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Speaker 1: This is Bloomberg Daybreak cure for this Thursday, the ninth

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Speaker 1: of March in London. Coming up today Powell's pirouette. The

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Speaker 1: Fed chief softens his tone on the size of a

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Speaker 1: March rate hike. The prudent approach. Bank of England policymaker

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Speaker 1: Spotty Dinger cautions against raising rates further. The helping hand

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Speaker 1: offered to arm a UK regulator suggested significant changes to

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Speaker 1: Liston's rules ey partners split on the split, a less

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Speaker 1: than mini cash injection and get back to the office

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Speaker 1: on Monday. Those are today's papers and I'm Leanne Gern's

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Speaker 1: plus the Wonder down under Rookie traders earn four hundred

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Speaker 1: thousand dollars in Sydney's Unlikely Markets Hub. That's all straight

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Speaker 1: ahead on Bloomberg Daybreak Europe. The business news you need

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Speaker 1: to start your day in just one fifteen minute podcast

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Speaker 1: on Apple, Spotify, the Bloomberg Business app and everywhere you

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Speaker 1: get your podcasts. Good morning, I'm Stephen Carroll and I'm

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Speaker 1: Caroline Hitker. Here all the stories that we're following today.

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Speaker 1: Federal Reserve Chief Jerome Powell has offered a softer approach

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Speaker 1: on future rate rises. This after his hawkish comments on

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Speaker 1: Tuesday sent markets into a frenzy. Speaking to US lawmakers

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Speaker 1: during a second day of congressional testimony, the central banker

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Speaker 1: made this concession. We have not made any decision about

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Speaker 1: the March meeting. We're not going to do that until

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Speaker 1: we see additional data. Larger point, though, is that we're

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Speaker 1: not on a preset path and that we will be

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Speaker 1: guided by the incoming data in the evolving outlook. No

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Speaker 1: decision has been made on this, but if the totality

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Speaker 1: of the data were to indicate that faster tightening is warranted,

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Speaker 1: we'd be prepared to increase the pace of rate hikes.

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Speaker 1: Poe's mildly dovish tilt signaling that officials will consider a

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Speaker 1: fifty basis point increase that they're marked meeting alongside at

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Speaker 1: twenty five basis point hike. Now, the Bank of England's

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Speaker 1: newest policymaker is warning against race see rates further. In

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Speaker 1: her first public speech, Spashi Dinger says that there are

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Speaker 1: fears of the economy being damaged. It isn't that surprising

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Speaker 1: that the energy and other imports have had broad based

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Speaker 1: impact on the cp On all CPI items, including services,

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Speaker 1: so domestically generated inflation, we're still talking about something which

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Speaker 1: is below three percentage points. We think, if anything, most

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Speaker 1: of what we've done, the balance of it is very

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Speaker 1: much skewed towards big giving you a bigger number for

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Speaker 1: domestically generated inflation because we want you to be conservative

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Speaker 1: about it. Dinger's davish comments come as Britain's monetary decision

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Speaker 1: makers differ on how to support the economy. The Bank

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Speaker 1: of England's December Great decision went three ways. We're staying

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Speaker 1: with the UK economy. Britain is set to avoid a

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Speaker 1: recession this year, but we'll see sluggish growth. That's the

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Speaker 1: forecast from one key business lobby group. Numbers You and

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Speaker 1: Parts has the details better than expected household spending and

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Speaker 1: corporate invest at the end of last year. I've seen

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Speaker 1: an upgrade to forecasts for UK growth this year. According

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Speaker 1: to the British Chambers of Commerce, the economy will still

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Speaker 1: shrink by nour point three percent this year, but that's

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Speaker 1: less bad than the one point three percent contraction it

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Speaker 1: forecasts just three months ago. Not exactly a stellar outlook,

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Speaker 1: but better than the Bank of England's latest forecast. Meanwhile,

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Speaker 1: Bloomberg has learned the chance that is weighing reforms to

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Speaker 1: pension tax rules in his budget next Wednesday in a

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Speaker 1: bid to cut the number of doctors quitting the NHS.

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Speaker 1: In London, I'm you and pots Been bod Daybreak Europe Now.

