1 00:00:02,920 --> 00:00:08,320 Speaker 1: Bloomberg Audio Studios, Podcasts, radio news. 2 00:00:11,440 --> 00:00:14,080 Speaker 2: This is Bloomberg day Break Weekend, our global look at 3 00:00:14,080 --> 00:00:16,640 Speaker 2: the top stories in the coming week from our Daybreak 4 00:00:16,640 --> 00:00:19,560 Speaker 2: anchors all around the world. That's straight ahead on the program, 5 00:00:19,560 --> 00:00:21,800 Speaker 2: a look at the March jobs report here in the 6 00:00:21,920 --> 00:00:25,160 Speaker 2: US and what it means for FED policy. I'm Tom 7 00:00:25,200 --> 00:00:26,360 Speaker 2: Busby in New York. 8 00:00:26,560 --> 00:00:29,040 Speaker 1: I'm Caroline Hepcker here in London, where we're asking if 9 00:00:29,080 --> 00:00:32,720 Speaker 1: the eupin Central Bank has won it's battle against inflation. 10 00:00:33,240 --> 00:00:35,680 Speaker 3: I'm Brian Curtis in Hong Kong. I'll look ahead to 11 00:00:35,800 --> 00:00:39,400 Speaker 3: China's PMIS and whether the PBOC wants to use the 12 00:00:39,520 --> 00:00:41,880 Speaker 3: Chinese currency to juice the economy. 13 00:00:43,880 --> 00:00:47,159 Speaker 4: That's all straight ahead on Bloomberg day Break Weekend on 14 00:00:47,320 --> 00:00:50,160 Speaker 4: Bloomberg Ey Look the Free own New York, Bloomberg ninety 15 00:00:50,240 --> 00:00:53,800 Speaker 4: nine to one, Washington, DC, Bloomberg one O six one, Boston, 16 00:00:53,880 --> 00:00:58,680 Speaker 4: Bloomberg nine sixty, San Francisco DAB Digital Radio, London, Sirius 17 00:00:58,800 --> 00:01:02,040 Speaker 4: XM one nineteen and around the world on Bloomberg Radio 18 00:01:02,160 --> 00:01:04,480 Speaker 4: dot Com and via the Bloomberg Business App. 19 00:01:08,600 --> 00:01:10,880 Speaker 2: Good day to you. I'm Tom Busby, and we begin 20 00:01:10,920 --> 00:01:13,840 Speaker 2: today's program with the March Jobs report, we get those 21 00:01:13,920 --> 00:01:17,839 Speaker 2: numbers this coming Friday. What does this mean for Fed 22 00:01:17,880 --> 00:01:20,919 Speaker 2: policy going forward? Well for more, we're joined by Michael McKee, 23 00:01:20,920 --> 00:01:25,800 Speaker 2: Bloomberg International Economics and Policy Correspondent. Now, Michael, we saw 24 00:01:25,959 --> 00:01:30,040 Speaker 2: blowout gains in January, strong growth in February, even though 25 00:01:30,080 --> 00:01:32,880 Speaker 2: the unemployment rate ticked a little higher three point nine percent. 26 00:01:33,319 --> 00:01:36,240 Speaker 2: What are you expecting to see for March this Friday? 27 00:01:37,160 --> 00:01:40,360 Speaker 5: Pretty much the same thing. Want to make it sound boring, 28 00:01:40,440 --> 00:01:43,120 Speaker 5: but we have no indication that the labor market has 29 00:01:43,160 --> 00:01:47,480 Speaker 5: fallen off. And right now, the forecast consensus from econdom 30 00:01:47,480 --> 00:01:50,040 Speaker 5: was surveyed by Bloomberg is for about two hundred and 31 00:01:50,040 --> 00:01:53,640 Speaker 5: fifteen two hundred and sixteen thousand. That would be down 32 00:01:53,720 --> 00:01:56,600 Speaker 5: from the prior month. But we haven't really been sure 33 00:01:56,760 --> 00:02:00,440 Speaker 5: about what the numbers would be in some time because 34 00:02:00,480 --> 00:02:03,560 Speaker 5: they keep coming in stronger than anticipated. So if we 35 00:02:03,680 --> 00:02:07,080 Speaker 5: see something similar to that again, it would be mixed 36 00:02:07,120 --> 00:02:09,400 Speaker 5: news for the FED and that they want people to 37 00:02:09,400 --> 00:02:12,600 Speaker 5: get jobs and it's good for the economy. But the 38 00:02:12,680 --> 00:02:15,679 Speaker 5: question becomes is an inflationary right? 39 00:02:15,840 --> 00:02:16,000 Speaker 1: Right? 40 00:02:16,080 --> 00:02:19,240 Speaker 2: Yeah? So a surprise to the upside would be no surprise, 41 00:02:19,760 --> 00:02:23,239 Speaker 2: but it could hurt things let's talk about another thing, 42 00:02:23,320 --> 00:02:26,880 Speaker 2: that's average hourly earnings and what are we looking for there? 43 00:02:26,880 --> 00:02:29,000 Speaker 2: And that will what will that tell us about inflation? 44 00:02:29,160 --> 00:02:34,440 Speaker 5: And yeah, average hourly earnings has been the Fed's focus 45 00:02:34,560 --> 00:02:37,480 Speaker 5: in these jobs numbers because they're looking at whether or 46 00:02:37,480 --> 00:02:40,680 Speaker 5: not employers are still having to pay up to attract 47 00:02:40,720 --> 00:02:45,400 Speaker 5: employees and then raise prices to cover that. Right now, 48 00:02:45,520 --> 00:02:49,280 Speaker 5: we're looking for a jump in average hourly earnings and 49 00:02:49,520 --> 00:02:52,040 Speaker 5: no change in a year over year basis four point 50 00:02:52,040 --> 00:02:56,680 Speaker 5: three percent. That's good for workers, it's above inflation. Inflation 51 00:02:56,760 --> 00:02:59,679 Speaker 5: adjusted wages have been rising over one percent for the 52 00:02:59,680 --> 00:03:04,160 Speaker 5: past some months, so that's from the worker side good news. 53 00:03:04,200 --> 00:03:06,880 Speaker 5: But it still concerns the FED in terms of is 54 00:03:06,919 --> 00:03:11,440 Speaker 5: that what's pushing up service industry prices as particular, which 55 00:03:11,480 --> 00:03:14,360 Speaker 5: has been a big contributor to the fact that they 56 00:03:14,400 --> 00:03:17,839 Speaker 5: can't get inflation down to two percent yet now not yet. 57 00:03:18,160 --> 00:03:21,679 Speaker 2: And another concern for the FED is the unemployment rate. 58 00:03:21,800 --> 00:03:24,679 Speaker 2: Now we know it's three point nine percent for February, 59 00:03:24,760 --> 00:03:28,239 Speaker 2: they're expecting three point eight, still below what they view 60 00:03:28,400 --> 00:03:30,440 Speaker 2: as an appropriate level four point one. 61 00:03:30,520 --> 00:03:32,600 Speaker 5: Right Well, the FED thought we would get to four 62 00:03:32,600 --> 00:03:35,160 Speaker 5: point one this year. They thought we would get to 63 00:03:35,160 --> 00:03:38,160 Speaker 5: four point one last year, and we did. The unemployment 64 00:03:38,240 --> 00:03:41,560 Speaker 5: rate has continued to surprise the FED. One of the 65 00:03:41,640 --> 00:03:45,560 Speaker 5: questions is going to come with the labor force participation rate. 66 00:03:46,040 --> 00:03:48,800 Speaker 5: We have seen more people entering the labor force, which 67 00:03:48,840 --> 00:03:51,440 Speaker 5: is one reason that unemployment rose from its low of 68 00:03:51,560 --> 00:03:54,360 Speaker 5: three and a half to now this three point nine percent, 69 00:03:54,520 --> 00:03:57,280 Speaker 5: and that could be a reason for us to go 70 00:03:57,400 --> 00:04:00,960 Speaker 5: over four. Nobody thinks we're going to go significantly over four, 71 00:04:01,000 --> 00:04:03,160 Speaker 5: but it's been a while since we've been there, so 72 00:04:03,560 --> 00:04:05,800 Speaker 5: there's a feeling at some point we have to go 73 00:04:05,960 --> 00:04:09,680 Speaker 5: back to around that level. Because the FED and most 74 00:04:09,760 --> 00:04:13,000 Speaker 5: economists think we are below the natural rate of unemployment, 75 00:04:13,040 --> 00:04:17,520 Speaker 5: we're still in a level at which we see inflationary 76 00:04:17,560 --> 00:04:20,760 Speaker 5: pressures because there's not enough people to take all the jobs. 77 00:04:21,279 --> 00:04:25,120 Speaker 2: Well, now, fifteen million jobs added since Biden took office. 78 00:04:25,760 --> 00:04:31,800 Speaker 2: How is this momentum carrying the perception of his economy 79 00:04:31,920 --> 00:04:32,719 Speaker 2: biden Omics. 80 00:04:32,839 --> 00:04:35,120 Speaker 5: It's starting to get better. We've had some numbers on 81 00:04:35,200 --> 00:04:38,920 Speaker 5: consumer sentiment. They've been up but down just a little bit. 82 00:04:38,960 --> 00:04:41,520 Speaker 5: But people are feeling pretty good still about the labor force, 83 00:04:41,600 --> 00:04:44,000 Speaker 5: and that's because they have jobs, and if they have jobs, 84 00:04:44,400 --> 00:04:47,039 Speaker 5: they can go out and spend, and the economy is 85 00:04:47,160 --> 00:04:51,640 Speaker 5: growing faster than had been anticipated this year. So it's 86 00:04:51,760 --> 00:04:54,200 Speaker 5: a reason perhaps that we have seen some of the 87 00:04:54,240 --> 00:04:57,919 Speaker 5: polls turn around for President Biden. But you need to 88 00:04:57,960 --> 00:05:00,320 Speaker 5: keep it going. And that's the question is is this 89 00:05:00,440 --> 00:05:01,279 Speaker 5: going to continue? 