WEBVTT - Bloomberg Daybreak Weekend: Central Bank Decisions 0:00:03.040 --> 0:00:05.480 This is Bloomberg day Break Weekend, our global look at 0:00:05.519 --> 0:00:07.440 the top stories in the coming week from our day 0:00:07.480 --> 0:00:10.280 Break anchors all around the world. And straight ahead on 0:00:10.280 --> 0:00:13.920 the program, the Fed decides J Powell and Company make 0:00:13.960 --> 0:00:17.439 a key interest rate decision. I'm Tom Busby in New York. 0:00:17.800 --> 0:00:20.799 I'm Kathie Lyons in Washington, where President Biden is preparing 0:00:20.800 --> 0:00:23.440 to head to New York for the UN General as Sunday. 0:00:23.800 --> 0:00:26.439 I'm Caroline Hepga here in London, where we're looking ahead 0:00:26.440 --> 0:00:28.720 to the next Bank of England rate decision. 0:00:29.160 --> 0:00:32.280 I'm Doug Prisner. Inflation in Japan is above target. Now 0:00:32.320 --> 0:00:33.720 it's up to the Bank of Japan. 0:00:35.440 --> 0:00:38.720 That's all straight ahead on Bloomberg day Break Weekend. On 0:00:38.880 --> 0:00:41.959 Bloomberg Eleve them three own New York, Bloomberg ninety nine 0:00:42.000 --> 0:00:45.400 to one, Washington, DC, Bloomberg one O six one, Boston, 0:00:45.440 --> 0:00:50.280 Bloomberg nine sixty, San Francisco, DAB Digital Radio London, Sirius 0:00:50.400 --> 0:00:53.640 XM one nineteen and around the world on Bloomberg Radio 0:00:53.720 --> 0:00:56.000 dot Com and via the Bloomberg Business App. 0:01:00.040 --> 0:01:01.800 Good day to you. I'm Tom Busby, and we begin 0:01:01.800 --> 0:01:05.000 today's program with the Federal Reserve meeting again this week, 0:01:05.120 --> 0:01:08.080 after nearly two months since the last MED decision, in 0:01:08.120 --> 0:01:11.760 which J. Powell and Central bank policymakers raised their benchmark 0:01:11.840 --> 0:01:14.920 lending rate to a twenty two year high. So will 0:01:14.959 --> 0:01:17.640 the Fed hit pause again or is there another rate 0:01:17.720 --> 0:01:19.800 hike in the cards. We'll find out Wednesday and for 0:01:19.880 --> 0:01:23.560 more we're joined by Bloomberg International Economics and Policy correspondent 0:01:23.920 --> 0:01:26.880 Michael McKee. Now, before we take a deeper dive into 0:01:26.880 --> 0:01:28.880 the data, the FED is looking at what are you 0:01:29.080 --> 0:01:31.360 expecting to see from the FOMC this week? 0:01:31.920 --> 0:01:34.039 I think I go with the consensus on Wall Street 0:01:34.080 --> 0:01:37.440 that the Fed will pause. They gave every indication in 0:01:37.520 --> 0:01:40.760 their speeches, those who did speak since the last meeting 0:01:41.160 --> 0:01:44.040 that they are not in a hurry to raise rates again. 0:01:44.720 --> 0:01:46.679 They leave it on the table, but not in a hurry. 0:01:46.760 --> 0:01:50.040 And so they've created a consensus on Wall Street that 0:01:50.080 --> 0:01:51.760 they're not going to do anything and they would be 0:01:51.840 --> 0:01:53.520 loath to surprise investors. 