative of what most people in the markets think, and im sticking to my view that i would be pretty astonished if they went negative. Anna ok. Thank you very much. Chief economist at pantheon macroeconomics. He stays with us on the program. Coming up, reaction to the u. S. Jobs report. Will be talking to the talking to larry kudlow at 2 00 p. M. Coming up, the ecb president says she has no choice but to go beyond conventional policies. You will hear from her next. This is bloomberg. Anna welcome back to the European Market open, live in london. Futures suggest in europe we will see a positive session as we have through asia and in the u. S. Futures upside pointing to the upside as well. Hasstine lagarde says she no thoughts of going beyond conventional policies to combat the coronavirus crisis. This comes after german courts ruled the institutions Bond Buying Program may be illegal. The guard said current circumstances are exceptional. Take all possible measures and policies to help with maintaining the situation, sustaining it for as long as necessary to weather this horrible shop. The message has to be to everybody the best we can do in a situation like this is to learn together, cooperate as dont letssible, and our stronger do more so that our weaker can ride on measures taken elsewhere. The more we can control this as a pandemic, the healthier our economies will be and the healthier our economies are, the healthier we will be. Ndividually and as communities anna some of the voices yesterday from that panel. Executive of pantheon macroeconomics is still with us. When you look at what the german court said this week, the impact on the ecb, you encounter a direct line between with the court said and what they are doing to fight the pandemic, but there are links. Has the german courts movement threaten does it the ecbs independence, do you think . Ultimately, i think it probably doesnt because ultimately, the decision will end up in the European Court of justice, and my guess is that eventually ultimately, the ecb will not be prevented from doing this, but it has injected a temporary note of uncertainty. I think i would be willing to go that far. Im sure people in the German Constitutional Court knew that what they were doing was effectively create cratering thethrowing a bomb into mechanism the ecb has introduced, but i very much doubt if they genuinely believe they will stop or substantially change what is happening, and listening to ecb leadership over the last couple of days, i dont think that they are panicking over that they will be unable to do what they think they need to be able to do to prevent the economy from falling into an even deeper hole. Would be hugely surprised if the ecb was forced to go away and rethink and support mechanisms. The reaction in the market for that does not really bear thinking about. I cannot believe it was the constitutional courts intention, and ultimately, i suspect it will blow over. Anna what kind of trajectory of recovery do you see for the eurozone economy . Dire pmi data with singledigit readings in some cases. What kind of path out of this recession do you see for europe . What is the shape of it . I think europe has a couple of advantages, over the u. S. , for example. Policy coordination across europe sometimes look fractious, but in fact, i think theyre going to do reasonably well, but also the european governments, germany in particular, and also many other countries in east europe have been very good at fighting the virus with aggressive Testing Programs and really controlling it much more quickly and effectively than they have in the u. S. If that continues, the opening of europe will probably be smoother and less patchy than it is in the u. S. Where things are kind of going the wrong way. Huge differences, so im reasonably helpful that actually once we get through the worst of it anna sorry but we are out of time and the conversation. Thank you very much for joining us from pantheon macroeconomics. We will talk about siemens numbers coming up next on bloomberg. These days staying connected is more important than ever. So were working 24 7 to maintain a reliable network, to meet your growing internet needs. Were helping customers who are experiencing Financial Difficulties stay connected. Were increasing internet speeds for low income families in our internet essentials program. And delivering selfinstall kits to your door. Nos comprome