1
00:00:02,400 --> 00:00:05,880
Speaker 1: This is Bloomberg Daybreak Asia for this Wednesday, June fourteenth

2
00:00:05,960 --> 00:00:09,520
Speaker 1: in Hong Kong Tuesday June thirteenth in New York. Coming

3
00:00:09,600 --> 00:00:13,119
Speaker 1: up today, US inflation slows and the markets are preparing

4
00:00:13,160 --> 00:00:16,040
Speaker 1: for the FED to pause in its tightening campaign. The

5
00:00:16,160 --> 00:00:18,360
Speaker 1: US is said to be planning a purchase of twelve

6
00:00:18,480 --> 00:00:22,640
Speaker 1: million barrels of crude to refill its depleted reserves, and

7
00:00:22,760 --> 00:00:26,439
Speaker 1: China weighs broader stimulus to stimulate economic growth.

8
00:00:26,680 --> 00:00:29,720
Speaker 2: Donald Trump becomes a first former president to be arrested

9
00:00:29,760 --> 00:00:33,680
Speaker 2: and charged with federal crimes. Plead's not guilty. She hosts

10
00:00:33,680 --> 00:00:37,680
Speaker 2: Palestinian leader of Boss NATO asks for two percent GDP

11
00:00:37,880 --> 00:00:41,360
Speaker 2: nation aid for Ukraine. I'm at Baxter with Global News.

12
00:00:44,120 --> 00:00:47,800
Speaker 3: That's all straight ahead on Bloomberg Daybreak Asia, the business

13
00:00:47,840 --> 00:00:50,279
Speaker 3: news you need to start your day in just one

14
00:00:50,400 --> 00:00:55,320
Speaker 3: fifteen minute podcast available on Apple, Spotify, the Bloomberg Business App,

15
00:00:55,360 --> 00:00:57,320
Speaker 3: and everywhere you get your podcasts.

16
00:01:00,240 --> 00:01:02,640
Speaker 4: Good morning, I'm Richard Salamath.

17
00:01:02,240 --> 00:01:05,160
Speaker 1: And I'm Doug Chrisner. Here are the stories we're following today.

18
00:01:05,600 --> 00:01:07,760
Speaker 4: Absolutely, let's have a look now, you know, the whole

19
00:01:07,760 --> 00:01:10,280
Speaker 4: inflation picture. Because the Fed will be concluding its two

20
00:01:10,360 --> 00:01:14,480
Speaker 4: day meeting tomorrow and issuing its next monetary policy decision.

21
00:01:14,480 --> 00:01:16,440
Speaker 4: Of course, Michael McKay has a preview.

22
00:01:16,600 --> 00:01:19,319
Speaker 5: FED officials went into their two day meeting divided over

23
00:01:19,360 --> 00:01:23,800
Speaker 5: whether inflation remains so stubborn that additional rate increases are necessary.

24
00:01:23,959 --> 00:01:27,320
Speaker 5: Tuesday's benign CPI report likely tips the balance of the

25
00:01:27,440 --> 00:01:30,600
Speaker 5: argument to those who would put a further move on hold.

26
00:01:31,000 --> 00:01:33,920
Speaker 5: The Central Bank has raised the nation's benchmark borrowing rate

27
00:01:33,959 --> 00:01:37,760
Speaker 5: by more than five percentage points and inflation is coming down.

28
00:01:37,920 --> 00:01:40,479
Speaker 5: While investors have priced out a rate move for this meeting,

29
00:01:40,680 --> 00:01:44,039
Speaker 5: July and future meetings remain on the table, at least

30
00:01:44,040 --> 00:01:47,400
Speaker 5: for now, markets will price those odds after today a

31
00:01:47,480 --> 00:01:50,320
Speaker 5: new forecast from FED officials and a new dot plot

32
00:01:50,320 --> 00:01:53,520
Speaker 5: outlining their rate views, coupled with what FED Chair Jay

33
00:01:53,600 --> 00:01:57,560
Speaker 5: Powell says about the outlook Michael McKee, Bloomberg, Daybreak, Asia.

34
00:01:57,440 --> 00:02:01,080
Speaker 1: Elsewhere, and Washington US Treasury Secretary ea gannat YELLENI is

35
00:02:01,120 --> 00:02:04,360
Speaker 1: working to rebuild her department's cash balance to what she

36
00:02:04,520 --> 00:02:07,600
Speaker 1: calls a safe and appropriate level. We have more from

37
00:02:07,640 --> 00:02:08,720
Speaker 1: Bloombergs and Kates.

38
00:02:09,000 --> 00:02:11,400
Speaker 6: Yell And told the House Financial Services Committee that the

39
00:02:11,440 --> 00:02:13,880
Speaker 6: cost of the federal government must be minimized and to

40
00:02:13,960 --> 00:02:16,560
Speaker 6: avoid market disruption to the maximum extent possible.

41
00:02:16,800 --> 00:02:22,320
Speaker 5: We've consulted widely with market participants about what the best

42
00:02:22,400 --> 00:02:23,760
Speaker 5: way is to do that.

43
00:02:24,240 --> 00:02:26,680
Speaker 6: The government is making the move to replenish its coffers

44
00:02:26,680 --> 00:02:28,840
Speaker 6: in the wake of the debt sailing suspension through the

45
00:02:28,880 --> 00:02:33,000
Speaker 6: sale of treasury bills in Washington and Kate's Bloomberg Daybreak Asia.