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Speaker 1: The Financial Conduct Authority offered significant changes to its listing

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Speaker 1: rules as part of an unsuccessful attempt to secure the

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Speaker 1: IPO of ARM. Speaking to lawmakers, the Watchdog CEO Nicol Ratti,

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Speaker 1: said that they had done what they could to secure

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Speaker 1: the chip designers share sale. In any individual decision, they'll

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Speaker 1: be many, many factors at play, and certainly in the

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Speaker 1: case of ARM, we were aware and the government indicated

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Speaker 1: to us that this was a company of national importance

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Speaker 1: and therefore we engaged to look at our rules where

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Speaker 1: there was a case for making modifications and where their

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Speaker 1: evidence was presented to us. Ratty, who was previously the

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Speaker 1: CEO of the London Stock Exchange, also rejected arguments that

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Speaker 1: listing's rules have played a major role in the capitol

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Speaker 1: struggles to secure more IPOs. JP Morgan is accusing Jeff

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Speaker 1: Dally of concealing an inappropriate relationship with Jeffrey Epstein and

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Speaker 1: vouching for the sex offender's character to keep him as

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Speaker 1: a client. The bank filed a third party complaint against

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Speaker 1: its former CEO and a federal court in Manhattan. In

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Speaker 1: a sudden turn against its former private banking chief, JP

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Speaker 1: Morgan is trying to recoup eight years of back pay

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Speaker 1: from Staley, a figure of more than eighty million dollars.

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Speaker 1: Staley has consistently denied knowledge of Epstein's abuse, and City

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Speaker 1: Group's chief financial officer Mark Mason is warning that the

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Speaker 1: Wall Street Chants trading revenue will probably drop compared with

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Speaker 1: a year ago now from Bloomberg's Charlie Pealett. That was

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Speaker 1: when Russia's invasion of Ukraine royal markets and spurred client

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Speaker 1: activity across the globe, Mason told investors at a New

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Speaker 1: York conference, markets revenue is likely to fall my eight

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Speaker 1: percentage and the high single digits, in line with current

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Speaker 1: analysts expectations for the business. The bank's hall last year

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Speaker 1: was helped by a one hundred seventy three percent increase

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Speaker 1: in commodities trading revenue. Mason says the firm still expects

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Speaker 1: revenue for the year to climb as high as seventy

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Speaker 1: nine billion dollars in New York, Charlie Palett, Bloomberg Daybreak Europe.

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Speaker 1: So those are our top stories this morning, and one

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Speaker 1: story you caught my eye. If you're questioning your life

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Speaker 1: choices on this cold, cold and miserable winter's morning in London,

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Speaker 1: perhaps you might be interested to know that graduate traders

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Speaker 1: in Sydney are earning as much as four hundred thousand

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Speaker 1: dollars down Under straight out of school. This is part

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Speaker 1: of the story that our Patrick Winters is reporting this

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Speaker 1: morning about how firms in Sydney are willing to pay well.

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Speaker 1: There are a few catches to it, though you do

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Speaker 1: have to obviously have a maths and science background. According

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Speaker 1: to people familiar that we've spoken to, yeah, Sydney has

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Speaker 1: become this, I mean, perhaps an unlikely Asia Pacific hub,

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Speaker 1: but yeah, it's apparently now a really quite big, tech

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Speaker 1: driven trading hub in Asia, which I do think is interesting.

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Speaker 1: Also I spotted, though a bit closer to home, the

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Speaker 1: house price survey, the latest of which from Rix. I

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Speaker 1: think it is quite interesting that despite the kind of

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Speaker 1: interest rate challenges that we were just hearing about in

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Speaker 1: terms of the back of England, there are flickers of

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Speaker 1: life in the UK housing market, at least according to

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Speaker 1: the latest survey of surveyors in Britain. Yeah. Interesting to

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Speaker 1: see that perhaps the housing market holding up better than

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Speaker 1: had been expected, although the house prices declining on the

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Speaker 1: latest survey from RIX. The sign of the fact those

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Speaker 1: hi and mortgage casts, you know, I don't seem to

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Speaker 1: be impinging on few the future picture anyway, at least

