WEBVTT - Bloomberg Daybreak: May 5, 2022 - Hour 2 (Radio) 0:00:03.000 --> 0:00:06.160 Live from the Bloomberg Interactive Burgers Studios. This is Bloomberg 0:00:06.240 --> 0:00:10.560 day Break for Thursday. Coming up this hour. US stocks 0:00:10.600 --> 0:00:12.959 have their best day in two years after J. Pale 0:00:13.039 --> 0:00:15.840 indicates a seventy five basis point hike is not in 0:00:15.880 --> 0:00:17.920 the cards. The Bank of England is expected to raise 0:00:18.120 --> 0:00:21.320 rates to the highest level in thirteen years, and Warren 0:00:21.360 --> 0:00:25.200 Buffett raises his bet on one oil Giant. The majority 0:00:25.239 --> 0:00:28.120 of New Yorker's disapprove of me or Adams handling on 0:00:28.320 --> 0:00:32.159 Prime bless sucks every state. Anthony Blincoln test positive for COVID. 0:00:32.400 --> 0:00:35.880 I'm Michael barn More Ahead, I'm trying Stationwark forwards. The 0:00:35.960 --> 0:00:38.480 Yankees eleven game win streak came to Aday. The Mets 0:00:38.520 --> 0:00:41.040 also lost the Rangers in Penguins play Game two with 0:00:41.120 --> 0:00:46.919 the Garden Tonight. That's All's train ahead on Bloomberg Daybreak 0:00:47.240 --> 0:00:51.560 on Bloomberg eleven, Free on New York, Bloomberg one, Washington, 0:00:51.680 --> 0:00:55.280 d C, Bloomberg one oh six one, Boston, Bloomberg nine 0:00:55.360 --> 0:00:59.680 sixties and Francisco Sirius XM one nineteen and around the 0:00:59.680 --> 0:01:03.360 world on Bloomberg Radio dot Com and bother Bloomberg business 0:01:03.440 --> 0:01:10.160 app Good Morning, I'm Nathan Hager and I'm Karen Moscow. 0:01:10.240 --> 0:01:13.399 In US stock index futures are lower this morning. We're 0:01:13.440 --> 0:01:15.000 coming up to six o one on Wall Street, and 0:01:15.040 --> 0:01:17.280 we check the markets every fifteen minutes throughout the trading 0:01:17.360 --> 0:01:20.760 day on Bloomberg with SNP futures down twenty five points down, 0:01:20.840 --> 0:01:23.920 futures down one thirty eight, and NAS day futures down 0:01:23.920 --> 0:01:27.319 one d seven. Ten year Treasury down four thirty seconds 0:01:27.360 --> 0:01:29.520 yield two point nine five percent. They yield on the 0:01:29.600 --> 0:01:32.800 two year two point six seven percent call max school 0:01:32.800 --> 0:01:34.760 there is at one point six percent of twenty eight 0:01:34.760 --> 0:01:38.240 dollars ninety cents at eight ninety seven seventy announced. The 0:01:38.319 --> 0:01:40.959 euro this morning at one point oh five nine six 0:01:41.000 --> 0:01:45.200 against the dollar, the n one nine point six seven. Nathan, well, Karen. 0:01:45.240 --> 0:01:47.720 The pullback we're seeing in stock futures this morning follows 0:01:47.800 --> 0:01:51.440 yesterday's fed field rally. In the news conference after the 0:01:51.520 --> 0:01:54.960 fifty basis point rate hike from the Central Bank, Chairman 0:01:55.040 --> 0:01:58.640 j Pal indicated another fifty, not seventy five, was on 0:01:58.680 --> 0:02:01.680 the table for the next meeting. Seventy five basis point 0:02:02.040 --> 0:02:05.520 uh it increases, not something the committee is actively considering, 0:02:05.600 --> 0:02:09.320 assuming that economic and financial conditions evolve in in ways 0:02:09.360 --> 0:02:12.440 that are consistent with our expectations. There's a broad sense 0:02:12.440 --> 0:02:15.080 on the committee that additional fifty basis increases should be 0:02:15.080 --> 0:02:17.040 on fifty basis point increas should be on the table 0:02:17.080 --> 0:02:19.120 for the next couple of meetings. Like comment by fed 0:02:19.160 --> 0:02:21.560 share pal fueled a huge rally in the market's treasury 0:02:21.639 --> 0:02:24.040 yields dropped. Stocks rally the most in two years, with 0:02:24.120 --> 0:02:27.000 the SMP five hundred surging three percent while the tech 0:02:27.000 --> 0:02:30.080 heavy NASDAC grows three point two percent. Jason Brady is 0:02:30.120 --> 0:02:34.079 CEO of Thornburg Investment Management. I actually expected seventy five 0:02:34.160 --> 0:02:36.200 to be on the table. He took it off the table. 0:02:36.200 --> 0:02:39.240 I think the markets were pricing in very hawkish, and 0:02:39.360 --> 0:02:42.160 you could now hawk the market. So obviously, the reaction 0:02:42.200 --> 0:02:44.160 markets has been that this is a little bit more dubbish. 