46
00:02:33,400 --> 00:02:35,800
Speaker 4: Indeed, we're having a look at what's been happening with

47
00:02:35,840 --> 00:02:40,160
Speaker 4: the US's oil situation, with the Washington planning to purchase

48
00:02:40,160 --> 00:02:44,720
Speaker 4: about twelve million barrels of it this year as it

49
00:02:44,760 --> 00:02:48,480
Speaker 4: begins to refill its depleted emergency reserve. Let's get details

50
00:02:48,480 --> 00:02:50,440
Speaker 4: now from Bloomberg's Charlie Pennett.

51
00:02:50,280 --> 00:02:53,360
Speaker 7: Sour So to say that number includes three million barrels

52
00:02:53,480 --> 00:02:57,480
Speaker 7: already scheduled for delivery in August and an additional three

53
00:02:57,520 --> 00:03:02,520
Speaker 7: million barrels from a solicitation the Biden administration issued on Friday.

54
00:03:02,960 --> 00:03:06,799
Speaker 7: An Energy Department spokesperson said they will continue to quote

55
00:03:07,080 --> 00:03:12,280
Speaker 7: seek opportunities for additional repurchases as market conditions and the

56
00:03:12,320 --> 00:03:17,280
Speaker 7: constraints of SPR operations allow. The more than seven hundred

57
00:03:17,400 --> 00:03:22,359
Speaker 7: million barrel capacity Strategic Petroleum Reserve is Nowaday, forty year

58
00:03:22,440 --> 00:03:26,240
Speaker 7: low in New York, Charlie Pellett, Bloomberg, Daybreak Asia.

59
00:03:26,360 --> 00:03:29,520
Speaker 1: Walt Disney is reshuffling the release dates of some of

60
00:03:29,560 --> 00:03:32,600
Speaker 1: its most highly anticipated movies. And here's the thing, the

61
00:03:32,639 --> 00:03:36,240
Speaker 1: company didn't give a reason. This comes as CEO Bob

62
00:03:36,320 --> 00:03:39,080
Speaker 1: Eiger has been trying to increase profits while at the

63
00:03:39,120 --> 00:03:43,240
Speaker 1: same time cutting back on content spending. Here's Bloomberg's Tom

64
00:03:43,240 --> 00:03:47,160
Speaker 1: busby Disney shaking up. It's a movie release schedule, stretching

65
00:03:47,200 --> 00:03:50,800
Speaker 1: out releases of scheduled films into the next decade. After

66
00:03:50,880 --> 00:03:53,840
Speaker 1: last year's long awaited Avatar sequel, Avatar The Way of

67
00:03:53,840 --> 00:03:56,240
Speaker 1: Water raked in two point three billion dollars at the

68
00:03:56,280 --> 00:03:59,640
Speaker 1: global box office, the third installment of that series now

69
00:03:59,680 --> 00:04:02,160
Speaker 1: hitting theaters a year later than planned in December of

70
00:04:02,200 --> 00:04:05,680
Speaker 1: twenty twenty five. Two other planned Avatar sequels will come

71
00:04:05,680 --> 00:04:09,440
Speaker 1: out in twenty twenty nine and twenty thirty one. Also,

72
00:04:09,480 --> 00:04:12,400
Speaker 1: two upcoming films in the Marvel Avengers series push back

73
00:04:12,440 --> 00:04:14,840
Speaker 1: a year each to twenty twenty six and twenty seven,

74
00:04:15,000 --> 00:04:17,680
Speaker 1: the next Star Wars film being held for an extra year.

75
00:04:17,680 --> 00:04:19,640
Speaker 1: Two nestlated to hit the big screen in May of

76
00:04:19,680 --> 00:04:22,560
Speaker 1: twenty six. Tom buzzby Bloomberg Daybreak Asia.

77
00:04:22,800 --> 00:04:26,080
Speaker 4: We've been seeing how Beijing has been trying to counter

78
00:04:26,200 --> 00:04:29,360
Speaker 4: the slowdown for its economy by tinkering the edges with

79
00:04:29,560 --> 00:04:33,440
Speaker 4: making slight cuts in various types of raids. Well, we

80
00:04:33,520 --> 00:04:35,839
Speaker 4: certainly have one in prospect at the moment. In the

81
00:04:35,920 --> 00:04:39,200
Speaker 4: early rate cuts we've been seeing could well mean a

82
00:04:39,240 --> 00:04:43,040
Speaker 4: more meaningful medium term lending rate facility cut is perhaps

83
00:04:43,040 --> 00:04:45,120
Speaker 4: on the way. Let's get detail from Bloomberg's Joanne Wong.

