WEBVTT - What's Driving Volatility in Chinese Tech Stocks?

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<v Speaker 1>Bloomberg Audio Studios, Podcasts, radio News.

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<v Speaker 2>Welcome to the Daybreak Asia podcast. I'm Doug Krisner. There

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<v Speaker 2>has been no shortage of volatility recently for Chinese tech shares.

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<v Speaker 2>In the last session, as an example, the Hangsang Tech

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<v Speaker 2>Index was down three point eight percent, and that's after

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<v Speaker 2>climbing one point seven percent in the Monday session. And

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<v Speaker 2>that gain came after losses last Thursday and Friday, when

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<v Speaker 2>the Tech index was down three point four percent each day. Now,

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<v Speaker 2>to be fair, despite the recent turbulence, the Hangsang Tech

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<v Speaker 2>Index is still up more than twenty three percent so

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<v Speaker 2>far this year. That said, there are some analysts saying

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<v Speaker 2>any further selloff could undermine the narrative that Chinese markets

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<v Speaker 2>have become an alternative investment ground. Let's take a closer

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<v Speaker 2>look now with Bloomberg opinion columnist Shuley Ren Shuley, does

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<v Speaker 2>this really come down in terms of the enthusiasm for

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<v Speaker 2>Chinese tech? Is it all about the deep seek moment?

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<v Speaker 3>I think so. I mean, like, it's true that the

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<v Speaker 3>hands and tacking decks has corrected quite a bit, but

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<v Speaker 3>I think a lot of it is just a portfolio

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<v Speaker 3>flows right. There is a little bit of a zero

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<v Speaker 3>sum game between the US star market and Chinese and

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<v Speaker 3>European stock markets. As the US market seems to have

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<v Speaker 3>a bottom out for the short term, like a lot

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<v Speaker 3>of hot money will be pulling out of the hands

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<v Speaker 3>and tacking decks because they have made quite a bit

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<v Speaker 3>of money and it's good to take profit, and then

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<v Speaker 3>they will perhaps go back to the US star market.

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<v Speaker 2>On Monday, ten Cent unveiled and upgraded AI reasoning model,

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<v Speaker 2>and this only adds to the enthusiasm for AI related

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<v Speaker 2>companies in China and what they're doing. Is this going

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<v Speaker 2>to continue for a while longer or is there a

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<v Speaker 2>concern that is developing that maybe things have come too

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<v Speaker 2>far too fast.

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<v Speaker 3>I think it's both. Like people think that AI theme

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<v Speaker 3>in China is not just like a three month thing,

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<v Speaker 3>right It has been only just not not even three

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<v Speaker 3>months in China. It will continue on, but the rally

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<v Speaker 3>has been quite fast, so you will see some people

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<v Speaker 3>taking profit. But one thing I would like to point

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<v Speaker 3>out is that what you're seeing is every week we

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<v Speaker 3>see like Chinese companies big and small coming out with

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<v Speaker 3>the new AI models, large language and applications. And also

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<v Speaker 3>there are like you know, hardware companies like BYD and

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<v Speaker 3>they Shellby. They're also coming out with like new car

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<v Speaker 3>models and technologies that while the investors. So I think

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<v Speaker 3>as long as there is a continuous pace of a

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<v Speaker 3>product innovation, people will still be interested.

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<v Speaker 2>Jotsai, the chairman of Ali Baba, was saying yesterday, I

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<v Speaker 2>believe that he's starting to see the beginning of a

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<v Speaker 2>bubble in the buildout of AI data centers in China.

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<v Speaker 2>That's got to be a concern, I would imagine, and

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<v Speaker 2>maybe that contributed to some of the weakness that we

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<v Speaker 2>had in the equity market yesterday.

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<v Speaker 3>Yes, it's possible, but I will argue that I mean

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<v Speaker 3>the US there could be some the start of a

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<v Speaker 3>bubble in data centers as well, right Like I mean,

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<v Speaker 3>at this point globally, we know AI is a technological

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<v Speaker 3>leap and it's quite amazing, but how to make money

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<v Speaker 3>off of and how to really mass market to consumers

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<v Speaker 3>and get them to spend on AI products, it's still

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<v Speaker 3>a question globally.