0:02:44.360 --> 0:02:47.840 Thornburg Investment Management CEO Jason Brady says he thinks yesterday's 0:02:47.919 --> 0:02:51.720 rally is not sustainable. Well, reaction is still pouring into 0:02:51.760 --> 0:02:55.720 Powell pushing back against a larger seventy five basis point increase. 0:02:55.840 --> 0:02:57.519 Nathan and We get the very latest live with the 0:02:57.520 --> 0:03:01.000 Bloomberg's John Tucker. John Aaron at Grant Thorpe and the 0:03:01.040 --> 0:03:03.440 chief account of US there, Diane Schwant, says the FED 0:03:03.600 --> 0:03:06.359 is operating in a new paradigm. The FED is now 0:03:06.400 --> 0:03:09.919 in a position where they're focused on inflation and employment 0:03:10.120 --> 0:03:13.679 is secondary. That is a very different equation than we've 0:03:13.720 --> 0:03:16.640 seen the FIT in for a very very long time. 0:03:16.880 --> 0:03:19.959 Scott Minor, the chief investment officer at Google Hives, is 0:03:20.000 --> 0:03:22.720 going back to the nineteen thirties, the FED has never 0:03:22.760 --> 0:03:24.840 been able to reduce inflation by more than two and 0:03:24.880 --> 0:03:29.560 a half percentage points without inducing a recession. So even 0:03:29.680 --> 0:03:32.520 if we don't get close to the two percent target, 0:03:32.880 --> 0:03:35.600 it's very likely that we will have some kind of 0:03:35.600 --> 0:03:39.920 an economic slowdown well before we get to the desired 0:03:39.920 --> 0:03:43.600 inflation target. Scott minors these further hikes of fifty basis 0:03:43.640 --> 0:03:46.320 points on the table for June and July. Former Philly 0:03:46.360 --> 0:03:49.920 FED President Charles Plosser also weighing in. He says pal 0:03:50.200 --> 0:03:53.120 was trying to appease markets and should not have taken 0:03:53.120 --> 0:03:55.960 a seventy five basis point hike off the table Live 0:03:56.000 --> 0:03:59.120 in New York on John Tucker Bloomberg Daybreak. All right, John, thanks, 0:03:59.120 --> 0:04:01.640 Now we're waiting for another are important policy decision this 0:04:01.720 --> 0:04:04.360 morning in Europe. Let's get the very latest onn that 0:04:04.400 --> 0:04:07.880 lie from Bloomberg's Max Ramsey. Good morning, Max, Morning to you, 0:04:08.000 --> 0:04:10.320 Nathan and Karen. Less than an hour ago until the 0:04:10.400 --> 0:04:13.040 rate decision from the Bank of England market for pricing 0:04:13.040 --> 0:04:15.640 in a fourth back to back hike. This would take 0:04:15.640 --> 0:04:18.480 the benchmark policy rate to one percent. That's the highest 0:04:18.600 --> 0:04:21.479 since two thousand and nine. But also very much in 0:04:21.560 --> 0:04:24.599 focus any details of how the BOE intends to unwind 0:04:24.640 --> 0:04:27.839 more than a decade of bond purchases. Live in London, 0:04:27.880 --> 0:04:30.200 Max Ramsey, bloom Back day break right, Max, thank you. 0:04:30.240 --> 0:04:33.120 There's also an Opaque meeting today. OPEC and his allies 0:04:33.120 --> 0:04:35.960 are expected to ratify another small increase in oil production. 0:04:36.040 --> 0:04:38.719 Their meeting comes just one day after the EU announced 0:04:38.800 --> 0:04:41.640 is planned for a phased ban on Russian crude and 0:04:41.720 --> 0:04:44.760 checking prices. Right now, Nimex crude oil is higher up 0:04:44.760 --> 0:04:46.760 to tens of upper cent or sixty and cents at 0:04:46.760 --> 0:04:49.520 a hundred seven dollars ninety eight cents of barrel Brent 0:04:49.680 --> 0:04:51.839 is at four tenths percent at a hundred ten dollars 0:04:51.839 --> 0:04:54.920 sixty one cents. The oil prices at historic heis Karen 0:04:54.960 --> 0:04:58.320 ev Lawmakers pointing to anti trust laws at OPEC, A 0:04:58.440 --> 0:05:02.040 key Senate committees expected to approved legislation that would allow 0:05:02.080 --> 0:05:05.800 the US to sue the cartel for manipulating energy markets. 