WEBVTT - Bloomberg Daybreak: October 12, 2022 - Hour 2 (Radio) 0:00:03.080 --> 0:00:06.199 Live from the Bloomberg Interactive Berger Studios. This is Bloomberg 0:00:06.280 --> 0:00:09.800 Daybreak for Wednesday, October twelve two. Coming up this shower, 0:00:09.960 --> 0:00:13.680 President Biden says a slight recession is possible in the US. 0:00:13.840 --> 0:00:16.119 We're tough talk from the FED on fighting inflation. We 0:00:16.160 --> 0:00:19.360 speak with Cleveland Fed President Lorettamester. The Bank of England 0:00:19.360 --> 0:00:22.520 confirms it will end emergency bond buying on Friday, and 0:00:22.600 --> 0:00:26.239 Intel plans thousands of job cuts. New Jersey says New 0:00:26.320 --> 0:00:30.560 York City's congestion pricing charts threatens sport authority revenue plus 0:00:30.680 --> 0:00:34.240 NASA successfully moves and Asteroid off its over. I'm Michael 0:00:34.240 --> 0:00:37.560 barn More ahead, I'm John Stashower. Sports game one of 0:00:37.600 --> 0:00:39.960 the Yankees day beat Cleveland at the Stadium of the 0:00:40.080 --> 0:00:45.080 Rangers one. There sees an open art. That's all s 0:00:45.080 --> 0:00:49.360 tradyhead on Bloomberg Daybreak on Bloomberg eleven three on New York, 0:00:49.520 --> 0:00:54.200 Bloomberg one, Washington d C, Bloomberg one oh six one, Boston, 0:00:54.480 --> 0:00:59.120 Bloomberg nine sixties and Francisco Sirius XAM one nine team 0:00:59.160 --> 0:01:01.800 and around the world Old on Bloomberg Radio dot Com 0:01:02.000 --> 0:01:10.600 and via the Bloomberg Business App. Good morning. I'm Karen Moscow, 0:01:10.800 --> 0:01:13.039 I'm Nathan Hagar. Bloomberg Daybreak is brought to you by 0:01:13.040 --> 0:01:15.280 b n y Melon's Pershing Learned why the world's most 0:01:15.319 --> 0:01:19.000 sophisticated wealth management and institutional firms rely on Pershing to 0:01:19.040 --> 0:01:22.959 help them improve profitability, create efficiency, attract talent, and manage 0:01:23.080 --> 0:01:26.600 risk at Pershing dot Com. And Futures this morning are 0:01:26.640 --> 0:01:28.480 on the rise six o one on Wall Street, and 0:01:28.520 --> 0:01:30.960 we check the markets every fifteen minutes throughout the trading day. 0:01:31.000 --> 0:01:34.080 On Bloomberg SNP, Future is up twenty nine points down. 0:01:34.120 --> 0:01:36.640 Future is up a hundred ninety four. Nasday features up 0:01:36.680 --> 0:01:39.840 one eight ten year Treasury up one thirty second deal 0:01:39.880 --> 0:01:42.160 three point nine four percent, and they yield on the 0:01:42.240 --> 0:01:46.039 two year at four point to nine percent. NIMEX screwed 0:01:46.080 --> 0:01:48.760 oil up three tenths of a percent. Nathan, Karen, We'll 0:01:48.760 --> 0:01:51.040 have more on markets in a minute, but first, President 0:01:51.080 --> 0:01:53.840 Biden's weighing in on the economy. As investors, c e 0:01:53.880 --> 0:01:56.640 o s and economists talk about a possible recession, so 0:01:56.840 --> 0:01:59.360 is the President. I don't think there will be your recession. 0:01:59.400 --> 0:02:01.800 If it is the be a very slight recession, that 0:02:01.920 --> 0:02:07.200 is will move down slightly. Well, look, think about what's happened. 0:02:07.600 --> 0:02:10.560 We have done more with in a better position than 0:02:10.600 --> 0:02:13.600 any other major country in the world. In an interview 0:02:13.600 --> 0:02:16.239 with CNN s Jake Tapp for the President also voiced 0:02:16.280 --> 0:02:19.320 anger with Saudi Arabia and oil production cuts from OPEC. 0:02:19.360 --> 0:02:22.280 Plus he accuses the Kingdom of allying itself with Russia 0:02:22.320 --> 0:02:25.160 and vows to engage with lawmakers to punish riyadd there's 0:02:25.200 --> 0:02:28.040 gonna be some consequences for what they've done with Russia. 0:02:28.360 --> 0:02:31.519 What kind of consequences, Venenda says, suspend all arms sales? 