1 00:00:02,480 --> 00:00:06,840 Speaker 1: Bloomberg Audio Studios, Podcasts, radio News. 2 00:00:09,680 --> 00:00:12,119 Speaker 2: This is Bloomberg day Break Weekend, our global look at 3 00:00:12,160 --> 00:00:14,360 Speaker 2: the top stories in the coming week from our Daybreak 4 00:00:14,360 --> 00:00:16,920 Speaker 2: anchors all around the world, and straight ahead on the program, 5 00:00:16,960 --> 00:00:19,599 Speaker 2: earning season rolls on. We'll take a look ahead to 6 00:00:19,640 --> 00:00:21,799 Speaker 2: results from the chip maker at the center of the 7 00:00:21,960 --> 00:00:25,720 Speaker 2: artificial intelligence Boom on Wall Street and Video, which just 8 00:00:25,760 --> 00:00:27,760 Speaker 2: became the third most valuable company in the S and 9 00:00:27,840 --> 00:00:28,560 Speaker 2: P five hundred. 10 00:00:28,760 --> 00:00:31,920 Speaker 3: I'm Tom Buzber, New York. I'm Stephen Carolyn London. We're 11 00:00:31,920 --> 00:00:33,240 Speaker 3: looking ahead to London. 12 00:00:32,960 --> 00:00:36,120 Speaker 4: Milan and Paris fashion weeks as the luxury sector faces 13 00:00:36,159 --> 00:00:37,840 Speaker 4: cooling demand for its products. 14 00:00:38,080 --> 00:00:41,000 Speaker 5: I'm deg Prisoner previewing the next move from the Reserve 15 00:00:41,080 --> 00:00:44,000 Speaker 5: Bank of Austria. 16 00:00:44,240 --> 00:00:48,320 Speaker 6: That's all straight ahead on Bloomberg Daybreak Weekend, the business 17 00:00:48,360 --> 00:00:52,320 Speaker 6: news you need to wrap up your week. Available on Apple, Spotify, 18 00:00:52,479 --> 00:00:55,800 Speaker 6: the Bloomberg Business Appen everywhere you get your podcasts. 19 00:01:00,520 --> 00:01:01,080 Speaker 3: Good day to you. 20 00:01:01,160 --> 00:01:03,880 Speaker 2: I'm Tom Busby, and we begin today's program with earnings 21 00:01:03,920 --> 00:01:07,600 Speaker 2: this Wednesday from Nvideo and for more on what to expect, 22 00:01:07,720 --> 00:01:12,600 Speaker 2: we welcome Bloomberg Technology co host ed ludlow Ed and Video. 23 00:01:12,680 --> 00:01:15,600 Speaker 2: This past week edging past the market value of Amazon 24 00:01:15,640 --> 00:01:19,520 Speaker 2: dot Com then Alphabet worth one point eight trillion dollars. 25 00:01:20,520 --> 00:01:21,920 Speaker 3: Is this unstoppable? 26 00:01:22,000 --> 00:01:26,959 Speaker 7: This company, it seems unstop stoppable. It seems like a juggernaut, 27 00:01:27,040 --> 00:01:30,400 Speaker 7: right And when you look at what Wall Street expects 28 00:01:30,440 --> 00:01:33,479 Speaker 7: them to say when they post earnings next week, there 29 00:01:33,520 --> 00:01:36,640 Speaker 7: are no signs that that will stop. You know that 30 00:01:37,520 --> 00:01:40,720 Speaker 7: there's a lot of misconception and a lack of understanding 31 00:01:40,760 --> 00:01:43,240 Speaker 7: about why in Nvidia has been on the tear that 32 00:01:43,319 --> 00:01:45,760 Speaker 7: it has. And when we talk about in video in 33 00:01:45,800 --> 00:01:49,440 Speaker 7: the AI context, what we're literally talking about is that 34 00:01:49,920 --> 00:01:53,920 Speaker 7: the AI development, the building of large language models, it 35 00:01:54,040 --> 00:01:58,960 Speaker 7: requires just one hundreds of square miles of data centers, 36 00:01:59,480 --> 00:02:02,600 Speaker 7: just rat some racks of servers, and those servers are 37 00:02:02,640 --> 00:02:05,960 Speaker 7: basically lots of big boxes that get stacked up on 38 00:02:05,960 --> 00:02:08,600 Speaker 7: one another. And those boxes, you can think of them 39 00:02:08,680 --> 00:02:11,720 Speaker 7: like supercomputers. So you know, the listener at home has 40 00:02:11,760 --> 00:02:15,880 Speaker 7: maybe a desktop and it's a sort of rectangular shaped box. 41 00:02:16,400 --> 00:02:18,680 Speaker 7: Think about something that's ten times the size of that, 42 00:02:19,000 --> 00:02:21,720 Speaker 7: and then take that box and times it by one thousand. 43 00:02:22,240 --> 00:02:24,640 Speaker 7: And in Video's role in that is that they provide 44 00:02:24,680 --> 00:02:28,600 Speaker 7: the brains in that box, the GPU or AI accelerator 45 00:02:29,240 --> 00:02:32,560 Speaker 7: and all of the money that's flowing into AI to 46 00:02:32,639 --> 00:02:36,480 Speaker 7: build out that infrastructure. The reality is that you've only 47 00:02:36,520 --> 00:02:41,120 Speaker 7: been able to build it within video products. Until very recently, 48 00:02:41,160 --> 00:02:42,760 Speaker 7: there was no one else on the market doing that. 49 00:02:43,120 --> 00:02:46,360 Speaker 7: So the numbers are that Wall Street sees revenue growth 50 00:02:46,360 --> 00:02:49,760 Speaker 7: of three hundred and sixty nine percent year on year 51 00:02:50,040 --> 00:02:52,760 Speaker 7: in the coming quarter. I'll repeat it, three hundred and 52 00:02:52,760 --> 00:02:55,839 Speaker 7: sixty nine percent top line growth. And what's so astonishing 53 00:02:56,360 --> 00:02:59,040 Speaker 7: is that last quarter they had two hundred and eighty 54 00:02:59,120 --> 00:03:02,760 Speaker 7: percent tope and growth year on year, so it just 55 00:03:02,840 --> 00:03:04,760 Speaker 7: doesn't seem to be tapering out yet. 56 00:03:04,960 --> 00:03:07,240 Speaker 2: And the shares are up two hundred and thirty percent 57 00:03:07,240 --> 00:03:08,720 Speaker 2: in the past twelve months. 58 00:03:08,400 --> 00:03:10,359 Speaker 3: So it's it's yeah. 59 00:03:10,600 --> 00:03:13,360 Speaker 2: Everything is just you know, coming up of roses for 60 00:03:13,400 --> 00:03:17,120 Speaker 2: this company. But who are in Video's biggest customers and 61 00:03:17,440 --> 00:03:19,280 Speaker 2: who are its top competitors? 62 00:03:19,639 --> 00:03:22,919 Speaker 7: Yeah, I mean the question of who the biggest customers 63 00:03:23,080 --> 00:03:26,079 Speaker 7: are goes right to the explanation I gave on how 64 00:03:26,120 --> 00:03:30,360 Speaker 7: AI works in the real world, and the short answer 65 00:03:30,400 --> 00:03:34,680 Speaker 7: is the hyperscalers, the cloud companies that own, operate and 66 00:03:34,720 --> 00:03:38,040 Speaker 7: control the data centers. For the most part, that means 67 00:03:38,080 --> 00:03:43,560 Speaker 7: Microsoft Azure and in video powering AWS, which is Amazon's 68 00:03:43,600 --> 00:03:47,680 Speaker 7: cloud business. The other big player is Google and Google 69 00:03:47,680 --> 00:03:50,240 Speaker 7: Cloud Platform. But remember Google's done a bit of work 70 00:03:50,280 --> 00:03:53,560 Speaker 7: with its own custom silicon. But for the most part, 71 00:03:54,120 --> 00:03:56,800 Speaker 7: even if you see the news headline like for example, 72 00:03:57,720 --> 00:04:00,440 Speaker 7: and Thropic, which is a really big a company that 73 00:04:00,480 --> 00:04:04,320 Speaker 7: makes a generative AI product is powered by Nvidia, we 74 00:04:04,440 --> 00:04:06,680 Speaker 7: don't mean that that, you know, The CEO of and 75 00:04:06,760 --> 00:04:09,600 Speaker 7: Propic knocks on the door of Nvidia in Santa Clara 76 00:04:09,680 --> 00:04:11,520 Speaker 7: and says, hey, can I have a big bag of 77 00:04:11,600 --> 00:04:14,240 Speaker 7: chips please, and throws it over his shoulder and off 78 00:04:14,240 --> 00:04:17,400 Speaker 7: he goes to make AI. The reality is that you're 79 00:04:17,440 --> 00:04:21,080 Speaker 7: still reliant on a hyperscaler and that Nvidia ships those 80 00:04:21,560 --> 00:04:26,320 Speaker 7: h one hundreds. They're called to the cloud provider and 81 00:04:26,360 --> 00:04:29,719 Speaker 7: the data center that they go into, and the AI 82 00:04:29,800 --> 00:04:34,360 Speaker 7: company never has direct contact with with Nvidia. But it's 83 00:04:34,440 --> 00:04:37,400 Speaker 7: kind of a triumvirate. You have Nvidia providing the hardware, 84 00:04:37,880 --> 00:04:41,400 Speaker 7: the hyperscaler that runs, the data centers operating it, and 85 00:04:41,440 --> 00:04:45,000 Speaker 7: the AI company basically pays for the compute, pays for 86 00:04:45,160 --> 00:04:46,440 Speaker 7: use of that cloud capacity. 87 00:04:47,120 --> 00:04:50,479 Speaker 3: And who competes at that kind of level within video? 