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Speaker 1: looking at these latest numbers. So near term expectations expected

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Speaker 1: the piece of Jude, but things looking like that we

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Speaker 1: might see the decline and buyer enquiries moderating. That's what

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Speaker 1: Tyrett Parsons from Exit saying anyway, So an interesting one

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Speaker 1: to watch. Yeah, absolutely right. Launted dig into the commentary

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Speaker 1: that we had this morning, hawkish comments from the Bank

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Speaker 1: of England policy Catherine Mann those came earlier this week

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Speaker 1: had been followed now by these more darvish comments from

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Speaker 1: Swatty Dinger, who has warned against further interest rate rises,

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Speaker 1: saying that they could actually damage a week UK economy.

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Speaker 1: This comes as we get more hints as to what

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Speaker 1: the Chancellor is expected to announce in next week's budget.

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Speaker 1: Our UK correspondent Lizzie Burdon of course is here with us, Lizzie,

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Speaker 1: what was your key takeaway Because these comments, of course

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Speaker 1: were at a panel event and the Resolution Foundation yesterday

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Speaker 1: you were there in person, so you heard from Swaty Dingra.

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Speaker 1: What did you take away from that panel? Well, you know,

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Speaker 1: Swatty Dingra's already voted to keep interest rates on hold

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Speaker 1: twice and she said that she'd do it again because

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Speaker 1: overtightening risks denting the economy. Now we're going to get

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Speaker 1: more data on GDP tomorrow, but the latest survey from

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Speaker 1: the British Chambers of Commerce, as you and told you there,

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Speaker 1: suggests that the UK is going to sputter along below

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Speaker 1: pre pandemics until late next year, and even though inflations

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Speaker 1: in double digits. Dingra's point was that the Hawks are

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Speaker 1: too focused on domestically driven inflation in other words, wage

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Speaker 1: and profit growth, when actually, because she's the trade expert

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Speaker 1: of the committee, she showed that actually much of our

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Speaker 1: inflation problem in the UK is still imported, and she

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Speaker 1: was emphasizing that because of the lag, the time lag

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Speaker 1: in monetary policy, the jumbo hikes the Bank's already done

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Speaker 1: are still filtering through. And actually that chimes with what

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Speaker 1: the committee's two former arch hawks have told us in

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Speaker 1: the past week here at Bloomberg. So Michael Saunders told

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Speaker 1: us on the UK Politics podcast Caroline that it's time

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Speaker 1: to ease to twenty five basis points, and even Andy

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Speaker 1: Haldane told our colleague Tom Reese that the bank needs

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Speaker 1: to quote tread cautiously ahead. So there is a dovish

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Speaker 1: wind in the air even among the hawks. Okay, we

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Speaker 1: are two weeks away from the next Bank of England decision.

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Speaker 1: How do we square this dovish wind, as you put it, Lizzie,

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Speaker 1: out of the Bank of England with the hawkishness we're

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Speaker 1: getting out of other central banks like the fan in

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Speaker 1: the UCP. It's a good point because off the back

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Speaker 1: of the other central banks hawkishness, at one point yesterday

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Speaker 1: traders were fully pricing a five percent peak in the

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Speaker 1: UK from the Bank of England for November. So it's strange,

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Speaker 1: isn't it. And this is something I did discuss with

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Speaker 1: swatty ingra. You could look at it as it is,

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Speaker 1: you could look at it as the UK has the

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Speaker 1: worst of both worlds. You've got the tight labor market

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Speaker 1: of the US and the energy price spike of Europe,

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Speaker 1: and then you could conclude therefore, if we're in the

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Speaker 1: middle of this bend diagram, we should be doubly hawkish.

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Speaker 1: But her argument was that there are huge differences even

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Speaker 1: between say Germany and France, and the US is far

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Speaker 1: more consumer driven than the UK, and she says she's

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Speaker 1: not so concerned about a further potential drop in sterling

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Speaker 1: against the dollar, which contrasts to Catherine Man, the hawk

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Speaker 1: of the committee, who, as you say, we had on

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Speaker 1: Bloomberg TV this week because Dingras showed that most of

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Speaker 1: our imports aren't actually priced in dollars. And so this

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Speaker 1: is the way you can have a three way split

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Speaker 1: on the committee when economists are looking at the same data,

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Speaker 1: sitting next to each other, and yet reaching such different conclusions. Yeah,

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Speaker 1: that is very interesting, isn't it. Okay, So how does

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Speaker 1: the kind of how does this square with the government.