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<v Speaker 2>So if we can use AI as a metaphor for

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<v Speaker 2>some of the gains that we have seen in automation,

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<v Speaker 2>in mechanized handling of certain processes, and in robotics as well.

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<v Speaker 2>Is there a risk for the overall economy in China,

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<v Speaker 2>particularly if you start to consider Chinese workers, Yes.

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<v Speaker 3>There is. There's no question that the AI and the

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<v Speaker 3>robotics they're talking about human like robots right will be

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<v Speaker 3>taking away a lot of jobs, especially in the manufacturing sector.

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<v Speaker 3>We have already seen that, like China is no doubt

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<v Speaker 3>the world's biggest factory, but even the manufacturing sector, the

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<v Speaker 3>number of employees has been shrinking because automation is already happening.

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<v Speaker 3>So there is this concern. But what the government is

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<v Speaker 3>trying to do is to say, Okay, China's services sector

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<v Speaker 3>is still underdeveloped. What China is doing is that it's

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<v Speaker 3>producing too many goods but not enough services, and it's

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<v Speaker 3>trying to push people to become small business owners. For instance,

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<v Speaker 3>they can open little restaurants, little like I don't know,

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<v Speaker 3>pat shops and then perhaps become like uber drivers, you know,

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<v Speaker 3>or like they can take franchises and the open little

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<v Speaker 3>milk shops, et cetera. Like they're trying to push these

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<v Speaker 3>people into the services sector.

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<v Speaker 2>Does the government need to reconsider how it's educating the

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<v Speaker 2>younger generations?

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<v Speaker 3>I think so, because what we are seeing the last

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<v Speaker 3>few years, and I think it's a glob trend, is

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<v Speaker 3>that the young people going into universities and they're taking

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<v Speaker 3>out certain majors. By the time they graduate, their majors

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<v Speaker 3>are no longer hot. Like in twenty twenty, like a

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<v Speaker 3>lot of people did the management and the finance, and

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<v Speaker 3>then when they graduated they realized, oh, you know, it's

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<v Speaker 3>actually engineering these days that are hot. So the government

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<v Speaker 3>does need to, you know, give people a sense of

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<v Speaker 3>the long term plan of the economy rather than you know,

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<v Speaker 3>abruptly changing policies.

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<v Speaker 2>I'm curious to get your take because we've been talking

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<v Speaker 2>so much about tariffs here in the States and the

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<v Speaker 2>trade tension between Washington and Beijing. What is your sense

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<v Speaker 2>of where we are going and how this is going

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<v Speaker 2>to impact the economy in China.

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<v Speaker 3>I think the sentiment is not good, but the Chinese like.

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<v Speaker 3>The sense that I got is that the Chinese have

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<v Speaker 3>pretty much given up and they have decided that the

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<v Speaker 3>tariffs are coming and it is what it is. And

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<v Speaker 3>of course it affects certain sectors of the economy. For instance,

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<v Speaker 3>like the biggest Chinese exports into US smartphones, Apple, etcetera. Right,

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<v Speaker 3>but the second biggest would be apparels and houseware, and

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<v Speaker 3>that does affect the very small businesses in the East

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<v Speaker 3>and the south coast of China, and there's just nothing

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<v Speaker 3>the government can do about this.

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<v Speaker 2>Surely, you and I have talked in the past about

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<v Speaker 2>the impact of the export controls that were put in

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<v Speaker 2>place under the Biden administration, particularly as semiconductors were concerned.

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<v Speaker 2>You could make the argument that the deep Seek moment

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<v Speaker 2>was tied to the controls on semiconductor technology insofar as

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<v Speaker 2>China being forced to innovate its way around them. And

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<v Speaker 2>I'm wondering what your senses on that trajectory. Are we

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<v Speaker 2>going to see continued advancement and innovation in China.

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<v Speaker 3>I think what China is doing is it's looking inward.