88 00:04:50,720 --> 00:04:53,160 Speaker 7: Yeah, so for quite a long time now, and when 89 00:04:53,160 --> 00:04:54,800 Speaker 7: I say that, it actually is not a long time, 90 00:04:54,839 --> 00:04:57,480 Speaker 7: it's basically two years. Because all of this has happened 91 00:04:57,720 --> 00:05:02,360 Speaker 7: in two years. Nvidia has been the only name where 92 00:05:02,360 --> 00:05:07,600 Speaker 7: they're actually building its scale these GPUs graphics processing units, 93 00:05:07,640 --> 00:05:10,799 Speaker 7: and in very simple terms, a GPU can make lots 94 00:05:10,839 --> 00:05:14,440 Speaker 7: of mathematical calculations in parallel at once. That's why they're 95 00:05:14,480 --> 00:05:18,400 Speaker 7: good for training large language models or building AI. AMD 96 00:05:18,680 --> 00:05:21,480 Speaker 7: has recently come to the market with a similar products 97 00:05:21,560 --> 00:05:25,200 Speaker 7: called the mi I three hundred series. But you don't 98 00:05:25,240 --> 00:05:28,839 Speaker 7: just sort of start building these in huge volumes. It 99 00:05:28,880 --> 00:05:31,520 Speaker 7: takes a really long time to ramp, and as you know, 100 00:05:31,680 --> 00:05:35,000 Speaker 7: there's been a chip supply crunch in the post pandemic 101 00:05:35,120 --> 00:05:39,359 Speaker 7: era which has impacted that. So AMD is slowly ramping. 102 00:05:39,400 --> 00:05:42,159 Speaker 7: The principal difference between the two of them is that 103 00:05:42,240 --> 00:05:44,760 Speaker 7: AMD realizes in video has got a real hold on 104 00:05:44,800 --> 00:05:48,240 Speaker 7: this market for training large language models. But once you've 105 00:05:48,240 --> 00:05:50,480 Speaker 7: trained the model and you want to start actually running 106 00:05:50,680 --> 00:05:53,760 Speaker 7: the technology in the real world, you have consumers using 107 00:05:53,839 --> 00:05:57,479 Speaker 7: generative AI tools like chat, GPT, or start integrating AI 108 00:05:57,520 --> 00:06:01,280 Speaker 7: tools into your own software. Move to what's called inference. 109 00:06:01,480 --> 00:06:04,360 Speaker 7: In other words, getting a response from the model you ask, 110 00:06:04,400 --> 00:06:07,000 Speaker 7: it's something, it gives your response, and AMD is basically 111 00:06:07,040 --> 00:06:10,200 Speaker 7: saying ours is going to be better because what they 112 00:06:10,240 --> 00:06:13,920 Speaker 7: all have in common is is incredibly expensive to do 113 00:06:13,960 --> 00:06:16,960 Speaker 7: both of those functions. And so there's a battle that's 114 00:06:17,000 --> 00:06:20,159 Speaker 7: brewing now as the market shifts from training models to 115 00:06:20,240 --> 00:06:22,760 Speaker 7: actually using them in the inference stage. And it'll be 116 00:06:22,760 --> 00:06:25,320 Speaker 7: interesting to see if AMD starts to take some market share. 117 00:06:26,000 --> 00:06:28,320 Speaker 3: So what's next for Nvidia? How do they pivot now? 118 00:06:29,000 --> 00:06:31,120 Speaker 7: Well, I think they just keep going. I mean, you 119 00:06:31,160 --> 00:06:33,159 Speaker 7: guys may have seen that I did an interview with 120 00:06:33,360 --> 00:06:36,240 Speaker 7: Nvidia's CEO Jensen Huang last week or the end of 121 00:06:36,400 --> 00:06:39,200 Speaker 7: a couple of weeks ago. And the next big market 122 00:06:39,360 --> 00:06:42,640 Speaker 7: is what Jensen's calling sovereign AI. So right now, all 123 00:06:42,680 --> 00:06:46,240 Speaker 7: of the financing and activity behind AI is being done 124 00:06:46,240 --> 00:06:49,479 Speaker 7: by the private sector, big tech companies. But there is 125 00:06:49,520 --> 00:06:53,680 Speaker 7: an academic school of thought that, because of how impactful 126 00:06:53,839 --> 00:06:57,480 Speaker 7: artificial intelligence will be on society, governments should have their 127 00:06:57,520 --> 00:07:02,200 Speaker 7: own operations. Right, government should have supercomputers and data centers 128 00:07:02,920 --> 00:07:06,280 Speaker 7: that they control, that is, training large language models, that is, 129 00:07:06,720 --> 00:07:10,520 Speaker 7: giving some kind of national level AI competence. And Jensen's 130 00:07:10,560 --> 00:07:13,560 Speaker 7: been flying around the world to every region, speaking to 131 00:07:14,000 --> 00:07:17,440 Speaker 7: you the leaders of those nations, and doing deals, you know, 132 00:07:17,560 --> 00:07:21,760 Speaker 7: saying let's collaborate, we can do something where we sell 133 00:07:21,840 --> 00:07:23,960 Speaker 7: directly to you that doesn't really show up in the 134 00:07:23,960 --> 00:07:24,840 Speaker 7: financials yet. 135 00:07:24,920 --> 00:07:26,840 Speaker 2: Wow, a lot to look forward to. Well, our thanks 136 00:07:26,840 --> 00:07:30,440 Speaker 2: to Bloomberg Technology co host ed Ludlow, thanks for being here. 137 00:07:30,400 --> 00:07:31,320 Speaker 7: Ed, Thank you very much. 138 00:07:31,320 --> 00:07:33,920 Speaker 2: Hapy weekend, And now we turn to the Fed and 139 00:07:34,080 --> 00:07:36,920 Speaker 2: minutes from the January meeting of the FOMC will be 140 00:07:36,960 --> 00:07:40,680 Speaker 2: released this coming Wednesday, and policymakers voted to keep benchmark 141 00:07:40,760 --> 00:07:44,160 Speaker 2: lending rates unchanged at that meeting for the fourth time 142 00:07:44,200 --> 00:07:46,600 Speaker 2: in a row. So what will they reveal and how 143 00:07:46,680 --> 00:07:49,760 Speaker 2: soon will the Fed pivot to cutting rates? For some insight, 144 00:07:50,080 --> 00:07:54,760 Speaker 2: we welcome Bloomberg International Economic and Policy correspondent Michael McKee. So, Michael, 145 00:07:54,880 --> 00:07:57,440 Speaker 2: what are you expecting to see in these minutes? 146 00:07:57,760 --> 00:08:01,000 Speaker 8: You didn't need me, You just answered the question. That's 147 00:08:01,000 --> 00:08:03,880 Speaker 8: what people want on Wall Street to find out is 148 00:08:03,920 --> 00:08:07,640 Speaker 8: when and under what conditions will the FED start lowering 149 00:08:07,640 --> 00:08:09,760 Speaker 8: interest rates? And I'm not sure they're going to get 150 00:08:09,840 --> 00:08:14,280 Speaker 8: a complete answer. We have heard from a lot of 151 00:08:14,280 --> 00:08:18,200 Speaker 8: Fed officials since the meeting that they thought the news 152 00:08:18,600 --> 00:08:22,440 Speaker 8: was good on the economy and things were progressing towards 153 00:08:22,440 --> 00:08:25,640 Speaker 8: the two percent target, but they're not there yet, and 154 00:08:25,720 --> 00:08:27,880 Speaker 8: so they want to see more good news, which just 155 00:08:27,920 --> 00:08:32,120 Speaker 8: basically means they need more months of data. How many months, Well, 156 00:08:32,280 --> 00:08:35,760 Speaker 8: they're not sure of that either. They have to wait 157 00:08:35,800 --> 00:08:38,680 Speaker 8: and see how the data comes in and whether it 158 00:08:38,800 --> 00:08:42,200 Speaker 8: is in any way confusing. So when you're looking at 159 00:08:42,240 --> 00:08:46,280 Speaker 8: the minutes, you'll probably see something along the lines of 160 00:08:46,400 --> 00:08:49,840 Speaker 8: most members agreed that progress had been made, but there's 161 00:08:49,840 --> 00:08:51,720 Speaker 8: not going to be anybody who says it's time to 162 00:08:51,760 --> 00:08:52,600 Speaker 8: cut Well. 163 00:08:52,679 --> 00:08:54,640 Speaker 2: Boy, well, let's talk about some of the data we 164 00:08:54,720 --> 00:08:58,920 Speaker 2: have seen, and we've seen a pretty robust labor market, 165 00:08:58,960 --> 00:09:02,520 Speaker 2: although seen a lot of especially in the tech sector, 166 00:09:02,800 --> 00:09:07,040 Speaker 2: job cuts nowadays. Consumer demand has been good, spending, you know, 167 00:09:07,280 --> 00:09:11,040 Speaker 2: not as strong sustained economic growth, the soft landing, I mean, 168 00:09:11,120 --> 00:09:12,600 Speaker 2: all of that is pretty good. 169 00:09:13,480 --> 00:09:18,000 Speaker 8: Well, we've had a week where the data sort of 170 00:09:18,000 --> 00:09:20,400 Speaker 8: contradicted each other when you're thinking about it. In terms 171 00:09:20,400 --> 00:09:23,040 Speaker 8: of the FED, they had a strong CPI number, which 172 00:09:23,120 --> 00:09:25,840 Speaker 8: took a lot of people by surprise and of course 173 00:09:26,640 --> 00:09:30,040 Speaker 8: raised questions about whether inflation is going to be coming 174 00:09:30,120 --> 00:09:33,520 Speaker 8: back or not. Inflation could be driven by a strong economy, 175 