WEBVTT - Daybreak Asia: January 31, 2023

0:00:02.640 --> 0:00:06.120
<v Speaker 1>This is Bloomberg Daybreak Asia for this Tuesday January thirty

0:00:06.160 --> 0:00:09.880
<v Speaker 1>feet in Hong Kong, Monday January in New York and

0:00:10.000 --> 0:00:12.560
<v Speaker 1>coming up this hour, US stocks decline is the market

0:00:12.560 --> 0:00:16.680
<v Speaker 1>awaits the Fitts rate decision. Ford slashes EV prices in

0:00:16.760 --> 0:00:20.239
<v Speaker 1>response to Tesla's action and the Biden administration ways of

0:00:20.360 --> 0:00:24.520
<v Speaker 1>ban on all US components sales to Huawei, final plans

0:00:24.560 --> 0:00:27.240
<v Speaker 1>being made for the blank and visit to Beijing. China

0:00:27.320 --> 0:00:31.080
<v Speaker 1>reacts to check Taiwan phone call. Ford joins the US

0:00:31.120 --> 0:00:34.640
<v Speaker 1>electric vehicle price cuts. I met Baxter with Global News

0:00:34.920 --> 0:00:38.120
<v Speaker 1>at American soccer star Moose from Italy to England on

0:00:38.320 --> 0:00:40.640
<v Speaker 1>Dan Schwartzmann. I'll have that story more coming up in

0:00:40.720 --> 0:00:47.280
<v Speaker 1>Bloomberg Sports. That's all straight ahead on Bloomberg Daybreak Asia

0:00:47.720 --> 0:00:51.879
<v Speaker 1>on Bloomberg eleven and three on New York, Bloomberg n Washington,

0:00:51.960 --> 0:00:55.880
<v Speaker 1>d C, Bloomberg one, O six one, Boston, Bloomberg nine sixties,

0:00:55.920 --> 0:00:59.480
<v Speaker 1>San Francisco, Sirius x M one nineteen and around the

0:00:59.520 --> 0:01:02.800
<v Speaker 1>world on Bloomberg Radio dot Com and via the Bloomberg

0:01:02.880 --> 0:01:10.240
<v Speaker 1>Business Actor. Good morning, I'm do Prisoner and I'm Brian Curtis.

0:01:10.240 --> 0:01:13.280
<v Speaker 1>Here are the stories we're following today. The White House

0:01:13.400 --> 0:01:16.959
<v Speaker 1>is considering cutting off Huawei technologies from all of its

0:01:16.959 --> 0:01:21.000
<v Speaker 1>American suppliers. Four years ago, the Trump administration limited sales

0:01:21.080 --> 0:01:24.200
<v Speaker 1>by US companies when Huawei was added to the US

0:01:24.400 --> 0:01:28.200
<v Speaker 1>Entity List out of national security concerns, but now officials

0:01:28.240 --> 0:01:31.080
<v Speaker 1>in the Biden administration are calling for an outright ban.

0:01:31.800 --> 0:01:34.920
<v Speaker 1>It's not clear how soon the administration would act on

0:01:34.959 --> 0:01:38.160
<v Speaker 1>this kind of policy change. We're told that the discussions

0:01:38.160 --> 0:01:41.360
<v Speaker 1>are still at an early stage. Officials said that timing

0:01:41.400 --> 0:01:45.080
<v Speaker 1>could coincide with the anniversary of Huawei's addition to the

0:01:45.240 --> 0:01:48.680
<v Speaker 1>Entity list in May. There was no comment today from

0:01:48.680 --> 0:01:52.080
<v Speaker 1>either the National Security Council or the Commerce Department. Well,

0:01:52.120 --> 0:01:54.600
<v Speaker 1>on Wednesday, two pm Wall Street time, we will have

0:01:54.880 --> 0:01:58.080
<v Speaker 1>a FED rate decision. The goals seems to be dialing

0:01:58.160 --> 0:02:00.440
<v Speaker 1>back on the nature of how a rest with the

0:02:00.440 --> 0:02:04.160
<v Speaker 1>FED has been in its fight against inflation, without signaling

0:02:04.200 --> 0:02:07.760
<v Speaker 1>a readiness to stop entirely. Now, despite the rates that

0:02:07.800 --> 0:02:10.880
<v Speaker 1>we have seen last year, the rate hikes, I should say,

0:02:10.880 --> 0:02:13.519
<v Speaker 1>financial conditions are at the weakest level that they have

0:02:13.639 --> 0:02:16.800
<v Speaker 1>been in about eleven months. Somewhat hard to believe. And

0:02:16.880 --> 0:02:18.840
<v Speaker 1>now the f O m C seems to be worried

0:02:18.880 --> 0:02:24.800
<v Speaker 1>that markets maybe missing the message. Paul Krugman is Nobel Laureate.