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<v Speaker 3>Like we have seen news reports that China is considering

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<v Speaker 3>even like installing its own export controls so that Chinese

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<v Speaker 3>companies are not flooding cheap goods into the rest of

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<v Speaker 3>the world, because the government does recognize that it's a

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<v Speaker 3>bit of a shock to the rest of the globe. Right, So,

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<v Speaker 3>like what we are hearing recently is that the goods

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<v Speaker 3>that are meant to be exported, they're trying to get

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<v Speaker 3>them consumed at home, and that's why we see a

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<v Speaker 3>lot of that. That's in part why we see a

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<v Speaker 3>lot of the so called training programs. If you have

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<v Speaker 3>a car that's like three year old, you can trade

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<v Speaker 3>in and then get some subsidy and get a brand

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<v Speaker 3>new car. They're trying to basically consume the access capacity

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<v Speaker 3>and the goods at home.

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<v Speaker 2>Are you seeing signs that domestic demand is improving?

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<v Speaker 3>I think so, like the last couple of months, especially

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<v Speaker 3>since the beginning of Deep. I mean when we entered

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<v Speaker 3>twenty twenty five, everybody was pretty pessimistic, right, and suddenly

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<v Speaker 3>Deep seek about and that the government is now talking

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<v Speaker 3>the right things. They're not necessarily doing that much like

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<v Speaker 3>if you look at the fiscal stimulus, it's bigger, but

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<v Speaker 3>it's not that big, right, But they are saying the

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<v Speaker 3>right things and people feel a little bit well, a

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<v Speaker 3>lot of it is just sentiment. People feel a little

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<v Speaker 3>bitter safer in this economic environment, and that you do

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<v Speaker 3>see the sentiment improving.

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<v Speaker 2>We'll leave it there. Surely it's always a pleasure. Thank

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<v Speaker 2>you so much. Bloomberg Opinion columnist Shuly Wren joining from

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<v Speaker 2>Hong Kong here on the Daybreak Asia podcast. Welcome back

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<v Speaker 2>to the Daybreak Asia Podcast. I'm dek Krisner. So we

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<v Speaker 2>had a bit of churn in the US equity market

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<v Speaker 2>through most of the session on Tuesday, a little bit

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<v Speaker 2>of assessment of risk associated with the trade war. I

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<v Speaker 2>think that's a fair way of describing it. Chief among

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<v Speaker 2>those risk stagflation and with it the rising odds of recession.

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<v Speaker 2>Now for a look at the price action as Bill Campbell,

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<v Speaker 2>he is Global bond portfolio manager at Double Line. Bill

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<v Speaker 2>joining from Los Angeles. Thanks for making time to chat

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<v Speaker 2>with us. How do you evaluate the economy right now?

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<v Speaker 2>Bill vis a vi the threat of a lot more

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<v Speaker 2>tariffs on the way.

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<v Speaker 1>Well, thanks for having me, Doug. The way we're looking

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<v Speaker 1>at things in the near term is until we remove

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<v Speaker 1>this cloud of uncertainty, markets and the economic outlook is

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<v Speaker 1>it's going to be challenged at best. I think the

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<v Speaker 1>place where we invest in our most active across the

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<v Speaker 1>bond markets. They're telling you that there is a lot

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<v Speaker 1>of concern not only with the upcoming April second date,

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<v Speaker 1>but what we haven't had clarity on and what there

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<v Speaker 1>still is a lot of confusion about, is April second

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<v Speaker 1>going to be the final date where we get a

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<v Speaker 1>framework for what the tariffs in the tariff package and

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<v Speaker 1>the goals will look like, or do we have this

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<v Speaker 1>risk of continued layering that potentially sectoral tariffs targeting the

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<v Speaker 1>auto sector, pharmaceuticals and other industries may then follow a

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<v Speaker 1>reciprocal tariff package. And until we get those answers, the

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<v Speaker 1>uncertainty is likely to keep risk assets at least it's

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<v Speaker 1>going to be a headwind to risk assets moving higher.

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<v Speaker 1>And you know, from our outlook, what we're trying to

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<v Speaker 1>do is get a little bit more defensive. But we're

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<v Speaker 1>finding some more interesting plays in the bond market and

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<v Speaker 1>also in markets in the US treasury market, specifically the

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<v Speaker 1>frunt end of the US Treasury curve, and interestingly enough,

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<v Speaker 1>a couple of international plays, with some focus on Europe.