90 00:05:01,560 --> 00:05:04,520 Speaker 2: Yeah, November still a long way away. Well, let's talk 91 00:05:04,560 --> 00:05:06,800 Speaker 2: about some of the jobs that we're seeing growth and 92 00:05:06,839 --> 00:05:09,560 Speaker 2: some of the jobs where we're losing a little steam. 93 00:05:10,120 --> 00:05:13,880 Speaker 5: Well, last month we lost to some manufacturing jobs which 94 00:05:14,520 --> 00:05:17,360 Speaker 5: had been expected for some time and hadn't shown up 95 00:05:17,440 --> 00:05:22,080 Speaker 5: yet because the ism numbers other measures of manufacturing have 96 00:05:22,160 --> 00:05:27,039 Speaker 5: suggested a slow down. So we'll watch manufacturing payrolls. But 97 00:05:27,279 --> 00:05:29,440 Speaker 5: most of the jobs are still being created in the 98 00:05:29,440 --> 00:05:33,280 Speaker 5: health services industry and that's expected to continue for quite 99 00:05:33,279 --> 00:05:36,000 Speaker 5: some time. As America ages, we need more people to 100 00:05:36,000 --> 00:05:39,920 Speaker 5: help take care of them, so that a rise there 101 00:05:39,960 --> 00:05:42,640 Speaker 5: is not a surprise. A rise in leisure and hospitality 102 00:05:43,080 --> 00:05:45,960 Speaker 5: would not be a surprise. Those jobs turnover fairly quickly, 103 00:05:46,000 --> 00:05:48,919 Speaker 5: and we've never really gotten back all the jobs at bars, 104 00:05:48,960 --> 00:05:53,080 Speaker 5: restaurants and hotels that we lost during the pandemic. After that, 105 00:05:53,720 --> 00:05:56,360 Speaker 5: you'd want to look at something like retail to see 106 00:05:56,400 --> 00:06:00,200 Speaker 5: if companies are still feeling like Americans are going to 107 00:06:00,279 --> 00:06:05,040 Speaker 5: shop enough to add workers. We've gotten through now January 108 00:06:05,080 --> 00:06:09,640 Speaker 5: February where the extra help they hire for the holiday 109 00:06:09,720 --> 00:06:14,159 Speaker 5: season gets let go. Are they still letting go people 110 00:06:14,240 --> 00:06:18,240 Speaker 5: or are we going to see a rise in retail payrolls. 111 00:06:18,400 --> 00:06:20,520 Speaker 2: That's going to be something to watch as well, and 112 00:06:20,560 --> 00:06:25,120 Speaker 2: also another economic indicator construction jobs. Construction jobs have been 113 00:06:25,120 --> 00:06:28,560 Speaker 2: interesting because the builders can't build houses fast enough. There's 114 00:06:28,600 --> 00:06:32,760 Speaker 2: so much demand for new homes, and they have been 115 00:06:32,800 --> 00:06:36,440 Speaker 2: able to find workers. Construction jobs have been rising, and 116 00:06:36,520 --> 00:06:42,440 Speaker 2: so that's a consideration. Do we still see construction jobs rising. 117 00:06:42,920 --> 00:06:45,160 Speaker 2: This kind of plays into the whole debate too about 118 00:06:45,279 --> 00:06:50,880 Speaker 2: immigration in the presidential race, because a lot of undocumented 119 00:06:51,000 --> 00:06:56,320 Speaker 2: immigrants are taking construction jobs, and without them, you wouldn't 120 00:06:56,320 --> 00:06:59,679 Speaker 2: have the ability to build as many homes. So there's 121 00:06:59,680 --> 00:07:02,400 Speaker 2: some good news bad news in that. Well our thanks 122 00:07:02,400 --> 00:07:07,479 Speaker 2: to Michael McKee, Bloomberg's International economics and policy correspondent. Well 123 00:07:07,520 --> 00:07:10,400 Speaker 2: we move now to the Walt Disney Company's annual meeting 124 00:07:10,440 --> 00:07:13,880 Speaker 2: of shareholders. It'll be held on April third. It's usually 125 00:07:14,080 --> 00:07:17,760 Speaker 2: an uneventful affair, but not this year. Activist investor, try 126 00:07:17,800 --> 00:07:21,560 Speaker 2: On Fund Management founder Nelson Peltz going up against Disney 127 00:07:21,600 --> 00:07:24,800 Speaker 2: CEO Bob Iiger looking for a seat on Disney's board. 128 00:07:24,800 --> 00:07:26,640 Speaker 2: And for more on what's turned out to be a 129 00:07:26,680 --> 00:07:31,560 Speaker 2: battle Royale, we're joined by Thomas Buckley, Bloomberg News entertainment reporter. 130 00:07:32,320 --> 00:07:35,559 Speaker 2: So Thomas lay it out what is behind this fight 131 00:07:35,760 --> 00:07:37,920 Speaker 2: for at least one board seat at Disney. 132 00:07:38,120 --> 00:07:40,320 Speaker 6: Well, as you said, Tom, I think that in previous 133 00:07:40,400 --> 00:07:42,640 Speaker 6: years it's been a pretty uneventful of third the Disney 134 00:07:42,680 --> 00:07:45,800 Speaker 6: Annual General Meeting. I think that it couldn't be more eventful. 135 00:07:45,800 --> 00:07:49,160 Speaker 6: In fact, this year, Nelson Pels's Trend Fund Management, the 136 00:07:49,160 --> 00:07:52,200 Speaker 6: activist firm, has accumulated a stake in Disney work without 137 00:07:52,280 --> 00:07:55,400 Speaker 6: three point five billion dollars and has been lobbying for 138 00:07:55,480 --> 00:07:58,440 Speaker 6: board seats for the better half of almost two years now. 139 00:07:59,080 --> 00:08:01,600 Speaker 6: And even a couple of weeks ago, it looked like, 140 00:08:01,960 --> 00:08:04,320 Speaker 6: you know, Disney had turned in a very strong earnings 141 00:08:04,360 --> 00:08:07,640 Speaker 6: report and it seems as though momentum on the Trian 142 00:08:07,800 --> 00:08:11,280 Speaker 6: and Nelson Pelts side had really slowed. But since then 143 00:08:11,400 --> 00:08:14,360 Speaker 6: we've seen a number of people step out in support 144 00:08:14,440 --> 00:08:17,480 Speaker 6: of Pelts. Now that includes directors on the boards of 145 00:08:17,480 --> 00:08:20,280 Speaker 6: companies where he's previously selled as a director, including Procter 146 00:08:20,360 --> 00:08:25,280 Speaker 6: and Gamble, Montalize, Janis, Henderson and Moore. And now we 147 00:08:25,360 --> 00:08:29,360 Speaker 6: have proxy advisers Iss and Egan Jones also supporting his 148 00:08:29,480 --> 00:08:32,920 Speaker 6: candidacy for a board seat. So what seemed like in 149 00:08:33,000 --> 00:08:35,680 Speaker 6: maybe an early victory for Disney is maybe now looking 150 00:08:35,679 --> 00:08:36,840 Speaker 6: a bit more like a contest. 151 00:08:37,360 --> 00:08:40,520 Speaker 2: Well, what is the problem that he has with Eiger 152 00:08:40,640 --> 00:08:43,120 Speaker 2: and the direction of the Disney Company. What does he 153 00:08:43,200 --> 00:08:44,320 Speaker 2: want to see changed? 154 00:08:44,720 --> 00:08:47,160 Speaker 6: I think there are a number of issues that tryan 155 00:08:47,240 --> 00:08:49,520 Speaker 6: light laid out in a one hundred and thirty three 156 00:08:49,960 --> 00:08:55,360 Speaker 6: page white paper recently. Now he focuses on really the 157 00:08:55,480 --> 00:08:59,520 Speaker 6: lack of oversight and accountability at the board level, which 158 00:08:59,559 --> 00:09:02,199 Speaker 6: he claims has been the case for most of Disney's 159 00:09:02,240 --> 00:09:05,920 Speaker 6: recent history. I think that Disney has taken steps to 160 00:09:06,240 --> 00:09:08,760 Speaker 6: address a number of the complaints or you could say 161 00:09:08,840 --> 00:09:11,640 Speaker 6: arguments laid out on the white paper. For example, it's 162 00:09:11,679 --> 00:09:15,640 Speaker 6: appointed former Morgan Stanley's CEO James Gorman to its board 163 00:09:15,679 --> 00:09:18,800 Speaker 6: and also former Sky CEO Jeremy Director Aid in a 164 00:09:18,840 --> 00:09:22,960 Speaker 6: succession planning process. Obviously, will remember that the succession planning 165 00:09:22,960 --> 00:09:25,439 Speaker 6: process as carried out by the board for the CEO 166 00:09:25,520 --> 00:09:29,800 Speaker 6: that preceded Barbiger, so Bob Jpek, who lasted little less 167 00:09:29,800 --> 00:09:32,160 Speaker 6: than three years and the role was not successful, which 168 00:09:32,200 --> 00:09:35,280 Speaker 6: is why Barbigo had to return. Since his return in 169 00:09:35,280 --> 00:09:38,200 Speaker 6: twenty twenty two, as contract has been extended all the 170 00:09:38,200 --> 00:09:41,240 Speaker 6: way out of twenty twenty six. So I think that 171 00:09:41,679 --> 00:09:44,000 Speaker 6: Nelson probably feels as though the board could be doing 172 00:09:44,000 --> 00:09:47,280 Speaker 6: a better job, certainly in areas of succession planning and accountability. 