0:02:31.680 --> 0:02:34.680 Is that something you'd consider. I'm not going to get 0:02:34.680 --> 0:02:37.280 into what i'd considering what I'm having mind, but there 0:02:37.280 --> 0:02:40.480 will be There will be consequences the President. Biden suggests 0:02:40.480 --> 0:02:43.760 those consequences likely will not come until after next month's 0:02:43.800 --> 0:02:47.440 midterm elections. Well top talking the inflation continues from the 0:02:47.440 --> 0:02:50.040 Fed and Nathan. The latest waying in is Cleveland FED 0:02:50.040 --> 0:02:52.560 President Loretta Master. She tells us a central bank is 0:02:52.600 --> 0:02:56.360 definitely not done raising rates. The real issue is we 0:02:56.400 --> 0:02:59.880 need to do more. We have not seen inflation move 0:03:00.160 --> 0:03:03.720 down um and we need to see that because leaving 0:03:03.800 --> 0:03:07.040 inflation where it is, if it continues, there's a higher 0:03:07.120 --> 0:03:10.560 chance that it does become embedded in the economy. Cleveland Fed, 0:03:10.600 --> 0:03:12.920 President of the Redemester, made the comments in an interview 0:03:12.919 --> 0:03:15.600 with The Bloomberg's Kathleen Hayes. Well, the Fed still has 0:03:15.600 --> 0:03:19.320 its critics out there. Karen, including Muhammad Larrian, the Alliance 0:03:19.360 --> 0:03:23.359 chief economic advisor and Bloomberg opinion columnists, says aggressive tightening 0:03:23.360 --> 0:03:25.959 by the Central Bank will not only damage the US economy, 0:03:26.160 --> 0:03:28.200 it will also affect the rest of the world. This 0:03:28.280 --> 0:03:30.280 is going to be a reminder a little bit of 0:03:30.320 --> 0:03:33.639 October without in and eight, when people gather in Washington 0:03:33.840 --> 0:03:36.240 and realize we have a global problem and it needs 0:03:36.240 --> 0:03:39.600 global global solution. Muhammed Alarian made the comments to Jonathan 0:03:39.640 --> 0:03:43.120 Faroe on Bloomberg Surveillance Catch of program weekdays at seven am, 0:03:43.120 --> 0:03:46.400 All Street Time on Bloomberg Radio and Television. Well, coming 0:03:46.440 --> 0:03:48.520 up today, Nathan, we get the first is several key 0:03:48.560 --> 0:03:51.040 economic readings this week, and we get the details from 0:03:51.040 --> 0:03:54.520 Bloomberg Economics, corresponded Michael McKee. The world is watching the 0:03:54.640 --> 0:03:57.880 US Federal Reserve raising rates to fight inflation has an 0:03:57.880 --> 0:04:01.040 impact on markets everywhere. So this week's inflation reports are 0:04:01.120 --> 0:04:05.040 key for markets. Wednesday, the u S reports on producer prices. 0:04:05.080 --> 0:04:09.160 The bad news economists forecast factory gate prices rose last month. 0:04:09.280 --> 0:04:12.000 Also Wednesday, the Fed releases the minutes of its September 0:04:12.040 --> 0:04:15.440 twenty one meeting. Investors will parse those for clues to 0:04:15.720 --> 0:04:18.800 how fast the Central Bank thinks inflation will come down, 0:04:19.240 --> 0:04:22.280 which may influence how high rates will go and for 0:04:22.320 --> 0:04:26.120 how long. Michael McKee, Bloomberg Daybreak, Mike thanks Soaring inflation 0:04:26.200 --> 0:04:28.760 and higher interest rates have seeing yields rise, and stocks 0:04:28.760 --> 0:04:31.799 are trading at their lowest levels in almost two years. Still, 0:04:31.880 --> 0:04:35.039 Morgan Stanley Chief US equity strategist Mike Wilson says it 0:04:35.080 --> 0:04:37.480 could be too early to call a bottom. I think 0:04:37.480 --> 0:04:40.719 the bomb market is probably there. Uh and but unfortunately, 0:04:40.839 --> 0:04:43.240 kind of like stocks, the bomb market used to be 0:04:43.279 --> 0:04:45.920 told by the Fed that they're done right, And that's 0:04:45.960 --> 0:04:47.880 just the dance we're in right now. It's the hardest 0:04:47.880 --> 0:04:50.320 part of the cycle to trade. We think we know 0:04:50.400 --> 0:04:52.600 we're going in equities, we think deals are probably flows 0:04:52.640 --> 0:04:54.920 to topping, but we got to go through the earnings 0:04:54.920 --> 0:04:57.839 revision still, which is why you can't say that that 0:04:58.080 --> 0:05:01.520 stocks at Bob's Morgan Stanley ch US sequity strategist Mike 0:05:01.520 --> 0:05:04.960 Wilson says inventory, labor costs and other latent expenses are 0:05:04.960 --> 0:05:08.600 wreaking havoc on company cash flow well in Europe. This morning, 0:05:08.640 --> 0:05:11.159 Nathan questions continue to shroll over whether the Bank of 0:05:11.200 --> 0:05:14.279 England will end its emergency bond buying program on Friday, 0:05:14.279 --> 0:05:15.800 and we go to London and get the latest with 0:05:15.839 --> 0:05:19.239 Bloomberg's hun pasts. Good morning you, Good morning Karen and Nathan. 