84
00:04:45,360 --> 00:04:48,120
Speaker 8: So People Spank of China unexpectedly cut a series of

85
00:04:48,120 --> 00:04:51,320
Speaker 8: different policy interest rates on Tuesday. The move suggests a

86
00:04:51,400 --> 00:04:54,239
Speaker 8: shift and stands by the Chinese government from a cautious

87
00:04:54,279 --> 00:04:57,880
Speaker 8: approach to stimulus. This asks to policy makers concerns about

88
00:04:57,920 --> 00:05:01,040
Speaker 8: the economy slowdown after a consumer were led surge early

89
00:05:01,080 --> 00:05:04,120
Speaker 8: in the year started to to endull Economists say the

90
00:05:04,120 --> 00:05:07,400
Speaker 8: cuts paved a way to lowering key lending rates. On Thursday,

91
00:05:07,839 --> 00:05:10,760
Speaker 8: Goldman Sachs predicts a twenty five basis point triple R

92
00:05:10,839 --> 00:05:13,560
Speaker 8: cut in the third quarter and maybe another cut in

93
00:05:13,600 --> 00:05:16,520
Speaker 8: the fourth quarter. Sources say officials are considering a broad

94
00:05:16,560 --> 00:05:19,800
Speaker 8: package of stimulus proposals to support areas such as real

95
00:05:19,880 --> 00:05:23,400
Speaker 8: estate and domestic demands in Hong Kong, Join Wang, Bloomberg

96
00:05:23,440 --> 00:05:24,120
Speaker 8: Day Brigaisia.

97
00:05:24,279 --> 00:05:26,359
Speaker 1: We had a rally in the Korean wand during the

98
00:05:26,400 --> 00:05:29,040
Speaker 1: New York session, stronger against the dollar by about one

99
00:05:29,080 --> 00:05:32,240
Speaker 1: point three percent. Seems as though there was heavy flows

100
00:05:32,240 --> 00:05:36,480
Speaker 1: into tech equities in the South Korea. Christopher wangover at

101
00:05:36,480 --> 00:05:40,080
Speaker 1: OCBCS in Singapore telling us this is tied to the

102
00:05:40,120 --> 00:05:42,240
Speaker 1: bet on ai and if you look at the South

103
00:05:42,320 --> 00:05:45,160
Speaker 1: Korean chip makers, they were up three point seven percent

104
00:05:45,240 --> 00:05:47,960
Speaker 1: in the last session. This news comes on a day

105
00:05:48,000 --> 00:05:50,880
Speaker 1: when we got the latest survey of global fund managers

106
00:05:50,920 --> 00:05:54,920
Speaker 1: from Bank of America. It shows investors are exclusively long

107
00:05:55,400 --> 00:05:59,720
Speaker 1: tech stocks given the buzz surrounding artificial intelligence, and according

108
00:05:59,760 --> 00:06:03,000
Speaker 1: to b of A, fifty five percent of participants say

109
00:06:03,640 --> 00:06:07,000
Speaker 1: the most crowded trade right now is long big tech.

110
00:06:07,440 --> 00:06:11,760
Speaker 1: Even so BAA says fund managers remain broadly under weight stocks.

111
00:06:12,120 --> 00:06:16,479
Speaker 1: The surveys shows investors cutting equity allocations right now to

112
00:06:16,520 --> 00:06:19,480
Speaker 1: a five month low. Let's get to global news next.

113
00:06:19,480 --> 00:06:23,200
Speaker 1: Here on Daybreak Asia, Donald Trump has pleaded not guilty

114
00:06:23,240 --> 00:06:26,839
Speaker 1: to all thirty seven federal counts against him. At Baxter

115
00:06:26,960 --> 00:06:29,200
Speaker 1: has more from the Bloomberg newsroom in San Francisco.

116
00:06:29,279 --> 00:06:32,280
Speaker 2: Head exactly right, Doug. He becomes first former president to

117
00:06:32,320 --> 00:06:35,359
Speaker 2: ever be arrested on federal charges. Joining US Live is

118
00:06:35,360 --> 00:06:38,480
Speaker 2: Bloomberg sound On and Balance of Power co host Joe Matthew.

119
00:06:38,800 --> 00:06:40,720
Speaker 2: I want to steal you for a little bit more, Joe,

120
00:06:40,720 --> 00:06:44,440
Speaker 2: Thank you so much. Hey, before we get to the proceedings,

121
00:06:44,880 --> 00:06:46,640
Speaker 2: it's hard to ignore the history made here.

122
00:06:46,920 --> 00:06:49,480
Speaker 9: Well, that's right, you know, and that's actually something that

123
00:06:49,520 --> 00:06:51,479
Speaker 9: we need to remind ourselves of because a lot of

124
00:06:51,480 --> 00:06:54,719
Speaker 9: this was predictable. We saw the choreography in advance, and

125
00:06:54,800 --> 00:06:59,640
Speaker 9: Donald Trump's not guilty please were not a surprise. But

126
00:06:59,760 --> 00:07:02,039
Speaker 9: we have to stop down and acknowledge the history of

127
00:07:02,080 --> 00:07:04,240
Speaker 9: this moment. It's never happened before, and to see the

128
00:07:04,279 --> 00:07:08,360
Speaker 9: president posing for photographs at a Cuban restaurant moments after

129
00:07:08,440 --> 00:07:09,560
Speaker 9: it happened was remarkable.

130
00:07:09,960 --> 00:07:10,160
Speaker 3: Yeah.

131
00:07:10,200 --> 00:07:13,559
Speaker 2: I love the headline up on the Bloomberg terminal. Trump

132
00:07:13,560 --> 00:07:16,040
Speaker 2: pleads not guilty, jets to greet supporters in New Jersey.

133
00:07:16,160 --> 00:07:19,440
Speaker 2: But even before that, you mentioned the Versailles. He finishes

134
00:07:19,480 --> 00:07:22,280
Speaker 2: with the court and he goes to a restaurant that

135
00:07:22,920 --> 00:07:25,560
Speaker 2: it was not announced but obviously was organized.