173 00:09:48,120 --> 00:09:50,520 Speaker 2: Well, now you talked about the support that Pelt has, 174 00:09:50,640 --> 00:09:53,520 Speaker 2: but let's talk about the support that Iiger has won 175 00:09:53,640 --> 00:09:57,320 Speaker 2: from Glass Lewis, JP Morgan Chase CEO, Jamie Diamond, and 176 00:09:57,400 --> 00:10:01,559 Speaker 2: big names like Loreen Powell, jobs Star Wars director George Lucas, 177 00:10:01,640 --> 00:10:04,800 Speaker 2: a favorite of many people, and also the Disney family. 178 00:10:05,080 --> 00:10:09,160 Speaker 2: How does that backing affect, you know, what's going to 179 00:10:09,200 --> 00:10:09,920 Speaker 2: happen this week? 180 00:10:11,360 --> 00:10:14,400 Speaker 6: Well, I think that's really interesting because fundamentally we're seeing 181 00:10:14,520 --> 00:10:19,280 Speaker 6: both sides Marshal support. I think that, you know, I'm 182 00:10:19,360 --> 00:10:22,240 Speaker 6: not sure how you would argue necessarily the credibility of 183 00:10:22,240 --> 00:10:25,479 Speaker 6: Glass Lewis versus the credibility of Iss versus the credibility 184 00:10:25,520 --> 00:10:27,839 Speaker 6: of Evon Jones. I mean, these people are very much 185 00:10:27,880 --> 00:10:32,200 Speaker 6: in the same game of speaking to shareholders and speaking 186 00:10:32,200 --> 00:10:36,439 Speaker 6: to the companies and seeking to really, I suppose, improve 187 00:10:36,559 --> 00:10:39,800 Speaker 6: governance of the companies that they monitor. I think the 188 00:10:39,880 --> 00:10:43,440 Speaker 6: fact that a number of these proxy advisors are split 189 00:10:43,640 --> 00:10:47,360 Speaker 6: speaks volumes probably about the shareholder base being split. I 190 00:10:47,400 --> 00:10:52,280 Speaker 6: think that the support from Jamie Diamond would probably sway 191 00:10:52,480 --> 00:10:56,439 Speaker 6: a number of institutional shareholders. The support from the likes 192 00:10:56,440 --> 00:11:00,199 Speaker 6: of George Lucas, as you said, it's Star Wars, we 193 00:11:00,280 --> 00:11:03,800 Speaker 6: might sway a number of retail shareholders. But I think 194 00:11:03,880 --> 00:11:06,600 Speaker 6: that's certainly the support for Trian from a number of 195 00:11:06,640 --> 00:11:10,840 Speaker 6: directors where Nelson's also served on the board might sway 196 00:11:11,400 --> 00:11:15,280 Speaker 6: some disgruntleeds soucial shareholders who maybe bought Disney at the top, 197 00:11:15,400 --> 00:11:18,560 Speaker 6: you know, around twenty twenty one and feel as though 198 00:11:18,760 --> 00:11:21,920 Speaker 6: a bit of adgitus is what's needed at the company. 199 00:11:22,760 --> 00:11:25,440 Speaker 2: Well, try On Fund controls about three and a half 200 00:11:25,480 --> 00:11:29,640 Speaker 2: billion dollars of Disney stock. How big a slice is 201 00:11:29,679 --> 00:11:33,480 Speaker 2: that holding and how much sway does that give Pelton 202 00:11:33,559 --> 00:11:33,920 Speaker 2: try On? 203 00:11:34,480 --> 00:11:36,920 Speaker 6: Well, the holding has certainly grown over time. So when 204 00:11:37,600 --> 00:11:40,079 Speaker 6: Nelson first disclosed stake in the business at the time 205 00:11:40,080 --> 00:11:43,160 Speaker 6: of what Biker's return. In November twenty twenty two, the 206 00:11:43,240 --> 00:11:46,440 Speaker 6: steak was worth anywhere between eight hundred and nine hundred 207 00:11:46,520 --> 00:11:50,400 Speaker 6: million dollars. It has grown materially over time because it 208 00:11:50,440 --> 00:11:55,079 Speaker 6: includes Nell shares pledged by the former chairman of Marvel Entertainment, 209 00:11:55,160 --> 00:11:59,320 Speaker 6: Ike Palmetto, who was fired unceremoniously by Aiger last year. 210 00:11:59,640 --> 00:12:01,280 Speaker 6: To give a bit of context, I mean that three 211 00:12:01,320 --> 00:12:04,240 Speaker 6: point five billion dollar steak compares to a market cap 212 00:12:04,240 --> 00:12:07,400 Speaker 6: of about two hundred and twenty one million dollars, so 213 00:12:07,840 --> 00:12:11,640 Speaker 6: on that front is a pretty meaningful, sizable steak. I'm 214 00:12:12,200 --> 00:12:14,880 Speaker 6: certainly a shareholder that if it were anybody other than 215 00:12:14,960 --> 00:12:17,400 Speaker 6: Nelson or Tryan, I think that the boys would probably 216 00:12:17,400 --> 00:12:20,480 Speaker 6: be very much engaging with behind the scenes. Given the 217 00:12:20,520 --> 00:12:23,520 Speaker 6: size of the of the voting power, I think that 218 00:12:24,000 --> 00:12:28,400 Speaker 6: it gives naturally Tryan quite a bit of credibility. I mean, 219 00:12:28,440 --> 00:12:31,280 Speaker 6: it's it's a huge stake to have in any business, 220 00:12:31,760 --> 00:12:34,320 Speaker 6: especially one in the world's largest sense company. 221 00:12:34,800 --> 00:12:37,760 Speaker 2: Well that virtual shareholder meeting this coming Wednesday. In our 222 00:12:37,800 --> 00:12:41,920 Speaker 2: thanks to Thomas Buckley, Bloomberg News entertainment reporter, for his 223 00:12:42,040 --> 00:12:45,160 Speaker 2: insights coming up on Bloomberg day Break Weekend we'll talk 224 00:12:45,200 --> 00:12:47,880 Speaker 2: about whether the European Central Bank has won its battle 225 00:12:48,240 --> 00:13:02,840 Speaker 2: against inflation. I'm Tom Busby, and this is Bloomberg. This 226 00:13:02,960 --> 00:13:05,320 Speaker 2: is Bloomberg day Break weekend, our global look ahead at 227 00:13:05,320 --> 00:13:07,800 Speaker 2: the top stories for investors in the coming week. I'm 228 00:13:07,840 --> 00:13:10,720 Speaker 2: Tom Busby in New York. Up later in our program, 229 00:13:10,760 --> 00:13:13,040 Speaker 2: how close is the US Senate to passing a bill 230 00:13:13,040 --> 00:13:15,800 Speaker 2: that would force TikTok's parent company to either sell the 231 00:13:15,840 --> 00:13:19,760 Speaker 2: app or be banned in the US. But first, after 232 00:13:19,800 --> 00:13:23,000 Speaker 2: the latest rounds of central bank rate decisions, investors are 233 00:13:23,040 --> 00:13:26,240 Speaker 2: placing their bets on summer rate cuts. But one thing 234 00:13:26,320 --> 00:13:29,280 Speaker 2: stands in a way. The data. One of the most 235 00:13:29,280 --> 00:13:33,760 Speaker 2: important metrics is inflation in the EU. The higher for 236 00:13:33,880 --> 00:13:37,680 Speaker 2: longer strategy was originally adopted by policymakers around the world 237 00:13:38,000 --> 00:13:41,000 Speaker 2: in a bid to rain in soaring inflation levels. Is 238 00:13:41,040 --> 00:13:44,280 Speaker 2: that fight over European core inflation data due next week 239 00:13:44,559 --> 00:13:47,600 Speaker 2: may provide the biggest clue yet And for more, Let's 240 00:13:47,600 --> 00:13:50,079 Speaker 2: go to London and bring in Bloomberg Daybreak europe anker 241 00:13:50,480 --> 00:13:52,199 Speaker 2: Caroline Hepger Tom. 242 00:13:52,400 --> 00:13:56,040 Speaker 1: So far in twenty twenty four, economists, CEOs and central 243 00:13:56,080 --> 00:13:59,640 Speaker 1: bankers have all been consumed by one question when will 244 00:13:59,679 --> 00:14:01,000 Speaker 1: interest rates come down? 245 00:14:01,400 --> 00:14:01,880 Speaker 7: In Europe? 246 00:14:02,000 --> 00:14:04,840 Speaker 1: Rates have reached their highest points since the global financial 247 00:14:04,880 --> 00:14:07,560 Speaker 1: crisis in two thousand and eight, and yet the ECB 248 00:14:07,720 --> 00:14:10,280 Speaker 1: has held interest rates steady at four and a half 249 00:14:10,320 --> 00:14:13,960 Speaker 1: percent since September of last year. Even in the face 250 00:14:14,200 --> 00:14:17,360 Speaker 1: of growing market pressure. There is a glimmer of hope, though. 