0:05:06.080 --> 0:05:08.480 This vote by the Senate Judiciary Committee today would pave 0:05:08.560 --> 0:05:11.120 the way for full Senate consideration. Now, staying in the 0:05:11.120 --> 0:05:13.720 oil passion, Nathan, we're in Buffet is increasing his bat 0:05:13.760 --> 0:05:15.960 on one big energy company, and we get the Ladish 0:05:16.040 --> 0:05:18.440 line from Bloomberg's renied a Young, good morning, Ready down, 0:05:18.480 --> 0:05:21.360 good morning. Karen Berkshire half Away had already built up 0:05:21.360 --> 0:05:25.440 a roughly fourteen point six percent holding of Occidental Petroleum's 0:05:25.480 --> 0:05:28.719 common stock. Now Buffett is snapping up about five point 0:05:28.839 --> 0:05:31.920 nine million more shares of the oil giant. Of filing 0:05:31.960 --> 0:05:34.960 shows the shares were bought this week at prices ranging 0:05:34.960 --> 0:05:37.440 from about fifty six to fifty eight dollars of peace, 0:05:37.720 --> 0:05:41.080 and right now it's trading close to sixty two dollars 0:05:41.120 --> 0:05:44.039 this morning. Accidental was the best performing stock in the 0:05:44.160 --> 0:05:47.000 SMP five during the first quarter, and it's seen it 0:05:47.080 --> 0:05:51.440 shares benefit from Buffett's purchases and higher oil prices driven 0:05:51.480 --> 0:05:54.480 by the war in Ukraine. Live in New York. I'm 0:05:54.520 --> 0:05:57.279 renned a young Bloomberg daybreak. All right, Renia, thanks, Let's 0:05:57.279 --> 0:05:59.240 turn to what's happening on the ground in Ukraine. Now, 0:05:59.320 --> 0:06:02.480 civilian of avacuations continue out of the war ravaged city 0:06:02.480 --> 0:06:08.440 of Maryu Poul. In his latest video address, President Vladimir's 0:06:08.480 --> 0:06:11.040 Lensky says three forty four people have gotten out, even 0:06:11.080 --> 0:06:14.000 as heavy fighting continues at a steel plant in the city. 0:06:14.240 --> 0:06:17.279 The Pentagon says Russia is getting bogged down in eastern 0:06:17.320 --> 0:06:20.640 and southern Ukraine. And Sweden's Foreign minister met with Secretary 0:06:20.680 --> 0:06:22.760 of State Antony Blink and she says the US is 0:06:22.800 --> 0:06:26.280 offering security assurances to Sweden and Finland as they apply 0:06:26.360 --> 0:06:29.000 to join NATO. Well, the other big political story we 0:06:29.000 --> 0:06:31.719 continue to follow Nathan is abortion rights. The head of 0:06:31.720 --> 0:06:34.720 the CDC, Dr Rochelle Wilenski is weighing in and she 0:06:34.800 --> 0:06:37.240 warns the more deaths if the link Supreme Court rolling 0:06:37.240 --> 0:06:40.120 on Roe v. Wade stands. Plumbar said Baxter has more. 0:06:40.560 --> 0:06:42.960 Dr Wolenski says she fears that there could be an 0:06:42.960 --> 0:06:47.000 atmosphere where there's much less medical supervision for people taking 0:06:47.040 --> 0:06:49.520 things into their own hands, and she says it will 0:06:49.560 --> 0:06:53.080 lead to unequal access to the procedure because people with 0:06:53.240 --> 0:06:55.880 less funds will not be able to cross state lines. 0:06:56.000 --> 0:06:59.560 Tied to that, abortion rights groups took over twelve million 0:06:59.640 --> 0:07:03.080 dollars over the twenty four hours following the leak of 0:07:03.080 --> 0:07:06.800 the initial roev Wade decision draft, and Planned Parenthood says 0:07:06.839 --> 0:07:10.680 it saw a six hundred fifty percent increase in online actions. 0:07:10.920 --> 0:07:14.160 In San Francisco, I'm at Baxter Bloomberg, Gay break alright 0:07:14.320 --> 0:07:17.320 ed thanks as futures move lawer. We check your local headlines. 0:07:17.400 --> 0:07:23.960 Next plus sports. This is Bloomberg at six o seven 0:07:23.960 --> 0:07:26.080 on Wall Street where fifty eight degrees in Central Park. 0:07:26.160 --> 0:07:28.880 Still dealing with that accident Old Country Road in West 0:07:29.000 --> 0:07:32.800 Very a tractor trailer involved. Detailers coming up in traffic. 0:07:32.840 --> 0:07:34.600 First Michael Barr with more on what's going on in 0:07:34.600 --> 0:07:37.040 New York and around the world. Michael, thank you very much. Nathan. 