00:09:33,520 --> 00:09:35,880 Speaker 8: which we had been seeing, and then we got the 176 00:09:35,920 --> 00:09:39,760 Speaker 8: retail sales numbers that showed a lot of weakness. Some 177 00:09:39,840 --> 00:09:42,360 Speaker 8: of that may have been weather related and it may 178 00:09:42,960 --> 00:09:47,200 Speaker 8: reverse in the next month, which would be another argument 179 00:09:47,280 --> 00:09:51,600 Speaker 8: for waiting on the Fed side. But if the economy 180 00:09:51,720 --> 00:09:54,840 Speaker 8: is weakening, then you would assume there would be less 181 00:09:54,840 --> 00:09:57,320 Speaker 8: inflation and we'd be more on the path that the 182 00:09:57,360 --> 00:10:01,079 Speaker 8: FED wants to see. The jobless claim numbers came in 183 00:10:01,400 --> 00:10:05,079 Speaker 8: down this week, which is a bit surprising given what 184 00:10:05,120 --> 00:10:08,200 Speaker 8: we have seen and heard in the layoff announcements, but 185 00:10:08,480 --> 00:10:11,560 Speaker 8: it does suggest that the labor market is still strong, 186 00:10:11,640 --> 00:10:13,840 Speaker 8: and as long as the labor markets strong, people will 187 00:10:13,840 --> 00:10:16,199 Speaker 8: be spending. It's only a question of how much. 188 00:10:16,920 --> 00:10:19,000 Speaker 2: Yeah, and the and the high inflation that we're seeing, 189 00:10:19,000 --> 00:10:23,200 Speaker 2: I mean, that's affecting certainly housing business, you know, borrowing 190 00:10:23,320 --> 00:10:25,439 Speaker 2: and infrastructure spending. 191 00:10:25,520 --> 00:10:28,760 Speaker 3: So what else is it affecting negatively? 192 00:10:29,800 --> 00:10:35,840 Speaker 8: Well, this last month's numbers were kind of distorted by 193 00:10:35,960 --> 00:10:39,240 Speaker 8: the weather, so we know there's some issues in there. 194 00:10:39,280 --> 00:10:45,319 Speaker 8: But inflation is making a difference in housing definitely, because 195 00:10:45,840 --> 00:10:48,840 Speaker 8: we've been expecting housing prices to come down in the 196 00:10:48,880 --> 00:10:52,040 Speaker 8: CPI and the PCE, and they haven't really done that. 197 00:10:52,800 --> 00:10:55,800 Speaker 8: They actually rose in the CPI numbers, and so FAN 198 00:10:55,840 --> 00:10:58,640 Speaker 8: officials are a little confused about that, as is everybody. 199 00:10:59,280 --> 00:11:04,640 Speaker 8: Why we see rent prices falling and that doesn't translate 200 00:11:04,679 --> 00:11:08,080 Speaker 8: into lower housing numbers because they use the rent numbers 201 00:11:08,120 --> 00:11:12,120 Speaker 8: to calculate those. If that were to finally take off 202 00:11:13,520 --> 00:11:16,000 Speaker 8: and go down, then the FED would feel a whole 203 00:11:16,040 --> 00:11:19,320 Speaker 8: lot better about the inflation picture right now. But the 204 00:11:19,360 --> 00:11:22,160 Speaker 8: good news is inflation has come down a lot, to 205 00:11:22,200 --> 00:11:24,960 Speaker 8: the point where now for the last six or eight months, 206 00:11:25,640 --> 00:11:30,880 Speaker 8: Americans average hourly earnings have outpaced inflation. That looks like 207 00:11:30,920 --> 00:11:34,200 Speaker 8: the American people haven't noticed yet, but they're finally ahead 208 00:11:34,200 --> 00:11:36,960 Speaker 8: of the game and maybe they'll start to notice that soon. 209 00:11:37,200 --> 00:11:41,760 Speaker 2: Yeah, someone should tell them that it's looking good. Hey, everybody, Well, 210 00:11:41,960 --> 00:11:45,520 Speaker 2: our next FMC meeting March nineteenth and twentieth. So what 211 00:11:45,600 --> 00:11:48,400 Speaker 2: are we going to get between now and then, or 212 00:11:48,400 --> 00:11:50,760 Speaker 2: what is the FED going to get to come to 213 00:11:50,800 --> 00:11:51,400 Speaker 2: their decision. 214 00:11:52,200 --> 00:11:55,280 Speaker 8: We'll get another CPI reading and we will also get 215 00:11:55,760 --> 00:12:00,360 Speaker 8: the jobs numbers for the month, and we should get 216 00:12:00,400 --> 00:12:03,160 Speaker 8: retail sales before that, so they'll have another month's picture. 217 00:12:03,160 --> 00:12:06,160 Speaker 8: They'll have the February picture before they have to make 218 00:12:06,200 --> 00:12:09,600 Speaker 8: a decision. We won't have the PCE index, which is 219 00:12:09,640 --> 00:12:12,480 Speaker 8: the inflation number that they follow, and there's been a 220 00:12:12,480 --> 00:12:16,000 Speaker 8: wedge between the CPI and the PCE that is partly 221 00:12:16,040 --> 00:12:19,439 Speaker 8: based on the waiting of the things in the various categories. 222 00:12:19,480 --> 00:12:24,160 Speaker 8: PC's been running a lot slower and it's much closer 223 00:12:24,160 --> 00:12:27,760 Speaker 8: to the two percent goal that the Fed has and 224 00:12:27,800 --> 00:12:28,440 Speaker 8: they won't. 225 00:12:28,240 --> 00:12:29,160 Speaker 3: Have that data. 226 00:12:29,240 --> 00:12:32,960 Speaker 8: So expect March to be an on hold meeting. They've 227 00:12:33,040 --> 00:12:35,880 Speaker 8: kind of signaled that at this point. By the time 228 00:12:35,880 --> 00:12:38,080 Speaker 8: we get to the meeting after that in May, there 229 00:12:38,120 --> 00:12:41,240 Speaker 8: should be enough data that they can make a decision. 230 00:12:41,280 --> 00:12:44,719 Speaker 8: But if it comes in contradictory as it has this 231 00:12:44,920 --> 00:12:47,400 Speaker 8: past month, they may not be ready then either. 232 00:12:47,520 --> 00:12:49,040 Speaker 3: Well, it's a lot to look forward to. Well. 233 00:12:49,040 --> 00:12:53,440 Speaker 2: Our thanks to Bloomberg International Economic and Policy correspondent Michael McKee, 234 00:12:54,240 --> 00:12:56,800 Speaker 2: and coming up on Bloomberg day Break weekend, we're looking 235 00:12:56,840 --> 00:13:00,920 Speaker 2: ahead to London, Milan and Paris for fashion as the 236 00:13:00,960 --> 00:13:04,320 Speaker 2: luxury sector faces cooling demand for its products. I'm Tom 237 00:13:04,320 --> 00:13:17,640 Speaker 2: Busby and this is Bloomberg. This is Bloomberg Daybreak Weekend. 238 00:13:17,679 --> 00:13:19,920 Speaker 2: Our global look ahead at the top stories for investors 239 00:13:19,960 --> 00:13:22,160 Speaker 2: in the coming week. I'm Tom Busby in New York. 240 00:13:22,559 --> 00:13:25,520 Speaker 2: The biggest fashion brands will be showcasing their designs across 241 00:13:25,559 --> 00:13:28,400 Speaker 2: Europe in the coming days at the London, Milan and 242 00:13:28,559 --> 00:13:31,679 Speaker 2: Paris fashion Weeks. These glitzy events are happening at a 243 00:13:31,760 --> 00:13:34,760 Speaker 2: challenging time for many luxury names. So how are the 244 00:13:34,760 --> 00:13:38,520 Speaker 2: world's most illustrious fashion houses protecting their profits while also 245 00:13:38,640 --> 00:13:42,120 Speaker 2: prioritizing style well for more, Let's go to London and 246 00:13:42,160 --> 00:13:45,160 Speaker 2: bring in Bloomberg Daybreak europe banker Stephen Carroll. 247 00:13:45,120 --> 00:13:48,000 Speaker 4: Tom it's a tricky time to be in fashion. Cooling 248 00:13:48,000 --> 00:13:51,720 Speaker 4: demand for luxury products after the pandemic, along with slowing 249 00:13:51,760 --> 00:13:55,880 Speaker 4: sales in China and higher inflation, have squeezed some key 250 00:13:55,960 --> 00:13:59,640 Speaker 4: drivers of growth. This season of European Fashion Weeks are 251 00:13:59,679 --> 00:14:02,080 Speaker 4: expected to be as glamorous as ever, with the fashion 252 00:14:02,080 --> 00:14:05,840 Speaker 4: elite descending on London, then Milan, and then Paris. While 253 00:14:05,880 --> 00:14:09,720 Speaker 4: luxury giants LVMH and Armez had good stories to tell 254 00:14:09,760 --> 00:14:13,280 Speaker 4: in their most recent results with strong sales and key brands, 255 00:14:13,559 --> 00:14:15,800 Speaker 4: there was less good news and the likes of Burbery, 256 00:14:15,800 --> 00:14:18,839 Speaker 4: which issued a profit warning, wiping the equivalent of almost 257 00:14:18,880 --> 00:14:22,880 Speaker 4: one hundred and thirty million dollars off its outlook. I've 258 00:14:22,920 --> 00:14:25,480 Speaker 4: been discussing all of this with Bloomberg opinion columnist Andrea 259 00:14:25,600 --> 00:14:30,240 Speaker 4: Felsted and our European luxury reporter Angelina Rascouette. I started 260 00:14:30,280 --> 00:14:34,480 Speaker 4: by asking Angelina how important Fashion Week events are to 261 00:14:34,560 --> 00:14:35,560 Speaker 4: these big brands. 