251 00:14:17,400 --> 00:14:20,800 Speaker 1: In a statement released following its last interest rate decision, 252 00:14:20,840 --> 00:14:25,560 Speaker 1: the ECB said inflation projections have been revised down, in 253 00:14:25,560 --> 00:14:29,320 Speaker 1: particular for twenty twenty four, which mainly reflects a lower 254 00:14:29,360 --> 00:14:33,360 Speaker 1: contribution from energy prices. Now the central Bank has set 255 00:14:33,360 --> 00:14:37,080 Speaker 1: itself a target of reducing inflation to two percent across 256 00:14:37,200 --> 00:14:41,040 Speaker 1: all European countries combined, and officials might be closer than 257 00:14:41,080 --> 00:14:45,080 Speaker 1: they think. According to Bloomberg's recent now cast of inflation, 258 00:14:45,240 --> 00:14:49,200 Speaker 1: Eurozone inflation already sits at two percent. The gauge, compiled 259 00:14:49,200 --> 00:14:53,760 Speaker 1: by Bloomberg Economics, incorporates thirty two variables ranging from unemployment 260 00:14:53,800 --> 00:14:56,880 Speaker 1: to those energy costs are mentioned, and it has hit 261 00:14:57,120 --> 00:15:00,240 Speaker 1: one point nine five percent after a drop in anual 262 00:15:00,360 --> 00:15:04,200 Speaker 1: producer prices fed into the model. The figure is subject 263 00:15:04,240 --> 00:15:06,480 Speaker 1: to change because of the nature of the now cast, 264 00:15:06,760 --> 00:15:10,200 Speaker 1: but the drop speaks to a broader trend of falling 265 00:15:10,280 --> 00:15:13,840 Speaker 1: European inflation. In fact, it's been on a downward trend 266 00:15:13,880 --> 00:15:17,080 Speaker 1: for months as energy prices dip and the twenty country 267 00:15:17,080 --> 00:15:20,560 Speaker 1: Eurozone economy stagnates for a second year in a row. 268 00:15:20,760 --> 00:15:24,200 Speaker 1: So lower inflation should lead to lower interest rates, at 269 00:15:24,280 --> 00:15:27,560 Speaker 1: least according to ECB President Christine Legarde, who said in 270 00:15:27,600 --> 00:15:30,600 Speaker 1: a recent speech that the decisions of the Central Bank 271 00:15:30,680 --> 00:15:34,160 Speaker 1: regarding rate cuts would be guided by economic data. 272 00:15:34,720 --> 00:15:41,360 Speaker 8: Domestic price pressures will still be visible. We expect services inflation, 273 00:15:41,480 --> 00:15:44,880 Speaker 8: for example, to remain elevated for most of this year, 274 00:15:45,320 --> 00:15:48,440 Speaker 8: so there will be a period ahead where we need 275 00:15:48,480 --> 00:15:52,520 Speaker 8: to confirm on an ongoing basis that the incoming data 276 00:15:53,040 --> 00:15:58,720 Speaker 8: supports our inflation outlook. So this has two important implications 277 00:15:58,760 --> 00:16:03,640 Speaker 8: for the policy path. Head two important implications. First, our 278 00:16:03,640 --> 00:16:09,640 Speaker 8: decisions will have to remain data dependent and decided meeting 279 00:16:09,920 --> 00:16:14,040 Speaker 8: by meeting, responding to new information as it comes in. 280 00:16:15,800 --> 00:16:19,880 Speaker 8: This implies that even after the first rate cut, we 281 00:16:20,000 --> 00:16:26,360 Speaker 8: cannot we cannot precommit to a particular rate path, however 282 00:16:26,520 --> 00:16:30,320 Speaker 8: tempting that is, however much some of you would like 283 00:16:30,400 --> 00:16:34,800 Speaker 8: to see it. If we are honest to our methodology 284 00:16:35,160 --> 00:16:38,680 Speaker 8: and if we have discipline. In adhering to these principles, 285 00:16:39,120 --> 00:16:43,000 Speaker 8: we cannot That was the first important implication. The second 286 00:16:43,080 --> 00:16:48,640 Speaker 8: important implication is that our policy framework will remain important 287 00:16:49,520 --> 00:16:54,040 Speaker 8: to process the incoming data and calibrate the appropriate policy 288 00:16:54,080 --> 00:16:59,600 Speaker 8: stants inflation outlook, dynamics of underlying inflation, transmission of monetary policy. 289 00:17:00,120 --> 00:17:04,080 Speaker 8: But at the same time, the relative weights assigned to 290 00:17:04,200 --> 00:17:08,760 Speaker 8: the three criteria will have to be regularly examined. 291 00:17:09,760 --> 00:17:12,879 Speaker 1: That was the ECB President Christine Lagarde speaking at the 292 00:17:12,920 --> 00:17:17,160 Speaker 1: ECB and Its Watchers conference earlier this month. It's not 293 00:17:17,200 --> 00:17:21,080 Speaker 1: all good news though. Underlying price pressures, particularly from salaries 294 00:17:21,440 --> 00:17:24,960 Speaker 1: in the services sector, are still relatively high, a potential 295 00:17:25,000 --> 00:17:29,360 Speaker 1: indicator that the trend towards slowing inflation could change. It's 296 00:17:29,359 --> 00:17:32,240 Speaker 1: one of the reasons that the ECB continues to emphasize 297 00:17:32,240 --> 00:17:35,640 Speaker 1: that rate cuts come only once they are sure that 298 00:17:35,680 --> 00:17:40,040 Speaker 1: wage restraint is taking effect and that inflation and its 299 00:17:40,040 --> 00:17:43,359 Speaker 1: slow down is actually here to stay. Because of this, 300 00:17:43,440 --> 00:17:47,240 Speaker 1: European central bankers aren't declaring victory just yet. They have 301 00:17:47,320 --> 00:17:51,480 Speaker 1: talked about most measures of underlying inflation having eased further, 302 00:17:51,520 --> 00:17:56,200 Speaker 1: but domestic price pressures remaining high. Now one group hoping 303 00:17:56,240 --> 00:17:59,240 Speaker 1: to see falling inflation next week, will be investors who 304 00:17:59,240 --> 00:18:02,640 Speaker 1: are pricing in a ninety percent chance of an ECB 305 00:18:02,840 --> 00:18:06,000 Speaker 1: rate cut by June. I was discussing this point with 306 00:18:06,160 --> 00:18:09,240 Speaker 1: Black Crook's senior investment strategists Laura Cooper. 307 00:18:09,560 --> 00:18:12,400 Speaker 9: So we'll be watching for whether that broadening, that upside 308 00:18:12,480 --> 00:18:15,639 Speaker 9: kind of price pressures persist in March. But I don't 309 00:18:15,640 --> 00:18:19,040 Speaker 9: think that's necessarily going to deviate the ECB away from 310 00:18:19,040 --> 00:18:20,960 Speaker 9: a June rate cut. I think because at that point 311 00:18:21,040 --> 00:18:23,280 Speaker 9: Christine Legard made it quite clear that they will have 312 00:18:23,359 --> 00:18:27,159 Speaker 9: sufficient data to have more confidence than inflation is on 313 00:18:27,240 --> 00:18:30,280 Speaker 9: that sustained trajectory back to two percent. So we're still 314 00:18:30,359 --> 00:18:33,640 Speaker 9: leaning towards this rate cut in June and then at a 315 00:18:33,600 --> 00:18:35,879 Speaker 9: very gradual pace through the end of the year because 316 00:18:35,960 --> 00:18:38,240 Speaker 9: essentially they may not want to cut back to back 317 00:18:38,480 --> 00:18:41,959 Speaker 9: because for fear of markets essentially extrapolating out that easing 318 00:18:42,040 --> 00:18:45,240 Speaker 9: trend and markets could anticipate them getting back to neutral 319 00:18:45,359 --> 00:18:48,040 Speaker 9: much sooner than what they actually want to kind of 320 00:18:48,040 --> 00:18:49,200 Speaker 9: guide markets towards. 321 00:18:49,400 --> 00:18:52,639 Speaker 1: That was Black Fox's Laura Cooper. Now, we are expecting 322 00:18:52,880 --> 00:18:55,800 Speaker 1: data for inflation out of Europe in the next few 323 00:18:55,880 --> 00:18:59,200 Speaker 1: days to examine what they could mean for the future 324 00:18:59,560 --> 00:19:03,919 Speaker 1: path of great cards. Bloomberg's ECB reporter Alexander Webber has 325 00:19:03,960 --> 00:19:07,800 Speaker 1: been speaking to me about what exactly we're expecting from 326 00:19:07,920 --> 00:19:08,920 Speaker 1: those figures. 327 00:19:09,480 --> 00:19:12,399 Speaker 10: We expect the number to come in roughly at a 328 00:19:12,440 --> 00:19:17,000 Speaker 10: similar level as in February, meaning around two point six. 329 00:19:17,680 --> 00:19:21,320 Speaker 10: There are some, including Bloomberg Economics, who forecast a slight 330 00:19:21,359 --> 00:19:24,080 Speaker 10: decline to two point four. So all of that is 331 00:19:24,119 --> 00:19:28,760 Speaker 10: in line with the expectation that inflation will continue to slow, 332 00:19:29,080 --> 00:19:31,280 Speaker 10: but at a slower pace than what we've seen in 333 00:19:31,640 --> 00:19:32,560 Speaker 10: recent months. 334 00:19:33,160 --> 00:19:35,280 Speaker 1: Does the CPI number tell us the whole story? Do 335 00:19:35,320 --> 00:19:37,040 Speaker 1: you think about the inflation. 