0:07:37.080 --> 0:07:39.880 A majority of New Yorkers say they disapprove of Mayor 0:07:40.000 --> 0:07:42.960 Eric adams handling of crime in the Five Boroughs, a 0:07:43.040 --> 0:07:46.240 reversal from three months ago. According to a new Quinnipiac 0:07:46.400 --> 0:07:50.760 University poll, owning approve of Adam's handling of crime well 0:07:50.880 --> 0:07:56.280 fifty four percent disapprove. In February approved of Adam's performance 0:07:56.320 --> 0:07:59.200 on crime. The news comes as two men were shot 0:07:59.280 --> 0:08:02.680 and killed in Intown Manhattan Overninth Police is searching for 0:08:02.720 --> 0:08:07.320 three suspects for the shooting at thirty seven and ninth Avenue. Meanwhile, 0:08:07.400 --> 0:08:10.120 Mayor Adams is urging New Yorkers to trade the pajamas 0:08:10.160 --> 0:08:14.200 for lunch near their workplaces. Adams says that's the way 0:08:14.320 --> 0:08:18.880 metropolitan economies functioned properly. He spoke during a panel discussion 0:08:18.920 --> 0:08:22.560 at the Milken Institute Global Conference in Beverly Hills, California. 0:08:22.920 --> 0:08:26.320 State Department spokesman Ned Price says Secretary of State Anthony 0:08:26.360 --> 0:08:31.160 Blincoln is quarantining. Secretary Blincoln has tested positive for COVID. 0:08:31.480 --> 0:08:34.960 The good news is that he is fully vaccinated, he 0:08:35.160 --> 0:08:40.360 is boosted. He is experiencing only mild symptoms. Spokesman Ned 0:08:40.400 --> 0:08:43.199 Price says Blincoln will work from home in the coming days. 0:08:43.440 --> 0:08:46.600 Blincoln had to postpone a key China policy speech that 0:08:46.679 --> 0:08:49.760 had been scheduled for today. He attended the White House 0:08:49.800 --> 0:08:53.720 Correspondents Association dinner on Saturday. No word yet on who 0:08:53.800 --> 0:08:57.120 leaked the Supreme Court draft opinion on abortion rights. Chief 0:08:57.200 --> 0:09:01.160 Justice John Roberts has called for an internal investor gaistion. Meanwhile, 0:09:01.200 --> 0:09:04.480 President Biden is not mincing words about a draft document 0:09:04.840 --> 0:09:08.400 with the majority voting to overturn Roe V. Wade. What 0:09:08.480 --> 0:09:10.560 are the next things that are going to be attacked? 0:09:11.240 --> 0:09:14.800 Because this MAGA crowd is really the most extreme political 0:09:15.280 --> 0:09:19.880 organization that's existed in American history, in recent American history. 0:09:20.280 --> 0:09:23.120 The President spoke to reporters at an event on the 0:09:23.160 --> 0:09:26.760 economy and the deficit. We're learning Donald Trump Jr. Was 0:09:26.800 --> 0:09:29.960 interviewed as part of a House Select Committee's investigation of 0:09:30.080 --> 0:09:33.040 last year's ryan at the US Capital. He is the 0:09:33.120 --> 0:09:36.480 latest member of former President Trump's family to be questioned. 0:09:36.760 --> 0:09:39.320 A person familiar with the matters says the private virtual 0:09:39.360 --> 0:09:43.520 session lasted between two and three hours. Global News twenty 0:09:43.559 --> 0:09:46.319 four hours a day on air and on Bloomberg quick Take, 0:09:46.360 --> 0:09:49.480 powered by more than twenty seven hundred journalists and analysts 0:09:49.520 --> 0:09:52.240 more than a hundred twenty countries. Michael Barr and this 0:09:52.320 --> 0:09:59.600 is Bloomberg, Nathan, Thanks Michael six o nine on Wall 0:09:59.600 --> 0:10:02.320 Streets on Stash hours here at the Bloomberg Sports update. 0:10:02.440 --> 0:10:05.360 All right, anthan the Yankees first loss since April one 0:10:05.559 --> 0:10:08.120 in Toronto. They had an early home run from Joey Gallo. 0:10:08.240 --> 0:10:11.160 Nothing after that. The eleven game winning streak ended two 0:10:11.200 --> 0:10:13.640 to one. Esther Cortes gave up a Matt Chapman home run, 0:10:13.679 --> 0:10:16.320 he took his first loss. Michael King and Clay Holmes 0:10:16.360 --> 0:10:19.240 followed Cortes through four hit listenings of relief. Both those 0:10:19.280 --> 0:10:22.400 guys have e r a s under one day off today. 0:10:22.440 --> 0:10:25.479 Yanks back home tomorrow to play Texas Mets. Tonight in Philadelphia. 0:10:25.480 --> 0:10:28.439 They lost to Atlanta nine to two, scoreless game going 0:10:28.480 --> 0:10:31.079 to the sixth inning when the Braves erupted for seven runs. 0:10:31.120 --> 0:10:33.920 Tyler McGill, his first start since he got the win 0:10:33.960 --> 0:10:36.120 and the Mets no hitter suffered his first loss, so 0:10:36.559 --> 0:10:38.679 they split the four game series, the first series this 0:10:38.800 --> 0:10:41.760 season the Mets of failed to win NBA playoffs. Miami 0:10:41.760 --> 0:10:44.040 and Phoenix are the top seeds and they both wanted 0:10:44.080 --> 0:10:46.320 home and both leave their series too nothing. Stanley Cup 0:10:46.320 --> 0:10:49.200 Playoffs three series are not tied at one. After wins 0:10:49.200 --> 0:10:53.160 by Tampa Bay, Minnesota and Edmonton. Carolina again beat Boston. 