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<v Speaker 2>Do you see the risk of stagflation as being significant

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<v Speaker 2>right now.

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<v Speaker 1>Well, that depends on what you mean by stagflation if

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<v Speaker 1>you are talking, you know, about a recession. I think

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<v Speaker 1>we're still uh, you know, looking at the odds of recession,

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<v Speaker 1>still about a third, but those probabilities have come up

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<v Speaker 1>over the past month, you know, maybe almost doubled from

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<v Speaker 1>where you know, our initial expectations were when the Trump

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<v Speaker 1>administration initially came into office. So I think that the

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<v Speaker 1>the questions that we need to answer to, you know,

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<v Speaker 1>get you know, the question that we need to answer

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<v Speaker 1>about stagflation really are how long are tariff's going to

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<v Speaker 1>be in place, how high are the tariff rates going

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<v Speaker 1>to be? And is there a risk that as I

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<v Speaker 1>mentioned before, there's going to be layering now that if

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<v Speaker 1>we don't have layering and we turn out to have

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<v Speaker 1>a one and done type tariff package on April seconds.

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<v Speaker 1>I think the scenario that Jay Powell articulated in the

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<v Speaker 1>you know, in its press conference, you know, at the

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<v Speaker 1>last fo MC meeting, you know, that that is plausible.

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<v Speaker 1>They you know, the Fed seas inflation on a core

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<v Speaker 1>on for the PCE core to you know, remain pretty sticky,

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<v Speaker 1>tick up to two point eight percent before ticking down

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<v Speaker 1>to two percent, So inflation would be a one year

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<v Speaker 1>issue before prices start to normalize. But the risk to

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<v Speaker 1>that outlook is the layering risk and the more that

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<v Speaker 1>we have additional tariffs placed on for any reason, whether

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<v Speaker 1>it's trying to bring manufacturing back to the US or

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<v Speaker 1>like we saw today with the Venezuela tariffs, trying to

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<v Speaker 1>achieve geopolitical outcomes using tariffs. All of that weighs on

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<v Speaker 1>the economic outlook, both for persistently higher inflation and you know,

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<v Speaker 1>downside risks to growth. And we again with that outlook,

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<v Speaker 1>I think right now our positioning, one of the things

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<v Speaker 1>we're trying to do is, you know, take more of

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<v Speaker 1>a barbelled position, where we're layering a little bit more

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<v Speaker 1>into the front end of the treasury curve, where we

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<v Speaker 1>think that you know, with j. Powell's current rhetoric, he's

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<v Speaker 1>kind of capped how much yields on the front end

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<v Speaker 1>of the treasury curve could back up, given the fact

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<v Speaker 1>that he's willing to look through the potential for higher

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<v Speaker 1>inflation rates in the near term. But if there is

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<v Speaker 1>a growth accident, if too many tariffs do cause a

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<v Speaker 1>growth accident, we think that then there's plenty of room

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<v Speaker 1>for those treasury bonds to rally, creating a decent convexity profile.

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<v Speaker 2>So I'm curious as to how you wait consumer confidence

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<v Speaker 2>in everything that we're describing right now or everything that

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<v Speaker 2>you've kind of laid out. Today the Conference Board published

0:13:47.559 --> 0:13:51.360
<v Speaker 2>its index. We saw a fourth straight monthly decline. It

0:13:51.480 --> 0:13:54.520
<v Speaker 2>kind of mirrors echoes perhaps what we had recently from

0:13:54.559 --> 0:13:58.679
<v Speaker 2>the University of Michigan, those data indicating that consumer sentiment

0:13:58.720 --> 0:14:01.800
<v Speaker 2>fell to something that was greater than a two year low.

0:14:01.880 --> 0:14:05.679
<v Speaker 2>I believe is there in your work a strong correlation

0:14:05.840 --> 0:14:10.120
<v Speaker 2>between how consumers are feeling that sentiment reading and how

0:14:10.160 --> 0:14:11.600
<v Speaker 2>they go about their spending.