0:01:53.760 --> 0:01:56.040 Let's talk about rates and where they are right now. 0:01:56.080 --> 0:01:58.040 We're at a range of five and a quarter to 0:01:58.120 --> 0:02:01.280 five and a half percent. That's a twenty two year high, right, 0:02:01.360 --> 0:02:02.720 and how high can they go? 0:02:03.160 --> 0:02:06.600 Well, they've only said that they would go one more time, 0:02:07.760 --> 0:02:10.320 and that may change at this meeting, but if they did, 0:02:10.440 --> 0:02:12.959 they'd go up to a range of five and a 0:02:13.000 --> 0:02:15.320 half to five and three quarters percent. But of course, 0:02:15.360 --> 0:02:19.360 if inflation continues to rise and they don't feel like 0:02:19.440 --> 0:02:23.040 they have tight enough to bring it down, they could 0:02:23.040 --> 0:02:25.600 go higher than that. Some people were predicting earlier this 0:02:25.680 --> 0:02:28.079 year that they'd get to six or six and a 0:02:28.160 --> 0:02:32.280 quarter percent. Jim Bullard, who just left the FED after 0:02:32.360 --> 0:02:36.960 that last meeting, had predicted in his June dot plot 0:02:37.000 --> 0:02:39.400 that they'd go to six and a quarter percent. So 0:02:39.480 --> 0:02:42.280 it's very possible that we haven't seen the end of it. 0:02:42.280 --> 0:02:44.520 It will just depend on the progress against inflation. 0:02:44.800 --> 0:02:47.320 We saw some inflation data this past week, some good, 0:02:47.400 --> 0:02:49.480 some of it not so good. Let's talk about what 0:02:49.520 --> 0:02:52.520 happened in August month over month and what was behind 0:02:52.560 --> 0:02:53.399 that big increase. 0:02:53.800 --> 0:02:58.960 Well, the big increase came in the CPI headline numbers, 0:03:00.080 --> 0:03:02.160 so we saw it in the PPI as well, the 0:03:02.160 --> 0:03:06.880 Producer Price Index. The oil prices pushed up, gasoline prices 0:03:06.919 --> 0:03:10.720 that pushed up the headline numbers. Overall, the core went 0:03:10.840 --> 0:03:15.120 down though, particularly for the CPI, and that is what 0:03:15.160 --> 0:03:18.120 the Fed's focused on. Because they know they can't affect 0:03:18.280 --> 0:03:19.120 the oil price. 0:03:19.639 --> 0:03:20.120 They can't. 0:03:20.520 --> 0:03:21.960 They can raise raise all I want, but they're not 0:03:21.960 --> 0:03:24.960 going to bring down the price of gasoline by doing that. 0:03:25.480 --> 0:03:27.920 So they're focused on the core, and the core gave 0:03:27.960 --> 0:03:31.480 them some evidence that they're still making progress. Slow, but 0:03:31.560 --> 0:03:32.639 there is still progress. 0:03:32.919 --> 0:03:34.880 And that core year of a year was the biggest 0:03:34.880 --> 0:03:37.920 decline in two years, so there is progress. 0:03:38.080 --> 0:03:40.720 It's definitely progress, and now they need to keep that going. 0:03:41.320 --> 0:03:43.720 The question is do they need to raise rates further 0:03:43.800 --> 0:03:46.160 to keep the momentum going or are they at a 0:03:46.520 --> 0:03:49.720 tight enough spot now that it already keeps the pressure on. 0:03:50.280 --> 0:03:53.120 Let's go to the labor market. Still strong, initial jobless 0:03:53.120 --> 0:03:56.720 claims edging a little lower, surprising some economists. There's a 0:03:56.720 --> 0:03:58.320 lot of labor strife though. 0:03:59.280 --> 0:04:02.480 There is labor strife now with the United Auto Workers 0:04:02.760 --> 0:04:07.240 out on strike, but you won't really notice that too 0:04:07.320 --> 0:04:10.960 much in the data for a while. The strike began 0:04:11.160 --> 0:04:15.720 during the reference week for the September payrolls report, so 0:04:16.040 --> 0:04:19.719 since the workers were at work for most of that week, 0:04:19.960 --> 0:04:23.400 they won't fall off of the payrolls numbers for September 0:04:23.600 --> 0:04:27.119 if they still on strike in October. Is a good chance, 0:04:27.160 --> 0:04:29.120 then we would see a decline in the number of 0:04:29.200 --> 0:04:33.640 people who are at work in manufacturing. The