1 00:00:02,560 --> 00:00:07,040 Speaker 1: Bloomberg Audio Studios, podcasts, radio news. 2 00:00:09,920 --> 00:00:13,039 Speaker 2: This is the Bluemberg Daybacurate podcast. Good morning, It's Wednesday, 3 00:00:13,080 --> 00:00:16,440 Speaker 2: the seventeenth of September. I'm Caroline Hepka in London and. 4 00:00:16,400 --> 00:00:20,280 Speaker 3: I'm Stephen Caroline Brussels. Coming up today, Microsoft, Open AI, 5 00:00:20,440 --> 00:00:23,640 Speaker 3: and Vidia and others commit to investing tens of billions 6 00:00:23,640 --> 00:00:26,480 Speaker 3: of pounds in Britain during Donald Trump's state visit. 7 00:00:27,080 --> 00:00:29,520 Speaker 2: The US President will have an audience with the King 8 00:00:29,640 --> 00:00:33,760 Speaker 2: as the UK government shelves talks of eliminating steel tariffs. 9 00:00:34,080 --> 00:00:37,520 Speaker 3: Plus is fifty the new twenty five Traders boost bets 10 00:00:37,520 --> 00:00:40,000 Speaker 3: on a half point interest rate cut from the Federal 11 00:00:40,040 --> 00:00:41,800 Speaker 3: Reserve by the end of the year. 12 00:00:42,159 --> 00:00:44,919 Speaker 2: Let's start with a roundup of our top stories. Our 13 00:00:44,960 --> 00:00:45,680 Speaker 2: top stories. 14 00:00:45,800 --> 00:00:48,640 Speaker 3: Some of the world's largest technology firms have announced tens 15 00:00:48,720 --> 00:00:52,080 Speaker 3: of billions of pounds of UK investment to coincide with 16 00:00:52,240 --> 00:00:56,200 Speaker 3: US President Donald trump state visit. Microsoft and Video and 17 00:00:56,280 --> 00:00:58,600 Speaker 3: Google are among the companies who say they will spend 18 00:00:58,640 --> 00:01:02,800 Speaker 3: billions building out Britain AI infrastructure. In a video message, 19 00:01:02,840 --> 00:01:05,720 Speaker 3: Microsoft CEO sach And Nadala compared the moment to the 20 00:01:05,720 --> 00:01:06,759 Speaker 3: Industrial revolution. 21 00:01:07,440 --> 00:01:09,839 Speaker 4: We're doubling down on our investment in the UK. 22 00:01:10,480 --> 00:01:14,440 Speaker 5: We will invest more than thirty billion dollars over four 23 00:01:14,520 --> 00:01:18,440 Speaker 5: years to build on the foundation we have already laid here, 24 00:01:18,880 --> 00:01:21,399 Speaker 5: our largest investment in the country ever. 25 00:01:22,120 --> 00:01:25,200 Speaker 3: Such a nadalas joining Trump on the visit alongside several 26 00:01:25,240 --> 00:01:28,319 Speaker 3: other leading tech CEOs, including in videos Jensen Wang and 27 00:01:28,400 --> 00:01:29,720 Speaker 3: open Ai Sam Altman. 28 00:01:30,400 --> 00:01:33,680 Speaker 2: But the visit may not achieve all of our Minsesekere 29 00:01:33,760 --> 00:01:37,240 Speaker 2: Starmer's aims. Bloomberg has learned that the UK has quietly 30 00:01:37,360 --> 00:01:41,080 Speaker 2: shelved its talks with the US on eliminating tariffs on 31 00:01:41,120 --> 00:01:43,840 Speaker 2: British steel. It's a blow to the industry, which has 32 00:01:43,880 --> 00:01:46,280 Speaker 2: been waiting for months for the removal of the twenty 33 00:01:46,280 --> 00:01:49,560 Speaker 2: five percent levy, which had been agreed in earlier talks. 34 00:01:50,080 --> 00:01:53,720 Speaker 2: The strategic decision comes even as President Trump signaled that 35 00:01:53,760 --> 00:01:57,480 Speaker 2: he was open to some concessions on trade as he 36 00:01:57,560 --> 00:01:59,880 Speaker 2: boarded Air Force one for the trip. 37 00:02:00,480 --> 00:02:03,440 Speaker 6: They say winter Parsil is the ulphimate, right, so it's 38 00:02:03,440 --> 00:02:06,440 Speaker 6: going to be nice. But basically they're also on trade. 39 00:02:06,840 --> 00:02:08,839 Speaker 6: They want to seem they can refine a trade deal 40 00:02:08,880 --> 00:02:11,000 Speaker 6: a little bit. We've made a deal and it's a 41 00:02:11,040 --> 00:02:14,639 Speaker 6: great deal, and I'm into helping them our country is 42 00:02:14,720 --> 00:02:15,560 Speaker 6: doing very well. 43 00:02:15,800 --> 00:02:16,959 Speaker 4: We've never done this well. 44 00:02:16,960 --> 00:02:20,760 Speaker 6: We're making having brillions of dollars coming represent the tariffs. 