0:05:19.279 --> 0:05:21.800 It has been a rocky few hours of watches of 0:05:22.000 --> 0:05:24.760 UK assets this morning. The Bank of England now confirm 0:05:24.960 --> 0:05:28.680 it will end its emergency bond buying program this Friday. 0:05:28.800 --> 0:05:31.080 That was after an earlier Financial Time report that the 0:05:31.120 --> 0:05:34.800 bank had told lenders in private there could be an extension. 0:05:35.320 --> 0:05:38.640 UK GDP. Meanwhile, and expectedly shrinking in August for the 0:05:38.760 --> 0:05:41.719 second time in three months, the north point three percent 0:05:41.800 --> 0:05:44.960 drop in output driven by a sharp decline in manufacturing, 0:05:45.160 --> 0:05:47.919 raising the possibility of the country is now in a recession. 0:05:48.160 --> 0:05:49.960 In London, I'm you and part spin Boo day Break 0:05:50.000 --> 0:05:51.760 all arguing thanks back hearing in the U s A, 0:05:51.839 --> 0:05:54.560 big companies looking at a major reduction in head count. 0:05:54.600 --> 0:05:57.480 Looks like Intel could be slashing jobs in an effort 0:05:57.520 --> 0:06:00.800 to cut costs. More from Bloomberg's Doug Chris, we're told 0:06:00.800 --> 0:06:03.560 the job cuts will likely number in the thousands and 0:06:03.640 --> 0:06:06.520 will be announced as early as next month. Some divisions, 0:06:06.520 --> 0:06:09.760 including sales and marketing, could seek cuts, affecting about twenty 0:06:09.800 --> 0:06:13.200 percent of staff. As of July, Intel had a hundred 0:06:13.279 --> 0:06:16.720 thirteen thousand, seven hundred employees. The company is facing a 0:06:16.760 --> 0:06:20.720 steep decline in demand for PC processors. Its main businesses 0:06:20.760 --> 0:06:23.800 struggled to win back market share lost to rivals like 0:06:23.920 --> 0:06:28.280 Advanced micro Devices. In July, Intel said two sales would 0:06:28.279 --> 0:06:32.000 be about eleven billion dollars lower than previously forecast. In 0:06:32.040 --> 0:06:34.760 New York Time, Doug Prisoner Bloomberg Daybreak, All right, don, 0:06:34.880 --> 0:06:36.880 thank you and euro up. This morning, Shares our credit 0:06:36.960 --> 0:06:40.039 Suite are lower. They're down about three and a half percent. 0:06:40.400 --> 0:06:43.119 Sources say that Justice Department is investigating whether the Swiss 0:06:43.160 --> 0:06:46.360 lander continued to help US clients hide assets from authorities. 0:06:46.560 --> 0:06:49.440 To bank paid up multibillion dollar fee over a similar 0:06:49.440 --> 0:06:52.680 issue eight years ago, and had pledged to tackle the issue. 0:06:52.960 --> 0:06:56.200 We are watching earnings cross the Bloomberg This morning. PepsiCo 0:06:56.279 --> 0:07:00.040 reporting a third quarter core profit that beat analysts, s 0:07:00.040 --> 0:07:03.520 tomates and it sees its fiscally your organic revenue also 0:07:03.800 --> 0:07:07.840 meeting analysts estimates. Futures this morning are on the rise. 0:07:08.000 --> 0:07:10.040 S and P future is up about thirty points down, 0:07:10.040 --> 0:07:12.400 futures up a hundred ninety two, and Nastas futures up 0:07:12.440 --> 0:07:15.600 one hundred twelve. Straight ahead your latest local headlines, plus 0:07:15.600 --> 0:07:23.840 a check of sports, and this is Bloomberg. Thank you Caring. 0:07:23.880 --> 0:07:26.040 It is six oh seven on Wall Street. We are 0:07:26.080 --> 0:07:28.480 at fifty eight degrees in Central Park. I got a 0:07:28.520 --> 0:07:31.800 new crash northbound of Jersey Turnpike, trucklings and exit thirteen. 