136
00:07:25,720 --> 00:07:25,960
Speaker 3: Yeah.

137
00:07:26,200 --> 00:07:26,760
Speaker 5: Well, that's true.

138
00:07:26,960 --> 00:07:29,920
Speaker 9: I don't know how spontaneous that was, but you know, look,

139
00:07:29,960 --> 00:07:31,920
Speaker 9: who could blame him for wanting a Cubano at one

140
00:07:31,920 --> 00:07:34,160
Speaker 9: of the great Cuban restaurants in Miami. It's a tourist

141
00:07:34,200 --> 00:07:36,480
Speaker 9: attraction though, and he was seeing a lot of different

142
00:07:36,480 --> 00:07:38,880
Speaker 9: people there. They sang happy birthday to him as well.

143
00:07:39,120 --> 00:07:41,120
Speaker 9: And if we can just add another bizarre line to

144
00:07:41,160 --> 00:07:43,920
Speaker 9: this whole story, he's celebrating his seventy seventh birthday tomorrow.

145
00:07:44,360 --> 00:07:49,600
Speaker 2: Yeah, so here we go. Now back to the hard stuff. Arrest, arraignment,

146
00:07:49,800 --> 00:07:52,760
Speaker 2: pretty profoma, as you say, going forward to the trili

147
00:07:52,840 --> 00:07:54,760
Speaker 2: be held now in West Palm Beach. Any thoughts about

148
00:07:54,760 --> 00:07:57,360
Speaker 2: whether this could either favor the prosecution or defense. I

149
00:07:57,400 --> 00:08:00,240
Speaker 2: know that's kind of a question that'd be there in

150
00:08:00,240 --> 00:08:02,200
Speaker 2: the clouds if that's true, and it's one that we've

151
00:08:02,240 --> 00:08:04,560
Speaker 2: been talking about. Actually, we spoke with Dave Ehrenberg a

152
00:08:04,600 --> 00:08:08,320
Speaker 2: little bit earlier on sound on here on Bloomberg Radio,

153
00:08:09,040 --> 00:08:12,679
Speaker 2: Palm Beach County Attorney, and he was making the case

154
00:08:12,800 --> 00:08:15,360
Speaker 2: that you can look at this a couple of different ways,

155
00:08:15,400 --> 00:08:18,880
Speaker 2: but this may not have been the preferred venue for

156
00:08:19,000 --> 00:08:21,120
Speaker 2: Donald Trump. Now, of course, we don't know who's going

157
00:08:21,200 --> 00:08:25,520
Speaker 2: to end up involved in this case necessarily, But in Miami,

158
00:08:25,600 --> 00:08:28,720
Speaker 2: when you consider his point was all of the immigrants

159
00:08:28,720 --> 00:08:31,960
Speaker 2: there who fled oppressive regimes, they tend not to trust government,

160
00:08:32,000 --> 00:08:35,320
Speaker 2: particularly when it goes after a former leader or a

161
00:08:35,360 --> 00:08:37,920
Speaker 2: sitting president for that matter. And he may have found

162
00:08:37,920 --> 00:08:40,480
Speaker 2: a more sensitive ear in Miami, But either way, this

163
00:08:40,559 --> 00:08:43,320
Speaker 2: is going to happen in Palm Beach County. And we

164
00:08:43,400 --> 00:08:45,840
Speaker 2: do not have a trial date yet. That's one thing

165
00:08:45,880 --> 00:08:47,560
Speaker 2: we were hoping to learn today. We're not sure when

166
00:08:47,600 --> 00:08:50,680
Speaker 2: it's going to begin. Yeah, exactly now. Jack Smith, the

167
00:08:50,720 --> 00:08:53,280
Speaker 2: council Special counsel, already said he wants to speedy trial

168
00:08:53,320 --> 00:08:56,640
Speaker 2: a prosecutor. Do we know whether Trump wants to slow

169
00:08:56,720 --> 00:08:59,240
Speaker 2: things down? And this is all guests work, I realized.

170
00:08:59,280 --> 00:09:03,480
Speaker 2: But presumably if you try to go inside his mind,

171
00:09:03,920 --> 00:09:06,400
Speaker 2: could be elected and then pardon himself.

172
00:09:07,040 --> 00:09:13,360
Speaker 9: All of that is arguably true, especially the delay strategy here.

173
00:09:13,400 --> 00:09:16,400
Speaker 9: That's been the focus for Donald Trump in any number

174
00:09:16,440 --> 00:09:19,160
Speaker 9: of legal venues, and that's going to be the case here.