45 00:02:21,120 --> 00:02:22,799 Speaker 6: I they'd like to seem they could get a little 46 00:02:22,840 --> 00:02:24,880 Speaker 6: bit bettery, just so we'll cop to them. 47 00:02:25,120 --> 00:02:27,840 Speaker 2: Those comments from the US President came as sources that 48 00:02:27,960 --> 00:02:30,959 Speaker 2: told Bloomberg that negotiate US from the UK will continue 49 00:02:31,000 --> 00:02:34,919 Speaker 2: talks with their uspers to act steel tariffs over time. 50 00:02:35,600 --> 00:02:35,720 Speaker 7: Well. 51 00:02:35,840 --> 00:02:38,920 Speaker 3: Much of the focus of the US President's visit to 52 00:02:38,960 --> 00:02:41,519 Speaker 3: the UK is on the economic benefits for Britain. The 53 00:02:41,560 --> 00:02:45,200 Speaker 3: British drug maker maker GSK has also announced plans to 54 00:02:45,240 --> 00:02:49,080 Speaker 3: invest thirty billion dollars in America over the next five years. 55 00:02:49,440 --> 00:02:52,440 Speaker 3: The US accounts for about fifty percent of the company's revenue. 56 00:02:52,680 --> 00:02:56,200 Speaker 3: Prime Minister care Starmer has lent his support to GSK's investment, 57 00:02:56,320 --> 00:03:00,560 Speaker 3: highlighting it as an example of UK US collaboration. The 58 00:03:00,600 --> 00:03:04,480 Speaker 3: move follows similar announcements by other pharmaceutical companies after Trump 59 00:03:04,520 --> 00:03:08,400 Speaker 3: threatened tariffs and important drugs and complained about high prices 60 00:03:08,440 --> 00:03:09,800 Speaker 3: paid by Americans. 61 00:03:10,400 --> 00:03:12,640 Speaker 2: Well, the King and Queen are preparing for a full 62 00:03:12,720 --> 00:03:16,000 Speaker 2: day hosting Donald and Milania Trump on their state visit 63 00:03:16,160 --> 00:03:19,320 Speaker 2: at Windsor Castle. The US President has been invited to 64 00:03:19,800 --> 00:03:22,919 Speaker 2: inspect the Guard of Honor with the King. They'll also 65 00:03:23,000 --> 00:03:26,280 Speaker 2: view a ceremonial drill that concludes with a military jet 66 00:03:26,320 --> 00:03:29,919 Speaker 2: fly past. Kim Darrek, one of the UK's former ambassadors 67 00:03:29,960 --> 00:03:32,800 Speaker 2: of the United States, says this kind of welcome means 68 00:03:32,800 --> 00:03:33,799 Speaker 2: a lot to the President. 69 00:03:34,360 --> 00:03:39,320 Speaker 7: Trump does revere is fascinating by the royal family. When 70 00:03:39,320 --> 00:03:42,840 Speaker 7: it came over first state business, he brought his whole family, 71 00:03:43,120 --> 00:03:46,400 Speaker 7: which is like saying to them, look, look, I've immediate. 72 00:03:46,840 --> 00:03:50,240 Speaker 2: But the pageantry that Derek mentions might be overshadowed by 73 00:03:50,280 --> 00:03:54,280 Speaker 2: the ongoing controversy around public figures with ties to p 74 00:03:54,480 --> 00:03:58,320 Speaker 2: file Jeffrey Epstein. Last week, his Starma fired his ambassador 75 00:03:58,360 --> 00:04:01,040 Speaker 2: to the US, Peter Mandelson, over the the issue, which 76 00:04:01,080 --> 00:04:02,680 Speaker 2: has also dogged President Trump. 77 00:04:03,200 --> 00:04:06,720 Speaker 3: The euro hit its strongest level in four years yesterday 78 00:04:06,720 --> 00:04:09,720 Speaker 3: as traders prepare for a Federal Reserve interest rate cut. 79 00:04:09,720 --> 00:04:12,080 Speaker 4: Today, the currency rose. 80 00:04:12,000 --> 00:04:14,640 Speaker 3: As the Bloomberg on trading yesterday, as a Bloomberg dollar 81 00:04:14,680 --> 00:04:18,200 Speaker 3: spot index edged closer to this year's lows. Officials are 82 00:04:18,360 --> 00:04:21,200 Speaker 3: expected to lower borrowing costs for the first time in 83 00:04:21,279 --> 00:04:24,039 Speaker 3: twenty twenty five, with a quarter point reduction seen as 84 00:04:24,080 --> 00:04:27,800 Speaker 3: the most likely decision. Alicia Levine is head of Investment 85 00:04:27,880 --> 00:04:31,320 Speaker 3: Strategy and Equities at bny Mellon Wealth Management. 