0:14:12.360 --> 0:14:15.800
<v Speaker 1>Well, yes, when we're looking at the you know, the

0:14:15.800 --> 0:14:19.840
<v Speaker 1>the confidence numbers, both from the University of Michigan and

0:14:20.040 --> 0:14:24.000
<v Speaker 1>also the Conference Board today, they're showing clearly that you know,

0:14:24.080 --> 0:14:27.080
<v Speaker 1>the consumer in the US, uh, you know, is becoming

0:14:27.120 --> 0:14:28.600
<v Speaker 1>more cautious at the margin.

0:14:29.200 --> 0:14:29.320
<v Speaker 4>Uh.

0:14:29.520 --> 0:14:32.640
<v Speaker 1>You know, we also are watching credit card delinquencies and

0:14:33.000 --> 0:14:34.920
<v Speaker 1>you know, at the lower end of the income bracket,

0:14:34.920 --> 0:14:37.200
<v Speaker 1>we're starting to see some you know, there have been

0:14:37.240 --> 0:14:41.360
<v Speaker 1>stresses you know on the consumer there as well. Not

0:14:41.520 --> 0:14:45.600
<v Speaker 1>only is it you know, concerns that inflation will remain

0:14:45.720 --> 0:14:49.920
<v Speaker 1>higher and higher prices you know, are denting consumer confidence.

0:14:50.440 --> 0:14:54.280
<v Speaker 1>But you know, with the with the tariff risk, what

0:14:54.320 --> 0:14:57.680
<v Speaker 1>we're seeing is the potential for more margin squeeze across

0:14:58.040 --> 0:15:02.800
<v Speaker 1>many sectors. And when margins get squeezed and companies need

0:15:02.840 --> 0:15:06.560
<v Speaker 1>to start managing the bottom line, that puts jobs at risk,

0:15:06.600 --> 0:15:11.480
<v Speaker 1>and that further can crimp both consumer spending and consumer confidence.

0:15:12.080 --> 0:15:16.200
<v Speaker 1>I think the Trump administration is clearly making the bet

0:15:16.480 --> 0:15:21.600
<v Speaker 1>that with all of the upcoming government layoffs, they're anticipating

0:15:21.640 --> 0:15:23.920
<v Speaker 1>that there's going to be a handoff of those jobs

0:15:23.920 --> 0:15:27.400
<v Speaker 1>from the government sector to the private sector. And this

0:15:27.560 --> 0:15:30.360
<v Speaker 1>is where one of the risks that we've been highlighting

0:15:30.400 --> 0:15:34.920
<v Speaker 1>about the Trump administration and all of the changes that

0:15:34.920 --> 0:15:37.040
<v Speaker 1>they're putting in place so quickly is there's a high

0:15:37.120 --> 0:15:40.280
<v Speaker 1>level of execution risk, and this is an example of

0:15:40.320 --> 0:15:45.400
<v Speaker 1>that that they're hoping that the private sector is going

0:15:45.400 --> 0:15:48.480
<v Speaker 1>to be able to take a lot of the government

0:15:48.560 --> 0:15:50.880
<v Speaker 1>jobs that are going to be shed over the coming quarters.

0:15:51.400 --> 0:15:59.400
<v Speaker 1>But with increased prices, potentially tighter margins, and the subdued

0:15:59.480 --> 0:16:03.640
<v Speaker 1>outlook for near term growth, as was highlighted, you know,

0:16:03.800 --> 0:16:08.720
<v Speaker 1>most notably by the Fed marking down twenty five growth expectations,

0:16:09.320 --> 0:16:11.960
<v Speaker 1>there's an execution risk that the private sector may not

0:16:12.080 --> 0:16:13.480
<v Speaker 1>be able to handle that.

0:16:13.920 --> 0:16:16.640
<v Speaker 2>So tonight in the States, we are learning that GOP

0:16:16.800 --> 0:16:19.920
<v Speaker 2>congressional leaders are close to agreeing on a plan to

0:16:20.040 --> 0:16:24.240
<v Speaker 2>pass an extension of those twenty seventeen tax cuts, and

0:16:24.360 --> 0:16:27.160
<v Speaker 2>this plan we were told would also increase the debt ceiling.