0:02:24.840 --> 0:02:27.280
<v Speaker 1>We spoke with him earlier. I'm a little worried that

0:02:27.639 --> 0:02:29.600
<v Speaker 1>the markets may be getting ahead of themselves. I mean,

0:02:29.639 --> 0:02:34.000
<v Speaker 1>I'm I'm a big inflation dove. I'm still basically I

0:02:34.040 --> 0:02:38.240
<v Speaker 1>believe that that inflation is going to come down. But

0:02:38.600 --> 0:02:42.360
<v Speaker 1>the degree of certainty uh that we're seeing in the

0:02:42.400 --> 0:02:45.440
<v Speaker 1>market is the degree of certainty I'm seeing in financial

0:02:45.440 --> 0:02:49.000
<v Speaker 1>newsletters that inflation is behind us. That makes me nervous.

0:02:49.120 --> 0:02:51.920
<v Speaker 1>That is economist Paul Krugman. By the way, the market

0:02:51.960 --> 0:02:54.880
<v Speaker 1>is expecting the Fed to raise rates by a quarter point,

0:02:54.960 --> 0:02:56.880
<v Speaker 1>so we would have the target for the Fed Funds

0:02:56.919 --> 0:02:58.720
<v Speaker 1>and Arrange of four and a half to four and

0:02:58.880 --> 0:03:02.440
<v Speaker 1>three quarter percent. And as you know, Brian, last month

0:03:02.520 --> 0:03:07.200
<v Speaker 1>we were up a half point following four consecutive seventy

0:03:07.280 --> 0:03:11.760
<v Speaker 1>five basis point rate hikes. So it's a little difficult

0:03:11.760 --> 0:03:15.600
<v Speaker 1>to know exactly where we are there and also in China,

0:03:15.720 --> 0:03:18.080
<v Speaker 1>but listen to this. Boeing is set to add a

0:03:18.120 --> 0:03:20.800
<v Speaker 1>fourth assembly line for its seven thirty seven Max in

0:03:20.800 --> 0:03:24.359
<v Speaker 1>a move to capitalize on growing demand for narrow body jets.

0:03:24.639 --> 0:03:27.639
<v Speaker 1>The work will come satisfactory in Everett, Washington, and it's

0:03:27.639 --> 0:03:31.000
<v Speaker 1>expected to start in the second half of four The

0:03:31.080 --> 0:03:33.840
<v Speaker 1>decision comes on the heels of an optimistic outlook for

0:03:33.919 --> 0:03:37.960
<v Speaker 1>China travel, as reopening propels passengers back to the skies.

0:03:38.240 --> 0:03:41.800
<v Speaker 1>According to Boeing's vice president of Commercial Marketing Darren Holst,

0:03:42.320 --> 0:03:45.400
<v Speaker 1>air travel worldwide was back to seventy seven percent of

0:03:45.400 --> 0:03:48.680
<v Speaker 1>twenty nineteen levels in December. Those numbers are expected to

0:03:48.800 --> 0:03:53.320
<v Speaker 1>rise to by the end of June as China's travelers returned.

0:03:53.600 --> 0:03:57.720
<v Speaker 1>Holst reiterated the playmakers expectations that airlines will need roughly

0:03:58.640 --> 0:04:01.520
<v Speaker 1>aircraft over the next twenty years to meet demand and

0:04:01.600 --> 0:04:05.120
<v Speaker 1>replace aging planes, and he says that China will be

0:04:05.120 --> 0:04:08.840
<v Speaker 1>a major driver of orders. Malaysia State owned Investment Fund

0:04:09.040 --> 0:04:13.560
<v Speaker 1>one MDB was supposed to promote economic development, but instead

0:04:13.800 --> 0:04:17.839
<v Speaker 1>it spurred a global multibillion dollars scandal, and now Malaysian

0:04:17.880 --> 0:04:21.360
<v Speaker 1>Prime Minister on War Ebram is calling out Goldman Sacks

0:04:21.400 --> 0:04:24.159
<v Speaker 1>to honor the settlement for its role in this ordeal.