86 00:04:32,080 --> 00:04:35,200 Speaker 8: If that's going to cut, it looks perhaps more justified 87 00:04:35,240 --> 00:04:37,400 Speaker 8: than it did two or three months ago when this 88 00:04:37,440 --> 00:04:42,040 Speaker 8: conversation started in earnest And look, the market's already priced 89 00:04:42,040 --> 00:04:44,200 Speaker 8: in something like one hundred and forty basis points into 90 00:04:44,200 --> 00:04:45,920 Speaker 8: the end of the next year, So it's already. 91 00:04:45,640 --> 00:04:47,080 Speaker 4: In the market BN wise. 92 00:04:47,160 --> 00:04:51,040 Speaker 3: Alicia Levine, speaking there as the cooling labor market in 93 00:04:51,080 --> 00:04:53,760 Speaker 3: the US leads some traders to increase their bets that 94 00:04:53,839 --> 00:04:57,320 Speaker 3: a souring economic outlook could prompt at least one half 95 00:04:57,360 --> 00:05:01,320 Speaker 3: point interest rate cut across this year's A policy meetings. 96 00:05:02,200 --> 00:05:06,240 Speaker 2: Now two other stories, TikTok's US operations would be bought 97 00:05:06,279 --> 00:05:10,080 Speaker 2: by a consortium of US companies under a deal to 98 00:05:10,120 --> 00:05:15,160 Speaker 2: be discussed between President Trump and China's Shijingping. The framework 99 00:05:15,320 --> 00:05:21,200 Speaker 2: agreement involves a US based version of the app backed 100 00:05:21,240 --> 00:05:24,599 Speaker 2: by firms including Oracle, private actuity firms, Silver Lake and 101 00:05:24,680 --> 00:05:29,240 Speaker 2: Venture Capital Company Anderson. US trade representative Jameison Greer says 102 00:05:29,240 --> 00:05:31,800 Speaker 2: that the deal represents a step forward. 103 00:05:31,880 --> 00:05:34,280 Speaker 1: The TikTok saga has gone on for a long time. 104 00:05:34,880 --> 00:05:36,960 Speaker 1: Toward the end of his first term, President Trump set 105 00:05:37,000 --> 00:05:37,800 Speaker 1: about to solve it. 106 00:05:38,839 --> 00:05:40,120 Speaker 4: Over the course of the Biden. 107 00:05:39,880 --> 00:05:42,920 Speaker 1: Administration, they grappled with this issue but could not solve it. 108 00:05:43,480 --> 00:05:46,320 Speaker 1: But as of yesterday, we believe that President Trump has 109 00:05:46,360 --> 00:05:48,320 Speaker 1: in fact resolved this issue. 110 00:05:48,680 --> 00:05:52,400 Speaker 2: US Trade Representative Jamison Greer there speaking to Fox News. 111 00:05:52,520 --> 00:05:56,680 Speaker 2: Under an initial agreement by Dance's stake in TikTok would 112 00:05:56,720 --> 00:06:00,000 Speaker 2: fall below twenty percent in order to satisfy a twenty 113 00:05:59,880 --> 00:06:03,800 Speaker 2: twenty four US law that requires the Beijing based company 114 00:06:03,839 --> 00:06:09,000 Speaker 2: to divest. The deal values TikTok's US operations at about 115 00:06:09,000 --> 00:06:11,520 Speaker 2: thirty five to forty billion dollars. 116 00:06:12,200 --> 00:06:15,479 Speaker 3: The cyber attack that brought Jaguar Landrovers plans to a 117 00:06:15,560 --> 00:06:19,479 Speaker 3: standstill earlier this month is forcing some European parts makers 118 00:06:19,520 --> 00:06:23,520 Speaker 3: to pause or scale back their own production. Bloomberg's Micaalcubala 119 00:06:23,560 --> 00:06:23,960 Speaker 3: has more. 120 00:06:24,240 --> 00:06:26,760 Speaker 9: It's been over two weeks since the carmaker announced the 121 00:06:26,800 --> 00:06:30,400 Speaker 9: hack had severely disrupted its operations. That's also a meant 122 00:06:30,400 --> 00:06:34,440 Speaker 9: halting production at companies like Eberschbacher, a German exhaust maker. 123 00:06:34,720 --> 00:06:37,240 Speaker 9: It's put around thirty staff at its plant in Slovakia 124 00:06:37,279 --> 00:06:40,239 Speaker 9: on holiday or on short time work with reduced pay. 125 00:06:40,680 --> 00:06:41,760 Speaker 4: Others have been hit too. 126 00:06:42,000 --> 00:06:45,640 Speaker 9: The CEO of quality control firm Holland Warm nervousness is 127 00:06:45,640 --> 00:06:50,320 Speaker 9: growing among contractors exposed to Jaguar land Rover JLR says 128 00:06:50,360 --> 00:06:53,839 Speaker 9: operations won't restart until at least September twenty fourth and 129 00:06:53,920 --> 00:06:58,479 Speaker 9: as warned with some data may have been compromised in Brussels. Michaalkubala, 130 00:06:58,640 --> 00:07:02,800 Speaker 9: Bloomberg Radio and those are your top stories on the markets. 