Total bond purchase target to 745 billion. Beforewaiting until 2 30 the governor comments to journalists. We will get more details on exactly what the bank was thinking at that point, but theres obviously speculation swirling that we could see as far as negative rates. Qe byoted 81 to expand 100 billion. It will be interesting to know whether that one is actually for more qe at that point. The data in the moment very weak. We saw the cpi data earlier this and thatedibly weak, negative gdp print for april. Remember, the bank and the asernor more broadly seen more optimistic on the economy in the u. K. , but the bank is ready to take further action is needed to aid the economy. That is what weve got so far. Jonathan the pound filling the gap lower, turning negative by just 0. 1 against the u. S. Dollar. Get me to august for the next big bank of england sit down. We expanded qe by 100 billion. Do they have to go again . Guy the expectation is they probably do have to go again. In many ways, today is just a continuation operation. They get to where they need to be in august to make a better assessment of what is happening with the economy. Bank now saying the axes saying the Asset Purchase Program to be completed by the end of the year. As the august decision seen absolutely pivotal. We will see whether they dip their toe into the negative rates universe. It is now widely thought that the bank will look at other options such as yield curve control, maybe lowering the rate on the funding program, similar to what the ecb is doing with the tltro. You keep the main rate where it is and lower the funding on that program, which gives the banks very cheap money, or it could buy even riskier debt. But the bank also now adding that the labor market has weakened materially. But that august meeting now absolutely crucial. You wait until 2 30, and we make it a better guide at that point as to where the bank is going, where the governor is going in terms of additional policy, which could become reality in august. Jonathan guy johnson on the latest from the bank of england for another 100 billion sterling in qe. Largely expected. Maybe they will have to do any more. Largely expected they will expand the Balance Sheet again. Sterling turns around with it. Pop is amazing, john it is amazing, jon. Im going to interview now our chief premier league strategist jonathan ferro. Do you decide to do negative rates, or does the market tell you to do a negative rates . What do you think . Jonathan i think what the bank of england has done has been really curious. I think they are flirting with negative interest rates, which brings down yields even further, but i dont think they want to do it. The former governor used to call this the merit dollar strategy, were you think left where you feint right, but ultimately just go forward. Tom whos merit donna . On, you cant know the man city score and not know who diego merit donna is. Youre just exposing yourself. Tom was he there last night . I dont know. I know kenny g played. Jonathan can i turn to Lisa Abramowicz to get the latest on what we expect over the next four hours . [laughter] through the day ahead, please. Lisa it is interesting, especially as the data gets worse in terms of the labor market in the united kingdom. 8 30 am theting at initial jobless claims, as well as the continuing claims, which i am watching closely to see whether the optimistic read on the jobs report will read through. Also, 1 00 p. M. , democrats in the house unveil an infrastructure proposal, and a 3 00 p. M. , President Trump is meeting with governors to discuss reopening of Small Businesses. Very interested in what he has to say about the book john bolton wrote. Also, i look ahead to his rally in tulsa, oklahoma tomorrow. Election season really heating up in the u. S. , heading towards another crosswind in the difficult market. Jonathan nobody is happy with mr. Bolton. We will catch up with mr. Cirilli in about 10 minutes. I want to start with kate moore, blackrock strategist. Can you tell me whether traditional approaches matter anymore in a world dominated by Monetary Policy . Kate let me just say, good morning. I think valuations at this point are really tricky, especially forward measures of valuation. No one knows at this point, have a, companies great sense of what earnings. Ill be in 2020 or 2021 i thank we are experiencing a lot of dislocations in the economy and consumption patterns, and it is predifficult to predict. So valuations in and of themselves are a difficult way to make investment decisions. What i will say is on across asset basis, with all of this qe, with all of this repression of yield, equities may look a little bit better. Tom this is extraordinary. I agree, it is completely unusual times, but june 30 beckons. How will institutional buy side 1 . Ey reset for july ate i am not sure we have giant rebalance after the second quarter. They never tend to move the market is much as we might fear. I think there has been a consistent rebalancing of institutional portfolios along the way, and people are still trying to figure out what to do with the second half of the year, yet alone make big asset shifts that will affect multiyear horizons. At this point, i would expect people to continue to ride the risk wave a bit, conscious of the fact that in the second half of the year, we have another set of big risk factors. Lisa just mentioned the election. Theres going to be a lot more news out of d. C. Over the next couple of months, and a lot of posturing by both democrats and republicans. I think that is perhaps going to shake the markets a little bit at some point. Lisa i am struggling with writing the risk curve at a time when people are still hiding out in some of the more defensive names. You see that certainly would be tech