0:04:24.520 --> 0:04:29.040
<v Speaker 1>I think Woldman's sex to come out clean and and

0:04:29.040 --> 0:04:31.800
<v Speaker 1>and deal with militia and don't don't think that you can,

0:04:32.200 --> 0:04:38.159
<v Speaker 1>you know, dismiss this as something um small that you

0:04:38.200 --> 0:04:43.120
<v Speaker 1>can just use your strength to dictate your terms now.

0:04:43.120 --> 0:04:46.719
<v Speaker 1>An agreement reached back in July called for Goldman to

0:04:46.760 --> 0:04:49.520
<v Speaker 1>pay two and a half billion dollars in exchange for

0:04:49.600 --> 0:04:53.000
<v Speaker 1>Malaysia to drop its charges. Goldman was also asked to

0:04:53.040 --> 0:04:57.040
<v Speaker 1>return one point four billion dollars of one MDB assets

0:04:57.080 --> 0:04:59.799
<v Speaker 1>that were seized by authorities around the globe. Now. According

0:04:59.839 --> 0:05:03.240
<v Speaker 1>to of filing from Goldman last year, the current issue

0:05:03.320 --> 0:05:08.480
<v Speaker 1>remains over an August two payment deadline. At that time

0:05:08.920 --> 0:05:11.880
<v Speaker 1>for the filing, Goldman stated the party has had three

0:05:11.920 --> 0:05:14.680
<v Speaker 1>months to resolve this dispute. The matter will now head

0:05:14.720 --> 0:05:20.000
<v Speaker 1>to arbitration if no resolution is reached. Briefly, copper prices

0:05:20.120 --> 0:05:23.359
<v Speaker 1>lower as investors reassess the outlook for demand in China.

0:05:23.400 --> 0:05:27.120
<v Speaker 1>More from Bloomberg's Anibal Jewelers. Bloomberg's index of early Chinese

0:05:27.160 --> 0:05:30.600
<v Speaker 1>economic indicators shows a slight uptick, but copper has been

0:05:30.640 --> 0:05:33.600
<v Speaker 1>constrained as China's home sales during the holiday period fell

0:05:33.680 --> 0:05:37.160
<v Speaker 1>four from a year earlier. Sentiment has now turned more

0:05:37.200 --> 0:05:39.960
<v Speaker 1>cautious as investors trying to gauge the health of the

0:05:40.000 --> 0:05:43.520
<v Speaker 1>recovery a note from gin Ray Futures said China's economic

0:05:43.560 --> 0:05:46.919
<v Speaker 1>recovery will continue, but Kappa has already priced in some

0:05:47.040 --> 0:05:50.279
<v Speaker 1>of the more recent macro bullishness. It's trading a relatively

0:05:50.320 --> 0:05:53.440
<v Speaker 1>high levels, which increases the risk of a pullback in

0:05:53.520 --> 0:05:57.000
<v Speaker 1>Hong Kong. I'm Annibal Rulers Bloomberg Daybreak Asian coming up

0:05:57.000 --> 0:06:01.200
<v Speaker 1>on Global News. Final preparations are being put on high

0:06:01.320 --> 0:06:04.440
<v Speaker 1>level US China talks later this week at Baxter with

0:06:04.480 --> 0:06:07.200
<v Speaker 1>more from the Bloomberg Newsroom in San Francisco. Eddie, Yeah,

0:06:07.200 --> 0:06:09.800
<v Speaker 1>exactly right. Douglas U s Secretary of State, and today

0:06:09.839 --> 0:06:13.120
<v Speaker 1>Blincoln is traveling to Beijang. It's been billboarded as a

0:06:13.160 --> 0:06:17.440
<v Speaker 1>major conversation. Asia Society Institute Vice President Wendy Cutler on