175
00:09:19,200 --> 00:09:20,920
Speaker 9: He's having a little bit of trouble building out his

176
00:09:21,040 --> 00:09:23,920
Speaker 9: legal team. That's been a challenge here because he's been

177
00:09:23,920 --> 00:09:25,240
Speaker 9: through a lot of lawyers, and not a lot of

178
00:09:25,320 --> 00:09:27,320
Speaker 9: lawyers want to put their careers on the line here

179
00:09:27,360 --> 00:09:30,479
Speaker 9: for what can be a very difficult client to control,

180
00:09:31,240 --> 00:09:33,960
Speaker 9: so delay. Yes, Also, they're going to go after the

181
00:09:34,040 --> 00:09:37,280
Speaker 9: crime fraud exception and very important part of this indictment

182
00:09:37,520 --> 00:09:40,600
Speaker 9: that people should understand that allowed prosecutors to use notes

183
00:09:40,600 --> 00:09:44,319
Speaker 9: from Donald Trump's former lawyer, Evan Corkran. Forget the attorney

184
00:09:44,400 --> 00:09:47,720
Speaker 9: client privilege. That's now part of the case, and Donald

185
00:09:47,720 --> 00:09:50,960
Speaker 9: Trump's team will likely begin its attack on that part

186
00:09:50,960 --> 00:09:52,760
Speaker 9: of the indictment. And a lot of the argument here

187
00:09:52,760 --> 00:09:55,520
Speaker 9: in this case rests on the notes. Some described it

188
00:09:55,559 --> 00:09:58,280
Speaker 9: as a novel from Evan Corkran about everything that he

189
00:09:58,360 --> 00:10:00,559
Speaker 9: was doing. The idea here at is that the former president,

190
00:10:00,559 --> 00:10:03,480
Speaker 9: he's alleged to have tried to further his crimes through

191
00:10:03,559 --> 00:10:06,040
Speaker 9: his lawyer, so that lawyer is now part of the case.

192
00:10:06,520 --> 00:10:09,280
Speaker 2: Yeah, all right, well, Joe, let's trap ourselves in. We

193
00:10:09,320 --> 00:10:12,720
Speaker 2: have you said it. This is going to last at

194
00:10:12,800 --> 00:10:15,520
Speaker 2: least through the primaries and possibly through the general. Thank

195
00:10:15,559 --> 00:10:17,720
Speaker 2: you so much, Joe, really appreciate it. You do a

196
00:10:17,720 --> 00:10:19,760
Speaker 2: great job on a soundown and balance of power. By

197
00:10:19,800 --> 00:10:22,600
Speaker 2: the way, that is a Bloomberg shoe Matthew in San Francisco.

198
00:10:22,880 --> 00:10:25,280
Speaker 2: I'm Ed Baxter, and this is Bloomberg.

199
00:10:25,400 --> 00:10:27,719
Speaker 1: Let's get to our guest. Christina Hooper is with us.

200
00:10:27,760 --> 00:10:31,520
Speaker 1: She is the chief Global market strategist at Invesco, joining

201
00:10:31,600 --> 00:10:34,400
Speaker 1: us in the Bloomberg Interactive Broker Studio. Thanks for being

202
00:10:34,440 --> 00:10:37,240
Speaker 1: with us. We have to begin with the inflation data.

203
00:10:37,280 --> 00:10:41,080
Speaker 1: The consumer price index numbers coming in maybe on the headline,

204
00:10:41,080 --> 00:10:42,960
Speaker 1: at a rate that was a little softer than the

205
00:10:42,960 --> 00:10:46,120
Speaker 1: market had been predicting. This, I think it's fair to

206
00:10:46,160 --> 00:10:48,600
Speaker 1: say gives the FED a lot more flexibility and going

207
00:10:48,640 --> 00:10:51,640
Speaker 1: on hold at tomorrow's meeting when they announced the decision,

208
00:10:51,760 --> 00:10:53,559
Speaker 1: how do you read the data visa viva FED.

209
00:10:54,559 --> 00:10:58,840
Speaker 10: So I think this gives the FED the ability to

210
00:10:58,880 --> 00:11:01,880
Speaker 10: maintain that pause, which is what I think wants to

211
00:11:01,920 --> 00:11:05,320
Speaker 10: do because I think there's growing concern about what is

212
00:11:05,400 --> 00:11:08,480
Speaker 10: going to happen to the economy. There are very significant

213
00:11:08,760 --> 00:11:13,400
Speaker 10: lagged effects from the implementation of monetary policy to when

214
00:11:13,440 --> 00:11:14,800
Speaker 10: it shows up in the real economy.

215
00:11:15,200 --> 00:11:16,000
Speaker 6: So I think the.

216
00:11:15,960 --> 00:11:19,640
Speaker 10: FED is very aware of that, and so long as

217
00:11:19,679 --> 00:11:23,640
Speaker 10: inflation is moving in the right direction, then it can

218
00:11:23,679 --> 00:11:27,440
Speaker 10: feel comfortable maintaining that pause and having more time to

219
00:11:27,520 --> 00:11:31,520
Speaker 10: assess more data. I think it will show a deterioration economy,

220
00:11:31,720 --> 00:11:34,080
Speaker 10: though not traumatic Christina.

221
00:11:34,200 --> 00:11:36,640
Speaker 4: So the thing is, it does look like, you know,

222
00:11:36,720 --> 00:11:38,600
Speaker 4: maybe they've got to at the time being at least

223
00:11:38,640 --> 00:11:41,520
Speaker 4: a lid on inflation. But shouldn't they be not getting

224
00:11:41,559 --> 00:11:45,560
Speaker 4: more prepared for the inflationary picture to be let's say,

225
00:11:46,120 --> 00:11:49,720
Speaker 4: more vociferous than it has been in recent years and

226
00:11:49,840 --> 00:11:52,760
Speaker 4: down to of course, it becoming a little bit more structural.