stocks and investment great. And investmentgrade credit. What do they have to see to go further into risk . Kate i feel like you are asking at what point we get a rotation into value, and perhaps some of the lower quality stuff. The hiding out has been in higherquality companies with strong Balance Sheets, management teams that investors have conviction and confidence in their ability to execute, and i think that makes sense. The trouble with what falls into value or what falls into the highly cyclical parts of the market at this point, some of it is structurally impaired. It is a much harder call, whether we are talking about the next couple of weeks or couple of years. One of the ways we have been talking about it on my team is to go into the wimpy cyclicals. These are cyclical companies, if you want to make a rotation towards better u. S. Growth, that also have the Balance Sheets and decent management teams. They may not be the cheapest, but i think they are the better bet. E, always kate moor great to catch up with you. Talking about structurally impaired businesses, did you see the delta ceo an hour ago speaking to bloombergs david westin, cap and capacity on planes at 60 . He was clear that can change, but lets consider that. Operating below capacity, can these Airlines Make money at 60 capacity . Lisa it is really difficult, and this is a big question. How much can these airlines ramp up business at a time when people are nervous about the virus, and they have to protect themselves from a liability standpoint . I am struggling with the viability. At what point does the pressure of not getting customers through the door start to create a solvency issue that said money cannot solve . I think thats what a lot of investors are grappling with. Just limitedis not customer demand. It is limited ability to actually expand capacity. You have to put the cap on yourself as an airline. Weve touched on it several times over the last month, but below Capacity Growth is something we will be grappling with with a long time, away from the sequential improvement story driving this market. Tom tom i think you nailed the meat of the delta interview. I think it is absolutely incredible how we are going to you and i i think talked the other day, is it a variable cost or a fixed cost . These companies, whatever their industry, are being overwhelmed by the new reality of crushing fixed costs, and they are going to have to adjust to that. That, ason alluded to he needs to wait and see what september and october bring. On this program, mr. Bolton managing to upset absolutely everybody. The republicans for obvious reasons, the democrats because he did not testify. We will talk about that with Kevin Cirilli and washington, d. C. From new york city, good morning. Alongside tom keene, im jonathan ferro, together with Lisa Abramowicz. This is bloomberg surveillance , live on bloomberg tv and Bloomberg Radio. The first word news, im ritika gupta. China is vowing retaliation for u. S. Legislation that targets beijing for imprisoning more than one million muslims. The law requires President Trump to sanction any individuals found responsible for the ighurs and other muslim groups. Meanwhile, john bolton wrote that President Trump asked chinas xi jinping to help him win reelection by buying more u. S. Farm products. An exit from the book appears in the wall street journal, in a devastating portrayal of the president s conduct in foreign policy. The president calls bolton a liar, and the justice the court has asked to not let the book be public. Critics mourn that legislation will threaten hong kongs unique freedom. The measure would punish acts of secession, subversion, terrorism, and collusion in hong kong. Any report says the coronavirus pandemic could wipe out more wealth than the financial crisis a decade ago. According to boston consulting group, more than 16 trillion of wealth could disappear, and growth could be slowed for the next five years. The report said the biggest losers would be rich people in north america and japan. Several brands with ties to slavery have apologized, and will make payments to projects supporting black and ethnic minorities, according to the telegraph. Global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. Im rick. Im ritika gupta. This is bloomberg. This is a very complicated relationship. It has gotten more comp a kid because of actions taken recently. I think we have what is an excellent agreement in place, 370 billion worth of tariffs in addition to all of the things ive said so far. I thing it is a really good deal for the United States, and we expect it to be honored. Jonathan u. S. Trade representative robert lighthizer. John bolton casting a shadow over that trade deal this morning. Good morning to you all. Alongside tom keene, im jonathan ferro, together with Lisa Abramowicz. This is bloomberg surveillance , live on bloomberg tv and Bloomberg Radio. In your equity market, we roll over a little bit. We are down 14 points on the s p 500, off by around 0. 4 . In the bond market, on treasuries would come in around two basis points on the 10 year on2 , in one neighbor the 10 year to 0. 