0:06:17.480 --> 0:06:21.119
<v Speaker 1>Bloomberg's Balance of power today, says, very important first step

0:06:21.160 --> 0:06:24.480
<v Speaker 1>going forward. What's the most disturbing is how little engagement

0:06:24.520 --> 0:06:28.200
<v Speaker 1>there has been between officials. And when there's little engagement,

0:06:28.440 --> 0:06:31.800
<v Speaker 1>then there's little prospects for cooperation in those areas where

0:06:31.839 --> 0:06:34.400
<v Speaker 1>either we need to cooperate because it's in the public good,

0:06:34.960 --> 0:06:37.920
<v Speaker 1>or it's in our interest to avoid a military conflict

0:06:38.000 --> 0:06:41.000
<v Speaker 1>or a military incident. Cutler says in the benefit of

0:06:41.040 --> 0:06:43.359
<v Speaker 1>both sides to talk, but at the same time, we

0:06:43.360 --> 0:06:46.640
<v Speaker 1>should not expect that a major breakthroughs Again, that's the

0:06:46.839 --> 0:06:49.600
<v Speaker 1>end of the week, within the week. Blincoln meanwhile, as

0:06:49.640 --> 0:06:52.600
<v Speaker 1>an Israel today, saying the US commitment to Israel has

0:06:52.720 --> 0:06:56.200
<v Speaker 1>never wavered, but peace in the region will only come

0:06:56.440 --> 0:06:59.279
<v Speaker 1>with a two state commitment. We continue to believe the

0:06:59.279 --> 0:07:02.560
<v Speaker 1>best way to achieve it is through preserving and then

0:07:02.600 --> 0:07:06.640
<v Speaker 1>realizing division of two states. Yeah, Israeli Prime Minister Benjamin

0:07:06.680 --> 0:07:08.520
<v Speaker 1>that Yahoo mean, while says on the top of the

0:07:08.560 --> 0:07:10.600
<v Speaker 1>list and cooperation, is it wrong? I think there's a

0:07:10.600 --> 0:07:14.960
<v Speaker 1>common consensus that this regime must not acquire nuclear weapons,

0:07:15.600 --> 0:07:17.640
<v Speaker 1>and that Yaho says it has to be stopped at

0:07:17.680 --> 0:07:21.040
<v Speaker 1>all costs. Meanwhile, a drone hit in an Iranian advanced

0:07:21.040 --> 0:07:24.720
<v Speaker 1>weapons production facility today Wall Street Journal reporting it was

0:07:24.760 --> 0:07:29.360
<v Speaker 1>an Israeli drone. Beijing has reacted angrily after reports that

0:07:29.520 --> 0:07:33.760
<v Speaker 1>the check President elect Peter Pavo called Taiwanese President Sim

0:07:33.800 --> 0:07:37.280
<v Speaker 1>Wang over the weekend to discuss their shared values of

0:07:37.320 --> 0:07:41.640
<v Speaker 1>democracy and human rights. China says it is considering blacklisting

0:07:42.160 --> 0:07:45.640
<v Speaker 1>Check made products and making them largely unable to clear

0:07:45.720 --> 0:07:50.080
<v Speaker 1>Chinese customs. Meanwhile, China's warning how speaker Kevin McCarthy not

0:07:50.200 --> 0:07:54.520
<v Speaker 1>to repeat Nancy Pelosi's visit to Taiwan. Well, we're starting

0:07:54.560 --> 0:07:57.680
<v Speaker 1>to see signs of an accelerating electric vehicle price war

0:07:57.720 --> 0:08:00.960
<v Speaker 1>in the US. TESTA went first and Forward is cutting

0:08:00.960 --> 0:08:05.840
<v Speaker 1>forty dollars off it's Mocke Mustang version. But Bloomberg's Ed

0:08:05.920 --> 0:08:09.200
<v Speaker 1>Ludlow says, as you move up the scale, the most

0:08:09.200 --> 0:08:12.560
<v Speaker 1>significant cuts are at the higher end. The GT Extended

0:08:12.680 --> 0:08:15.720
<v Speaker 1>range has a price trim of fifty dollars, and so