0:07:32.320 --> 0:07:34.800 More coming up in traffic first Michael Barr with more 0:07:34.840 --> 0:07:37.160 on what's going on in New York and around the world. Michael, 0:07:37.280 --> 0:07:39.800 thank you very much. Nathan. New Jersey Governor Phil Murphy 0:07:39.840 --> 0:07:45.440 has put up another potential block to Manhattan's contraffic congestion pricing, 0:07:45.480 --> 0:07:48.240 with an inquiry into the potential revenue hit to the 0:07:48.280 --> 0:07:51.320 Port Authority of New York and New Jersey. Murphy says 0:07:51.360 --> 0:07:55.040 the plan would cut bridge and tunnel toll collections. Murphy 0:07:55.040 --> 0:07:59.520 wrote to Port Authority Executive Director Richard Cotton in October eleventh, 0:07:59.600 --> 0:08:02.960 letter obtained by Bloomberg News, any reduction in the Port 0:08:02.960 --> 0:08:06.480 Authority capital plan because of congestion pricing should not come 0:08:06.520 --> 0:08:10.120 at the expense of any New Jersey projects. On the 0:08:10.160 --> 0:08:13.520 campaign trails, Senate Minority Leader Mitch McConnell says the party 0:08:13.760 --> 0:08:16.960 will stick with Herschel Walker as their GOP candidate for 0:08:17.040 --> 0:08:20.960 Senate in Georgia. Walker told ABC he denies a woman's 0:08:20.960 --> 0:08:24.000 claim at the former NFL star once urged her to 0:08:24.040 --> 0:08:26.600 have an abortion. I know nothing about an abortion, and 0:08:26.640 --> 0:08:28.960 I knew us a lie, and I said it was 0:08:29.000 --> 0:08:32.040 a lie, and I just move on. Walker's campaign is 0:08:32.120 --> 0:08:35.560 rocked by allegations that he reimbursed an ex girlfriend for 0:08:35.600 --> 0:08:38.800 an abortion. In two thousand nine, New York City Mayor 0:08:38.920 --> 0:08:43.440 Eric Adams signed legislation barring concealed guns, both legal and illegal, 0:08:43.480 --> 0:08:46.920 from Times Square. Mayor Adams says it's essential for the 0:08:46.960 --> 0:08:50.000 city to safeguard the rights of the tourists and visitors. 0:08:50.280 --> 0:08:55.080 We are projected to receive fifties six million tourists in 0:08:55.160 --> 0:08:58.079 this city. Many of them come through Times Square has 0:08:58.120 --> 0:09:01.520 become a signature of this city, and we want to 0:09:01.559 --> 0:09:05.079 make sure that this safe. The decision comes following the 0:09:05.120 --> 0:09:09.160 summer's Supreme Court decision to overturn the state's law requiring 0:09:09.160 --> 0:09:12.800 a license to carry concealed weapons in public places. NASA 0:09:12.880 --> 0:09:16.000 says the Dart spacecraft that crashed into a small, harmless 0:09:16.000 --> 0:09:19.840 asteroid two weeks ago has succeeded in shifting the space 0:09:19.960 --> 0:09:23.800 rocks orbit. NASA Administrator Bill Nelson now the team is 0:09:23.880 --> 0:09:30.839 confirmed that the spacecraft's impact altered demorphous orbit around Didimos 0:09:31.559 --> 0:09:36.640 by thirty two minutes. NASA's Bill Nelson says the refrigerators 0:09:36.679 --> 0:09:41.720 sized spacecraft originally struck the asteroid seven million miles away. 0:09:42.360 --> 0:09:45.000 Global News twenty four hours a day on air and 0:09:45.160 --> 0:09:49.040 on Bloomberg Quick Takes, powered by more than journalists analysts 0:09:49.080 --> 0:09:52.000 more than a hundred twenty countries. Michael Barr and this 0:09:52.160 --> 0:10:00.480 is Bloomberg, Nathan, it's pretty good, Aim. Thanks Michael six 0:10:00.520 --> 0:10:02.440 o nine on Wall Street. Time for the Bloomberg Sports 0:10:02.440 --> 0:10:05.000 South DA. Here's John Stetshem. All right, Nathan, the Yankee 0:10:05.160 --> 0:10:08.199 signed Garrett Cole to win big games in October. It 0:10:08.200 --> 0:10:10.080 didn't happened last year. We got roughed up in that 0:10:10.120 --> 0:10:12.920 one game playoff in Boston. A Cole pitched like an ace. 0:10:13.040 --> 0:10:14.760 Last night at the State even six and the third 0:10:15.120 --> 0:10:17.719 allowed just one run, struck out eight. The bullpen a 0:10:17.840 --> 0:10:20.880 question mark head into the postseason, but it did its job, 0:10:20.920 --> 0:10:23.040 getting the last eight ounces of the Yankees to Game 0:10:23.080 --> 0:10:26.000 one from Cleveland four to one. Home run for Harrison 0:10:26.040 --> 0:10:28.040 Bader that's his first ever in Finch trights and an 0:10:28.080 --> 0:10:31.600 Anthony rizzle along two on shot. Game two schedule for 0:10:31.640 --> 0:10:34.720 tomorrow night, although rain is in the forecast. High drama 0:10:34.760 --> 0:10:37.640 on the other American League series opener. Seattle was coming 0:10:37.640 --> 0:10:39.880 off a win in Toronto where the Mariners came back 0:10:39.920 --> 0:10:42.199 from an eight to one defensive. This time they had 0:10:42.200 --> 0:10:44.880 the lead. They got the Justin Verlander. In Houston, they 0:10:44.960 --> 0:10:48.240 led four nothing later seven to three. Seattle was one 0:10:48.280 --> 0:11:07.680 out from victory over food is k b ami they 0:11:07.679 --> 0:11:10.920 call Houston seven. Dodgers beat the Padres in l A five, 0:11:10.960 --> 0:11:13.000 the three the Phillies in a surprise to Game one 0:11:13.080 --> 0:11:15.600 in Atlanta seven to six. Openy night for the Rangers. 