other aspect 0:04:33.680 --> 0:04:36.599 of it is that if you are on strike, you're 0:04:36.640 --> 0:04:41.960 not eligible for unemployment benefits. Twelve seven hundred workers are 0:04:42.000 --> 0:04:44.240 actually on strike, but there's one hundred and forty six 0:04:44.279 --> 0:04:47.760 thousand United Auto Workers. If other plants are shut down 0:04:47.839 --> 0:04:51.640 because those few workers are out, then all those people 0:04:51.920 --> 0:04:56.320 could file for unemployment benefits and we'll know it's a strike. 0:04:56.520 --> 0:04:58.320 So the FED won't be too upset about it, but 0:04:58.360 --> 0:05:00.560 it'll certainly make it hard to get a read on 0:05:00.600 --> 0:05:02.159 the numbers from the jobless claims. 0:05:02.520 --> 0:05:04.640 On the other hand, the Writers Guild strike it started 0:05:04.720 --> 0:05:07.840 May TEWOD has really ballooned to other industries that are 0:05:07.960 --> 0:05:10.480 sitting idle in Hollywood. You have the sag after strike 0:05:10.560 --> 0:05:14.080 compounding that you see that show up in the unemployment data. 0:05:14.200 --> 0:05:18.359 Yeah, the people who are collateral victims of the strike 0:05:19.279 --> 0:05:25.320 don't get counted as jobs lost. But the strikers are 0:05:25.400 --> 0:05:27.839 only just in the last month or so beginning to 0:05:27.920 --> 0:05:31.760 get counted in terms of number of jobs lost in 0:05:31.760 --> 0:05:35.000 the motion picture industry and things like that because they 0:05:35.080 --> 0:05:38.159 had irregular paychecks. Most of them are freelancers, and so 0:05:38.600 --> 0:05:41.080 they don't get paid in the same way that other 0:05:41.120 --> 0:05:44.600 workers do, so it's harder for the Bureau of Labor Statistics. 0:05:44.080 --> 0:05:47.359 To count them now. Despite inflation still a problem, retail 0:05:47.400 --> 0:05:49.960 spending held up pretty well in August. You talked about 0:05:49.960 --> 0:05:52.400 fuel prices being a big part of that increase, but 0:05:52.440 --> 0:05:54.720 still Americans are spending. 0:05:54.839 --> 0:05:58.440 Americans are spending. Gasoline went up five point two percent, 0:05:58.520 --> 0:06:01.280 a big jump, and that of course means people had 0:06:01.400 --> 0:06:05.000 less to spend on other things, but they spent anyway. 0:06:05.400 --> 0:06:08.640 It really was a sort of traditional back to school 0:06:08.680 --> 0:06:11.800 month of August, as clothing store sales went up by 0:06:12.120 --> 0:06:15.720 nine tenths. We also saw a rise in personal care 0:06:15.760 --> 0:06:17.400 as people went out and got their back to school 0:06:17.440 --> 0:06:22.440 haircuts and things like that. And we saw electronics rise 0:06:22.480 --> 0:06:25.560 people buying computers for their kids to go back to school, 0:06:26.839 --> 0:06:31.160 and calculators and things like that. So it was kind 0:06:31.160 --> 0:06:34.839 of the spending that you would expect for an August, 0:06:34.960 --> 0:06:36.800 which is good news for the fat Now. 0:06:36.839 --> 0:06:40.000 Housing long term mortgage rates still above seven percent at 0:06:40.000 --> 0:06:42.880 a two decade high. Adjustable rates just hit a twelve 0:06:42.960 --> 0:06:45.359 year high. Still a problem in housing. 