0:08:15.840 --> 0:08:18.360
<v Speaker 1>that actually starts to indicate that this might be more

0:08:18.360 --> 0:08:21.360
<v Speaker 1>about getting those vehicles in line with the i ra

0:08:21.360 --> 0:08:27.000
<v Speaker 1>A requirements for seventy federal credit or discount. It also

0:08:27.040 --> 0:08:28.680
<v Speaker 1>says you could have to do with the fact that

0:08:28.720 --> 0:08:31.280
<v Speaker 1>the chip supply is better now, so the supply demand

0:08:31.400 --> 0:08:34.560
<v Speaker 1>ratio for consumers may tip more to the buyer for

0:08:34.640 --> 0:08:37.040
<v Speaker 1>it also has at a discounted financing and an effort

0:08:37.040 --> 0:08:40.480
<v Speaker 1>to boost sales. White House are our US House speaker

0:08:40.559 --> 0:08:43.199
<v Speaker 1>Kevin McCarthy is going to the White House on Wednesday,

0:08:43.440 --> 0:08:45.840
<v Speaker 1>he says, to talk about the debt ceiling. But Bloomberg's

0:08:45.880 --> 0:08:49.560
<v Speaker 1>Jennie Schanzeno says, the White House has been firm on

0:08:49.640 --> 0:08:54.480
<v Speaker 1>its position on the debt ceiling. They keep to their

0:08:54.640 --> 0:08:56.640
<v Speaker 1>point that they are not going to negotiate on the

0:08:56.679 --> 0:08:58.880
<v Speaker 1>debt ceiling. I think what they'd really like to do

0:08:59.160 --> 0:09:01.920
<v Speaker 1>on the debt ceiling is have the Republicans come forward

0:09:02.120 --> 0:09:05.160
<v Speaker 1>with where they want to cut spending. McArthur has said

0:09:05.200 --> 0:09:07.560
<v Speaker 1>that he's open to talks about raising the death ceiling,

0:09:07.679 --> 0:09:10.439
<v Speaker 1>but that he wants guaranteed caps on spending. So we'll

0:09:10.480 --> 0:09:13.880
<v Speaker 1>see how this plays out. On Wednesday in San Francisco,

0:09:14.000 --> 0:09:17.280
<v Speaker 1>I'm at Baxter. This is Bloomberg. This is Bloomberg day

0:09:17.280 --> 0:09:20.440
<v Speaker 1>Break Asia. I'm Brian Curtis along with Rashad Salama, and

0:09:20.440 --> 0:09:23.640
<v Speaker 1>our guest is on Witty Bahoganah, head of multi assets

0:09:23.679 --> 0:09:27.640
<v Speaker 1>strategy at Columbia thread Needle Investments. And what we just

0:09:27.679 --> 0:09:30.160
<v Speaker 1>heard those comments from Paul Krugman, which are all the

0:09:30.200 --> 0:09:33.160
<v Speaker 1>more interesting since he is at Dove. But as a

0:09:33.240 --> 0:09:37.280
<v Speaker 1>counter to that, HSBC is predicting that the Fed will

0:09:37.679 --> 0:09:41.679
<v Speaker 1>will change course this year and will cut quite significantly,

0:09:42.400 --> 0:09:46.960
<v Speaker 1>cutting as soon as recession uh you know, is apparent.

0:09:47.480 --> 0:09:51.040
<v Speaker 1>HSPC is looking for a full percentage point in in

0:09:51.160 --> 0:09:53.240
<v Speaker 1>cuts and that's double the market Right now, the swaps

0:09:53.280 --> 0:09:56.679
<v Speaker 1>market sees just fifty basis points of a cut. Your

0:09:56.720 --> 0:10:00.920
<v Speaker 1>thoughts on that. How do you see the FED moving? Hey, Brian,

0:10:01.400 --> 0:10:03.520
<v Speaker 1>thank you for having me in a very happy new year.

0:10:04.800 --> 0:10:08.439
<v Speaker 1>Lots of debate in the market about production and really

0:10:08.920 --> 0:10:12.079
<v Speaker 1>um you specified just now with the market is expecting.