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Speaker 1: I suppose we've got the big spring budget of course

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Speaker 1: next week from Jeremy Hunt. What do we think might

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Speaker 1: be in it? Well, it's kite flying season, Carolina. I

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Speaker 1: wouldn't believe everything you read in the papers. It's the

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Speaker 1: season for the government to tell the newspapers things that

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Speaker 1: might happen, gauge the reaction, and then tone up or

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Speaker 1: tone down the policies for the actual budget. So the

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Speaker 1: Final Antial Times reports that the government's drawing up plans

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Speaker 1: to loosen immigration rules to try to plug some of

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Speaker 1: the holes in the labor force that we've been talking

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Speaker 1: about for months, especially in the construction industry. I have

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Speaker 1: to say, speaking to people who are close to the

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Speaker 1: Chancellor's thinking, it's going to be very difficult to get

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Speaker 1: a policy like that past the Home Secretary Seller Brahman,

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Speaker 1: whose wing of the party. Of course, the Prime Minister

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Speaker 1: needs to tread carefully around, given the winds of frameworks

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Speaker 1: still in the pre vote stage. But I do understand

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Speaker 1: that there's going to be a focus in the budget

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Speaker 1: on the labor market, in activity in the labor market,

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Speaker 1: including tweaking the benefit and pension systems to try to

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Speaker 1: nudge people back into work. And Bloomberg's of course already

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Speaker 1: reported that there's going to be extra defense spending three

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Speaker 1: hundred and sixty million pounds to make Britain as science superpower,

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Speaker 1: but no planned corporation tax cancelation of the planned corporation

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Speaker 1: tax rise. Meanwhile, labor today is expected to pledge to

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Speaker 1: set up a modern childcare system, something we've been talking

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Speaker 1: about in the UK Politics cast, and this of course

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Speaker 1: is an issue that's climbed up the agenda, so labors

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Speaker 1: spotted an opportunity. We're expecting to hear from the Shadow

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Speaker 1: Education Secretary Bridget Phillipson today announcing more funding for childcare

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Speaker 1: between parental leave until children finish primary school. But when

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Speaker 1: I was at the Resolution Foundation yesterday, interestingly, there is

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Speaker 1: some skepticism among economists about the degree to which better

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Speaker 1: childcare provision will actually encourage more people into work, beyond

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Speaker 1: encouraging people working parents who are already working to work more. Okay,

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Speaker 1: Missie Burden, thank you very much for talking us through

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Speaker 1: all of those parts of that story. Up next, Ey

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Speaker 1: Partners split on the split, a less than many cash

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Speaker 1: injection and get back to the office. On Mondays Now,

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Speaker 1: the Paper review on Blue Birthday Break Europe, the news

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Speaker 1: you need to know from today's papers and Blue Bag.

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Speaker 1: Leanne Games is back with us this morning. Leanne, You've

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Speaker 1: got the Times a headline EY split plan on the

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Speaker 1: brink of collapse. We've been following this story, Yes we have, indeed,

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Speaker 1: Caroline and good morning to you. Yes, so, global accounting

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Speaker 1: and consultancy giant Erneston Young's plan to split its order

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Speaker 1: and consulting business is now said to breathe on the

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Speaker 1: brink of collapse. According to The Times, senior partners did

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Speaker 1: meet for this big crisis meeting which happened over in

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Speaker 1: New York last night. This plan has been dubbed Project

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Speaker 1: Everest probably give you a hint at how big it is,

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Speaker 1: and it's now said to be on pause while issues

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Speaker 1: between different factions are resolved. Now reporting from Bloomberg says

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Speaker 1: that the breakup is being reshaped but it's still on track,

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Speaker 1: so in line with really what the Times is saying.

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Speaker 1: The complex deal spans independent affiliates in seventy five countries,

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Speaker 1: so it's absolutely massive and will require the firm to

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Speaker 1: split up its buildings and technology as well as its clients. Now.