0:11:15.600 --> 0:11:18.839 Little payback on Tampa Bay, who ousted them four months 0:11:18.840 --> 0:11:20.920 ago in the Stanley Cup playoffs at the Garden because 0:11:20.920 --> 0:11:23.440 a band of jad scored shorthanded. Then on the power 0:11:23.480 --> 0:11:25.320 play of the the Blue Shirts one three to one. The 0:11:25.400 --> 0:11:28.080 Giants are back from London, but their punter is not. 0:11:28.360 --> 0:11:30.920 Jamie Gallan is a native of Scotland, came to live 0:11:30.920 --> 0:11:33.280 in the US well in high school. He is stuck 0:11:33.320 --> 0:11:35.920 in England with a visa issue. The Giants expect him 0:11:35.920 --> 0:11:39.160 back in time to punt on Sunday against Baltimore. John 0:11:39.160 --> 0:11:43.120 Stash Bloomberg Sports. Nathan all Right, John, thank you. This 0:11:43.200 --> 0:11:47.000 headline just crossing the Bloomberg terminal. UK thirty year guilt 0:11:47.120 --> 0:11:50.400 yields rise to five per cent for the first time 0:11:50.760 --> 0:11:54.160 since the Bank of England intervention. Right now, SMP futures 0:11:54.160 --> 0:11:56.280 are up twenty nine point, staff futures up a hundred 0:11:56.320 --> 0:12:00.240 ninety nastack futures up a hundred six points, which sucked 0:12:00.280 --> 0:12:03.880 the inflation outlook. Next with Neil Richardson of a DP. 0:12:04.120 --> 0:12:09.600 This is Bloomberg. Bloomberg eleven three oh weather morning, sun today, 0:12:09.679 --> 0:12:13.160 afternoon clouds near seventy degrees. Those cruds will bring us 0:12:13.280 --> 0:12:15.920 rain tomorrow in the high Your seventy back in the 0:12:15.960 --> 0:12:22.560 sunshine Friday, right now fifty eight in Central Park Markets, 0:12:22.640 --> 0:12:25.719 headlines and breaking news twenty four hours a day at 0:12:25.720 --> 0:12:29.720 Bloomberg dot Com, The Bloomberg Business out and at Bloomberg Quicktape. 0:12:30.240 --> 0:12:39.120 He's a Bloomberg Business Flash and I'm Karen Moscow, and 0:12:39.160 --> 0:12:41.720 we are watching shares of Pepsi this morning. They're up 0:12:41.720 --> 0:12:43.960 more than two and a half percent in early trading 0:12:44.000 --> 0:12:46.320 after it forecast or again a revenue for the full 0:12:46.400 --> 0:12:49.640 year that beat the average analyst estimates. Gilts are falling, 0:12:49.679 --> 0:12:52.680 the pounds being whipsawed as traders struggled to make sense 0:12:52.679 --> 0:12:56.000 of UK policy. US knock index futures and European shares 0:12:56.360 --> 0:12:59.160 are rising ahead of tomorrow's inflation report. And we checked 0:12:59.200 --> 0:13:02.040 the markets every fifty minutes throughout the trading day. On Bloomberg. 0:13:02.400 --> 0:13:05.120 SNP futures have twenty nine points this morning, down features 0:13:05.160 --> 0:13:07.880 of a hundred eighty five NASDACK futures have one hundred 0:13:08.040 --> 0:13:10.440 seven The decks in Germany's up four tenths of upper 0:13:10.480 --> 0:13:13.319 cent ten your treasury little change, you'll three point nine 0:13:13.360 --> 0:13:15.640 four percent. They yield on the two year four point 0:13:15.679 --> 0:13:18.480 to nine percent. Nine X Screwed oil is up three 0:13:18.520 --> 0:13:20.559 tens of upper cent or twenty seven cents at eighty 0:13:20.600 --> 0:13:23.120 nine dollars sixty two cents of barrel call makes gold 0:13:23.120 --> 0:13:25.600 down half percent or eight dollars fifty cents at sixteen 0:13:25.679 --> 0:13:28.880 seventy seven sixty announced, the euro is at point nine 0:13:28.920 --> 0:13:31.640 seven zero against the dollar, British found one point one 0:13:31.720 --> 0:13:35.200 zero seven zero the end one forty six point four zero, 0:13:35.679 --> 0:13:37.839 and Bitcoin this morning up eight tens of a percent 0:13:37.920 --> 0:13:41.280 at nineteen thousand, one hundred seventy dollars. That's a Bloomberg 0:13:41.360 --> 0:13:43.839 business flash. Now here's Michael bar with Moore on what's 0:13:43.880 --> 0:13:46.640 going on around the world. Michael Karen, thank you very much. 0:13:46.720 --> 0:13:50.160 President Joe Biden voiced a siri yesterday with Saudi Arabia 0:13:50.280 --> 0:13:54.320 over OPEC oil production cuts, accusing the kingdom of allying 0:13:54.440 --> 0:13:58.600 itself with Russia. Biden, speaking to CNN, says there's going 0:13:58.640 --> 0:14:01.400 to be some consequences for what they've done with Russia. 