0:10:12.720 --> 0:10:16.640
<v Speaker 1>You know, I suspect the FED stays on hold this

0:10:16.760 --> 0:10:22.400
<v Speaker 1>year if the soft landing scenario um comes through and

0:10:22.520 --> 0:10:26.000
<v Speaker 1>the other scenario, which is recession, would actually be very

0:10:26.080 --> 0:10:28.600
<v Speaker 1>much in line with what HSDC is thinking. If there

0:10:28.679 --> 0:10:33.000
<v Speaker 1>is inter pocession, they're likely to cut and quite aggressively,

0:10:33.040 --> 0:10:36.520
<v Speaker 1>not just fifty basis points. Well, yeah, that's quite a

0:10:36.559 --> 0:10:38.160
<v Speaker 1>cool actually, but you know when did that happen? And

0:10:38.200 --> 0:10:40.240
<v Speaker 1>you know we've got three central banks. You know, we've

0:10:40.280 --> 0:10:42.760
<v Speaker 1>got the Bank of England and then then the ECB

0:10:43.040 --> 0:10:46.200
<v Speaker 1>and the FED. As we've been talking about what other

0:10:46.280 --> 0:10:51.440
<v Speaker 1>separate narratives here, So which that's an excellent question. I

0:10:51.440 --> 0:10:54.960
<v Speaker 1>would say that, you know, market grappling with three different

0:10:55.040 --> 0:10:59.680
<v Speaker 1>narratives when it comes to growth and inflation going forward.

0:11:00.000 --> 0:11:02.720
<v Speaker 1>We just talked about of this the session scenario and

0:11:02.760 --> 0:11:06.680
<v Speaker 1>the soft landing where we have, you know, inflation come

0:11:06.960 --> 0:11:09.480
<v Speaker 1>coming down without a mass of it to growth. And

0:11:09.559 --> 0:11:13.360
<v Speaker 1>the other scenario out there is the scenario where growth

0:11:13.400 --> 0:11:19.439
<v Speaker 1>actually re accelerate and or that inflation re accelerates, and

0:11:19.440 --> 0:11:23.400
<v Speaker 1>that's what Yeah, that's what Kuipman was saying. But you know,

0:11:23.559 --> 0:11:28.600
<v Speaker 1>out of the last thirteen FED hiking cycles, the average

0:11:28.640 --> 0:11:31.520
<v Speaker 1>time in between the last hike and the first cut

0:11:31.640 --> 0:11:34.800
<v Speaker 1>is five months five months, and in six of the

0:11:34.840 --> 0:11:38.679
<v Speaker 1>thirteen cycles the time was two months or less. So

0:11:38.720 --> 0:11:41.439
<v Speaker 1>I think that investors would be wise to think about

0:11:41.480 --> 0:11:45.800
<v Speaker 1>that before pillering the bond market for suggesting a cut

0:11:45.880 --> 0:11:49.439
<v Speaker 1>later this year. And indeed HSBC is full one percentage

0:11:49.440 --> 0:11:52.600
<v Speaker 1>point exactly. And I think if you think about the

0:11:52.640 --> 0:11:58.040
<v Speaker 1>fact that market bond markets are sort of reflecting probabilities,

0:11:58.640 --> 0:12:01.160
<v Speaker 1>then the part of the market it doesn't expect any

0:12:01.280 --> 0:12:05.960
<v Speaker 1>cuts would would you know, would expect things to stay flat,

0:12:05.960 --> 0:12:09.400
<v Speaker 1>whereas the HSBC sort of scenarios would expect the cut

0:12:09.520 --> 0:12:12.560
<v Speaker 1>and are finding probabilities that waited to have, which is

0:12:12.559 --> 0:12:17.679
<v Speaker 1>actually what the swop curves are reflecting. All right, so

0:12:17.920 --> 0:12:20.520
<v Speaker 1>let's have a look at what all this really played

0:12:20.679 --> 0:12:22.320
<v Speaker 1>it plays out on markets. I mean, we've had so

0:12:22.480 --> 0:12:25.040
<v Speaker 1>much euphoria at the start of this year equity wise,

0:12:25.640 --> 0:12:28.400
<v Speaker 1>you know, we know the risks to all of that

0:12:28.520 --> 0:12:32.760
<v Speaker 1>becoming a damp squibt I eat a real recession of course,

0:12:33.000 --> 0:12:37.640
<v Speaker 1>also a geopolitics, but would actually turn around for the

0:12:37.720 --> 0:12:41.280
<v Speaker 1>dollar and strength for the dollar also be a big,

0:12:41.320 --> 0:12:46.760
<v Speaker 1>big how can I say a headwind absolutely, I mean

0:12:46.760 --> 0:12:49.080
<v Speaker 1>that was the scenario all of last year. The shot.