262 00:14:36,240 --> 00:14:39,560 Speaker 9: These events are very important because obviously you're unveiling and 263 00:14:39,600 --> 00:14:43,960 Speaker 9: you're you're going to be showing your consumer's WATA will 264 00:14:44,000 --> 00:14:48,120 Speaker 9: be the trend. And obviously, in the age of social media, 265 00:14:48,560 --> 00:14:51,840 Speaker 9: you know, you have influencers, celebrities who's got millions of followers. 266 00:14:52,360 --> 00:14:56,400 Speaker 9: So actually the impact of these fashion shows are huge. 267 00:14:56,520 --> 00:14:59,800 Speaker 9: And you know, but it's not just fashion shows obviously. 268 00:14:59,840 --> 00:15:01,920 Speaker 9: I and if you think just about Miley Cyrus, like 269 00:15:02,760 --> 00:15:04,760 Speaker 9: recently she was at the Grammars and she was wearing 270 00:15:04,760 --> 00:15:06,640 Speaker 9: a Gucci you know, at some point she was wearing 271 00:15:06,680 --> 00:15:09,080 Speaker 9: a Gucci gown with a bag, and that's very important 272 00:15:09,080 --> 00:15:10,600 Speaker 9: for the brand. You know, you think about Gucci, I'm 273 00:15:10,640 --> 00:15:12,760 Speaker 9: going to be going to the show and in Milan 274 00:15:12,840 --> 00:15:16,040 Speaker 9: next week. It's a brand that is in turnaround and 275 00:15:16,480 --> 00:15:19,200 Speaker 9: he needs all the attention and the visibility can get. 276 00:15:19,680 --> 00:15:21,880 Speaker 9: They have a new recently new designer. I mean this 277 00:15:21,960 --> 00:15:25,360 Speaker 9: is going to be his third show, so indeed it's 278 00:15:25,400 --> 00:15:28,320 Speaker 9: going to be you know, very important. But remember there's 279 00:15:28,320 --> 00:15:30,920 Speaker 9: always a lag also between the unveiling of a collection. 280 00:15:31,320 --> 00:15:35,080 Speaker 9: So his first collection, Sabato at Gucci, was in September 281 00:15:35,160 --> 00:15:37,640 Speaker 9: and it's now only hitting the stores right now, so 282 00:15:37,680 --> 00:15:41,400 Speaker 9: there's always a lag of course, So the financial impact 283 00:15:41,400 --> 00:15:44,920 Speaker 9: cannot be assessed obviously right away. Right away, what you 284 00:15:44,960 --> 00:15:48,000 Speaker 9: can assess is you know, the bus you know, if 285 00:15:48,040 --> 00:15:51,440 Speaker 9: a video goes viral, that's pretty much what you can assess. 286 00:15:51,840 --> 00:15:54,160 Speaker 4: Andrea, that brings us very neatly something you've been writing 287 00:15:54,160 --> 00:15:56,320 Speaker 4: about recently when it comes to Gucci as well. Just 288 00:15:56,320 --> 00:15:58,800 Speaker 4: the headline from your piece Gucci can be revived, but 289 00:15:58,840 --> 00:16:02,520 Speaker 4: it won't go viral. Tell us more about how you're 290 00:16:02,520 --> 00:16:04,720 Speaker 4: thinking about the series of fashion weeks. 291 00:16:04,960 --> 00:16:09,960 Speaker 1: Yes, obviously Gucci, as Angelina mentioned, it's it's moving from 292 00:16:10,120 --> 00:16:15,760 Speaker 1: its bold maximalism that it had before to this new 293 00:16:16,280 --> 00:16:21,520 Speaker 1: much sleeker esthetic in line with quiet luxury. This this 294 00:16:21,680 --> 00:16:24,840 Speaker 1: trends that emerged around a year ago at the at 295 00:16:24,880 --> 00:16:28,720 Speaker 1: the shows early last year, which sort of set the 296 00:16:28,760 --> 00:16:30,040 Speaker 1: direction of fashion. 297 00:16:30,200 --> 00:16:30,480 Speaker 9: Now. 298 00:16:30,760 --> 00:16:32,960 Speaker 1: The worry is that We're having a bit of quiet 299 00:16:33,040 --> 00:16:38,840 Speaker 1: luxury fatigue, so this could be potentially awkward for Gucci. 300 00:16:39,160 --> 00:16:43,400 Speaker 1: I'm not sure that the that the new Gucci is 301 00:16:43,520 --> 00:16:49,560 Speaker 1: really is distinctive enough to stand out in the way 302 00:16:49,680 --> 00:16:54,200 Speaker 1: that the past designer Alessandro and Mikayley did. It's also 303 00:16:54,240 --> 00:16:57,880 Speaker 1: going to take a while, as Angelina said, to come through, 304 00:16:58,200 --> 00:17:01,120 Speaker 1: So yes, this will we really want to. 305 00:17:01,160 --> 00:17:04,359 Speaker 4: Watch Miley cyrus not enough to revive an entire brand. 306 00:17:04,400 --> 00:17:07,240 Speaker 4: Andre I wanted to ask you though about Burbery as well, 307 00:17:07,280 --> 00:17:09,560 Speaker 4: because they made us bash in the last season of 308 00:17:09,560 --> 00:17:13,200 Speaker 4: Fashion Weeks in September with their takeover of Barn Street Station, 309 00:17:13,400 --> 00:17:17,320 Speaker 4: for example, but the company still saw a profit warning 310 00:17:17,320 --> 00:17:20,800 Speaker 4: its recent earnings report. Is this going to be a 311 00:17:20,840 --> 00:17:23,800 Speaker 4: difficult showcase for Burbery? Do they need to turn around 312 00:17:23,840 --> 00:17:24,360 Speaker 4: the vibes? 313 00:17:25,119 --> 00:17:27,679 Speaker 1: I think it's going to be just as sort of 314 00:17:27,800 --> 00:17:32,720 Speaker 1: confident and exciting as September was, because what Birbury needs 315 00:17:32,760 --> 00:17:36,040 Speaker 1: to do is, as Angela Andlina mentioned, it's all about 316 00:17:36,040 --> 00:17:39,880 Speaker 1: creating a buzz, creating a halo effect, and Burbury really 317 00:17:39,920 --> 00:17:41,880 Speaker 1: needs to do that. So it's got some quite nice 318 00:17:41,920 --> 00:17:46,440 Speaker 1: products some coming through. It's got a lot of nice bags, 319 00:17:46,640 --> 00:17:49,399 Speaker 1: you know, Daniel Lee is really pumping out the products. 320 00:17:49,400 --> 00:17:53,400 Speaker 1: There's a new trench bag which is canvas, very much 321 00:17:53,480 --> 00:17:58,040 Speaker 1: in line with the nylon bag trend we've seen. There's 322 00:17:58,080 --> 00:18:00,720 Speaker 1: been a lot of narrative that Burber has been putting 323 00:18:00,720 --> 00:18:04,119 Speaker 1: the prices up and that's putting people off. That's missing 324 00:18:04,160 --> 00:18:08,440 Speaker 1: the point. You know, what you need is brand desirability. 325 00:18:09,200 --> 00:18:12,040 Speaker 1: It's starting to happen. Burbery is starting to move there's 326 00:18:12,080 --> 00:18:14,679 Speaker 1: a list index of the most in demand brands that 327 00:18:14,720 --> 00:18:18,720 Speaker 1: people are searching for and buying started to move up gradually. 328 00:18:18,800 --> 00:18:22,920 Speaker 1: I'm seeing some young people with the Burbery check bags, 329 00:18:23,240 --> 00:18:27,680 Speaker 1: Barberary check scarves, often vintage, so that's really good size. 330 00:18:27,720 --> 00:18:29,600 Speaker 1: What it needs to do is it really needs to 331 00:18:30,160 --> 00:18:34,720 Speaker 1: pump up that desirability. It needs to get those bags 332 00:18:34,800 --> 00:18:38,680 Speaker 1: out to influencers so that we can follow and see 333 00:18:38,680 --> 00:18:43,200 Speaker 1: them in you know, Instagram, pos, TikTok videos, Pinterest boards. 334 00:18:43,680 --> 00:18:46,520 Speaker 1: And I think when that happens that that could be 335 00:18:46,600 --> 00:18:50,000 Speaker 1: good for Birbary because I feel that a lot of 336 00:18:50,040 --> 00:18:54,240 Speaker 1: the turnaround stories a lot of the brands are kind 337 00:18:54,280 --> 00:18:57,240 Speaker 1: of they've been around for a while. I mean, Gucci 338 00:18:57,560 --> 00:19:02,359 Speaker 1: was exploding around eight years ago. The Mew Mew turnaround 339 00:19:02,520 --> 00:19:07,200 Speaker 1: is and the product turnaround are pretty well established now. 340 00:19:07,480 --> 00:19:10,280 Speaker 1: I feel that there is room for something new and 341 00:19:10,359 --> 00:19:13,560 Speaker 1: exciting and if Barberie can get it right, that can 342 00:19:13,600 --> 00:19:16,200 Speaker 1: be Actually can tell I'm the lone Barbary. 