0:14:01.840 --> 0:14:05.240 The Supreme Court will not consider restricting abortion further after 0:14:05.320 --> 0:14:08.240 its June ruling that overturned Roe v. Wade, at least 0:14:08.280 --> 0:14:12.280 for now. The conservative leaning court declined yesterday to hear 0:14:12.320 --> 0:14:15.880 a case that would have granted constitutional rights to embryos 0:14:15.920 --> 0:14:19.240 and fetuses. In baseball, the Yankees one game one in 0:14:19.320 --> 0:14:23.040 their a ld S against the Guardians for one. In hockey, 0:14:23.120 --> 0:14:26.080 the Rangers won their season opener against the Lightning three 0:14:26.160 --> 0:14:29.240 one Global News twenty four hours a day on air 0:14:29.360 --> 0:14:33.560 and on Bloomberg Quicktake, powered by more than journalists and 0:14:33.560 --> 0:14:36.480 analysts more than a hundred twenty countries. Michael Barr and 0:14:36.520 --> 0:14:38.640 this is Bloomberg. Nathan all right, Michael, thank you, At 0:14:38.680 --> 0:14:41.720 six nineteen on Wall Street line from the Bloomberg Interactive 0:14:41.720 --> 0:14:45.840 Broker's studios. This is Bloomberg Daybreak. We're getting ready for 0:14:46.320 --> 0:14:49.840 quite a bit of economic data here, including the final 0:14:49.960 --> 0:14:53.320 reads on inflation before the FED holds its next meeting 0:14:53.440 --> 0:14:56.360 in just a couple of weeks. Let's get insights now. 0:14:56.560 --> 0:15:00.280 We're joined by Neila Richardson, chief economist at a DP. Neila, 0:15:00.320 --> 0:15:02.240 it's great to speak with you this morning while we 0:15:02.280 --> 0:15:05.680 await the first of the two inflation readings. Of course, 0:15:05.800 --> 0:15:08.400 this morning we get the Producer Price Index. Are you 0:15:08.520 --> 0:15:11.880 looking for signs of moderation in the p p I? 0:15:13.160 --> 0:15:17.400 Good morning, Nathan, um. I'm actually looking for some sen 0:15:17.520 --> 0:15:21.360 stability and consistency in the service component. We might see 0:15:21.440 --> 0:15:25.080 some moderation and the goods components. Energy prices have fallen, 0:15:25.520 --> 0:15:28.920 but for services that is the common thread. But let's 0:15:28.960 --> 0:15:32.400 go through line to the CPI report and I really 0:15:32.520 --> 0:15:35.920 think that that's where you're seeing the pressures rise right 0:15:36.000 --> 0:15:40.520 now is in services as consumers continue to shift their 0:15:40.840 --> 0:15:45.560 post pandemic spending from goods back into service sectors. If 0:15:45.600 --> 0:15:48.960 we do see more of that pressure on the services side, 0:15:49.040 --> 0:15:51.440 what does that imply. Are you thinking that we could 0:15:51.520 --> 0:15:55.920 see more pressure when it comes to wages? Well, actually, 0:15:56.000 --> 0:15:58.240 there was some good news in the ADP report that 0:15:58.360 --> 0:16:02.280 we released a last week. We saw that pressure in 0:16:02.360 --> 0:16:05.000 wages that you mentioned. For people who stayed in their 0:16:05.080 --> 0:16:08.200 jobs for more than a year, that actually accelerated a 0:16:08.240 --> 0:16:10.920 little bit to seven point eight percent from last month. 0:16:11.320 --> 0:16:13.960 But for people switching their jobs, and that's the big 0:16:14.080 --> 0:16:17.320 dynamic right now, is these people who are leaving one 0:16:17.440 --> 0:16:20.360 job and moving to the next. We actually saw our 0:16:20.440 --> 0:16:24.200 index decelerate for the first time since the pandemic um 0:16:24.240 --> 0:16:27.080 They're still making double digit gains, but the gains aren't 0:16:27.080 --> 0:16:29.560 as strong as they were just before, so we might 0:16:29.880 --> 0:16:32.800 that might be an indication that the wage pressures are 0:16:32.920 --> 0:16:37.640 softening in the index. I think there's overall UH tendency 0:16:37.760 --> 0:16:41.280 right now for companies to