131 00:07:02,839 --> 00:07:06,760 Speaker 9: The Mscish Pacific Index is trading slightly higher this morning 132 00:07:06,800 --> 00:07:08,880 Speaker 9: ahead of the Federal Reserve interest rate decision. 133 00:07:08,960 --> 00:07:11,040 Speaker 4: SMP mini futures are a little bit weaker today. 134 00:07:11,040 --> 00:07:13,400 Speaker 3: The ten year treasury yield upper basis point at four 135 00:07:13,400 --> 00:07:14,720 Speaker 3: point zero two percent. 136 00:07:15,160 --> 00:07:16,760 Speaker 4: The euro touch tweaker against. 137 00:07:16,480 --> 00:07:18,440 Speaker 3: The dollar after hitting that four year high yesterday, but 138 00:07:18,480 --> 00:07:21,720 Speaker 3: still above one eighteen at one eighteen fifty eight. As 139 00:07:21,720 --> 00:07:24,040 Speaker 3: we're looking at European stock futures pointing a little higher, 140 00:07:24,080 --> 00:07:26,800 Speaker 3: up three tenths for eurostocks fifty futures. 141 00:07:27,160 --> 00:07:28,880 Speaker 2: Well, in a moment, we're going to bring you more 142 00:07:28,920 --> 00:07:31,920 Speaker 2: on how kiss Starma and the UK government are going 143 00:07:31,960 --> 00:07:34,960 Speaker 2: to try to play Donald Trump's state visit to the UK, 144 00:07:35,560 --> 00:07:37,800 Speaker 2: and we'll also look ahead to what markets are expecting 145 00:07:37,840 --> 00:07:42,160 Speaker 2: from the Federal Reserve decision. Also later today. Another story 146 00:07:42,160 --> 00:07:46,280 Speaker 2: that's caught urri though, of course, is about the strategies 147 00:07:46,320 --> 00:07:50,000 Speaker 2: the tactics that big CEOs have been using to charm 148 00:07:50,080 --> 00:07:53,520 Speaker 2: Donald Trump and maybe something of a lesson for the 149 00:07:53,560 --> 00:07:54,760 Speaker 2: Prime Minister Kiss Starmer. 150 00:07:55,280 --> 00:07:55,880 Speaker 4: Yeah. Indeed, so. 151 00:07:55,920 --> 00:07:59,080 Speaker 3: Bloomberg's West Coast Silver has been writing about the meetings 152 00:07:59,120 --> 00:08:02,520 Speaker 3: that Donald Trump has had with some big CEOs and 153 00:08:02,760 --> 00:08:04,640 Speaker 3: how it's unusual that, of course, we get so much 154 00:08:04,680 --> 00:08:06,720 Speaker 3: of an insight into what a president is thinking because 155 00:08:06,760 --> 00:08:09,400 Speaker 3: Donald Trump uses social media so much, but also has 156 00:08:09,440 --> 00:08:13,800 Speaker 3: so many interactions with journalists where he makes quite i 157 00:08:13,840 --> 00:08:17,160 Speaker 3: suppose heartfelt comments. It appears about how he feels about 158 00:08:17,160 --> 00:08:20,520 Speaker 3: certain subjects. So this gives people who are trying to 159 00:08:20,720 --> 00:08:23,520 Speaker 3: i suppose win over Donald Trump plenty of material to 160 00:08:23,560 --> 00:08:26,200 Speaker 3: work with. We know that he loves prizes, for example, 161 00:08:26,280 --> 00:08:28,720 Speaker 3: so we had Apple CEO Tim Cook making a special 162 00:08:28,760 --> 00:08:31,880 Speaker 3: trophy for Trump when he came to the White House 163 00:08:32,000 --> 00:08:35,840 Speaker 3: for talks over chip tariffs, so that helped his company 164 00:08:35,880 --> 00:08:39,360 Speaker 3: potentially escape damaging levies as well. Alongside the announcement of 165 00:08:39,440 --> 00:08:43,960 Speaker 3: a lot of money for US manufacturing too. Now, as 166 00:08:43,960 --> 00:08:46,160 Speaker 3: West points out, there's nothing inherently wrong with the government 167 00:08:46,280 --> 00:08:49,480 Speaker 3: deciding to back certain industries or companies, think about France 168 00:08:49,559 --> 00:08:52,520 Speaker 3: and nuclear power. But he does speak