336 00:19:36,720 --> 00:19:40,479 Speaker 10: Picture at the moment. There's a bigger focus also on 337 00:19:40,520 --> 00:19:43,400 Speaker 10: the core number. Again that is still higher than the 338 00:19:43,440 --> 00:19:46,920 Speaker 10: headline number, which has been driven lower by energy. At 339 00:19:46,960 --> 00:19:51,360 Speaker 10: the core, the driving forces are really services, so that's 340 00:19:51,400 --> 00:19:54,600 Speaker 10: where a lot of the focus is. We also expect 341 00:19:54,680 --> 00:19:58,040 Speaker 10: a slight decline in the core inflation number to two 342 00:19:58,080 --> 00:20:02,760 Speaker 10: point nine, so still reasonably above the two percent target 343 00:20:02,840 --> 00:20:03,879 Speaker 10: that the ECB is signing. 344 00:20:05,320 --> 00:20:08,359 Speaker 1: Have there been indicators and that in the slowdown in 345 00:20:08,359 --> 00:20:10,800 Speaker 1: inflation is actually substantial on here to say, there are 346 00:20:10,840 --> 00:20:15,120 Speaker 1: some concerns about potentially a spike higher once inflation does 347 00:20:15,160 --> 00:20:17,320 Speaker 1: actually dip, that it then could rebound. 348 00:20:17,720 --> 00:20:20,560 Speaker 10: That could be rebound in the second half of the year. 349 00:20:20,840 --> 00:20:24,920 Speaker 10: So even if inflation hits two percent around the middle 350 00:20:24,960 --> 00:20:27,720 Speaker 10: of the year, which is what some forecasters are saying, 351 00:20:28,280 --> 00:20:31,760 Speaker 10: that doesn't mean the inflation fight is really over. So 352 00:20:31,880 --> 00:20:36,040 Speaker 10: the ECB wants to see inflation stay sustainably at the 353 00:20:36,080 --> 00:20:41,199 Speaker 10: two percent level, and that may not be really the 354 00:20:41,240 --> 00:20:46,679 Speaker 10: case until next year. So that's partly because there's energy 355 00:20:46,720 --> 00:20:49,600 Speaker 10: costs have been so volatile on a kind of government 356 00:20:49,640 --> 00:20:52,399 Speaker 10: measures that are now being phased out. That all makes 357 00:20:52,400 --> 00:20:55,479 Speaker 10: for a very bumpy path down to the two percent target. 358 00:20:56,000 --> 00:20:58,600 Speaker 1: Okay, so bumpy path, but how much bearing Also, do 359 00:20:58,600 --> 00:21:01,159 Speaker 1: you think that the individual figures next week you're going 360 00:21:01,200 --> 00:21:04,000 Speaker 1: to actually have on the ECB's first rate decision. 361 00:21:04,520 --> 00:21:07,240 Speaker 10: So we have a rate decision on April eleven. The 362 00:21:07,359 --> 00:21:10,960 Speaker 10: officials have already pretty clearly guided us toward a cut 363 00:21:11,080 --> 00:21:14,880 Speaker 10: in June, so nobody's really expecting any action in April. 364 00:21:15,160 --> 00:21:18,800 Speaker 10: The inflation figure is probably not going to change all 365 00:21:18,800 --> 00:21:21,920 Speaker 10: that much about it. What officials are really waiting for 366 00:21:22,080 --> 00:21:25,240 Speaker 10: is wage data for the first quarter, and that doesn't 367 00:21:25,240 --> 00:21:30,040 Speaker 10: come in until May even early June, and that's when 368 00:21:30,040 --> 00:21:32,800 Speaker 10: we have the real certainty about what's going on in 369 00:21:32,840 --> 00:21:36,520 Speaker 10: the economy and the crucial wage data that people are 370 00:21:36,560 --> 00:21:37,000 Speaker 10: waiting for. 371 00:21:37,400 --> 00:21:37,560 Speaker 6: Yeah. 372 00:21:37,560 --> 00:21:39,920 Speaker 1: Absolutely. I mean, do you think the markets are pricing 373 00:21:39,960 --> 00:21:42,520 Speaker 1: in interest rate cuts in the curve of rate cuts 374 00:21:42,560 --> 00:21:44,639 Speaker 1: too aggressively for the rest of the year. What's of you? 375 00:21:45,600 --> 00:21:47,439 Speaker 10: That is very difficult to say at the moment, so 376 00:21:47,600 --> 00:21:53,240 Speaker 10: market surprising around for cuts. There's been very little clarity 377 00:21:53,400 --> 00:21:58,600 Speaker 10: on what happens after June. Some officials have said that 378 00:21:59,000 --> 00:22:01,960 Speaker 10: expectations are about reasonable where they are now. On the 379 00:22:02,000 --> 00:22:06,280 Speaker 10: other hand, the environment is so uncertain that nobody wants 380 00:22:06,320 --> 00:22:09,600 Speaker 10: to really be too concrete about the path for interest 381 00:22:09,680 --> 00:22:13,520 Speaker 10: rates down. The views seem to be diverging quite a 382 00:22:13,520 --> 00:22:16,760 Speaker 10: lot at the moment, and a lot will just depend 383 00:22:16,800 --> 00:22:19,119 Speaker 10: on the data, how it comes in, whether there's going 384 00:22:19,200 --> 00:22:22,520 Speaker 10: to be breaks on the way down, and then how 385 00:22:22,560 --> 00:22:25,119 Speaker 10: things develop in the fall. That's when we're going to 386 00:22:25,119 --> 00:22:27,000 Speaker 10: have more clarity. At the moment, there's really a high 387 00:22:27,080 --> 00:22:28,000 Speaker 10: level of uncertainty. 388 00:22:28,440 --> 00:22:30,679 Speaker 1: Yeah absolutely. I'm in the deposit rate for the ECB 389 00:22:31,560 --> 00:22:33,680 Speaker 1: is at a higher four percent, so yes, the kind 390 00:22:33,680 --> 00:22:37,200 Speaker 1: of clarity on how that comes down is quite uncertain. 391 00:22:37,400 --> 00:22:41,280 Speaker 1: Just talk to us a bit about European services. Could 392 00:22:41,280 --> 00:22:45,760 Speaker 1: this be a cause for inflation perhaps to remain sticky, 393 00:22:45,880 --> 00:22:48,920 Speaker 1: is that the main worry that we've seen in terms 394 00:22:49,000 --> 00:22:55,120 Speaker 1: of the inflation rate for the twenty area Eurozone. 395 00:22:55,440 --> 00:22:59,680 Speaker 10: Yeah, service is absolutely key at the moment because it's 396 00:22:59,680 --> 00:23:03,240 Speaker 10: solabor intensive, and that means wages are play playing a 397 00:23:03,280 --> 00:23:05,800 Speaker 10: much bigger role than in other sectors of the economy. 398 00:23:06,400 --> 00:23:10,639 Speaker 10: And the labor market is still very tight, especially in 399 00:23:10,720 --> 00:23:13,840 Speaker 10: light of the economic weakness that we've seen. Even been 400 00:23:14,000 --> 00:23:17,159 Speaker 10: a recession in Germany in or likelihood, but still the 401 00:23:17,240 --> 00:23:20,640 Speaker 10: labor market has held up very well. And if an 402 00:23:20,680 --> 00:23:24,639 Speaker 10: economic rebound really materializes now in the coming quarters, that 403 00:23:24,800 --> 00:23:27,200 Speaker 10: means the labor market is pro not going to soften 404 00:23:27,200 --> 00:23:31,600 Speaker 10: any further. So wages are really where it's at. Demands 405 00:23:31,640 --> 00:23:36,320 Speaker 10: from labor unions are still very elevated, and we have 406 00:23:36,359 --> 00:23:41,000 Speaker 10: to see whether they can realize these demands, what companies 407 00:23:41,080 --> 00:23:45,639 Speaker 10: are saying, whether they give in and services are really 408 00:23:46,359 --> 00:23:47,080 Speaker 10: the key. 409 00:23:47,600 --> 00:23:51,080 Speaker 1: Yeah, absolutely, Alisond, How does you compare globally then, I 410 00:23:51,080 --> 00:23:54,360 Speaker 1: mean e's Europe is actually approaching the two percent inflation target. 411 00:23:54,400 --> 00:23:56,800 Speaker 1: It does seem to be that there's been a convergence 412 00:23:56,840 --> 00:24:00,679 Speaker 1: in recent weeks around the view of the in the 413 00:24:00,680 --> 00:24:03,960 Speaker 1: Bank of England, the ECB all cutting interest rates around 414 00:24:04,040 --> 00:24:07,200 Speaker 1: the same time in June. Is that what you're seeing 415 00:24:07,200 --> 00:24:10,720 Speaker 1: in the data? How likely is that to remain in place, 416 00:24:10,720 --> 00:24:12,080 Speaker 1: that idea of convergence. 417 00:24:12,800 --> 00:24:14,880 Speaker 10: Yeah, it does seem like that at the moment. There 418 00:24:14,960 --> 00:24:18,080 Speaker 10: was for a while there was the worry that, especially 419 00:24:18,119 --> 00:24:21,639 Speaker 10: in the US where the economy is just stronger, that 420 00:24:21,680 --> 00:24:24,160 Speaker 10: the FED may not be able to cut as soon. 421 00:24:24,400 --> 00:24:28,320 Speaker 10: And then the question is always what does that mean 422 00:24:28,359 --> 00:24:31,200 Speaker 10: for the ECB. Does the ECB dare to go first 423 00:24:31,400 --> 00:24:34,199 Speaker 10: or do they want to avoid that kind of divergence, 424 00:24:34,240 --> 00:24:37,280 Speaker 10: which of course has some impact on the exchange rate 425 00:24:37,359 --> 00:24:41,040 Speaker 10: and so on. But at the moment it does seem 426 00:24:41,560 --> 00:24:44,359 Speaker 10: also when you listen to what Fed officials are saying 427 00:24:44,440 --> 00:24:48,680 Speaker 10: Jerom Powell still guiding for a cut this year, then 428 00:24:49,240 --> 00:24:53,720 Speaker 10: it does seem like convergence is still the most likely scenario. 