increase prices to keep up, 0:16:41.400 --> 0:16:44.320 yes with past labor class, but also in in a 0:16:44.400 --> 0:16:47.400 world of uncertainty to make sure that their revenues stay 0:16:47.920 --> 0:16:51.920 afloat as well, and that, as you mentioned, does flow 0:16:52.160 --> 0:16:55.920 into the consumer price index. A lot of the economists 0:16:55.960 --> 0:16:58.560 that we've been serving here at Bloomberg are saying that 0:16:58.640 --> 0:17:01.600 we could see a little bit of softening even in 0:17:01.760 --> 0:17:04.359 core CPI. What's your call there when it comes to 0:17:04.440 --> 0:17:09.000 consumer prices? Yeah, I think there could be some softening, 0:17:09.160 --> 0:17:12.000 But there's always this the data money economist, whether we 0:17:12.160 --> 0:17:14.439 reached the peak or not, or whether things are trending 0:17:14.520 --> 0:17:16.560 down or not. And I would just caution that nothing 0:17:16.640 --> 0:17:19.800 happens in the straight line anymore. There's too much uncertainty 0:17:19.840 --> 0:17:21.840 in the world. So we might see a little bump 0:17:21.920 --> 0:17:24.760 up and down in that core read as well as 0:17:24.800 --> 0:17:27.000 the fact that it could stay at the levels of 0:17:27.200 --> 0:17:30.720 that that it could plateau for a while. So I'm 0:17:30.760 --> 0:17:35.040 not expecting major changes this week. If we don't see 0:17:35.080 --> 0:17:37.480 things in a straight line. What does that mean for 0:17:37.560 --> 0:17:42.159 the Fed? NILA Again, it means that the set is 0:17:42.200 --> 0:17:44.359 going to have to stay hawkish. They're going to have 0:17:44.480 --> 0:17:47.480 to stay focused on bringing inflation down. My read on 0:17:47.520 --> 0:17:49.320 the economy is that the fet is on it in 0:17:49.400 --> 0:17:52.480 a race against time. They have to bring down inflation 0:17:53.200 --> 0:17:56.240 even as their actions work with a lag before the 0:17:56.359 --> 0:18:00.080 economy softened so much that it dips into respression. So 0:18:00.200 --> 0:18:02.879 to me, that means that the FED stays aggressive and 0:18:02.960 --> 0:18:07.359 stay focused on bringing inflation down before their options are 0:18:07.480 --> 0:18:10.159 are harder, even harder than they are now. Are you 0:18:10.240 --> 0:18:13.159 expecting Are you expecting that the Fed is going to 0:18:13.240 --> 0:18:16.200 align with that when we get the f O MC 0:18:16.400 --> 0:18:18.720 minutes later on this afternoon. We've got about a minute 0:18:18.800 --> 0:18:21.320 left here. Sure, I think you're going to see a 0:18:21.440 --> 0:18:24.160 variety of opinions, and the opinions are going to get 0:18:24.359 --> 0:18:28.199 more widespread as we move along the cycle. There are 0:18:28.320 --> 0:18:31.640 those on the fm F l m C which will 0:18:31.760 --> 0:18:34.800 like to be more cautious and their rate increases, and 0:18:34.920 --> 0:18:37.480 there are those who are going to be more aggressive. 0:18:37.800 --> 0:18:41.920 So for market participants, that means more uncertainty that we're 0:18:41.960 --> 0:18:45.400 not going to account on a three fourth percentage increase 0:18:45.440 --> 0:18:47.560 every month. It could be point side, that could be 0:18:47.640 --> 0:18:51.040 a quarter percentage because there's going to be a wider 0:18:51.160 --> 0:18:54.159 range of opinions on the side. Ultimately, it's Chapaw who 0:18:54.240 --> 0:18:57.440 makes that decision, and he's been consistent about pain for 0:18:57.520 --> 0:19:00.040 the last two months. So I assume a more a 0:19:00.560 --> 0:19:04.480 continuation and aggressive hikes at least for the next meeting. Yeah, 0:19:04.520 --> 0:19:07.280 it certainly has been a message that's been hammered time 0:19:07.320 --> 0:19:10.080 and time again, not just by Chairman Pal, but plenty 0:19:10.119 --> 0:19:12.720 of other FED speakers as well. Thanks for this, Neil, 0:19:12.760 --> 0:19:14.639 a great having you on with us this morning as 0:19:14.680 --> 0:19:18.240 we await all that data UH coming out this afternoon 0:19:18.320 --> 0:19:20.399 and into the rest of this week. Neila Richardson, its 0:19:20.440 --> 0:19:23.080 chief economist at a DP. Of course, we get the 0:19:23.119 --> 0:19:25.760 producer price in next this morning a thirty