to the Harvard 169 00:08:52,520 --> 00:08:54,960 Speaker 3: Business School professor Rebecca Henderson, who says these deals are 170 00:08:54,960 --> 00:08:57,840 Speaker 3: often made in haste. She doesn't believe they'll yield significant 171 00:08:57,880 --> 00:09:00,959 Speaker 3: benefits to the US economy. And for company bosses, there 172 00:09:01,000 --> 00:09:03,240 Speaker 3: are cautionary tales in here as well. Just because you've 173 00:09:03,280 --> 00:09:05,439 Speaker 3: won over Donald Trump once doesn't mean you're going to 174 00:09:05,600 --> 00:09:07,720 Speaker 3: stay in his favor over the long term. Look at 175 00:09:07,760 --> 00:09:11,640 Speaker 3: Hyundai investing billions of dollars in US manufacturers, but Trump's 176 00:09:11,640 --> 00:09:15,880 Speaker 3: immigration force has still raided a Hyundai LG electric vehicle 177 00:09:15,920 --> 00:09:19,480 Speaker 3: battery plant under construction in Georgia, arresting hundreds of foreign 178 00:09:19,520 --> 00:09:21,000 Speaker 3: engineers working there as well. 179 00:09:21,440 --> 00:09:22,120 Speaker 4: Yeah. 180 00:09:22,240 --> 00:09:25,280 Speaker 2: No, I get your point about the stream of consciousness 181 00:09:25,280 --> 00:09:27,160 Speaker 2: that we get from the US president, and that does 182 00:09:27,200 --> 00:09:30,680 Speaker 2: give people lots of insights. And of obviously the gold 183 00:09:30,679 --> 00:09:34,560 Speaker 2: plated iPhone that Tim Cook handed over in this kind 184 00:09:34,600 --> 00:09:37,640 Speaker 2: of great show in the Oval Office. I mean, I'm 185 00:09:37,679 --> 00:09:39,920 Speaker 2: just wondering what is the UK going to do? I mean, 186 00:09:39,960 --> 00:09:42,680 Speaker 2: all of the pageantry. You're going to see it all 187 00:09:42,720 --> 00:09:46,280 Speaker 2: at Windsor Castle at also even at Checkers. I suspect 188 00:09:46,320 --> 00:09:49,920 Speaker 2: which is the country residence of the Prime Minister where 189 00:09:50,320 --> 00:09:52,559 Speaker 2: the kind of political bit of this visit is going 190 00:09:52,559 --> 00:09:54,080 Speaker 2: to take place. I mean, what do you think the 191 00:09:54,080 --> 00:09:56,640 Speaker 2: gifts are going to be again kind of is it 192 00:09:56,679 --> 00:10:01,400 Speaker 2: going to be tartan something along Scottish lines? Sure, spread biscuits, yeah, 193 00:10:01,440 --> 00:10:03,120 Speaker 2: but I mean maybe girld plated ones. 194 00:10:03,160 --> 00:10:03,600 Speaker 4: I don't know. 195 00:10:03,679 --> 00:10:06,120 Speaker 2: I mean, look, some flattery has clearly worked for the UK, 196 00:10:06,840 --> 00:10:09,200 Speaker 2: but you know, what does it mean in terms of 197 00:10:09,240 --> 00:10:10,960 Speaker 2: economic growth and the other things written? 198 00:10:10,960 --> 00:10:11,440 Speaker 4: Really once? 199 00:10:11,520 --> 00:10:14,719 Speaker 2: I mean, it's very tricky, it hugely important relationship. 200 00:10:15,000 --> 00:10:17,120 Speaker 3: Well, indeed, let's bring in bloom your opinion columist Rosa 201 00:10:17,200 --> 00:10:19,320 Speaker 3: Prince for more on this as well, or as you'll 202 00:10:19,320 --> 00:10:22,040 Speaker 3: be watching all the details of this very closely too. 203 00:10:22,559 --> 00:10:24,440 Speaker 3: I wonder if we think about it in the context 204 00:10:24,480 --> 00:10:27,280 Speaker 3: of we're starting this trip with the raft of announcements 205 00:10:27,320 --> 00:10:30,680 Speaker 3: of really big amounts of money talked about being invested 206 00:10:30,840 --> 00:10:34,200 Speaker 3: in the UK as well. From Kiris Charmer's point of view, 207 00:10:34,240 --> 00:10:37,000 Speaker 3: is this setting him up for a very successful trip 208 00:10:37,000 --> 00:10:37,760 Speaker 3: with Donald Trump? 