343 00:19:15,760 --> 00:19:19,400 Speaker 4: Ball Anthony, I wonder do you have a contrarian view 344 00:19:19,480 --> 00:19:22,280 Speaker 4: on on on Birbary From what Andrea was talking about, 345 00:19:22,320 --> 00:19:24,159 Speaker 4: is that the big highlight from London Fashion Week that 346 00:19:24,160 --> 00:19:24,960 Speaker 4: you'll be looking at. 347 00:19:24,840 --> 00:19:30,480 Speaker 9: For Yeah, so for sure, Burbery is definitely the most 348 00:19:30,480 --> 00:19:33,760 Speaker 9: famous brand coming out of London Fashion Week. And uh 349 00:19:34,240 --> 00:19:39,280 Speaker 9: and the tricky uh bit with Birberies that obviously being 350 00:19:39,320 --> 00:19:42,400 Speaker 9: a publicly listed company and it's not a group, it's 351 00:19:42,440 --> 00:19:45,399 Speaker 9: only one brand, right, so so so it has to 352 00:19:45,440 --> 00:19:49,680 Speaker 9: report results on a quarterly basis and that's scrutiny. Sometimes 353 00:19:49,680 --> 00:19:53,040 Speaker 9: it's very difficult for a brand that's in turnaround mode. 354 00:19:53,160 --> 00:19:56,000 Speaker 9: I mean, you know Andreas right, you have to be 355 00:19:56,080 --> 00:20:00,199 Speaker 9: confident and you know that about the designer. You know 356 00:20:00,240 --> 00:20:03,040 Speaker 9: he wasn't named less than two years ago and it 357 00:20:03,080 --> 00:20:06,159 Speaker 9: doesn't happen overnight. So so that's the tricky bit. And 358 00:20:07,040 --> 00:20:09,320 Speaker 9: Burbery in comparison to all the other groups, you know 359 00:20:09,359 --> 00:20:12,000 Speaker 9: that you know if so is part of one group. 360 00:20:13,080 --> 00:20:15,359 Speaker 9: Loueve is part of a group, so so you don't 361 00:20:15,400 --> 00:20:18,840 Speaker 9: get the granularity of their performance on a quarterly basis. 362 00:20:18,880 --> 00:20:24,000 Speaker 9: And that's that's actually the challenge for for Burbery because 363 00:20:24,040 --> 00:20:26,800 Speaker 9: of course LVMH another company that you cover, Andrelia is 364 00:20:27,880 --> 00:20:30,719 Speaker 9: an absolute mammoth in this area and and kind of 365 00:20:30,920 --> 00:20:33,760 Speaker 9: covers a lot of ground in terms of brands as well. 366 00:20:33,800 --> 00:20:36,639 Speaker 4: Does that allow for more space for underperformance and of 367 00:20:36,680 --> 00:20:39,200 Speaker 4: certain brands, yes, I. 368 00:20:39,119 --> 00:20:42,600 Speaker 9: Mean, you know, and and and they're not. You know, 369 00:20:42,800 --> 00:20:47,600 Speaker 9: they have some mega brands like Viviiton and Christian and 370 00:20:47,760 --> 00:20:51,640 Speaker 9: some brands who who who started from a very small 371 00:20:51,760 --> 00:20:54,520 Speaker 9: and you know, with very small sales numbers and now 372 00:20:54,720 --> 00:20:56,600 Speaker 9: we know that they've actually grown a lot in the 373 00:20:56,640 --> 00:20:58,439 Speaker 9: past five to ten years. You know, if you think 374 00:20:58,480 --> 00:21:02,440 Speaker 9: about a brand like Louieve with the designer Jonathan Anderson, 375 00:21:02,480 --> 00:21:05,760 Speaker 9: he's an Irish designer trained at the London College of 376 00:21:05,800 --> 00:21:08,600 Speaker 9: Fashion and he's done Wonders at WAVIN. We don't get 377 00:21:08,600 --> 00:21:12,080 Speaker 9: the numbers of Louve, but we know he's done Wonders 378 00:21:12,160 --> 00:21:14,720 Speaker 9: and they're very happy with him. And it's the same 379 00:21:14,720 --> 00:21:17,880 Speaker 9: thing with Celine with its slimann again, we don't get 380 00:21:17,880 --> 00:21:21,720 Speaker 9: the numbers, but we know these brands have fair very well. 381 00:21:21,760 --> 00:21:24,720 Speaker 9: And actually another brand that that was at some point problematic, 382 00:21:24,760 --> 00:21:27,000 Speaker 9: I mean he said it in I think it was 383 00:21:27,200 --> 00:21:30,080 Speaker 9: more than five or six years ago in results that 384 00:21:30,359 --> 00:21:33,000 Speaker 9: you know, Mark Jacobs was struggling and they managed to 385 00:21:33,040 --> 00:21:36,159 Speaker 9: turn it around and they're very happy with the turnaround 386 00:21:36,200 --> 00:21:38,639 Speaker 9: that they managed to do so. But being part of 387 00:21:38,680 --> 00:21:41,520 Speaker 9: this wider group where you only have numbers by unit, 388 00:21:41,880 --> 00:21:45,720 Speaker 9: not by brands, that is very helpful. That gives breathing 389 00:21:45,800 --> 00:21:48,880 Speaker 9: room for the brands and for the managers who are 390 00:21:48,920 --> 00:21:50,640 Speaker 9: in charge and the designers as well. 391 00:21:51,520 --> 00:21:54,080 Speaker 4: Andrea, can you give us since we're talking about London 392 00:21:54,119 --> 00:21:56,520 Speaker 4: fashion making then you know the European tour that follows 393 00:21:56,920 --> 00:22:01,080 Speaker 4: with Malan and with Paris. What's your feeling abound the 394 00:22:01,359 --> 00:22:03,800 Speaker 4: British fashion industry post breaks? 395 00:22:03,800 --> 00:22:04,400 Speaker 3: It has that. 396 00:22:04,400 --> 00:22:06,720 Speaker 4: Post challenges to it. Is that something that's led to 397 00:22:06,720 --> 00:22:07,159 Speaker 4: a shift? 398 00:22:07,280 --> 00:22:11,800 Speaker 1: It really has. The loss of those tax breaks for 399 00:22:12,200 --> 00:22:16,840 Speaker 1: overseas shoppers in London has really hurt the London fashion 400 00:22:17,040 --> 00:22:21,560 Speaker 1: fashion demand, particularly Berbery. It's another headwind that Burbery has 401 00:22:21,600 --> 00:22:24,239 Speaker 1: to deal with. But across the across the board, there 402 00:22:24,280 --> 00:22:27,520 Speaker 1: are hopes that might be revived. It was difficult for 403 00:22:27,600 --> 00:22:32,000 Speaker 1: the government to say we are giving luxury shopping a 404 00:22:32,119 --> 00:22:35,520 Speaker 1: tax break when we had the cost of living crisis 405 00:22:35,560 --> 00:22:39,760 Speaker 1: going on. Optically it didn't look very good. But now 406 00:22:39,840 --> 00:22:43,360 Speaker 1: that seems to be subsiding. There are hopes that that 407 00:22:43,520 --> 00:22:47,800 Speaker 1: can be reversed and that can breathe life back into 408 00:22:47,880 --> 00:22:49,240 Speaker 1: London fashion sales. 409 00:22:49,760 --> 00:22:51,600 Speaker 4: Ay, and I wonder when you think about the other 410 00:22:51,880 --> 00:22:53,840 Speaker 4: shows that you'll be going to, in the other brands 411 00:22:53,840 --> 00:22:56,600 Speaker 4: that you'll be monitoring, what are their highlights are you 412 00:22:56,640 --> 00:22:57,320 Speaker 4: looking out for? 413 00:22:59,080 --> 00:23:02,360 Speaker 9: I mean, obviously with Too is always a big it's 414 00:23:02,400 --> 00:23:06,600 Speaker 9: a big moment because it's the biggest luxury fashion brand. 415 00:23:06,760 --> 00:23:10,040 Speaker 9: And uh so last month in January it was the 416 00:23:10,080 --> 00:23:13,320 Speaker 9: Men's Worst Show. So that was Pharrell Williams. Uh third 417 00:23:13,440 --> 00:23:16,440 Speaker 9: show for the brand since it's been named, second show 418 00:23:16,480 --> 00:23:19,720 Speaker 9: in Paris. So now, you know, it'll be interesting to 419 00:23:19,720 --> 00:23:23,560 Speaker 9: see what Nicola offers for for for for ladies and 420 00:23:23,840 --> 00:23:27,000 Speaker 9: you know they, you know, we you know, when Forarrell 421 00:23:27,040 --> 00:23:28,960 Speaker 9: Williams was named, you know, people are saying, oh, maybe 422 00:23:28,960 --> 00:23:32,320 Speaker 9: he's going to like take all the spotlight away from 423 00:23:32,440 --> 00:23:36,400 Speaker 9: from from from Nicolajeska, but actually Nicola, you know, he's 424 00:23:36,440 --> 00:23:40,880 Speaker 9: been at Veton for ten years and they just renewed 425 00:23:40,880 --> 00:23:43,720 Speaker 9: his contract. So it's a vote of confidence for Nicolai 426 00:23:44,400 --> 00:23:46,960 Speaker 9: and uh and so for sure, I'll be I'll be 427 00:23:47,080 --> 00:23:48,960 Speaker 9: looking forward to that one. I'm still hoping to get 428 00:23:48,960 --> 00:23:52,960 Speaker 9: my invite. But uh and then uh, and then hermess 429 00:23:53,040 --> 00:23:56,160 Speaker 9: as well, I mean hermess is the you know, Andrew 430 00:23:56,359 --> 00:24:00,199 Speaker 9: was sort of mentioning the quiet luxury armess is you 431 00:24:00,200 --> 00:24:02,000 Speaker 9: could put it in that basket. I mean, it really 432 00:24:02,080 --> 00:24:06,640 Speaker 9: caters to the most to the ultra high network individuals. 