0:10:53.200 --> 0:10:56.000 The Hurricanes up to ZIP two nights after the first 0:10:56.040 --> 0:10:59.120 triple overtime game played at Madison Square Garden in fifty 0:10:59.160 --> 0:11:02.040 one years Andrews and Penguins. We'll be back at it 0:11:02.080 --> 0:11:04.560 tonight for Game two, Rangers coach Gerard gout And asked 0:11:04.559 --> 0:11:07.679 about losing a Game one heartbreaker. It would be heard 0:11:07.800 --> 0:11:11.760 if we were playing Colorado, who's talking the best game 0:11:11.760 --> 0:11:14.200 in the league, and you lose five. Nothing like games 0:11:14.200 --> 0:11:16.240 like that where you know you're saying to your team, 0:11:16.280 --> 0:11:17.640 how are we going to get back from this? We 0:11:17.720 --> 0:11:20.160 play that, we're playing a very good team who I 0:11:20.200 --> 0:11:22.120 think anybody can win this series. Of better team is 0:11:22.160 --> 0:11:23.439 going to win this series, and it's going to be 0:11:23.480 --> 0:11:25.880 a battle. So you know what, it's one game, you 0:11:25.920 --> 0:11:28.160 get over and you move on. It appears the Pittsburgh 0:11:28.160 --> 0:11:30.520 goalie tonight will being Louis domin game, who has never 0:11:30.520 --> 0:11:32.720 started a playoff game before. He came off the bench 0:11:32.760 --> 0:11:35.320 the other night when the starter Casey to Smith got hurt. 0:11:35.600 --> 0:11:38.360 John Stash they were Bloomberg Sports Nick all right, John, 0:11:38.400 --> 0:11:41.640 thanks right now. SMP futures are lower by twenty two points. 0:11:41.720 --> 0:11:45.199 Down futures down a hundred eighteen. NASTAC future is lower 0:11:45.280 --> 0:11:49.160 by nine three points. Some pullback for equity futures after 0:11:49.240 --> 0:11:53.520 the FED fueld rally sparked by Chairman Powell taking seventy 0:11:53.520 --> 0:11:56.960 five basis points off the table for now. More on 0:11:57.040 --> 0:12:00.040 the Fed decision coming up with Bloomberg Economics course on 0:12:00.160 --> 0:12:07.920 at Michael McKee, still in Washington. This is Bloomberg Bloomberg 0:12:07.960 --> 0:12:10.560 eleven three oh weather, sunshine and low seventies today, some 0:12:10.600 --> 0:12:14.280 scattered showers possible tomorrow. Low sixties will start the weekend 0:12:14.280 --> 0:12:18.120 with the breezy behind the mid fifties currently fifties seven 0:12:18.120 --> 0:12:24.640 degrees in Central Park. Markets. Headlines and breaking news twenty 0:12:24.640 --> 0:12:27.440 four hours a day at Bloomberg dot Com, the Bloomberg 0:12:27.520 --> 0:12:31.079 Business Out and at Bloomberg Quick Tape, She's a Bloomberg 0:12:31.160 --> 0:12:40.000 business flash and I'm Cameron Moscow and US dot index 0:12:40.040 --> 0:12:42.439 futures are signaling a pause following me U S and 0:12:42.520 --> 0:12:46.840 P five hundreds biggest daily advances twenty after jaround Powell 0:12:46.880 --> 0:12:49.200 East fears at the Federal embark on a more aggressive 0:12:49.240 --> 0:12:52.240 pace of tightening. European shares are moving higher, and we 0:12:52.320 --> 0:12:54.760 checked the markets every fifteen minutes throughout the trading day. 0:12:55.080 --> 0:12:57.360 On Bloomberg Guess and P future is down twenty three 0:12:57.360 --> 0:13:00.439 points this morning. Death futures down a hundred five downsday 0:13:00.520 --> 0:13:03.240 features down nineties seven. The decks in Germany's up one 0:13:03.240 --> 0:13:06.319 point four percent. Pen your treasury down four thirty seconds, 0:13:06.360 --> 0:13:08.400 he'll two point nine five percent. They yield on a 0:13:08.440 --> 0:13:11.640 two year two point six seven percent. Ninemex screwed oil 0:13:11.840 --> 0:13:13.880 is up six tents percent or sixty six cents at 0:13:13.880 --> 0:13:16.400 a hundred eight dollars, forty six cents of barrel, comic 0:13:16.440 --> 0:13:18.760 school at one point six percent of thirty dollars, ten 0:13:18.800 --> 0:13:21.800 cents at eight ninety eight ninety announce the euro one 0:13:21.800 --> 0:13:24.120 point oh six oh two against the dollar, British pound 0:13:24.120 --> 0:13:26.760 one point five six eight the end at one nine 0:13:26.800 --> 0:13:30.360 point six four and checking bitcoin this morning, it's lower, 0:13:30.400 --> 0:13:33.080 down eight ten percent at thirty nine thousand, four hundred 0:13:33.200 --> 0:13:36.320 seventy dollars. That's a bloomberg business flash. Now here's Muchael 0:13:36.320 --> 0:13:38.400 Barr with more on what's going on around the world. 