209 00:10:38,080 --> 00:10:41,960 Speaker 10: Well, he's definitely hoping. So we did see some really 210 00:10:41,960 --> 00:10:45,560 Speaker 10: big announcements coming over in the last few days, as 211 00:10:45,640 --> 00:10:49,600 Speaker 10: you say, about thirty billion pounds of investment, and particularly 212 00:10:49,640 --> 00:10:53,959 Speaker 10: in the tech space. Some talk that investment in AI 213 00:10:54,080 --> 00:10:57,319 Speaker 10: could boost the British economy by as much as ten percent. Now, 214 00:10:57,360 --> 00:10:59,719 Speaker 10: that would be really great for a Prime minister who 215 00:11:00,160 --> 00:11:03,720 Speaker 10: has found the country and something of an economic doom 216 00:11:03,800 --> 00:11:06,439 Speaker 10: loop and has said quite a few times that he's 217 00:11:06,480 --> 00:11:09,160 Speaker 10: hoping to grow our way out of this trouble. 218 00:11:09,240 --> 00:11:10,800 Speaker 4: So all good news on that front. 219 00:11:11,280 --> 00:11:16,120 Speaker 2: Yeah, But then early on the idea of getting steel 220 00:11:16,160 --> 00:11:21,040 Speaker 2: tariffs wound back or lowered, that that has been put aside. 221 00:11:21,040 --> 00:11:23,719 Speaker 2: I mean, the steel industry is not that significant for 222 00:11:23,760 --> 00:11:26,280 Speaker 2: the UK. Is that important or is it just a 223 00:11:26,320 --> 00:11:30,240 Speaker 2: signal that there are a lot of difficult issues still 224 00:11:30,280 --> 00:11:30,920 Speaker 2: on the table. 225 00:11:31,840 --> 00:11:34,480 Speaker 10: It's not that big in terms of how of its 226 00:11:34,679 --> 00:11:37,480 Speaker 10: kind of economic clout, but it's quite a sort of 227 00:11:37,640 --> 00:11:41,760 Speaker 10: totemic industry for Britain, particularly because the government has invested 228 00:11:42,320 --> 00:11:46,040 Speaker 10: and really sort of taken over some of Britain steels. 229 00:11:46,080 --> 00:11:50,679 Speaker 10: Now we're told that the sort of reduction to zero 230 00:11:50,840 --> 00:11:53,360 Speaker 10: tariffs that Britain had hoped for that had been talked 231 00:11:53,400 --> 00:11:56,240 Speaker 10: about a few months ago isn't going to happen. And 232 00:11:56,280 --> 00:11:58,719 Speaker 10: the main reason for that was that it didn't take 233 00:11:58,760 --> 00:12:01,600 Speaker 10: into account that the kind of quota system that was 234 00:12:02,000 --> 00:12:06,559 Speaker 10: involved in this, so it would have been it would 235 00:12:06,559 --> 00:12:11,720 Speaker 10: have meant that some companies were spared tariffs while others 236 00:12:11,840 --> 00:12:14,920 Speaker 10: were going to get the full fifty percent whack. So 237 00:12:15,160 --> 00:12:17,080 Speaker 10: the deal is now that Britain's going to get twenty 238 00:12:17,120 --> 00:12:20,720 Speaker 10: five percent a relief, which is better than most of 239 00:12:20,760 --> 00:12:24,040 Speaker 10: the world, so a small win. I think Britain had 240 00:12:24,080 --> 00:12:27,080 Speaker 10: hoped for more. One good thing about Donald Trump is, 241 00:12:27,200 --> 00:12:29,640 Speaker 10: as you've been saying, you know, he's really unpredictable. He's 242 00:12:29,640 --> 00:12:32,559 Speaker 10: really mercurial. As he got on the plane last night, 243 00:12:33,000 --> 00:12:36,559 Speaker 10: he actually brought up tariffs, which I think the negotiators 244 00:12:36,600 --> 00:12:38,880 Speaker 10: hadn't expected. He said, oh, maybe we can get them 245 00:12:38,880 --> 00:12:41,240 Speaker 10: a better deal. So I think Britain will be hoping 246 00:12:41,240 --> 00:12:43,840 Speaker 10: perhaps they can reopen something that they had been told 247 00:12:43,880 --> 00:12:46,480 Speaker 10: by their counterparts in the States wasn't going to happen. 248 00:12:46,880 --> 00:12:49,640 Speaker 3: Okay, Rosa Prince, Bloomberg opinion columnist, thank you very much 249 00:12:49,640 --> 00:12:51,560 Speaker 3: for joining us. You can read more from Rosa by 250 00:12:51,600 --> 00:12:53,480 Speaker 3: the way at Bloomberg Dot Calm slash Opinion. 251 00:12:55,679 --> 00:12:56,400 Speaker 4: Stay with us. 252 00:12:56,440 --> 00:12:59,319 Speaker 3: More from Bloomberg Daybreak Europe coming up after this. 253 00:13:00,840 --> 00:13:04,400 Speaker 2: Okay, so that's one major even that's preoccupying people in Britain. 