429 00:24:54,119 --> 00:24:58,560 Speaker 1: That was Alexander Webber, Bloomberg's ECB reported, they're speaking to 430 00:24:58,600 --> 00:25:01,760 Speaker 1: me around the inflation to expecting from Europe and what 431 00:25:01,800 --> 00:25:03,760 Speaker 1: it might mean for the eacy beat. My thanks to 432 00:25:03,840 --> 00:25:06,399 Speaker 1: him for joining me. I'm Caroline Hepge here in London. 433 00:25:06,560 --> 00:25:09,920 Speaker 1: You can catch us every weekday morning for Blueberg Daybreak Europe, 434 00:25:10,000 --> 00:25:12,960 Speaker 1: beginning at six am in London. That's one am on 435 00:25:13,119 --> 00:25:13,719 Speaker 1: Wall Street. 436 00:25:14,160 --> 00:25:17,120 Speaker 2: Tom Well, thank you, Caroline, and coming up on Bloomberg 437 00:25:17,160 --> 00:25:19,920 Speaker 2: day Break weekend to look at the social media app TikTok. 438 00:25:20,359 --> 00:25:22,760 Speaker 2: Will the app be allowed to stay in the US 439 00:25:23,480 --> 00:25:27,520 Speaker 2: or get banned? I'm Tom Busby and this is Bloomberg. 440 00:25:42,840 --> 00:25:44,880 Speaker 2: I'm Tom Busby in New York with your global look 441 00:25:44,880 --> 00:25:47,240 Speaker 2: ahead at the top stories for investors in the coming week. 442 00:25:47,480 --> 00:25:50,200 Speaker 2: After passing in the House, the US Senate now working 443 00:25:50,240 --> 00:25:53,120 Speaker 2: on a bill that would force TikTok's Chinese parent company 444 00:25:53,160 --> 00:25:55,760 Speaker 2: to either sell the app or be banned in the 445 00:25:55,880 --> 00:25:59,200 Speaker 2: US on national security concerns. For more, let's get to 446 00:25:59,200 --> 00:26:02,520 Speaker 2: Bloomberg day Break Asia co host Doug Krisner Tom. 447 00:26:02,560 --> 00:26:05,280 Speaker 11: The Senate will return from recess in a week. Before 448 00:26:05,280 --> 00:26:08,000 Speaker 11: the break, the chair of the Commerce Committee, Maria Cantwell, 449 00:26:08,040 --> 00:26:11,720 Speaker 11: said she's considering a public hearing on the TikTok bill. 450 00:26:12,240 --> 00:26:14,679 Speaker 11: You may know that it passed the House back in March, 451 00:26:14,800 --> 00:26:17,000 Speaker 11: and the President has said he's willing to sign it. 452 00:26:17,560 --> 00:26:20,080 Speaker 11: For a closer look at what maybe next. I'm joined 453 00:26:20,119 --> 00:26:23,679 Speaker 11: in the San Francisco studio by Bloomberg's Asia Counts. She 454 00:26:23,760 --> 00:26:26,639 Speaker 11: covers social media. She's also a member of the Technology 455 00:26:26,680 --> 00:26:29,440 Speaker 11: America's West Team. Thanks for stopping by. I'm glad we 456 00:26:29,480 --> 00:26:32,200 Speaker 11: could do this. One of the things that I've read 457 00:26:32,320 --> 00:26:35,639 Speaker 11: is that this bill has already run into several roadblocks 458 00:26:35,680 --> 00:26:37,919 Speaker 11: in the Senate, and it doesn't seem as though there 459 00:26:37,960 --> 00:26:40,879 Speaker 11: is a great deal of consensus on how to approach 460 00:26:41,119 --> 00:26:44,560 Speaker 11: whatever issues are at stake here. Is there any agreement 461 00:26:44,600 --> 00:26:46,880 Speaker 11: though that you're aware of? Is their commonality? 462 00:26:47,200 --> 00:26:49,600 Speaker 12: I think that Congress can agree that there needs to 463 00:26:49,640 --> 00:26:52,920 Speaker 12: be some sort of data privacy legislation. Again, like you said, 464 00:26:52,960 --> 00:26:55,760 Speaker 12: they disagree on what exactly that would look like. But 465 00:26:55,920 --> 00:26:59,280 Speaker 12: we've really seen Congress come together around this TikTok stuff 466 00:26:59,280 --> 00:27:01,639 Speaker 12: and mobilize a way that they haven't been able to 467 00:27:01,680 --> 00:27:03,000 Speaker 12: do for a host of other issues. 468 00:27:03,640 --> 00:27:07,080 Speaker 11: One of the arguments against an outright ban has to 469 00:27:07,080 --> 00:27:09,639 Speaker 11: do with the violation of the First Amendment. Are you 470 00:27:09,760 --> 00:27:12,720 Speaker 11: hearing that that has any kind of traction as a 471 00:27:12,760 --> 00:27:15,280 Speaker 11: rebuttal to this move to ban TikTok? 472 00:27:15,800 --> 00:27:17,800 Speaker 12: I mean, it seems like all the rebuttals that may 473 00:27:17,800 --> 00:27:20,560 Speaker 12: have come and TikTok has used an argument themselves haven't 474 00:27:20,640 --> 00:27:22,520 Speaker 12: really seemed to gain ground, but that is one that 475 00:27:22,840 --> 00:27:25,879 Speaker 12: TikTok has used, that these users, these one hundred and 476 00:27:25,880 --> 00:27:28,359 Speaker 12: seventy million Americans, should have the right to be able 477 00:27:28,400 --> 00:27:30,360 Speaker 12: to share their voices and their stories and to hear 478 00:27:30,400 --> 00:27:32,200 Speaker 12: other people's voices and stories as well. 479 00:27:32,359 --> 00:27:34,679 Speaker 11: One of the fascinating things about this story is the 480 00:27:34,680 --> 00:27:37,480 Speaker 11: way in which TikTok was able to rally the users 481 00:27:37,520 --> 00:27:41,520 Speaker 11: together to turn them into effectively lobbyists reaching out to 482 00:27:41,600 --> 00:27:45,359 Speaker 11: members of Congress pushing back on this legislation, and in 483 00:27:45,400 --> 00:27:48,760 Speaker 11: a weird way, it feels as though they made the 484 00:27:48,760 --> 00:27:53,520 Speaker 11: point themselves, showing illustrating the extent to which this platform 485 00:27:53,680 --> 00:27:57,000 Speaker 11: is so prevalent and has so much influence. 486 00:27:57,560 --> 00:27:58,000 Speaker 7: I agree. 487 00:27:58,040 --> 00:28:00,480 Speaker 12: I think in some ways that actually backfired on TikTok 488 00:28:00,520 --> 00:28:03,200 Speaker 12: because of that exact reason. You were able to see 489 00:28:03,200 --> 00:28:06,760 Speaker 12: them influence and sort of mobilize one hundred and seventy 490 00:28:06,800 --> 00:28:09,679 Speaker 12: million people, and that was sort of an example of 491 00:28:09,720 --> 00:28:11,720 Speaker 12: how the app could be used. You imagine it being 492 00:28:11,800 --> 00:28:13,920 Speaker 12: used in a more malicious way of how the app 493 00:28:13,960 --> 00:28:14,760 Speaker 12: could be weabinized. 494 00:28:14,920 --> 00:28:16,720 Speaker 11: This is not the first time, as we know that 495 00:28:16,840 --> 00:28:19,520 Speaker 11: the move has taken place in Washington to try to 496 00:28:19,560 --> 00:28:22,600 Speaker 11: ban this app. During the Trump administration, it seemed like 497 00:28:22,640 --> 00:28:25,880 Speaker 11: the administration got pretty close. And one of the things 498 00:28:25,960 --> 00:28:31,359 Speaker 11: that ended up happening was the firm Oracle Corporation, was 499 00:28:31,600 --> 00:28:34,679 Speaker 11: given the ability to house a lot of the data 500 00:28:35,280 --> 00:28:37,840 Speaker 11: on service here in the United States as a way 501 00:28:37,880 --> 00:28:42,040 Speaker 11: of addressing the concern about this level of national security 502 00:28:42,080 --> 00:28:47,239 Speaker 11: and potential breach of that type of sensitive information. That 503 00:28:47,400 --> 00:28:49,840 Speaker 11: doesn't seem to have gone far enough. But what do 504 00:28:49,880 --> 00:28:52,000 Speaker 11: we know about what Oracle is doing to try to 505 00:28:52,080 --> 00:28:54,920 Speaker 11: keep a hand or a handle on this data in 506 00:28:55,000 --> 00:28:55,640 Speaker 11: a safe way. 507 00:28:55,960 --> 00:28:58,080 Speaker 12: Yeah, it's really interesting because the concern was that the 508 00:28:58,160 --> 00:29:02,560 Speaker 12: Chinese government at any time could compel TikTok to release 509 00:29:03,840 --> 00:29:06,560 Speaker 12: national security related data so that they could release data 510 00:29:06,560 --> 00:29:09,160 Speaker 12: on American users. And so the solution was what you're 511 00:29:09,160 --> 00:29:12,920 Speaker 12: talking about, which is Project Texas, where Orco is storing 512 00:29:13,080 --> 00:29:17,680 Speaker 12: all the data of American users on American soil. How 513 00:29:17,680 --> 00:29:20,760 Speaker 12: effective that is it's hard to tell. I think the 514 00:29:20,920 --> 00:29:25,280 Speaker 12: arguments about Project Texas really insulating TikTok from China have 515 00:29:25,400 --> 00:29:29,200 Speaker 12: not convinced Congress. They still have felt like Chinese employees 516 00:29:29,520 --> 00:29:31,720 Speaker 12: at by dance or the Chinese government can have access, 517 00:29:31,760 --> 00:29:34,160 Speaker 12: so it hasn't really moved the needle from their perspective, 518 00:29:34,160 --> 00:29:36,440 Speaker 12: but it's gone further than most tech companies. 