0:13:38.520 --> 0:13:42.360 Muchel very in Ukrainian forces say they repelled Russian attacks 0:13:42.400 --> 0:13:45.400 in the east and captured some territory. It comes as 0:13:45.440 --> 0:13:48.840 Moscow moved to obstruct the flow of Western weapons to 0:13:49.120 --> 0:13:53.440 Ukraine by bombarding rail stations and other supplying line targets 0:13:53.440 --> 0:13:56.800 across the country coast to Coast protests continue after the 0:13:56.840 --> 0:14:00.120 release of a Supreme Court draft opinion that eludes to 0:14:00.200 --> 0:14:04.000 a reversal on Roe v. Wade. Fencing has gone up 0:14:04.000 --> 0:14:07.239 in front of the U S Supreme Court Complex. In baseball, 0:14:07.320 --> 0:14:10.640 the Yankees, Mets, Red Sox, Nationals, A's, and Giants all 0:14:10.840 --> 0:14:14.440 lost the Orioles one in the NHL Playoffs. The Rangers 0:14:14.440 --> 0:14:16.920 play Game two of their series against the Penguins tonight. 0:14:17.160 --> 0:14:20.160 The Bruins lost to the Hurricanes. Global News twenty four 0:14:20.200 --> 0:14:22.680 hours a day on air and on Bloomberg Quick to Take, 0:14:22.720 --> 0:14:25.320 powered by more than twenty seven hundred journalists and analysts 0:14:25.520 --> 0:14:28.200 in more than a hundred twenty countries. Michael Barr and 0:14:28.280 --> 0:14:31.400 this is Bloomberg. Nathan Alright, Michael, Thanks at six nineteen 0:14:31.400 --> 0:14:34.440 on Wall Street Live from the Bloomberg Interactive Broker Studios. 0:14:34.520 --> 0:14:39.360 This is Bloomberg Daybreak. Seventy basis point uh and it 0:14:39.400 --> 0:14:42.760 increases not something the committee is actively considering, assuming that 0:14:42.800 --> 0:14:46.200 economic and financial conditions evolve in in ways that are 0:14:46.200 --> 0:14:49.240 consistent with our expectations. There's a broad sense on the 0:14:49.240 --> 0:14:52.320 Committee that additional fifty basis increases should be on fifty 0:14:52.320 --> 0:14:54.040 basis points should be on the table for the next 0:14:54.080 --> 0:14:57.440 couple of weeks. That was FED Chairman Jerome Powell delivering 0:14:57.480 --> 0:15:01.600 what markets were expecting in term of interest rate hikes 0:15:01.800 --> 0:15:05.680 coming this month and potentially down the road, sparking a 0:15:05.800 --> 0:15:09.760 rally by taking seventy five basis points off the table. 0:15:10.040 --> 0:15:13.320 Bloomberg Economics correspondent Michael McKee is back with us this 0:15:13.360 --> 0:15:17.600 morning from our Bloomberg studios in Washington, d C. This 0:15:17.680 --> 0:15:23.080 morning after a very consequential FED news conference. My good morning. 0:15:23.120 --> 0:15:25.840 I guess my question is is the FED fighting inflation 0:15:25.880 --> 0:15:27.600 at this point or is the FED fighting the market? 0:15:29.000 --> 0:15:32.240 The Fed is fighting inflation, and that is something the 0:15:32.280 --> 0:15:35.960 market is trying to digest. Actually, the Fed has been 0:15:36.000 --> 0:15:39.760 sort of pushing the markets higher. What I say markets, 0:15:39.800 --> 0:15:42.480 I mean the bondod market in terms of yield. Uh. 0:15:42.560 --> 0:15:46.280 They've been pushing that higher, and uh that is kind 0:15:46.280 --> 0:15:49.200 of helped them in the sense that it tightens financial 0:15:49.240 --> 0:15:53.000 conditions more than just their rate rises. They're sort of 0:15:53.040 --> 0:15:56.840 front running themselves here, and if the market got a 0:15:56.840 --> 0:16:00.280 little ahead of itself with some idea of seventy bases points, 0:16:00.280 --> 0:16:03.560 were kind of back to reality now and we are 0:16:03.560 --> 0:16:07.640 going to see rates continue to rise, and that will 0:16:08.040 --> 0:16:11.520 uh slow the economy at some point? Well, it's slow inflation. 