254 00:13:04,520 --> 00:13:08,760 Speaker 2: But of course today's Federal Reserve decision is expected to 255 00:13:09,080 --> 00:13:13,080 Speaker 2: dominate markets, and we'll likely see the first interest rate 256 00:13:13,200 --> 00:13:16,000 Speaker 2: cut of the year, as recent data has highlighted a 257 00:13:16,040 --> 00:13:19,280 Speaker 2: weakening labor market in America. Joining us now our executive 258 00:13:19,360 --> 00:13:22,960 Speaker 2: editor for Asian Markets, Paul Dobson, Paul, Good morning, Marcus 259 00:13:23,000 --> 00:13:26,120 Speaker 2: fully pricing in twenty five basis points cut the likelihood 260 00:13:26,120 --> 00:13:29,240 Speaker 2: of a surprise from Powell today? What's your view on 261 00:13:29,280 --> 00:13:31,120 Speaker 2: the fifty basis point debate? 262 00:13:31,360 --> 00:13:33,480 Speaker 11: My view and the market's view and the economist view 263 00:13:33,520 --> 00:13:36,960 Speaker 11: is that that's unlikely to happen. Not many people would 264 00:13:37,080 --> 00:13:40,319 Speaker 11: expect it given what we've heard from the Fed policymakers. 265 00:13:40,360 --> 00:13:43,839 Speaker 11: We will have Myron joining the meeting, and he's lately 266 00:13:43,880 --> 00:13:46,560 Speaker 11: to push for something more aggressive, and a couple of 267 00:13:46,600 --> 00:13:50,520 Speaker 11: those other committee members made dissent in an express a 268 00:13:50,600 --> 00:13:54,319 Speaker 11: desire to get fifty. But the lightlihood of the majority 269 00:13:54,400 --> 00:13:58,079 Speaker 11: being persuaded that that's what's needed right now seems pretty 270 00:13:58,120 --> 00:14:00,520 Speaker 11: low given the data that we've seen y calling of 271 00:14:00,559 --> 00:14:03,680 Speaker 11: the labor market. But yes, there's also still those concerns 272 00:14:03,679 --> 00:14:06,439 Speaker 11: about sticky inflation, so the Fed won't want to act 273 00:14:06,559 --> 00:14:09,800 Speaker 11: too fast, probably, you know, move in a more moderate 274 00:14:09,840 --> 00:14:11,000 Speaker 11: way if it possibly can. 275 00:14:11,440 --> 00:14:15,440 Speaker 3: We'll talk about the economic projections next, Paul, What will 276 00:14:15,640 --> 00:14:17,520 Speaker 3: markets be watching out for in the dots? 277 00:14:17,559 --> 00:14:18,679 Speaker 4: Perhaps the looming question? 278 00:14:18,800 --> 00:14:21,800 Speaker 11: Mark, Yeah, I think there's there's a few things to 279 00:14:21,840 --> 00:14:24,920 Speaker 11: pick through there. In terms of the economic projections themselves, 280 00:14:24,960 --> 00:14:28,239 Speaker 11: it seems it looks, based on the analysis from Bloomberg Economics, 281 00:14:28,240 --> 00:14:30,720 Speaker 11: that they'd be likely to leave both the outlook for 282 00:14:30,760 --> 00:14:33,760 Speaker 11: inflation and for growth more or less where it was 283 00:14:33,960 --> 00:14:36,800 Speaker 11: the last meeting, So not a great deal of change 284 00:14:36,840 --> 00:14:39,040 Speaker 11: in that, but there is going to be that shift 285 00:14:39,360 --> 00:14:43,760 Speaker 11: towards a signal of more cuts. Most likely people would 286 00:14:43,760 --> 00:14:46,080 Speaker 11: be paying attention to the dots to see whether there's 287 00:14:46,200 --> 00:14:48,880 Speaker 11: an indication that there would be just one more cut 288 00:14:49,120 --> 00:14:52,080 Speaker 11: this year or a second cut starting to come into 289 00:14:52,120 --> 00:14:55,760 Speaker 11: some of the forecasts. Likewise, how many will we see 290 00:14:55,920 --> 00:14:58,240 Speaker 11: for next year and how soon could there be some 291 00:14:58,320 --> 00:15:01,080 Speaker 11: more into the first quarter, to see sort of how 292 00:15:01,080 --> 00:15:03,760 Speaker 11: aggressive the Fed is likely to be in that path 293 00:15:03,840 --> 00:15:06,200 Speaker 11: based on the views of the current members which is 294 00:15:06,280 --> 00:15:08,000 Speaker 11: a little bit in flux. Of course, some of the 295 00:15:08,040 --> 00:15:10,360 