519 00:29:36,080 --> 00:29:37,920 Speaker 11: When you look at the pushback. One of the things 520 00:29:38,000 --> 00:29:40,800 Speaker 11: I think was very interesting, and Vice president Kamala Harris 521 00:29:40,840 --> 00:29:43,960 Speaker 11: made this point very recently about the degree to which 522 00:29:44,160 --> 00:29:47,840 Speaker 11: this platform is responsible for supporting small businesses. There are 523 00:29:47,880 --> 00:29:51,200 Speaker 11: a number of users of TikTok that have really grown 524 00:29:51,640 --> 00:29:55,320 Speaker 11: businesses by virtue of this app, and there's a real, 525 00:29:55,520 --> 00:29:57,400 Speaker 11: I guess, a case to be made that you don't 526 00:29:57,440 --> 00:30:00,600 Speaker 11: want to stifle that type of innovation, right. I mean 527 00:30:01,040 --> 00:30:03,400 Speaker 11: that in and of itself doesn't like seem to be 528 00:30:03,440 --> 00:30:05,800 Speaker 11: a very strong case, and I think it's something that 529 00:30:05,840 --> 00:30:09,040 Speaker 11: people will consider, particularly in the context of this public hering. 530 00:30:09,120 --> 00:30:11,320 Speaker 12: Right, it's a real consequence of the app going away. 531 00:30:11,360 --> 00:30:14,560 Speaker 12: I think about retail or beauty. There are all kinds 532 00:30:14,560 --> 00:30:16,640 Speaker 12: of products that go viral on TikTok, and then you 533 00:30:16,680 --> 00:30:19,280 Speaker 12: can sustain a small business off of that. So I 534 00:30:19,280 --> 00:30:21,160 Speaker 12: think it's a very real argument to be made. Again, 535 00:30:21,200 --> 00:30:23,200 Speaker 12: I'm not sure how much the way that argument will have, 536 00:30:23,920 --> 00:30:27,440 Speaker 12: but it is real. And aside from that, there are thousands, 537 00:30:27,480 --> 00:30:30,320 Speaker 12: if not millions of creators, individual people that are creating 538 00:30:30,360 --> 00:30:31,960 Speaker 12: content and able to make a living off of it. 539 00:30:32,160 --> 00:30:33,320 Speaker 12: I've talked to some of them myself. 540 00:30:33,720 --> 00:30:36,160 Speaker 11: When you consider the fact that the algorithm is really, 541 00:30:36,320 --> 00:30:38,560 Speaker 11: you know, the golden key here. Okay, it's one thing 542 00:30:38,600 --> 00:30:43,280 Speaker 11: to talk about housing data, it's another thing about really 543 00:30:43,320 --> 00:30:46,880 Speaker 11: gaining access to this algorithm. It's been so effective at 544 00:30:46,880 --> 00:30:49,760 Speaker 11: helping to drive users into the content that they would 545 00:30:49,800 --> 00:30:52,440 Speaker 11: be most interested in. There's probably not a way where 546 00:30:52,480 --> 00:30:55,520 Speaker 11: Beijing would allow something like that to fall in American hands? 547 00:30:55,560 --> 00:30:56,560 Speaker 11: Am I right? Or I'm wrong? 548 00:30:56,720 --> 00:30:58,640 Speaker 12: I mean, I wouldn't want to allow that, right. I 549 00:30:58,680 --> 00:31:01,800 Speaker 12: mean the explosive growth of TikTok is because of the algorithm. 550 00:31:01,840 --> 00:31:03,680 Speaker 12: You go on and it kind of knows you better 551 00:31:03,720 --> 00:31:06,120 Speaker 12: than you know yourself in some ways, and you finds 552 00:31:06,120 --> 00:31:09,000 Speaker 12: out your interests and it's incredibly effective at that. So 553 00:31:09,040 --> 00:31:10,880 Speaker 12: I would not want that to fall into someone else's hands. 554 00:31:10,960 --> 00:31:13,920 Speaker 11: It's important to remember too, that this is not the 555 00:31:13,960 --> 00:31:17,120 Speaker 11: first move to ban TikTok in a country. India two 556 00:31:17,200 --> 00:31:20,320 Speaker 11: years ago was very successful. They moved very quickly, and 557 00:31:20,360 --> 00:31:22,960 Speaker 11: it wasn't just TikTok that was banned. I think fifty 558 00:31:23,000 --> 00:31:26,920 Speaker 11: eight different apps created by Chinese firms were also banned 559 00:31:27,120 --> 00:31:31,000 Speaker 11: from the India market. That said, at that point, TikTok 560 00:31:31,080 --> 00:31:33,840 Speaker 11: really hadn't developed that much traction in India to become 561 00:31:33,840 --> 00:31:37,240 Speaker 11: a threat to Bye Dance. Totally different story in the US, right. 562 00:31:37,480 --> 00:31:40,320 Speaker 12: Yeah, absolutely. I mean all these tech companies sort of 563 00:31:40,320 --> 00:31:42,320 Speaker 12: behind the scenes have been lobbying for TikTok to be 564 00:31:42,320 --> 00:31:45,840 Speaker 12: banned because it would benefit them. You think about Facebook, Instagram, Snapchat, YouTube, 565 00:31:45,840 --> 00:31:49,280 Speaker 12: they all benefit if TikTok gets banned. And then there 566 00:31:49,320 --> 00:31:52,560 Speaker 12: is this sort of tension of like Facebook is banned 567 00:31:52,560 --> 00:31:54,400 Speaker 12: in China and it's been banned for almost a decade, 568 00:31:54,480 --> 00:31:56,040 Speaker 12: so you kind of see this back and forth between 569 00:31:56,040 --> 00:31:56,760 Speaker 12: different countries. 570 00:31:57,040 --> 00:31:59,000 Speaker 11: Asha, thank you so much for making time to chat 571 00:31:59,040 --> 00:32:01,840 Speaker 11: with us at Bloomberg. Say Asia counts should covers social 572 00:32:01,880 --> 00:32:04,840 Speaker 11: media and as a member of the Technology America's team. Now, 573 00:32:04,960 --> 00:32:07,440 Speaker 11: let's pivot to China. We moved to Hong Kong next 574 00:32:07,840 --> 00:32:09,880 Speaker 11: and co host Brian Curtis. 575 00:32:09,520 --> 00:32:13,240 Speaker 3: Doug China's PMIS may show further improvement in one key 576 00:32:13,320 --> 00:32:16,400 Speaker 3: area of the economy. We'll get the numbers for March 577 00:32:16,480 --> 00:32:19,560 Speaker 3: in the coming week. The official PMI is projected to 578 00:32:19,560 --> 00:32:22,920 Speaker 3: come in at fifty point one, back in expansion after 579 00:32:23,000 --> 00:32:26,640 Speaker 3: last month's reading of forty nine point one, but clearly 580 00:32:26,680 --> 00:32:29,520 Speaker 3: more work is needed to get the Chinese economy buzzing. 581 00:32:30,040 --> 00:32:33,280 Speaker 3: Some investors had worried that China might be poised to 582 00:32:33,320 --> 00:32:37,440 Speaker 3: allow the Chinese currency to weaken to add support, but 583 00:32:37,480 --> 00:32:40,920 Speaker 3: then traders were confused by some back and forth movements 584 00:32:41,160 --> 00:32:45,320 Speaker 3: in the pboc's reference rate fixes. Joining us now for 585 00:32:45,400 --> 00:32:48,160 Speaker 3: some clarity on this is Tanya Chen, a specialist on 586 00:32:48,280 --> 00:32:52,360 Speaker 3: FX and rates for Bloomberg News. So Tanya, policymakers first 587 00:32:52,520 --> 00:32:56,840 Speaker 3: triggered a yuan selloff partially by weakening that rate, before 588 00:32:56,880 --> 00:33:00,160 Speaker 3: then causing a rebound via some stronger settings in the 589 00:33:00,240 --> 00:33:01,160 Speaker 3: next couple of days. 590 00:33:01,640 --> 00:33:04,560 Speaker 13: What do we know the yuon fix, which obviously is 591 00:33:04,600 --> 00:33:07,880 Speaker 13: the clearest signal that the PBOC can send in terms 592 00:33:07,920 --> 00:33:11,640 Speaker 13: of what it's trying to signal around the currency. The 593 00:33:11,680 --> 00:33:16,200 Speaker 13: rebuttal last week showed that perhaps the initial tolerance for 594 00:33:16,280 --> 00:33:20,960 Speaker 13: letting the currency slightly weaken in the yuon fix, Perhaps 595 00:33:21,080 --> 00:33:23,640 Speaker 