0:16:27.640 --> 0:16:30.720
<v Speaker 2>What are the fiscal ramifications of this and how do

0:16:30.760 --> 0:16:33.120
<v Speaker 2>you think the market will treat it well?

0:16:34.400 --> 0:16:38.600
<v Speaker 1>So there's fiscal ramifications and there's also a liquidity ramification

0:16:38.720 --> 0:16:41.120
<v Speaker 1>that you know, I'd like to highlight.

0:16:40.800 --> 0:16:41.520
<v Speaker 4>At the end of this.

0:16:42.760 --> 0:16:45.360
<v Speaker 1>First of all, I think the extension of the tax

0:16:45.400 --> 0:16:51.080
<v Speaker 1>cuts is needed for you know, the current economic environment

0:16:51.280 --> 0:16:55.840
<v Speaker 1>of a cooling consumer or a more consumer that's growing

0:16:55.880 --> 0:16:59.800
<v Speaker 1>ever more stretched. Our concern and double line has been that,

0:17:00.520 --> 0:17:05.520
<v Speaker 1>you know, the outlook or our fiscal deficit currently standing

0:17:05.960 --> 0:17:12.080
<v Speaker 1>you know around seven percent deficit to GDP is really

0:17:12.200 --> 0:17:17.600
<v Speaker 1>on an unsustainable path. The more that we're unable to

0:17:18.280 --> 0:17:21.199
<v Speaker 1>correct the deficit in the near term, if we do

0:17:21.280 --> 0:17:25.159
<v Speaker 1>have a growth slowdown, all the automatic stabilizers such as

0:17:25.240 --> 0:17:28.560
<v Speaker 1>unemployment insurance are just going to automatically, uh, you know,

0:17:28.680 --> 0:17:32.439
<v Speaker 1>increase the demands on the government to basically print money

0:17:32.640 --> 0:17:35.919
<v Speaker 1>or sell treasury more treasury bonds into the market. Uh

0:17:36.040 --> 0:17:38.800
<v Speaker 1>need to pay for those expenditures. And what that's going

0:17:38.880 --> 0:17:41.960
<v Speaker 1>to do is put upward pressure on back end yields.

0:17:42.440 --> 0:17:45.720
<v Speaker 1>So what I had highlighted earlier that we like to

0:17:46.160 --> 0:17:49.520
<v Speaker 1>you know, right now we're uh, we're waiting more heavily

0:17:49.520 --> 0:17:51.960
<v Speaker 1>in our portfolios the front end of the treasury curve.

0:17:52.359 --> 0:17:55.000
<v Speaker 1>What we're doing that at the expense of is we're

0:17:55.080 --> 0:17:58.040
<v Speaker 1>underweighting the back end of the treasury curve, you know,

0:17:58.119 --> 0:18:04.000
<v Speaker 1>due to these increased fiscal risks. Now on the liquidity side,

0:18:04.359 --> 0:18:10.160
<v Speaker 1>when the debt ceiling gets extended, perversely, there is a

0:18:10.560 --> 0:18:15.360
<v Speaker 1>tightening of market liquidity in the background. So when we

0:18:15.840 --> 0:18:20.840
<v Speaker 1>started into the excessive deficit procedures, the Treasury started drawing

0:18:20.880 --> 0:18:23.080
<v Speaker 1>down their cash account that they keep at the FED

0:18:23.240 --> 0:18:27.040
<v Speaker 1>called the Treasury General Account, in order to pay for

0:18:27.440 --> 0:18:30.240
<v Speaker 1>all of their bills instead of issuing new debt. But

0:18:30.359 --> 0:18:33.400
<v Speaker 1>what that does is it puts money into the banking system.

0:18:34.040 --> 0:18:34.880
<v Speaker 4>When the debt.