Speaker 11: members will be dropping off over the next year. And 296 00:15:10,400 --> 00:15:12,400 Speaker 11: the other thing that I thought was really interesting the 297 00:15:12,440 --> 00:15:15,320 Speaker 11: Bloomberg Economics is talking about is the possibility that a 298 00:15:15,360 --> 00:15:19,160 Speaker 11: couple of the dots may even come in higher for 299 00:15:19,240 --> 00:15:21,360 Speaker 11: the rest of this year than where the FED target 300 00:15:21,360 --> 00:15:24,320 Speaker 11: will be after lightly cut. I was sort of silent 301 00:15:24,400 --> 00:15:27,040 Speaker 11: dissent against that idea that the FED should be cutting 302 00:15:27,120 --> 00:15:27,480 Speaker 11: right now. 303 00:15:27,760 --> 00:15:30,440 Speaker 2: Interesting, how do you think that markets are going to react? 304 00:15:30,560 --> 00:15:33,160 Speaker 2: I mean the position at the moment, the euro hitting 305 00:15:33,160 --> 00:15:36,320 Speaker 2: a four year high, weakening of the dollar, gold also 306 00:15:36,360 --> 00:15:37,400 Speaker 2: close to another record. 307 00:15:37,760 --> 00:15:39,920 Speaker 11: It's been records, records, records, if you look at the 308 00:15:39,920 --> 00:15:42,360 Speaker 11: equities market, if you look at gold, if you look 309 00:15:42,400 --> 00:15:45,520 Speaker 11: at incredibly tight credit spreads as well. So there's a 310 00:15:45,560 --> 00:15:48,040 Speaker 11: lot baked in, you know, the optimism that the FED 311 00:15:48,120 --> 00:15:51,760 Speaker 11: is going to be beginning a cutting cycle. It's likely 312 00:15:51,800 --> 00:15:55,680 Speaker 11: probably the FED chair Power will in his press conference 313 00:15:56,240 --> 00:16:00,600 Speaker 11: moderate that somewhat. I think he will probably mention the 314 00:16:00,720 --> 00:16:03,880 Speaker 11: risks on the inflation side as well as the slowing 315 00:16:03,960 --> 00:16:07,720 Speaker 11: labor data and try to tread that line quite carefully. 316 00:16:07,920 --> 00:16:09,600 Speaker 11: But the market is probably on the lookout for that 317 00:16:09,680 --> 00:16:11,960 Speaker 11: already and what it really cares about is are there 318 00:16:12,000 --> 00:16:14,080 Speaker 11: more cuts coming? And the answer seems to be yes, 319 00:16:14,160 --> 00:16:16,760 Speaker 11: and in which case you know you might get it 320 00:16:16,760 --> 00:16:18,800 Speaker 11: by the ruma cell effect, it's kind of a move. 321 00:16:18,920 --> 00:16:22,400 Speaker 11: But the project trajectory, I think what you identified their 322 00:16:22,440 --> 00:16:25,880 Speaker 11: caroline with the dollar weakening against the euro weakening right 323 00:16:25,880 --> 00:16:28,440 Speaker 11: across the board is the one thing that seems most 324 00:16:28,480 --> 00:16:31,600 Speaker 11: certain the traders are focusing on through the rest of 325 00:16:31,640 --> 00:16:32,080 Speaker 11: this year. 326 00:16:34,720 --> 00:16:37,440 Speaker 3: This is Bloomberg Daybreak Europe, your morning brief on the 327 00:16:37,520 --> 00:16:40,560 Speaker 3: stories making news from London to Wall Street and beyond. 328 00:16:40,880 --> 00:16:44,880 Speaker 2: Look for us on your podcast feed every morning, on Apple, Spotify, 329 00:16:44,960 --> 00:16:47,000 Speaker 2: and anywhere else you get your podcasts. 330 00:16:47,080 --> 00:16:50,120 Speaker 3: You can also listen live each morning on London DAB Radio, 331 00:16:50,160 --> 00:16:52,840 Speaker 3: the Bloomberg Business app, and Bloomberg dot Com. 332 00:16:52,880 --> 00:16:55,640 Speaker 2: Our flagship New York station is also available on your 333 00:16:55,680 --> 00:17:00,440 Speaker 2: Amazon Alexa devices. Just say Alexa play Bloomberg eleventh thirty. 334 00:17:00,640 --> 00:17:01,960 Speaker 2: I'm Caroline Hepka and. 335 00:17:01,880 --> 00:17:04,520 Speaker 3: I'm Stephen Carol. Join us again tomorrow morning for all 336 00:17:04,560 --> 00:17:06,960 Speaker 3: the news you need to start your day right here 337 00:17:07,040 --> 00:17:10,399 Speaker 3: on Bloomberg Daybreak Europe.