13: equity markets reaction was not what they had hoped for, 596 00:33:24,120 --> 00:33:27,160 Speaker 13: and so some investors are actually saying the sentiment actually 597 00:33:27,200 --> 00:33:31,760 Speaker 13: hasn't stabilized around the currency, and the PBOC was perceived 598 00:33:31,760 --> 00:33:34,800 Speaker 13: by the investment community that perhaps the PBOC was allowing 599 00:33:34,800 --> 00:33:37,360 Speaker 13: the currency to decline ahead of the FED which is 600 00:33:37,400 --> 00:33:40,360 Speaker 13: expected to ease later this year, and that was seen 601 00:33:40,400 --> 00:33:44,240 Speaker 13: as a positive. However, due to how the markets sold 602 00:33:44,280 --> 00:33:47,240 Speaker 13: off on that, the PBOC quickly reined it back in 603 00:33:47,320 --> 00:33:52,400 Speaker 13: the days following by issuing much stronger fixes, and from 604 00:33:52,440 --> 00:33:55,920 Speaker 13: that we saw kind of the currency strengthen. But then 605 00:33:56,000 --> 00:33:58,560 Speaker 13: and also state banks coming back into the market and 606 00:33:58,600 --> 00:34:01,000 Speaker 13: trying to defend the currency. Or around this seven point 607 00:34:01,000 --> 00:34:02,040 Speaker 13: two line. 608 00:34:01,760 --> 00:34:04,880 Speaker 3: Do we have a general sense that the PBOC wants 609 00:34:04,920 --> 00:34:08,279 Speaker 3: to loosen their grip a bit on the currency or 610 00:34:09,080 --> 00:34:09,800 Speaker 3: just the reverse. 611 00:34:10,040 --> 00:34:12,600 Speaker 13: I think there's a couple of factors that the PBC 612 00:34:12,680 --> 00:34:16,080 Speaker 13: needs to consider. Obviously, the general sentiment around the economy 613 00:34:16,160 --> 00:34:19,359 Speaker 13: right now is fairly gloomy given what we've seen around 614 00:34:19,360 --> 00:34:20,479 Speaker 13: the macroeconomic data. 615 00:34:20,560 --> 00:34:22,560 Speaker 7: Yes, we've seen a few green shoots appearing. 616 00:34:23,040 --> 00:34:27,800 Speaker 13: However, the PBOC is trying to manage a very stable 617 00:34:27,880 --> 00:34:31,480 Speaker 13: currency depreciation around the currency, but also around. 618 00:34:31,280 --> 00:34:32,800 Speaker 7: Its main trading partners. 619 00:34:33,080 --> 00:34:35,320 Speaker 13: And actually, if you were to look kind of across 620 00:34:35,360 --> 00:34:37,920 Speaker 13: the sea where the Japanese yen is trading. You know 621 00:34:37,960 --> 00:34:40,279 Speaker 13: that it's also fairly weak, even after the Bank of 622 00:34:40,360 --> 00:34:44,359 Speaker 13: Japan had hiked rates earlier this month, and so there's 623 00:34:44,360 --> 00:34:46,279 Speaker 13: a couple of factors that the PBC needs to take 624 00:34:46,280 --> 00:34:50,040 Speaker 13: into account. And obviously the widening yield interest rate differential 625 00:34:50,120 --> 00:34:54,080 Speaker 13: between the yuan and also the US rates is one 626 00:34:54,120 --> 00:34:57,600 Speaker 13: to consider. Considering that the pboc's economy is so on 627 00:34:57,640 --> 00:35:00,600 Speaker 13: the back foot that most of the market is expecting 628 00:35:00,680 --> 00:35:04,759 Speaker 13: the central bank to either lower interest rates later this 629 00:35:04,880 --> 00:35:07,560 Speaker 13: year or to at least loosen the economy some more. 630 00:35:07,719 --> 00:35:09,600 Speaker 3: Is there any sort of line in the sand for 631 00:35:09,719 --> 00:35:11,080 Speaker 3: authorities on the one so. 632 00:35:11,080 --> 00:35:13,879 Speaker 13: After the PBOC came back and rained the currency by 633 00:35:13,920 --> 00:35:18,600 Speaker 13: setting stronger fixes last week, the currency was trading roughly 634 00:35:18,760 --> 00:35:20,920 Speaker 13: weaker than seven point two, which was a line that 635 00:35:20,960 --> 00:35:25,080 Speaker 13: they had actually fixed and maintained for the last six 636 00:35:25,120 --> 00:35:27,760 Speaker 13: months or so. By allowing the currency to tread slightly 637 00:35:27,800 --> 00:35:30,719 Speaker 13: weaker than seven point two shows that perhaps there is 638 00:35:30,760 --> 00:35:34,799 Speaker 13: some slight signal that they're allowing the currency to marginally depreciate. 639 00:35:35,000 --> 00:35:37,839 Speaker 13: We know that the last major cap that the PBOC 640 00:35:37,920 --> 00:35:39,960 Speaker 13: had enforced with seven point three, and that was a 641 00:35:40,000 --> 00:35:42,840 Speaker 13: line that they held most of late last year and 642 00:35:42,920 --> 00:35:46,160 Speaker 13: also last summer when you saw that the reference rate 643 00:35:46,200 --> 00:35:49,520 Speaker 13: with from Estimus was over thirteen hundred pips, and that 644 00:35:49,680 --> 00:35:52,920 Speaker 13: was quite a strong signal to the market that they 645 00:35:52,920 --> 00:35:56,320 Speaker 13: were enforcing a specific line. However, if you take another 646 00:35:56,360 --> 00:35:59,600 Speaker 13: step back and you look at just what the implied 647 00:36:00,080 --> 00:36:04,080 Speaker 13: volatility markets are telling you about the general sentiment towards 648 00:36:04,080 --> 00:36:07,120 Speaker 13: the currency right now, you're seeing that volatility is actually 649 00:36:07,120 --> 00:36:09,239 Speaker 13: not as elevated as what we have seen when the 650 00:36:09,280 --> 00:36:12,440 Speaker 13: currency was weakening around seven point three, nor is it 651 00:36:12,480 --> 00:36:14,160 Speaker 13: as high as it was during the trade war in 652 00:36:14,160 --> 00:36:17,200 Speaker 13: twenty eighteen or when it was devalued at twenty fifteen. 653 00:36:17,520 --> 00:36:19,200 Speaker 7: So taking all of this and taking this. 654 00:36:19,160 --> 00:36:23,760 Speaker 13: Step back, actually the kind of bearishness around the currency 655 00:36:23,840 --> 00:36:25,120 Speaker 13: is still slightly maintained. 656 00:36:25,320 --> 00:36:27,640 Speaker 3: What's odd about this is that it seems like the 657 00:36:27,640 --> 00:36:31,279 Speaker 3: PBOC is fixing is meant to be and has been 658 00:36:31,360 --> 00:36:34,800 Speaker 3: one of the more transparent parts of China's currency regime, 659 00:36:35,200 --> 00:36:36,880 Speaker 3: and now a lot of that seems to be a 660 00:36:36,880 --> 00:36:37,839 Speaker 3: little bit up in the air. 661 00:36:37,960 --> 00:36:41,200 Speaker 13: That's right, and I think that's also indicative of how 662 00:36:41,239 --> 00:36:43,440 Speaker 13: they've been issuing monetary. 663 00:36:42,960 --> 00:36:44,600 Speaker 7: Policy as of late as well. 664 00:36:44,719 --> 00:36:47,920 Speaker 13: So we had seen officials coming ahead of certain announcements 665 00:36:47,960 --> 00:36:50,920 Speaker 13: such as cutting the reserve requirement ratio. The way that 666 00:36:50,920 --> 00:36:55,000 Speaker 13: they're managing communication around the currency could potentially track with 667 00:36:55,120 --> 00:36:59,000 Speaker 13: how they're also managing the monetary policy in that they're 668 00:36:59,040 --> 00:37:01,359 Speaker 13: potentially trying to catch traders off guard, and that might 669 00:37:01,400 --> 00:37:03,759 Speaker 13: be a more effective way of getting what they need 670 00:37:03,800 --> 00:37:05,000 Speaker 13: to be done in the market. 671 00:37:05,280 --> 00:37:07,920 Speaker 3: Tanya, thanks so much for joining us. Tanya Chen a 672 00:37:07,960 --> 00:37:11,480 Speaker 3: specialist on FX and rates for Bloomberg News. I'm Brian 673 00:37:11,520 --> 00:37:14,239 Speaker 3: Curtis in Hong Kong along with Doug Krisner. You can 674 00:37:14,280 --> 00:37:17,680 Speaker 3: catch us every weekday here for Bloomberg Daybreak Asia, beginning 675 00:37:17,719 --> 00:37:20,480 Speaker 3: at eight am in Hong Kong and eight pm on 676 00:37:20,520 --> 00:37:21,120 Speaker 3: Wall Street. 677 00:37:21,160 --> 00:37:24,120 Speaker 2: Tom thank you, Brian. That does it for this edition 678 00:37:24,120 --> 00:37:26,960 Speaker 2: of Bloomberg day Break Weekend. Join us again Monday morning 679 00:37:26,960 --> 00:37:29,360 Speaker 2: at five am Wall Street time for the latest on 680 00:37:29,480 --> 00:37:32,600 Speaker 2: markets overseas and the news you need to start your day. 681 00:37:33,040 --> 00:37:35,840 Speaker 2: I'm Tom Busby. Stay with us. Top stories and global 682 00:37:35,880 --> 00:37:43,520 Speaker 2: business headlines are coming up right now.