0:16:12.320 --> 0:16:14.240 I guess that's the other big question. Yeah, that was 0:16:14.280 --> 0:16:16.400 the point that j. Powell is making. This isn't easy 0:16:16.480 --> 0:16:18.560 because much of the inflation that we see is on 0:16:18.600 --> 0:16:20.400 the supply side, and what the Fed can do is 0:16:20.440 --> 0:16:25.840 affect demand. But if they can affect demand enough, uh, 0:16:25.880 --> 0:16:29.680 they would bring demand down to supply uh. And so 0:16:29.840 --> 0:16:33.680 at that point you would uh get rid of inflation. 0:16:33.840 --> 0:16:36.800 But that might mean we have to go way down 0:16:36.840 --> 0:16:40.080 in growth, possibly even into a recession. Paul doesn't think so, 0:16:40.600 --> 0:16:44.600 but many analysts do. Where or at least, do we 0:16:44.720 --> 0:16:48.000 have a better sense of where the Fed is aiming 0:16:48.120 --> 0:16:50.800 in terms of the inflation rate? Did we get a 0:16:50.840 --> 0:16:54.520 better indication of that from Chairman Powell on what based 0:16:54.520 --> 0:16:57.120 on what he had to say yesterday, Well, he did 0:16:57.240 --> 0:17:00.320 assert they're still trying to reach their target of two said, 0:17:00.440 --> 0:17:02.920 but he didn't put a time frame on it. He 0:17:03.000 --> 0:17:06.520 did suggest they think they can get to neutral, the 0:17:06.600 --> 0:17:11.080 rate at which they're neither stimulating or holding back the economy, 0:17:11.240 --> 0:17:13.080 by the end of the year, but he also said 0:17:13.080 --> 0:17:17.000 he didn't know exactly what neutral rate is, maybe around 0:17:17.040 --> 0:17:20.639 two and a half. So we could have significantly higher 0:17:20.640 --> 0:17:22.639 interest rates than we've had over the last three or 0:17:22.640 --> 0:17:25.840 four years, but not high by historical standards, and what 0:17:25.920 --> 0:17:28.520 effect that has on the overall economy is gonna be 0:17:28.560 --> 0:17:31.280 hard to predict. How important, Mike was it for the 0:17:31.280 --> 0:17:34.040 FED to have unanimity in this decision. It was a 0:17:34.160 --> 0:17:37.520 unanimous decision to go for fifty basis points this time around, 0:17:37.520 --> 0:17:42.200 even after St. Louis President Bullard at least floated the 0:17:42.240 --> 0:17:45.879 possibility before this meeting of seventy five. Well, you know, 0:17:45.960 --> 0:17:48.280 he was asked about seventy five and he said, Wow, 0:17:48.280 --> 0:17:50.840 it's not my base case, but I could. I wouldn't 0:17:50.880 --> 0:17:53.520 rule it out. And then that became a thing on 0:17:53.640 --> 0:17:56.680 Wall Street, is Bullard calling for seventy five, but when 0:17:56.720 --> 0:17:59.160 he didn't really call for seventy five. So I think 0:17:59.200 --> 0:18:02.960 the FED was never really in danger of being disunited 0:18:03.000 --> 0:18:06.440 and on this issue, but Wall Street was sort of 0:18:07.000 --> 0:18:10.439 hedging its bets and just in case. You could make 0:18:10.480 --> 0:18:12.879 an argument that if you're going to go up to 0:18:12.920 --> 0:18:14.359 two and a half percent, you might as well do 0:18:14.400 --> 0:18:16.280 it as quickly as possible. But the FED seems to 0:18:16.359 --> 0:18:18.320 think that is too much of a risk to the 0:18:18.359 --> 0:18:21.199 markets in the economy because it would surprise them and 0:18:21.280 --> 0:18:24.359 raise questions about how worried the FED might be about 0:18:24.440 --> 0:18:27.760 inflation in the future. Yeah, it did seem as though 0:18:27.800 --> 0:18:31.959 the market took the Chairman's words about seventy five at 0:18:32.000 --> 0:18:35.680 least not actively considering it at this point as off 0:18:35.760 --> 0:18:38.640 the table. But do we have some kind of an idea, Mike, 0:18:38.920 --> 0:18:41.560 of what would need to take place in the economy 0:18:41.640 --> 0:18:46.679 or market conditions for the FED too actively consider seventy 0:18:47.560 --> 0:18:49.960 You'd probably have to see a really big rise in 0:18:50.080 --> 0:18:53.840 core inflation. The FED knows that we're seeing a lot 0:18:53.880 --> 0:18:58.280 of headline inflation generated by food problems and oil prices, 0:18:58.280 --> 0:19:01.679 and oil prices likely to go up again