227
00:11:54,040 --> 00:11:56,920
Speaker 10: Yeah, I think that's certainly one of the concerns. But

228
00:11:57,400 --> 00:12:01,240
Speaker 10: the task at hand really is to to focus on

229
00:12:01,920 --> 00:12:06,559
Speaker 10: the immediate inflation picture, and so the FED is seeing

230
00:12:07,800 --> 00:12:11,079
Speaker 10: services X housing moving in the right direction. I think

231
00:12:11,120 --> 00:12:16,040
Speaker 10: there are concerns that core in general is rather sticky,

232
00:12:16,760 --> 00:12:20,439
Speaker 10: but I think what the FED needs to be preparing

233
00:12:20,559 --> 00:12:23,720
Speaker 10: for is to be more even handed in managing its

234
00:12:23,760 --> 00:12:27,520
Speaker 10: two goals. It really has been focused on the inflation

235
00:12:27,640 --> 00:12:32,040
Speaker 10: component of it. It's dual objective policy. Now it needs

236
00:12:32,080 --> 00:12:36,720
Speaker 10: to be thinking about full employment. That might sound silly

237
00:12:37,720 --> 00:12:40,320
Speaker 10: right now, but I do think we are going to

238
00:12:40,360 --> 00:12:42,920
Speaker 10: see a weakening of the economy and that includes a

239
00:12:42,920 --> 00:12:45,760
Speaker 10: weakening of the labor market. It could be that it's

240
00:12:45,960 --> 00:12:50,480
Speaker 10: good enough right it's just enough that we see continued

241
00:12:50,480 --> 00:12:54,679
Speaker 10: easing of inflation without any kind of dramatic deterioration in

242
00:12:55,080 --> 00:12:59,080
Speaker 10: the US economy. That's my base case, but it could

243
00:12:59,080 --> 00:13:02,840
Speaker 10: be worse. We just don't know how dramatic the impact

244
00:13:02,920 --> 00:13:06,280
Speaker 10: is going to be because the lag is rather lengthy.

245
00:13:06,440 --> 00:13:08,360
Speaker 1: Could it be better? If you look at what the

246
00:13:08,400 --> 00:13:11,320
Speaker 1: equity market was saying today, I saw strength in materials

247
00:13:11,320 --> 00:13:13,680
Speaker 1: and industrial shares leading the S and P higher, and

248
00:13:13,760 --> 00:13:16,839
Speaker 1: at the same time, treasury yields right across the curve.

249
00:13:16,880 --> 00:13:17,320
Speaker 7: We're up.

250
00:13:18,200 --> 00:13:20,480
Speaker 1: Maybe there seems to be and if you look at

251
00:13:20,480 --> 00:13:22,600
Speaker 1: the recent rally that we have had in small caps,

252
00:13:22,880 --> 00:13:25,320
Speaker 1: maybe a leading indicator that the economy is holding up

253
00:13:25,320 --> 00:13:28,079
Speaker 1: pretty well. Maybe the market is coming to the conclusion

254
00:13:28,080 --> 00:13:30,920
Speaker 1: that the FED may be successful in kind of planning

255
00:13:30,960 --> 00:13:31,880
Speaker 1: the soft landing.

256
00:13:32,040 --> 00:13:33,400
Speaker 5: Is that possible, Doug?

257
00:13:33,440 --> 00:13:36,720
Speaker 10: I think you're right. I think that could very well

258
00:13:36,760 --> 00:13:40,120
Speaker 10: be what we see in what the market is anticipating.

259
00:13:40,280 --> 00:13:42,440
Speaker 10: But it would be wrong for me to say there

260
00:13:42,440 --> 00:13:48,760
Speaker 10: aren't risks to that scenario. So we don't know. But

261
00:13:49,200 --> 00:13:52,400
Speaker 10: it is encouraging to see such a tight labor market.

262
00:13:52,840 --> 00:13:55,400
Speaker 10: That is why it's a double edged sword, of course,

263
00:13:55,400 --> 00:13:59,800
Speaker 10: because that has contributed to inflation to sticky wages. At

264
00:13:59,800 --> 00:14:03,760
Speaker 10: the same time, it has proven a very significant cushion

265
00:14:04,160 --> 00:14:09,040
Speaker 10: for the US economy and could very well enable the

266
00:14:09,040 --> 00:14:11,480
Speaker 10: FED to execute a somewhat soft landing.

267
00:14:12,520 --> 00:14:14,520
Speaker 4: What does it mean for your strategy market wise?

268
00:14:15,559 --> 00:14:20,480
Speaker 10: So our view is that we need to have a

269
00:14:20,520 --> 00:14:25,360
Speaker 10: strategic diversified allocation. There are those who want to be tactical.

270
00:14:25,440 --> 00:14:27,720
Speaker 10: I think it's very hard to be a market timer,

271
00:14:28,600 --> 00:14:34,040
Speaker 10: But to me, this environment underscores the need for broad diversification.

272
00:14:34,840 --> 00:14:38,200
Speaker 10: This is a time to be looking at the equity

273
00:14:38,240 --> 00:14:41,600
Speaker 10: market looking to add exposure if one has been sitting

274
00:14:41,600 --> 00:14:45,200
Speaker 10: on the sidelines, but not to do it specifically in

275
00:14:45,240 --> 00:14:50,320
Speaker 10: the US, to be very broad in one's equity allocation.