433 00:24:06,720 --> 00:24:09,240 Speaker 9: And uh. And you know, for many, many years we 434 00:24:09,280 --> 00:24:12,080 Speaker 9: associated l Mess with the leatherboods, with handbags and with 435 00:24:12,280 --> 00:24:15,600 Speaker 9: you know, but actually they've done tremendously well when it 436 00:24:15,680 --> 00:24:18,000 Speaker 9: comes to ready to wear. And they have these two 437 00:24:18,920 --> 00:24:23,000 Speaker 9: uh designers, uh you know, two ladies, Uh, one for 438 00:24:23,119 --> 00:24:26,000 Speaker 9: men's wearing, one for for women's wear, and they've done wonders. 439 00:24:26,440 --> 00:24:26,800 Speaker 5: Uh. 440 00:24:26,960 --> 00:24:28,800 Speaker 9: So you know, but that but I'm one of of 441 00:24:28,800 --> 00:24:30,720 Speaker 9: course it is you know, you it's it's it's less 442 00:24:30,960 --> 00:24:34,000 Speaker 9: you know, on logos, it's less on bold maximalism that 443 00:24:34,000 --> 00:24:36,560 Speaker 9: that Andrew was talking about. It's more on the the 444 00:24:36,880 --> 00:24:40,600 Speaker 9: the quiet but uh, you know, the the think about 445 00:24:41,280 --> 00:24:45,080 Speaker 9: you know clothes that you can you know their their 446 00:24:45,160 --> 00:24:47,800 Speaker 9: viability will last for over a season. Let's put it 447 00:24:47,840 --> 00:24:52,440 Speaker 9: this way, and then otherwise, uh, you know, is always 448 00:24:52,480 --> 00:24:56,200 Speaker 9: an important one of course. Uh Maria gras acuity, she's 449 00:24:56,200 --> 00:24:58,320 Speaker 9: been she's been with the brand for for many years 450 00:24:58,359 --> 00:25:01,040 Speaker 9: and actually she's done Wonders as well for commercially. 451 00:25:02,280 --> 00:25:05,320 Speaker 4: Andrea, final thought from you, it's the fortieth year of 452 00:25:05,359 --> 00:25:07,240 Speaker 4: London Fashion Week, so it's a bit of a milestone 453 00:25:07,280 --> 00:25:09,880 Speaker 4: as well. Have you have you kind of a particular 454 00:25:09,960 --> 00:25:12,240 Speaker 4: view unwhere of about the next forty years might be 455 00:25:12,240 --> 00:25:13,199 Speaker 4: taking London fashion. 456 00:25:13,720 --> 00:25:17,600 Speaker 1: I'm London's always been very innovative in fashion. When we 457 00:25:17,680 --> 00:25:22,520 Speaker 1: think about you know, many designers come through some Martins, 458 00:25:22,640 --> 00:25:26,199 Speaker 1: for example. London can be quite edgy as well, so 459 00:25:26,920 --> 00:25:33,879 Speaker 1: I think that it's important to keep that, you know, experimentation, edginess, 460 00:25:35,280 --> 00:25:38,199 Speaker 1: to have a different point of view from some of 461 00:25:38,240 --> 00:25:41,000 Speaker 1: the bigger capitals. And I think if Barbery can get 462 00:25:41,040 --> 00:25:44,439 Speaker 1: it right, it can really reinforce that. 463 00:25:45,040 --> 00:25:48,200 Speaker 4: That was Bloomberg Opinion columnist Andrea Felsted and our European 464 00:25:48,280 --> 00:25:51,960 Speaker 4: luxury reporter Angelina Rascouette. I'm Stephen Carroll in London. You 465 00:25:51,960 --> 00:25:55,200 Speaker 4: can catch US every weekday morning here for Bloomberg Daybreak Europe, 466 00:25:55,240 --> 00:25:58,280 Speaker 4: beginning at six am in London and one am on 467 00:25:58,320 --> 00:25:59,879 Speaker 4: Wall Street, Tom. 468 00:26:00,119 --> 00:26:02,359 Speaker 2: Stephen and coming up on Bloomberg day Break weekend, the 469 00:26:02,359 --> 00:26:05,920 Speaker 2: Reserve Bank of Australia releasing minutes from its latest policy meeting, 470 00:26:06,160 --> 00:26:09,000 Speaker 2: and we'll get a preview. I'm Tom Busby and this 471 00:26:09,240 --> 00:26:21,520 Speaker 2: is Bloomberg. I'm Tom Busby in New York with your 472 00:26:21,520 --> 00:26:23,800 Speaker 2: global look ahead at the top stories for investors in 473 00:26:23,840 --> 00:26:26,360 Speaker 2: the coming week. In the week ahead, the Reserve Bank 474 00:26:26,400 --> 00:26:30,200 Speaker 2: of Australia releases minutes from its latest policy meeting. That's 475 00:26:30,240 --> 00:26:33,240 Speaker 2: when the RBA left its benchmark rate on hold after 476 00:26:33,320 --> 00:26:37,720 Speaker 2: lifting it thirteen times since twenty twenty two. Bloomberg's Doug 477 00:26:37,760 --> 00:26:40,959 Speaker 2: Christner and Paul Allen from the Daybreak Asia team on 478 00:26:41,000 --> 00:26:41,920 Speaker 2: what it all means. 479 00:26:42,359 --> 00:26:45,400 Speaker 5: Tom. We know how rampant inflation was in many developed 480 00:26:45,440 --> 00:26:49,879 Speaker 5: economies during the pandemic, and central bankers responded with aggressive 481 00:26:49,960 --> 00:26:52,919 Speaker 5: rate hikes. In a last year, the stories seemed to 482 00:26:53,000 --> 00:26:57,200 Speaker 5: shift to immaculate disinflation, but that's no longer a given, 483 00:26:57,320 --> 00:27:01,560 Speaker 5: as the recent USCPI data show clients have stalled and 484 00:27:01,640 --> 00:27:05,080 Speaker 5: it's forced an adjustment to expectations for the number of 485 00:27:05,200 --> 00:27:07,560 Speaker 5: rate cuts from the FED and how aggressive the FED 486 00:27:07,600 --> 00:27:07,879 Speaker 5: may be. 487 00:27:08,119 --> 00:27:11,520 Speaker 10: Other central banks facing a similar dynamic, and this week 488 00:27:11,560 --> 00:27:13,920 Speaker 10: we might get inside into how the RBA have used 489 00:27:13,920 --> 00:27:16,879 Speaker 10: the inflation story. Minutes from the last meeting of the 490 00:27:16,880 --> 00:27:20,240 Speaker 10: Reserve Bank of Australia schedule for release on Tuesday for 491 00:27:20,280 --> 00:27:23,639 Speaker 10: a look ahead, we're joined by Swati Pandi, Bloomberg Australia 492 00:27:23,760 --> 00:27:27,000 Speaker 10: Economy Government Reporter and Swati We've got a big piece 493 00:27:27,000 --> 00:27:30,840 Speaker 10: of the puzzle with the January unemployment numbers ticking up 494 00:27:30,840 --> 00:27:33,080 Speaker 10: to four point one percent. I believe that's the highest 495 00:27:33,119 --> 00:27:36,200 Speaker 10: in two years, one hundred thousand full time jobs lost. 496 00:27:36,200 --> 00:27:38,560 Speaker 10: A little bit more is that it can we say 497 00:27:38,600 --> 00:27:40,800 Speaker 10: that tightening's now off the table for the RBA. 498 00:27:41,080 --> 00:27:44,520 Speaker 11: It was a surprising piece of data and a very 499 00:27:44,520 --> 00:27:48,159 Speaker 11: important one as well, because the RBA has been looking 500 00:27:48,240 --> 00:27:51,760 Speaker 11: at the jobless rate and that was also one of 501 00:27:51,760 --> 00:27:55,280 Speaker 11: the reasons why they have been hawkish. But the ABS 502 00:27:55,359 --> 00:27:59,000 Speaker 11: has tried to play it down that report by saying 503 00:27:59,040 --> 00:28:02,240 Speaker 11: there is a lot of c reasonality in December and January, 504 00:28:02,520 --> 00:28:05,840 Speaker 11: January being a very popular month for people to go 505 00:28:05,920 --> 00:28:10,359 Speaker 11: on holidays, and also there have been some people who 506 00:28:11,119 --> 00:28:15,040 Speaker 11: were marked as unemployed, but they were actually in between jobs, 507 00:28:15,280 --> 00:28:19,200 Speaker 11: so we could see a revision in the unemployment rate, 508 00:28:19,680 --> 00:28:23,600 Speaker 11: maybe going back down in February. So I would say 509 00:28:23,640 --> 00:28:28,320 Speaker 11: it's probably too early to say that we are in 510 00:28:28,640 --> 00:28:33,080 Speaker 11: a market where the labor where the labor market is easing. 511 00:28:33,880 --> 00:28:38,760 Speaker 11: There are tentative signs, but overall the RBA's assessment is 512 00:28:38,800 --> 00:28:42,240 Speaker 11: that the labor market is still tight and demand is 513 00:28:42,240 --> 00:28:43,520 Speaker 11: still exceeding supply. 514 00:28:43,840 --> 00:28:47,000 Speaker 5: That said, the labor market data did get the market's attention. 