Wall Street time, 0:19:25.800 --> 0:19:27.560 and then the Fed minutes come out at two pm. 0:19:27.880 --> 0:19:31.119 And of course we are waiting for consumer prices tomorrow 0:19:31.240 --> 0:19:34.560 and retail sales on Friday. Lots for economists and the 0:19:34.640 --> 0:19:38.200 FED to digest before that next meeting coming up in 0:19:38.480 --> 0:19:41.040 just a couple of weeks, first week of November. Looking 0:19:41.080 --> 0:19:43.880 ahead to the market open this morning, futures are moving higher, 0:19:44.119 --> 0:19:47.280 SMP futures up twenty two points, STAFF futures up at 0:19:47.400 --> 0:19:50.960 one and NASTAC futures are higher by eighty eight points ten. 0:19:51.000 --> 0:19:54.359 Your treasuries now down one thirty second have a yield 0:19:54.440 --> 0:19:58.119 of three point nine five on the benchmark ten year 0:19:58.200 --> 0:20:07.640 Treasury note you're listening to Bloomberg Daybreak Bloomberg eleven three 0:20:07.680 --> 0:20:10.800 oh weather morning sun will have increasing clouds this afternoon 0:20:10.880 --> 0:20:13.800 with the high year seventy degrees, rainy, breezy. Tomorrow be 0:20:13.880 --> 0:20:17.640 high year seventy again, upper sixties, mostly sunny for Friday 0:20:17.760 --> 0:20:23.760 fifty eight. Currently in Central Park, broadcasting live from the 0:20:23.840 --> 0:20:27.800 Bloomberg Interactive Broker Studio in New York. Bloomberg E Living 0:20:27.880 --> 0:20:32.240 free on to Washington, d C. Bloomberg to Boston, Bloomberg 0:20:32.320 --> 0:20:35.439 one O six one, to San Francisco, Bloomberg N sixty 0:20:35.600 --> 0:20:38.800 to the Country Sirius XM Cho one nineteen and around 0:20:38.840 --> 0:20:42.400 the globe to Bloomberg Business app and Bloomberg Radio dot com. 0:20:42.800 --> 0:20:51.960 This is Bloomberg Daybreak six thirty on Wall Street. Good morning, 0:20:52.000 --> 0:20:54.840 I'm Nathan Hagar, but I'm Kared Moscow. Were just about 0:20:54.880 --> 0:20:57.200 three hours away from the open of US trading time 0:20:57.240 --> 0:20:58.840 for the five things that you need to know to 0:20:58.880 --> 0:21:02.800 start your day, BRONTI you buy Interacted Brokers. Interacted Brokers 0:21:02.920 --> 0:21:05.359 charges margin loan rates from three point five eight percent 0:21:05.440 --> 0:21:07.840 to four point five eight percent rates subject to change. 0:21:07.960 --> 0:21:10.600 Learn more at ib k R dot com. Slash compare 0:21:11.160 --> 0:21:14.200 up first in an interview as CNN, President Biden face 0:21:14.320 --> 0:21:17.679 questions about a possible contraction in growth. I don't think 0:21:17.720 --> 0:21:19.440 there will be a recession. If it is, it will 0:21:19.440 --> 0:21:23.040 be a very slight recession, that is, will move down slightly. 0:21:23.480 --> 0:21:26.280 President Biden said the U. S economy is resilient enough 0:21:26.320 --> 0:21:29.000 to write out any economic turbulence. He also says the 0:21:29.080 --> 0:21:32.640 American people do not need to prepare for a recession. Well, 0:21:32.680 --> 0:21:36.040 tough talk on inflation continues from the Fed. Karen Cleveland 0:21:36.080 --> 0:21:38.560 FED President Laretta Mester says the Central Bank is not 0:21:38.720 --> 0:21:41.400 done raising rates and she sees no reason to alter 0:21:41.520 --> 0:21:44.280 the central banks balance sheet runoff plan. I think we 0:21:44.359 --> 0:21:47.040 want to stick to that plan because the markets have 0:21:47.240 --> 0:21:50.320 understood the plan. They see it, they understand it. We 0:21:50.480 --> 0:21:53.480 did very well. I think broadcast what we were planning 0:21:53.520 --> 0:21:56.960 to do and implemented it. Cleveland FED President LAURRETTA. Mester 0:21:57.040 --> 0:21:59.680 made the comments in an interview with Bloomberg's Kathleen Hayes 0:21:59.720 --> 0:22:02.080 catch a full conversation on the Bloomberg Terminal and at 0:22:02.119 --> 0:22:05.359 bloomberg dot com. But if it still has its critics Nathan, 0:22:05.359 --> 0:22:08.440 including Muhammad Larry and the Alliance Chief Economic Advisor, and 0:22:08.440 --> 0:22:12.120 Bloomberg opinion columnists said the FEDS aggressive tightening could lead 0:22:12.160 --> 0:22:15.960 to a global slowdown. Central banks and governments have to 0:22:16.040 --> 0:22:18.399