0:06:45.520 --> 0:06:48.720 It is a problem in housing, particularly for existing home 0:06:48.760 --> 0:06:52.440 sales because so many people, something like forty percent of 0:06:52.520 --> 0:06:55.680 mortgage holders now have mortgages under four percent, and they 0:06:55.680 --> 0:06:59.159 don't want to get a new mortgage that's at seven 0:06:59.240 --> 0:07:01.440 or eight percent, so they're not putting their homes on 0:07:01.480 --> 0:07:04.279 the market, and it's sort of frozen the housing market, 0:07:04.279 --> 0:07:07.880 which then leads to fewer sales of new carpets and 0:07:07.960 --> 0:07:10.680 appliances and things like that. So that's a problem. The 0:07:10.680 --> 0:07:13.400 new home sales market has been booming because it's the 0:07:13.440 --> 0:07:15.960 only place you can get a house these days, and 0:07:16.000 --> 0:07:18.400 a lot of the builders have come up with their 0:07:18.440 --> 0:07:21.560 own financing and they're buying down your mortgage rate so 0:07:21.720 --> 0:07:24.960 you don't have to pay eight percent, you might pay five. 0:07:26.320 --> 0:07:27.600 We don't know if that's going to be enough to 0:07:27.680 --> 0:07:29.800 keep it going, but for right now that's the only 0:07:29.840 --> 0:07:30.840 bright spot in housing. 0:07:31.000 --> 0:07:34.440 According to b Redfin, the average mortgage costs two six 0:07:34.480 --> 0:07:37.080 hundred and thirty two bucks a month. That's the highest ever. 0:07:37.640 --> 0:07:40.240 Not even prices on those houses, but mortgage rates and 0:07:40.360 --> 0:07:43.800 insurance making that change. Car insurance, we know, went up 0:07:43.920 --> 0:07:45.840 nineteen percent in August year over year. 0:07:46.160 --> 0:07:49.920 Well, particularly with cars insurance. Cars have gotten much more 0:07:49.920 --> 0:07:54.680 complex and more expensive to fix. We also saw a 0:07:54.720 --> 0:07:57.600 big rise obviously in used car prices and more used 0:07:57.640 --> 0:08:01.320 cars break down. People were buying used cars because there 0:08:01.320 --> 0:08:05.840 weren't new cars to buy. So for the insurance companies, 0:08:05.920 --> 0:08:08.040 their costs have gone up a lot and they've been 0:08:08.120 --> 0:08:10.800 raising rates to make up for that. 0:08:11.080 --> 0:08:13.960 Now, staying on autos, how do you think a protracted 0:08:14.040 --> 0:08:16.520 job action might impact the economy. 0:08:16.800 --> 0:08:21.280 Well, in the past, we have not seen huge macroeconomic effects. 0:08:21.280 --> 0:08:23.040 You see them for a very short period of time. 0:08:23.520 --> 0:08:26.280 Nineteen ninety eight was a very similar year to what 0:08:26.320 --> 0:08:29.239 we're seeing right now. There was a strike against General Motors, 0:08:29.280 --> 0:08:31.760 but it was called against only two plants and only 0:08:31.840 --> 0:08:35.640 nine two hundred workers went out, but that shut down 0:08:35.760 --> 0:08:38.520 GM around the country, so there were about two hundred 0:08:38.559 --> 0:08:41.680 thousand people who were off work, and you can see 0:08:41.760 --> 0:08:45.920 in the auto manufacturing statistics there's a big drop in 0:08:45.960 --> 0:08:49.000 the third quarter of nineteen ninety eight, and in the 0:08:49.080 --> 0:08:51.360 number of workers there was a big drop in the 0:08:51.400 --> 0:08:54.480 third quarter of nineteen ninety eight. But plot GDP over 0:08:54.520 --> 0:08:56.360 that and you don't see it because as soon as 0:08:56.400 --> 0:08:59.520 the strike's over, the company gets back to producing cars 0:08:59.520 --> 0:09:02.480 as fast as as it can, and Americans are still 0:09:02.480 --> 0:09:05.000 going to be buying cars, and the people who were 0:09:05.040 --> 0:09:07.679 striking get