515 00:28:47,280 --> 00:28:50,040 Speaker 5: We spoke earlier in the week with Charlie Jamison, he 516 00:28:50,160 --> 00:28:52,800 Speaker 5: is the CIO of Jamison Coot Bonds. Here's what he 517 00:28:52,880 --> 00:28:53,360 Speaker 5: had to say. 518 00:28:53,440 --> 00:28:55,800 Speaker 12: We need to be generating more employment in order to 519 00:28:55,880 --> 00:28:58,440 Speaker 12: keep those numbers designable. There has been a lot of 520 00:28:58,680 --> 00:29:00,920 Speaker 12: loss of momentum in the me as we said, and 521 00:29:00,920 --> 00:29:03,560 Speaker 12: that's certainly, you know, different to what you guys are 522 00:29:03,600 --> 00:29:05,640 Speaker 12: saying in the United States at the moment, where the 523 00:29:05,640 --> 00:29:08,360 Speaker 12: economy seems to have accelerated a little bit in the 524 00:29:08,400 --> 00:29:10,320 Speaker 12: in the first part of the looking at employment and 525 00:29:10,840 --> 00:29:11,760 Speaker 12: inflation data. 526 00:29:11,880 --> 00:29:14,320 Speaker 5: So it's brought forward now the notion of rate cuts 527 00:29:14,320 --> 00:29:16,840 Speaker 5: from the RBA. SWATI, is it too soon to talk 528 00:29:16,840 --> 00:29:17,760 Speaker 5: about rate cuts. 529 00:29:17,840 --> 00:29:21,760 Speaker 11: It's actually not too soon. But if you ask Reserve 530 00:29:21,840 --> 00:29:25,480 Speaker 11: Bank Governor Michelle Velock, she would say it is too 531 00:29:25,520 --> 00:29:29,800 Speaker 11: soon because they are still not ruling out interest rate hikes. 532 00:29:29,880 --> 00:29:34,000 Speaker 11: That was her commentary last week, So they are not 533 00:29:34,160 --> 00:29:37,160 Speaker 11: ruling anything out for that matter. But she's still sounding hawkish. 534 00:29:37,240 --> 00:29:41,040 Speaker 11: Since she's still talking hard on inflation, markets are now 535 00:29:41,080 --> 00:29:45,440 Speaker 11: expecting some probability of an August rate cut. There are 536 00:29:45,440 --> 00:29:48,800 Speaker 11: some economists who are expecting a June rate cut. A 537 00:29:48,880 --> 00:29:53,160 Speaker 11: Bloomberg economist is also expecting a rate cut around May June. 538 00:29:53,440 --> 00:29:56,720 Speaker 11: So yes, it's it's still three months down the track. 539 00:29:56,800 --> 00:29:57,840 Speaker 11: I would say, wa'ts. 540 00:29:57,680 --> 00:29:59,640 Speaker 10: The inflation story telling us right now. 541 00:30:00,080 --> 00:30:03,920 Speaker 11: Inflation is still well above the RBA's target, still has 542 00:30:04,000 --> 00:30:08,000 Speaker 11: a four handle to it. ARBs target is two to 543 00:30:08,120 --> 00:30:11,719 Speaker 11: three percent. They are targeting the midpoint two point five percent. 544 00:30:12,240 --> 00:30:15,160 Speaker 11: So it is still at a level where a Michelle 545 00:30:15,160 --> 00:30:19,239 Speaker 11: Bullock is really uncomfortable, and that is one of the 546 00:30:19,280 --> 00:30:25,080 Speaker 11: reasons her vague guidance, I would say, is for interest 547 00:30:25,160 --> 00:30:29,680 Speaker 11: rates to remain elevated for longer. The RBA's forecast does 548 00:30:29,720 --> 00:30:33,200 Speaker 11: not show inflation in the midpoint until twenty twenty six. 549 00:30:33,480 --> 00:30:36,640 Speaker 5: I was reading comments earlier in the week from Maryan Coller, 550 00:30:36,680 --> 00:30:39,480 Speaker 5: the head of Economic Analysis from the RBA, and one 551 00:30:39,480 --> 00:30:42,720 Speaker 5: of the things she was cautioning is that inflation may 552 00:30:42,760 --> 00:30:47,120 Speaker 5: be sticky. Paul, give me your perspective. You live in Sydney. 553 00:30:47,200 --> 00:30:50,040 Speaker 5: What is it like, you know, the cost of living 554 00:30:50,120 --> 00:30:52,560 Speaker 5: right now? What are common people kind of dealing with 555 00:30:52,640 --> 00:30:54,200 Speaker 5: in in their everyday affairs. 556 00:30:54,560 --> 00:30:57,000 Speaker 10: Yeah, this is an interesting one that you raised, because 557 00:30:57,240 --> 00:31:01,440 Speaker 10: we have Michelle Bullock last week speaking to Parliament about 558 00:31:01,520 --> 00:31:06,360 Speaker 10: this and questions about businesses using the cover of high 559 00:31:06,440 --> 00:31:09,760 Speaker 10: inflation to start pushing up prices were raised. And look, 560 00:31:09,920 --> 00:31:12,600 Speaker 10: certainly from an anecdotal point of view, and I'm sure 561 00:31:12,600 --> 00:31:14,880 Speaker 10: Swaty will back me up here, is if you just 562 00:31:14,960 --> 00:31:17,280 Speaker 10: go on your regular grocery shop, you're just out and 563 00:31:17,320 --> 00:31:22,160 Speaker 10: about doing things. Inflation's running, it's, you know, something above 564 00:31:22,640 --> 00:31:27,320 Speaker 10: the RBA's target window, but you're buying things that might 565 00:31:27,360 --> 00:31:31,080 Speaker 10: be higher by fifty, sixty, even one hundred percent than 566 00:31:31,560 --> 00:31:34,240 Speaker 10: what they were a year ago. Now, the two big 567 00:31:34,280 --> 00:31:37,920 Speaker 10: supermarket chains in Australia, Coals and Woolworth, start coming under 568 00:31:37,920 --> 00:31:40,520 Speaker 10: fire as well for this type of thing. They're defending 569 00:31:40,560 --> 00:31:44,080 Speaker 10: themselves against this accusation of price guarding. But you know, 570 00:31:44,160 --> 00:31:46,800 Speaker 10: it's a hot subject in Australia at the moment, isn't 571 00:31:46,800 --> 00:31:49,720 Speaker 10: it smitty just how much consumers are paying for things 572 00:31:50,200 --> 00:31:52,920 Speaker 10: and how that doesn't really square away with the official 573 00:31:52,960 --> 00:31:53,680 Speaker 10: inflation rate. 574 00:31:54,080 --> 00:31:58,680 Speaker 11: That's absolutely right. Haircuts have become very expensive and it's 575 00:31:59,520 --> 00:32:05,880 Speaker 11: eating out. Restaurants have raised their prices. I still would 576 00:32:06,000 --> 00:32:08,760 Speaker 11: say that when you're out and about in Sydney, if 577 00:32:08,800 --> 00:32:12,520 Speaker 11: you go to a pub on Friday, it's still buzzing, 578 00:32:12,680 --> 00:32:17,040 Speaker 11: still teaming with people. So we are not really seeing 579 00:32:17,120 --> 00:32:23,360 Speaker 11: that impact on every day kind of lifestyle. Yet we've 580 00:32:23,400 --> 00:32:28,280 Speaker 11: not had a big impact on people really cutting down 581 00:32:28,960 --> 00:32:32,960 Speaker 11: drastically on their budget at an aggregate level. I'm sure 582 00:32:33,000 --> 00:32:36,200 Speaker 11: there are people at either ends of the spectrum who 583 00:32:36,200 --> 00:32:39,800 Speaker 11: are very deeply affected, but if you are going out 584 00:32:39,800 --> 00:32:43,040 Speaker 11: and about, it just feels like a normal day. During 585 00:32:43,080 --> 00:32:48,440 Speaker 11: Boxing Day. In fact, around Christmas, shopping malls were chocolate block. 586 00:32:48,520 --> 00:32:51,840 Speaker 11: They were huge queues of cars waiting to park, and 587 00:32:51,880 --> 00:32:53,720 Speaker 11: that was the time we were talking about a hard 588 00:32:53,760 --> 00:32:56,120 Speaker 11: landing soft landing, so it just did not feel like 589 00:32:57,480 --> 00:32:59,280 Speaker 11: a recession is coming for that matter. 590 00:33:00,000 --> 00:33:02,280 Speaker 5: You know, it's interesting because I think we have just 591 00:33:02,360 --> 00:33:04,560 Speaker 5: in listening to the conversation here, I think we have 592 00:33:04,720 --> 00:33:09,040 Speaker 5: to discriminate between services inflation and goods inflation. And I 593 00:33:09,160 --> 00:33:12,240 Speaker 5: recently saw that the IMF was recommending that the RBA 594 00:33:12,680 --> 00:33:15,360 Speaker 5: needed to raise rates to tame inflation. Is the IMF 595 00:33:15,440 --> 00:33:17,800 Speaker 5: looking more at the services side than the good side? 596 00:33:17,840 --> 00:33:22,720 Speaker 11: I would say the IMF is looking at the services 597 00:33:22,760 --> 00:33:26,040 Speaker 11: side because that is something that Michelle Bullock and earlier 598 00:33:26,120 --> 00:33:30,200 Speaker 11: Marion Kohler mentioned as well, that that is that part 599 00:33:30,280 --> 00:33:34,520 Speaker 11: of inflation is quite sticky, and their concern is that 600 00:33:35,400 --> 00:33:39,479 Speaker 11: it will remain elevated for some time. And another concern 601 00:33:39,520 --> 00:33:42,360 Speaker 11: that they have is inflation expectations. So if you allow 602 00:33:42,440 --> 00:33:46,520 Speaker 11: inflation to remain higher or above the target band for 603 00:33:47,320 --> 00:33:53,480 Speaker 11: a long time, it will unanchor or do more inflation 604 00:33:53,600 --> 00:33:57,520 Speaker 11: expectations as well, which right now is at two point 605 00:33:57,600 --> 00:33:58,360 Speaker 11: five mid point. 