0:12:49.160 --> 0:12:52.520
<v Speaker 1>You're absolutely right. If the dollar, you know, takes off

0:12:52.559 --> 0:12:57.160
<v Speaker 1>again like it did, most of that would be a

0:12:57.200 --> 0:13:00.680
<v Speaker 1>growth dampener globally. It's seen that happened again and again

0:13:00.760 --> 0:13:03.920
<v Speaker 1>in the past, and in the last three months or

0:13:03.960 --> 0:13:07.040
<v Speaker 1>so we've had dollar correct about ten percent. I'm talking

0:13:07.040 --> 0:13:10.640
<v Speaker 1>to d X y here um, which has really helped

0:13:10.640 --> 0:13:15.040
<v Speaker 1>the sentiment globally. We've seen the rally in the developed

0:13:15.080 --> 0:13:18.680
<v Speaker 1>market x US and E M far supart s apart

0:13:18.760 --> 0:13:22.000
<v Speaker 1>any of the enthusiasm you've seen in the US markets

0:13:22.120 --> 0:13:26.000
<v Speaker 1>and always been a huge factor in that M So

0:13:26.080 --> 0:13:28.680
<v Speaker 1>we'll get the jobs data this week now. If we

0:13:28.800 --> 0:13:33.360
<v Speaker 1>get a negative print on jobs seems unlikely, but it's possible.

0:13:34.760 --> 0:13:37.080
<v Speaker 1>I'm sure it would embarrass the Fed right after a hike,

0:13:37.160 --> 0:13:40.480
<v Speaker 1>But how do you think the market would respond that's

0:13:40.520 --> 0:13:44.240
<v Speaker 1>a very interesting question, Brian. I think I would say

0:13:44.280 --> 0:13:46.640
<v Speaker 1>that the bond market would you know, the treasury and

0:13:46.800 --> 0:13:49.320
<v Speaker 1>the sort of safer parts of the bone market would

0:13:49.360 --> 0:13:52.640
<v Speaker 1>rarely hard because that would price out any more hikes,

0:13:52.800 --> 0:13:56.600
<v Speaker 1>because a recession seems more likely. You know, the soft

0:13:56.679 --> 0:13:58.600
<v Speaker 1>data has been calling for that, but we haven't seen

0:13:58.640 --> 0:14:01.880
<v Speaker 1>it any of the hard data. Um. The equity picture

0:14:02.040 --> 0:14:05.160
<v Speaker 1>is a little bit mixed, you know. Um, so far

0:14:05.280 --> 0:14:09.320
<v Speaker 1>the correlation has been that both equities and bonds have

0:14:09.440 --> 0:14:13.240
<v Speaker 1>moved quite together, and in this is the one scenario

0:14:13.280 --> 0:14:16.360
<v Speaker 1>where when we see growth downgrades, I think equities might

0:14:16.400 --> 0:14:19.560
<v Speaker 1>not do quite as well as the bonds. Right, So

0:14:19.880 --> 0:14:21.600
<v Speaker 1>this brings us nice and you ready to talk about

0:14:21.680 --> 0:14:26.120
<v Speaker 1>whether you think that this momentum faquities can continue now

0:14:26.400 --> 0:14:29.280
<v Speaker 1>and if so, is it time to be loading up

0:14:29.280 --> 0:14:31.720
<v Speaker 1>on risk or is it time to probably take stock

0:14:31.800 --> 0:14:37.320
<v Speaker 1>part of the punk so I, you know, our positioning

0:14:37.400 --> 0:14:40.600
<v Speaker 1>is actually sort of what I would call barbelled. We

0:14:40.600 --> 0:14:44.640
<v Speaker 1>we love taking risk in emerging markets at this point. Um,