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Speaker 1: This is also at the top of the ft stories

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Speaker 1: today and it says e Y pausing its plan to

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Speaker 1: split in two. And this is amid fierce partner in

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Speaker 1: fighting over the fate of its tax experts. Yeah, well,

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Speaker 1: of course we had Anti Baldwin, who's the global managing

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Speaker 1: partner at EY on only a few weeks ago end

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Speaker 1: of FERB he said the breakup was inevitable, and I

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Speaker 1: had thought it was also really interesting that he told

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Speaker 1: us that China was not one of the countries where

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Speaker 1: this split would happen, But he said that the breakup

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Speaker 1: was inevitable because there's so much regulatory pressure on the

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Speaker 1: Big Four. So I can understand that there's a spat,

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Speaker 1: but I can't imagine the deal is not going to happen.

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Speaker 1: But anyway, that's pure speculation, So we'll have to see

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Speaker 1: where it goes nextly, and let's go to the Telegraph next.

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Speaker 1: BMW announcing a five hundred million pound upgrade for Mini

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Speaker 1: planned amid race for electric cars. Yes, indeed, so BMW

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Speaker 1: is preparing to invest hundreds of million pounds to continue

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Speaker 1: producing the Mini near Oxford. Now this is triggering speculation

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Speaker 1: and that BMW now plans to restart electric production here

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Speaker 1: in the UK. This comes after the collapse of British Volt,

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Speaker 1: which was only planned independent battery maker in the UK.

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Speaker 1: The electric future the British carmaker has now been thrown

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Speaker 1: into doubt. Yesterday Sky News broke the story and said

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Speaker 1: to understand some seventy five million pounds will come from

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Speaker 1: this big government grant to get electric production up and

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Speaker 1: running in the country. We know electrification is critical for

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Speaker 1: the UK. An overall vehicle production here has completely slumped. Aston,

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Speaker 1: Martin and Bentley can import batteries without customs penalties, but

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Speaker 1: Toyota and Mini, together with Nissan and Jaguar Landrover, which

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Speaker 1: make most of Britain's cars, have yet to unveil this

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Speaker 1: big local battery plant. And now Labor is promising to

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Speaker 1: invest thirty billion pounds in electric vehicle manufacturing. And if

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Speaker 1: that's if they are elected, still a year and a

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Speaker 1: half away though, however, from a general election as it

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Speaker 1: stands at the moment. Yeah, I do think it's interesting

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Speaker 1: Labors getting in there when they see an opportunity to

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Speaker 1: throw in a kind of policy idea, and electrification is

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Speaker 1: a big one. After British vault, the Ft just lastly

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Speaker 1: headlining Lloyds of London chief wants traders in the building

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Speaker 1: get back in on a Monday. I love this. Speaking

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Speaker 1: to the Ft, John Neil, the CEO, said Tuesday's, Wednesdays

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Speaker 1: and Thursdays are busy, but we need to get Monday back.

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Speaker 1: His plan is to get brokers and underwriters on the

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Speaker 1: trading floor four days a week back in to ensure

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Speaker 1: face to face trading continues to thrive here in London.

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Speaker 1: And that's all post the COVID era that we went through,

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Speaker 1: and the Lloyds of London really acknowledge the debate has

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Speaker 1: gone on and on about hybrid working and working from home,

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Speaker 1: but he really wants face to face trading to remain

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Speaker 1: in part of a massive mix when it comes to

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Speaker 1: the company. This is Bloomberg Daybreak Europe. You're morning brief

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Speaker 1: on the stories making news from London to Wall Street

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Speaker 1: morning on Apples, Spotify and anywhere else you get your podcasts.

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Speaker 1: You can also listen live each morning on London Dab Radio,

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Speaker 1: New York station is also available on your Amazon Alexa devices.

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Speaker 1: Just say Alexa play Bloomberg eleven thirty. I'm Caroline Hipka

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Speaker 1: and I'm Stephen Carroll. Join us again tomorrow morning for

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Speaker 1: all the news you need to start your day right

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Speaker 1: here on Bloomberg Daybreak Europe.