276
00:14:50,800 --> 00:14:54,680
Speaker 10: At the same time, what we've seen is an environment

277
00:14:54,800 --> 00:14:58,160
Speaker 10: very different than twenty twenty two for fixed income. We

278
00:14:58,240 --> 00:15:00,760
Speaker 10: are now in I don't want to say golden age

279
00:15:00,760 --> 00:15:03,720
Speaker 10: of fixed income, but we're in a pretty good environment

280
00:15:03,760 --> 00:15:06,280
Speaker 10: for fixed income relative to where we've been in about

281
00:15:06,320 --> 00:15:09,560
Speaker 10: fifteen years, and that means there are a lot of

282
00:15:09,680 --> 00:15:14,040
Speaker 10: attractive fixed income opportunities for investors.

283
00:15:14,360 --> 00:15:15,080
Speaker 6: So this is a.

284
00:15:15,040 --> 00:15:18,120
Speaker 10: Time when there really are are an abundance of opportunities

285
00:15:18,160 --> 00:15:22,160
Speaker 10: it's not Tina. It's Tina D. There's no alternative to diversification.

286
00:15:22,320 --> 00:15:22,680
Speaker 5: I want to.

287
00:15:22,640 --> 00:15:24,840
Speaker 1: Pivot to Japan because at the end of the week

288
00:15:24,880 --> 00:15:27,040
Speaker 1: we have a BOJ meeting, and we have seen the

289
00:15:27,080 --> 00:15:30,840
Speaker 1: equity market in Japan rally, I mean quite amazingly. I

290
00:15:30,880 --> 00:15:33,920
Speaker 1: mean nick Key in the last session was up about

291
00:15:33,920 --> 00:15:37,120
Speaker 1: one point eight percent. There was a lot of weakness

292
00:15:37,320 --> 00:15:39,800
Speaker 1: in the Japanese yen today against the dollar in the

293
00:15:39,840 --> 00:15:41,640
Speaker 1: New York session, and right now we're trading at a

294
00:15:41,640 --> 00:15:45,760
Speaker 1: one forty handle. Most of the participants in the market

295
00:15:45,800 --> 00:15:48,480
Speaker 1: that we've been speaking with don't expect the BOJ to

296
00:15:48,560 --> 00:15:53,080
Speaker 1: do anything radical at this week's meeting. What is the risk, though,

297
00:15:53,680 --> 00:15:56,920
Speaker 1: that the BOJ starts to fall a little bit behind

298
00:15:56,960 --> 00:15:59,040
Speaker 1: the curve? Is that a real risk? I mean, in

299
00:15:59,080 --> 00:15:59,880
Speaker 1: a small way.

300
00:16:00,640 --> 00:16:02,000
Speaker 6: I don't think it's a real risk.

301
00:16:02,760 --> 00:16:05,840
Speaker 10: It could be a calculated risk that the BOJ is taking.

302
00:16:05,960 --> 00:16:09,560
Speaker 10: They're certainly enjoying some of the benefits of higher inflation.

303
00:16:11,480 --> 00:16:14,880
Speaker 10: I think there will be a need to tweak their

304
00:16:14,960 --> 00:16:18,080
Speaker 10: yield curve control policy, but it doesn't have to happen

305
00:16:18,120 --> 00:16:22,120
Speaker 10: at this meeting. Necessarily, it could, but I think it's

306
00:16:22,160 --> 00:16:26,800
Speaker 10: more likely to happen in future meetings. What we're seeing

307
00:16:26,920 --> 00:16:29,200
Speaker 10: is is a Bank of Japan that can actually sit

308
00:16:29,280 --> 00:16:33,560
Speaker 10: on its hands and enjoy what has been a rather

309
00:16:33,840 --> 00:16:38,840
Speaker 10: strong economic environment for Japan for the first time in years.

310
00:16:40,240 --> 00:16:43,360
Speaker 4: Well, let's just look at you bad if we've found out.

311
00:16:43,440 --> 00:16:46,440
Speaker 4: I think the longest winning streak for the market is

312
00:16:46,480 --> 00:16:48,880
Speaker 4: ten weeks long. Now for the nik I think it's

313
00:16:48,880 --> 00:16:51,320
Speaker 4: the longest winning streaks in February two thousand and three.

314
00:16:52,840 --> 00:16:57,480
Speaker 4: Is the whole situation with Japan materially changed in your view?

315
00:16:58,560 --> 00:17:01,000
Speaker 10: Well, I don't know if i'd say it's really changed,

316
00:17:01,080 --> 00:17:05,679
Speaker 10: but we've certainly seen some healthy improvement there, and I

317
00:17:05,720 --> 00:17:10,120
Speaker 10: think it's sustainable. Some of it is being driven by

318
00:17:10,240 --> 00:17:15,040
Speaker 10: forces like increased tourism. There's a lot of different factors

319
00:17:15,080 --> 00:17:19,960
Speaker 10: at play. Certainly, we're also, I think, seeing Japan reaping

320
00:17:20,000 --> 00:17:25,200
Speaker 10: the benefits of past stimulus. So's it's a I think,

321
00:17:25,440 --> 00:17:28,159
Speaker 10: a good environment for a variety of different reasons. I

322
00:17:28,160 --> 00:17:30,560
Speaker 10: don't think it's a dramatic change, but we could be

323
00:17:31,480 --> 00:17:38,280
Speaker 10: embarking on a new and improved longer term environment for Japan.

324
00:17:38,400 --> 00:17:39,440
Speaker 10: It remains to be seen.