606 00:33:58,560 --> 00:34:01,160 Speaker 10: Well, we mentioned that Michelle Bullock the ABBYA Kevin I 607 00:34:01,360 --> 00:34:04,960 Speaker 10: was speaking with senators last week in Australia. She took 608 00:34:05,040 --> 00:34:06,880 Speaker 10: questions on this. What was she saying about it? 609 00:34:07,320 --> 00:34:11,000 Speaker 11: She actually said that the IMF is not particularly talking 610 00:34:11,040 --> 00:34:14,320 Speaker 11: about Australia. She said this is something they are talking 611 00:34:14,320 --> 00:34:20,400 Speaker 11: about in general for developed economies. Because inflation continues to 612 00:34:20,520 --> 00:34:23,760 Speaker 11: remain a concern. But also as far as goods inflation 613 00:34:23,960 --> 00:34:27,360 Speaker 11: is concerned, it's still too early to say that we 614 00:34:27,440 --> 00:34:30,839 Speaker 11: have won that battle because we have conflicts going on 615 00:34:31,160 --> 00:34:35,319 Speaker 11: in parts of the world. There are supply chain disruptions 616 00:34:35,320 --> 00:34:38,160 Speaker 11: that have again happened with the attacks in Red Sea. 617 00:34:38,640 --> 00:34:42,760 Speaker 11: So even as far as goods inflation is concerned, Michelle 618 00:34:42,760 --> 00:34:47,040 Speaker 11: Bullock is not willing to say that we have won 619 00:34:47,080 --> 00:34:47,719 Speaker 11: the battle there. 620 00:34:48,040 --> 00:34:50,720 Speaker 5: So my understanding is that the RBA during its tightening 621 00:34:50,760 --> 00:34:53,959 Speaker 5: cycle raised rates thirteen times for a total of four 622 00:34:54,040 --> 00:34:56,640 Speaker 5: hundred and twenty basis points. The policy rate now is 623 00:34:56,640 --> 00:35:00,279 Speaker 5: at four thirty five. Paul helped me understand how that 624 00:35:00,280 --> 00:35:02,399 Speaker 5: connects to the mortgage market in Australia. 625 00:35:02,520 --> 00:35:05,880 Speaker 10: The big four banks here often cop a lot of 626 00:35:05,920 --> 00:35:10,040 Speaker 10: criticism for being incredibly quick to pass on increases to 627 00:35:10,080 --> 00:35:12,879 Speaker 10: the cash rate to people who are borrowing money off them. 628 00:35:13,040 --> 00:35:18,520 Speaker 10: And in a country like Australia where house buying auctions 629 00:35:18,960 --> 00:35:22,359 Speaker 10: practically a national sport, the tax regime has also set 630 00:35:22,440 --> 00:35:25,680 Speaker 10: up very generously for people who want to buy investment properties. 631 00:35:26,400 --> 00:35:30,560 Speaker 10: These sorts of interest rate moves really get people talking. 632 00:35:31,200 --> 00:35:33,120 Speaker 10: There is a fair bit of competition. But if you're 633 00:35:33,160 --> 00:35:35,600 Speaker 10: taking out a mortgage in Australia, yes, you do pay 634 00:35:35,680 --> 00:35:37,680 Speaker 10: a lot more than you were a couple of years 635 00:35:37,680 --> 00:35:40,400 Speaker 10: ago during the depths of the pandemic, when interest rates 636 00:35:40,400 --> 00:35:43,680 Speaker 10: were very very low and we saw property prices just 637 00:35:43,920 --> 00:35:47,160 Speaker 10: absolutely taking off. Now a lot of people took out 638 00:35:47,200 --> 00:35:50,279 Speaker 10: loans when rates were at those low levels. Those rates 639 00:35:50,280 --> 00:35:53,280 Speaker 10: have since increased, but we haven't seen a huge amount 640 00:35:53,320 --> 00:35:57,200 Speaker 10: of mortgage stress. There's been a very few for sales, 641 00:35:57,239 --> 00:36:00,640 Speaker 10: and certainly none of what was predicted the time seems 642 00:36:00,680 --> 00:36:03,120 Speaker 10: to have come to pass. Is that your observation, Swati? 643 00:36:03,280 --> 00:36:06,439 Speaker 11: Yes, absolutely. I would also like to add there that 644 00:36:06,560 --> 00:36:11,200 Speaker 11: Australians are among the most indebted household in the world, 645 00:36:11,600 --> 00:36:15,600 Speaker 11: so we have a debt to income ratio of roughly 646 00:36:16,200 --> 00:36:19,799 Speaker 11: one hundred and eighty five percent, and that is one 647 00:36:19,840 --> 00:36:24,680 Speaker 11: of the reasons it was expected that households would be very, 648 00:36:24,800 --> 00:36:29,359 Speaker 11: very deeply hit by these interest rate hikes. But we 649 00:36:29,440 --> 00:36:33,520 Speaker 11: had earnings from Commonwealth Bank of Australia earlier this week 650 00:36:33,920 --> 00:36:38,520 Speaker 11: and they had like five billion dollars in profits, So 651 00:36:39,080 --> 00:36:42,960 Speaker 11: clearly we are not seeing that impact in defaults and 652 00:36:43,440 --> 00:36:45,719 Speaker 11: non performing assets for banks at least. 653 00:36:45,560 --> 00:36:47,799 Speaker 5: So Swati. I'm wondering whether or not when we get 654 00:36:47,840 --> 00:36:51,040 Speaker 5: these minutes from the last RBA meeting on Tuesday, whether 655 00:36:51,160 --> 00:36:54,360 Speaker 5: we're going to be able to learn anything here, whether 656 00:36:54,400 --> 00:36:57,880 Speaker 5: it's going to be kind of a level of understanding 657 00:36:57,920 --> 00:36:59,680 Speaker 5: that the market will have, or do we need to 658 00:36:59,680 --> 00:37:02,880 Speaker 5: say that because of this very very disappointing employment report, 659 00:37:03,000 --> 00:37:06,120 Speaker 5: that it's essentially all bets are off now, we're starting 660 00:37:06,160 --> 00:37:07,759 Speaker 5: almost from a clean slate. 661 00:37:07,719 --> 00:37:12,040 Speaker 11: So Doug, we will have monthly inflation report next week 662 00:37:12,680 --> 00:37:16,120 Speaker 11: that is going to be critical for markets, and if 663 00:37:16,200 --> 00:37:20,760 Speaker 11: that is showing a softer number, I think rate bets 664 00:37:20,840 --> 00:37:26,640 Speaker 11: will will be brought forward more convincingly than now. As 665 00:37:26,640 --> 00:37:30,640 Speaker 11: far as the minutes are concerned. The Reserve Bank Governor 666 00:37:30,719 --> 00:37:35,640 Speaker 11: held her first press conference after the rate decision last 667 00:37:35,680 --> 00:37:38,799 Speaker 11: week and that went on for almost an hour and 668 00:37:38,840 --> 00:37:41,879 Speaker 11: a lot of the questions around her views on interest rates, 669 00:37:41,920 --> 00:37:45,680 Speaker 11: inflation and economy were answered, and then she also appeared 670 00:37:45,719 --> 00:37:49,279 Speaker 11: into parliamentary appearances. So I think as far as the 671 00:37:49,440 --> 00:37:52,799 Speaker 11: RBA's thinking is concerned, we already have a lot of 672 00:37:52,800 --> 00:37:55,839 Speaker 11: information from them. So not sure how much more the 673 00:37:55,880 --> 00:37:59,239 Speaker 11: minutes are going to show, but definitely markets will be 674 00:37:59,239 --> 00:38:01,040 Speaker 11: looking out for that monthly inflation number. 675 00:38:01,200 --> 00:38:02,920 Speaker 10: And Doug, I'm not sure if you're aware we're actually 676 00:38:02,920 --> 00:38:05,080 Speaker 10: in the presence of history here because that was the 677 00:38:05,120 --> 00:38:08,200 Speaker 10: first ever press conference by an Ibya governor and Swatty 678 00:38:08,280 --> 00:38:11,160 Speaker 10: got to ask the first ever question, so that caused 679 00:38:11,160 --> 00:38:13,799 Speaker 10: a little bit of consternation among the media pack. 680 00:38:13,960 --> 00:38:16,080 Speaker 5: Swatty, thank you so much for making time to chat 681 00:38:16,120 --> 00:38:20,440 Speaker 5: with us. Swati Pondie Bloomberg Australia Economy and Government reporter, 682 00:38:20,800 --> 00:38:23,239 Speaker 5: and of course Paul Allen in Sydney, who is a 683 00:38:23,239 --> 00:38:26,200 Speaker 5: member of the Daybreak Asia team. Thanks to you both, 684 00:38:26,560 --> 00:38:29,360 Speaker 5: I'm Doug Prisner. You can catch Brian Curtis and myself 685 00:38:29,440 --> 00:38:32,560 Speaker 5: weekdays here for Bloomberg day Break Asia beginning at nine 686 00:38:32,600 --> 00:38:35,840 Speaker 5: in the morning in Hong Kong eight pm on Wall Street. 687 00:38:36,160 --> 00:38:38,680 Speaker 2: Tom our thanks to Doug and Paul. And that does 688 00:38:38,719 --> 00:38:41,399 Speaker 2: it for this edition of Bloomberg day Break Weekend. Join 689 00:38:41,480 --> 00:38:43,480 Speaker 2: us again Monday morning at five am Wall Street Time 690 00:38:43,520 --> 00:38:45,880 Speaker 2: for the latest on markets overseas and the news you 691 00:38:45,960 --> 00:38:47,040 Speaker 2: need to start your day. 692 00:38:47,560 --> 00:38:49,200 Speaker 3: I'm Tom Buzby. Stay with us. 693 00:38:49,440 --> 00:38:52,560 Speaker 2: Top stories and global business headlines are coming up right now.