72 . On, asus in washington tom calls it, the bolton paper. This ise house claims just a disgruntled former employee. The reviewer at the New York Times not happy either. The book is bloated with selfimportance, even though what it mostly recounts is bolton not being able to accomplish very much. It toggles between exceedingly tedious and slightly unhinged. Tom a nice summary, there. I think you captured the moment, particularly for our global audience. This is going to be huge in america today. What we want to do is give you some clarity of thought. But this mostly comes down to is the uniquely american concept of 1798,peech, started in was really infirmed in the depression years, particularly in the midwest of minnesota and nebraska, and culminated in the pentagon papers of 49 years ago. Joining us, Kevin Cirilli, our chief washington correspondent. Inside the beltway, free speech is a huge deal. What do you expect to see in the next 48 hours from the judge and what it will mean for the bolton papers, and what it will mean for the president . Kevin three things. First and foremost, regardless of what the judge decides, the information in the book is already ricocheting its way through the 2020 president ial election. This as john boltons accusing President Trump of trying to make a deal with president xi jinping in order to get reelected. I spoke with the Communications Director for the president s reelection campaign. He called it absurd. The administration pushing back heavily, saying nothing to see here, it is false, and trying to move on. The second point i would raise, this was largely expected. The administration knew this book was going to come out and tried to go the route of the judicial system. They are saying it is a breach of contract. That when you work in the intelligence community, you work on Sensitive National security issues, you do sign nondisclosure agreements, and not in the sense of a Trump Organization nondisclosure agreement, but with the United States government. Finally, regardless of what the judge does rule, this is a playbook that in recent years, even predating the trump administration, has really been utilized by the Publishing Industry to try to drum up sales for books, and that is what you are seeing on full display here. Jonathan well, we are all talking about it this morning, and i imagine every network is doing the same thing. Is anyone in washington, d. C. Happy about this book . Kevin i think bidens campaign is. [laughter] if you are former Vice President joe biden, this is just another piece of information you can use to try to attack the administration on. But beyond that, yesterday biden was campaigning in suburban philadelphia, and meeting with Small Business owners. But i spoke with several top democratic strategists who are wondering when joe biden is going to make more of an Aggressive Campaign pitch. When is he going to be able to really drive some news media narrative . It is a stark contrast to what you are seeing from President Trump. He is going to be back on the campaign trail on saturday in tulsa, oklahoma with a massive make America Great again rally. He will be flanked not just by his campaign, but by republican lawmakers. They want to reopen the economy. They want to get things back to normal, in their words. The president yesterday appearing on fox news, saying that they think the virus is going to fade away, versus what the biden world would say is a pragmatic, but slower approach. Lisa the market actually moved lower when the headlines from the bolton book came out yesterday, in that it perhaps dampens President Trumps chances of being reelected. Does it . Is there any momentum in the base against President Trump on these allegations . Kevin i put that very question to a trump advisor within the last 24 hours, and what the advisor said was impeachment, mueller, you name it, from a practical standpoint, between now and election day, virtually no chance of there being another impeachment process between now and election day, a significant one that would be a threat for removal of office. There is virtually no chance of any type of Mueller Report that would come about at all. Tom right. Nobody is surprised by this. Very quickly, why did the president select dr. Bolton . Everybody knew this was coming who knows john bolton. Why did he pick him for the job originally . Kevin it is part of a coalition of National Security leaders. John bolton is someone with a long history with washington, d. C. Very influential in conservative intelligence circles, and was brought into the administration as a result of that. Jonathan Kevin Cirilli down in washington, d. C. Kevin, thank you. Headline from the wall street journal, the president denying endorsing president xis camps for muslim minorities in xinjiang, china. I think this is what is interesting from this book, how it come look its policy over the weeks and months to come, and possibly the president as well. What we saw yesterday was fascinating. What did the president do . He signed a bill protecting muslim minorities in syngenta, china. In xinjiang,ang china. Tom is this the end of any discussions before the election with china . Maybe that is the outcome of the salacious comments within this book. Jonathan and as we know, this was going to be one of the big focal points of this election campaign. Who was hard on china, who could get the concessions. For that reason, some of the paragraphs from this book are quite damaging to that campaign. Lisa there is a question about, exactly to your point, this idea that perhaps President Trump will take an even harder line with china to prove a point ahead of the election, which certainly would be a risk. At least, you look at some of the models out there that are bullish on equities. Jonathan much more still to come. Equities down 16 points on the s p 500, down around about 0. 5 . In about an hour, claims data and america. U. S. Jobless just around the corner. From new york city this morning, good morning. This is bloomberg. Jonathan from new york city, this is bloomberg surveillance. We are live on bloomberg tv and Bloomberg Radio. Alongside tom keene, im jonathan ferro, together with Lisa Abramowicz. Equity futures slightly lower, down around 12, 13 points on the s p 500, 0. 4 . In the fx market, take a look at cable. The pound against the u. S. Ollar, 1. 25, 0. 4 they expanded qe by 100 billion. The mostll has to be confusing Monetary Pol