325
00:17:39,600 --> 00:17:42,440
Speaker 1: The other big meeting of Central Banks ECB this week

326
00:17:42,480 --> 00:17:44,040
Speaker 1: twenty five basis points is that.

327
00:17:43,960 --> 00:17:47,520
Speaker 10: Your prediction I would anticipate twenty five basis points. The

328
00:17:47,560 --> 00:17:50,520
Speaker 10: ECB and the BOE are both a little ways off

329
00:17:50,720 --> 00:17:54,960
Speaker 10: from enacting a conditional pause. I think they'll get there,

330
00:17:55,000 --> 00:17:57,960
Speaker 10: but they're behind the curve because they've been behind the curve.

331
00:18:00,000 --> 00:18:02,880
Speaker 4: So with that in mind and looking at what's going

332
00:18:02,880 --> 00:18:07,879
Speaker 4: on generally speaking, we've got I guess demography, people getting older,

333
00:18:07,960 --> 00:18:10,560
Speaker 4: We've got decoupling with China. On top of that, we've

334
00:18:10,600 --> 00:18:15,040
Speaker 4: got decarbonization three d's. These are structural changes which are

335
00:18:15,040 --> 00:18:17,800
Speaker 4: going on right now. How do they inform your investment decisions?

336
00:18:18,760 --> 00:18:23,320
Speaker 10: Well, they are just part of the longer term structural

337
00:18:23,440 --> 00:18:27,479
Speaker 10: changes that we've seen over the course of time, and

338
00:18:27,520 --> 00:18:31,040
Speaker 10: it really hasn't had much of an impact on asset

339
00:18:31,080 --> 00:18:35,119
Speaker 10: class performance. So I think it's important for investors not

340
00:18:35,320 --> 00:18:41,560
Speaker 10: to be spooked by structural changes, but to recognize that

341
00:18:41,600 --> 00:18:47,280
Speaker 10: there's certainly opportunities created by innovation. But I wouldn't want

342
00:18:47,280 --> 00:18:49,199
Speaker 10: to be scared away. I think one of the biggest

343
00:18:49,240 --> 00:18:52,280
Speaker 10: mistakes made during the global financial crisis was so many

344
00:18:52,280 --> 00:18:56,119
Speaker 10: investors were spooped. They were scared away from markets, and

345
00:18:57,240 --> 00:18:59,560
Speaker 10: I think they missed out they locked in losses, missed

346
00:18:59,560 --> 00:19:05,080
Speaker 10: out on on participation in strong capital market environment for years.

347
00:19:06,440 --> 00:19:10,600
Speaker 10: This is to me just you know, the structural changes

348
00:19:10,640 --> 00:19:13,680
Speaker 10: we're seeing are just part and parcel of an evolving

349
00:19:13,920 --> 00:19:17,680
Speaker 10: global economy that still represents opportunity for investors.

350
00:19:17,800 --> 00:19:20,639
Speaker 1: And I'm wondering whether artificial intelligence is a part of

351
00:19:20,680 --> 00:19:23,600
Speaker 1: that structural change. We'll leave that to next time, Christina,

352
00:19:23,600 --> 00:19:26,159
Speaker 1: thank you so much for being with us. Christina Hooper,

353
00:19:26,280 --> 00:19:29,920
Speaker 1: chief Global Strategist at Invesco, joining us here on DBA.

354
00:19:30,520 --> 00:19:33,119
Speaker 1: This is Bloomberg Day Break Asia, your morning brief on

355
00:19:33,160 --> 00:19:36,360
Speaker 1: the stories making news from Hong Kong to Singapore and

356
00:19:36,400 --> 00:19:37,000
Speaker 1: Wall Street.

357
00:19:37,400 --> 00:19:41,080
Speaker 4: Look for us on your podcast feed every day on Apples, Spotify,

358
00:19:41,119 --> 00:19:43,080
Speaker 4: and anywhere else you get your podcast.

359
00:19:43,600 --> 00:19:46,359
Speaker 1: You can also listen live each day on Bloomberg eleven

360
00:19:46,440 --> 00:19:48,879
Speaker 1: three to oh in New York, Bloomberg ninety nine to

361
00:19:48,880 --> 00:19:51,960
Speaker 1: one in Washington, Bloomberg one oh sixty one in Boston,

362
00:19:52,080 --> 00:19:54,560
Speaker 1: and Bloomberg nine sixty in San Francisco.

363
00:19:54,960 --> 00:19:57,640
Speaker 4: Our flagship New York station is available on your Amazon

364
00:19:57,720 --> 00:20:02,440
Speaker 4: Alexa devices. Just say Alexa play Bloomberg eleven thirty.

365
00:20:02,320 --> 00:20:05,040
Speaker 1: Plus listen coast to coast on the Bloomberg Business App,

366
00:20:05,320 --> 00:20:09,600
Speaker 1: Sirius XM Channel one nineteen, the iHeartRadio app, and on

367
00:20:09,640 --> 00:20:12,320
Speaker 1: Bloomberg dot Com. I'm Doug Chrisner and.

368
00:20:12,320 --> 00:20:15,000
Speaker 4: I'm rashand Salama. Join us again tomorrow for all the

369
00:20:15,040 --> 00:20:17,919
Speaker 4: news you need to start your day right here on

370
00:20:18,000 --> 00:20:21,480
Speaker 4: Bloomberg day Break Asia