if Europe 0:19:01.720 --> 0:19:05.639 follows through an embargoes Russian oil, so they can't do 0:19:05.640 --> 0:19:08.760 anything about that. But core prices if they start to 0:19:09.560 --> 0:19:13.480 rise considerably, and pressure in the core has been lower 0:19:13.520 --> 0:19:15.919 than on the headline, so if that turns around and 0:19:15.920 --> 0:19:18.360 they rise considerably, then the FED might get worried enough 0:19:18.400 --> 0:19:21.600 to do something. All right, Michael McKee as always great 0:19:21.600 --> 0:19:24.160 getting your thoughts, especially the morning after a FED day. 0:19:24.200 --> 0:19:28.800 Michael McKee, Bloomberg Economics correspondent with us from our studios 0:19:28.920 --> 0:19:32.320 in Washington d C. As we look at a bit 0:19:32.320 --> 0:19:35.119 of pullback for futures after the rally, we have SMP 0:19:35.280 --> 0:19:38.800 futures down twenty one points. Now futures are down a 0:19:38.880 --> 0:19:42.520 hundred nineteen and NAZDAC futures are lower by eighty eight 0:19:42.560 --> 0:19:46.520 points ten. Your treasury yield two point nine. Watching this 0:19:46.640 --> 0:19:50.680 red headline cross the Bloomberg terminal, Elon Musk has received 0:19:50.720 --> 0:19:54.920 additional equity commitment letters for his deal to buy Twitter. 0:19:55.240 --> 0:19:57.960 You know much more on that straight ahead as Bloomberg 0:19:58.119 --> 0:20:08.760 Daybreak continues. This is Bloomberg and Bloomberg Daybreak is brought 0:20:08.800 --> 0:20:10.760 to you by the Jewish Communal Fund. J c f's 0:20:10.800 --> 0:20:13.520 donor advised fund is the smart choice to manage your philanthropy, 0:20:13.640 --> 0:20:17.040 especially in times of crisis. Make your giving impactful. Visit 0:20:17.160 --> 0:20:23.640 j c F n Y dot org. Broadcasting wide from 0:20:23.640 --> 0:20:27.800 the Bloomberg Interactive Broker Studio in New York, Bloomberg Looking 0:20:27.840 --> 0:20:32.199 Free to Washington, d C, Bloomberg one to Boston, Bloomberg 0:20:32.280 --> 0:20:35.280 one O six one to San Francisco, Bloomberg nine six 0:20:35.560 --> 0:20:38.160 to the country, Sirius XM to A one nine team, 0:20:38.280 --> 0:20:41.800 and around the globe. The Bloomberg Business and Bloomberg Radio 0:20:41.920 --> 0:20:51.040 dot com. This is Bloomberg Daybreak six thirty on Wall Street. 0:20:51.080 --> 0:20:53.840 Good morning. I'm Nathan Hager and I'm Karen Moscow. We 0:20:53.880 --> 0:20:56.000 are just about three hours away from the open of 0:20:56.080 --> 0:20:58.159 US trading. Time for the five things you need to 0:20:58.160 --> 0:21:01.359 notice start your day. Brought to you by Interactive Brokers. 0:21:01.600 --> 0:21:05.280 Investment advisers switched to Interactive Brokers for lowest cost global 0:21:05.320 --> 0:21:08.720 training and turnkey custody solutions, no ticket charges and no 0:21:08.800 --> 0:21:11.800 complex of your interests at ibk R dot com slash 0:21:12.000 --> 0:21:14.920 r I A up. First, we're seeing a slight pullback 0:21:14.960 --> 0:21:17.760 in futures this morning after yesterday's rally that followed a 0:21:17.800 --> 0:21:21.480 press conference from Federal Reserve Chair J Powell. Powell indicated 0:21:21.480 --> 0:21:24.400 a seventy five basis point hike was not being considered 0:21:24.400 --> 0:21:27.040 for meetings in June and said he's committed to bringing 0:21:27.080 --> 0:21:31.600 down inflation. Inflation is much too high, and we understand 0:21:31.640 --> 0:21:35.000 the hardship it is causing, and we're moving expeditiously to 0:21:35.000 --> 0:21:38.040 bring it back down. We have both the tools we 0:21:38.080 --> 0:21:40.280 need and the resolve that it will take to restore 0:21:40.320 --> 0:21:43.560 price stability on behalf of American families and businesses, and 0:21:43.640 --> 0:21:46.119 Chair J. Powell's comments came as the Fed hiked interest 0:21:46.200 --> 0:21:49.160 rates fifty basis points, and we're still watching reaction pour 0:21:49.240 --> 0:21:51.679 in Karen from many different quarters. More on that in 0:21:51.720 --> 0:21:54.399 this live report from bloom Briggs John Tucker, John Nathan. 0:21:54.440 --> 0:21:57.800 Former Philadelphia fifth President Charles Plasters has fed your Powell 0:21:57.920 --> 0:22:01.639