0:18:34.680 --> 0:18:38.440
<v Speaker 1>Ceiling is passed, then the Treasury can issue new Treasury

0:18:38.480 --> 0:18:41.920
<v Speaker 1>bonds and they refill that bank account sitting at the FED,

0:18:42.280 --> 0:18:44.720
<v Speaker 1>the Treasury General Account. But what that does is it

0:18:44.760 --> 0:18:47.800
<v Speaker 1>pulls money out of the banking system, or liquidity out

0:18:47.800 --> 0:18:51.360
<v Speaker 1>of the banking system. So if this bill does pass,

0:18:52.240 --> 0:18:55.560
<v Speaker 1>what initially may look like a good headline, you could

0:18:55.640 --> 0:18:59.080
<v Speaker 1>have some tightening effects in the market and be another

0:18:59.119 --> 0:19:02.199
<v Speaker 1>headwind for overall all risk assets and it's something that

0:19:02.240 --> 0:19:06.520
<v Speaker 1>we should keep it close eye on in the coming months.

0:19:06.640 --> 0:19:08.760
<v Speaker 2>Bill. Before I let you go, you were talking there

0:19:08.800 --> 0:19:12.479
<v Speaker 2>about the FED today. Governor Adriana Kougeler was offering some

0:19:12.800 --> 0:19:16.000
<v Speaker 2>support for this idea that the FED would keep rate

0:19:16.040 --> 0:19:20.040
<v Speaker 2>steady for some time given rising inflation expectations and this

0:19:20.440 --> 0:19:24.119
<v Speaker 2>uptick that we have seen in goods inflation. Very quickly,

0:19:24.200 --> 0:19:26.400
<v Speaker 2>give me your outlook for FED rate cuts this year.

0:19:26.440 --> 0:19:27.960
<v Speaker 2>How many are you forecasting?

0:19:28.520 --> 0:19:31.879
<v Speaker 4>Well, that's a great question. I think for now.

0:19:33.160 --> 0:19:36.440
<v Speaker 1>One to two potentially this year, because we think that

0:19:36.520 --> 0:19:39.680
<v Speaker 1>there is the potential that growth could slow a little

0:19:39.680 --> 0:19:41.960
<v Speaker 1>bit more than maybe other.

0:19:41.800 --> 0:19:45.040
<v Speaker 4>Market participants are expecting, but that.

0:19:45.000 --> 0:19:47.359
<v Speaker 1>Would come at the end of the year, because we

0:19:47.440 --> 0:19:51.399
<v Speaker 1>do think that near term April second will cause a

0:19:51.480 --> 0:19:53.000
<v Speaker 1>temporary spike in inflation.

0:19:53.600 --> 0:19:56.320
<v Speaker 4>But we have to see, as you pointed.

0:19:56.040 --> 0:20:00.600
<v Speaker 1>Out, what is that growth and inflation profile after we

0:20:00.720 --> 0:20:04.960
<v Speaker 1>get through whatever these Trump tariff policies will be both

0:20:05.040 --> 0:20:08.359
<v Speaker 1>the April twid and the potential for sectoral tariffs and

0:20:08.400 --> 0:20:09.879
<v Speaker 1>additional tariffs afterwards.

0:20:10.040 --> 0:20:11.920
<v Speaker 2>Bill will leave it there, Thank you so much. A

0:20:12.000 --> 0:20:15.359
<v Speaker 2>great conversation with Bill Campbell. He is Global bond portfolio

0:20:15.400 --> 0:20:18.720
<v Speaker 2>manager at Double Line joining us from Los Angeles here

0:20:18.760 --> 0:20:24.640
<v Speaker 2>on the Daybreak Asia Podcast. Thanks for listening to today's

0:20:24.640 --> 0:20:29.120
<v Speaker 2>episode of the Bloomberg Daybreak Asia Edition podcast. Each weekday,

0:20:29.160 --> 0:20:33.120
<v Speaker 2>we look at the story shaping markets, finance, and geopolitics

0:20:33.119 --> 0:20:36.400
<v Speaker 2>in the Asia Pacific. You can find us on Apple, Spotify,

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<v Speaker 2>Join us again tomorrow for insight on the market moves

0:20:43.400 --> 0:20:47.960
<v Speaker 2>from Hong Kong to Singapore and Australia. I'm Doug Chrisner,

0:20:48.119 --> 0:20:49.480
<v Speaker 2>and this is Bloomberg