0:14:44.680 --> 0:14:50.240
<v Speaker 1>that's one area where we see quite a scope for

0:14:50.440 --> 0:14:53.640
<v Speaker 1>growth recovery. So e M has done quite well Richard

0:14:53.680 --> 0:14:56.360
<v Speaker 1>in the last two three months already, But Most of

0:14:56.360 --> 0:14:59.600
<v Speaker 1>it has been sort of multiple expansion in anticipation for

0:14:59.720 --> 0:15:04.080
<v Speaker 1>better earnings growth and better um economic growth. And if

0:15:04.120 --> 0:15:07.280
<v Speaker 1>that does come through, then I would say there is

0:15:07.360 --> 0:15:11.560
<v Speaker 1>more room in e M markets for more repricing of

0:15:11.960 --> 0:15:14.720
<v Speaker 1>a better growth scenario. The other side of it is

0:15:14.960 --> 0:15:17.480
<v Speaker 1>they also own a lot of treasuries because I think

0:15:17.480 --> 0:15:22.280
<v Speaker 1>the recession risk is real. Also, it's interesting how you

0:15:22.320 --> 0:15:25.320
<v Speaker 1>read China, so you can give me that because you're

0:15:25.360 --> 0:15:27.400
<v Speaker 1>on year and you're to date kind of squishy, but

0:15:27.640 --> 0:15:32.720
<v Speaker 1>last week pretty good. Yeah. You know, I've never seen

0:15:32.760 --> 0:15:36.760
<v Speaker 1>our China analyst as bullish as of late. And you know,

0:15:37.360 --> 0:15:42.080
<v Speaker 1>really the new year is starting UM policy wise quite nicely.

0:15:42.600 --> 0:15:47.120
<v Speaker 1>There there is some impact finally, of all the property

0:15:47.160 --> 0:15:50.000
<v Speaker 1>developed measures they had taken last year, some of them

0:15:50.000 --> 0:15:53.680
<v Speaker 1>are bearing fruit now. UM and monetary policy and credit

0:15:53.720 --> 0:15:56.320
<v Speaker 1>policy is all supposed to be very supportive. At the

0:15:56.360 --> 0:16:01.320
<v Speaker 1>same time, the draconian COVID policy have all been put aside,

0:16:01.360 --> 0:16:05.880
<v Speaker 1>So we are quite bullish in China. This is Bloomberg

0:16:05.960 --> 0:16:08.440
<v Speaker 1>Daybreak Asia, your morning brief on the story is making

0:16:08.480 --> 0:16:11.720
<v Speaker 1>news from Hong Kong to Singapore and Wall Street. Look

0:16:11.760 --> 0:16:15.720
<v Speaker 1>for us on your podcast feed every day on Apple Spotify,

0:16:15.800 --> 0:16:18.440
<v Speaker 1>and anywhere else you get your podcast. You can also

0:16:18.480 --> 0:16:21.080
<v Speaker 1>listen live each day on Bloomberg eleven three oh in

0:16:21.160 --> 0:16:25.440
<v Speaker 1>New York, Bloomberg in Washington, Bloomberg one oh six one

0:16:25.560 --> 0:16:29.440
<v Speaker 1>in Boston, and Bloomberg nine sixty in San Francisco. Our

0:16:29.520 --> 0:16:32.720
<v Speaker 1>flagship New York station is also available on your Amazon

0:16:32.800 --> 0:16:37.440
<v Speaker 1>Alexa devices. Just say Alexa play Bloomberg eleven thirty plus

0:16:37.560 --> 0:16:40.920
<v Speaker 1>listen coast to coast on the Bloomberg Business app, Sirius

0:16:41.120 --> 0:16:44.520
<v Speaker 1>XM Channel one nineteen, the I Heart Radio app, and

0:16:44.640 --> 0:16:48.520
<v Speaker 1>on Bloomberg dot Com. I'm Brian Curtis and I'm Doug Chrisner.

0:16:48.600 --> 0:16:50.640
<v Speaker 1>Join us again tomorrow for all the news you need

0:16:50.720 --> 0:16:53.600
<v Speaker 1>to start your day right here on Bloomberg day Break

0:16:53.640 --> 0:17:00.160
<v Speaker 1>Asia