raises and go out and maybe spend a 0:09:07.720 --> 0:09:10.920 little bit more, So you end up with it not 0:09:11.080 --> 0:09:14.199 having a major macro effect. Where you do see it 0:09:14.240 --> 0:09:19.000 is in equities, because it not only affects the automakers 0:09:19.400 --> 0:09:22.720 but the parts makers and their stocks drop, and it 0:09:22.920 --> 0:09:28.240 spreads beyond that raw materials makers steel and rubber. And 0:09:28.280 --> 0:09:32.920 then in nineteen ninety eight, the New York Times saw 0:09:33.000 --> 0:09:38.640 a decline in revenue because automobile advertising was pulled during 0:09:38.679 --> 0:09:41.520 the strike. So if you're looking for an effect, that's 0:09:41.520 --> 0:09:43.679 probably where you're going to see it more than in 0:09:43.720 --> 0:09:44.680 the macroeconomy. 0:09:44.720 --> 0:09:48.400 Well, Michael, thank you. Bloomberg International Economics and Policy correspondent 0:09:48.520 --> 0:09:51.439 Michael McKee. Coming up here on Bloomberg day Break weekend. 0:09:51.840 --> 0:09:54.040 Leaders from around the world gather in New York for 0:09:54.080 --> 0:09:57.040 the United Nations General Assembly meeting. Will tell you what 0:09:57.120 --> 0:10:01.040 to expect next week. I'm Tom Busby and is Bloomberg. 0:10:11.160 --> 0:10:13.600 This is Bloomberg Day Break Weekend, our global look ahead 0:10:13.640 --> 0:10:15.720 at the top stories for investors in the coming week. 0:10:16.080 --> 0:10:18.959 I'm Tom Busby in New York. The United Nations General 0:10:19.000 --> 0:10:21.719 Assembly holds its seventy eighth Annual Session the week of 0:10:21.760 --> 0:10:25.280 September eighteenth, leaders from around the world descending upon New 0:10:25.360 --> 0:10:28.760 York for what's expected to be the most interesting UNNGA 0:10:29.040 --> 0:10:32.200 since before the pandemic, with a focus on Russia's invasion 0:10:32.240 --> 0:10:36.440 of Ukraine, shadowed diplomacy with Iran, and the increasingly tense 0:10:36.720 --> 0:10:40.720 geostrategic divide between the US and China. General Debate begins 0:10:40.720 --> 0:10:43.439 on Tuesday. For more, Let's head to our Bloomberg ninety 0:10:43.480 --> 0:10:46.760 nine one newsroom in Washington and Bloomberg Sound On. Co 0:10:46.920 --> 0:10:48.080 host Kaylee. 0:10:47.800 --> 0:10:50.480 Lines, Yeah, Tom, Well, everyone in New York is bracing 0:10:50.559 --> 0:10:54.640 for heavier traffic associated with the annual UN General Assembly meeting, 0:10:54.920 --> 0:10:58.360 fondly known as UNGA. Washington is watching to see what 0:10:58.440 --> 0:11:01.640 real policy developments could come out of this gathering, and 0:11:01.679 --> 0:11:05.120 Bloomberg TV's very own chief Washington correspondent, Anrie horder And 0:11:05.200 --> 0:11:08.000 will be making the trip up there herself this coming week. 0:11:08.360 --> 0:11:11.560 She joins me now with more of a preview. So Anri, 0:11:12.040 --> 0:11:14.959 let's just talk about what the objective here really is. 0:11:15.080 --> 0:11:18.280 For President Biden, for example, he's gonna make the trip, 0:11:18.720 --> 0:11:20.760 what exactly does he want to achieve? 0:11:20.880 --> 0:11:22.760 I think what you'll see this year, Kaylee, is similar 0:11:22.800 --> 0:11:25.560 to what we saw from President Biden last year. Some 0:11:25.600 --> 0:11:28.240 of these major themes he wants to address in front 0:11:28.280 --> 0:11:30.720 of the international community. One of course, is going to 0:11:30.760 --> 0:11:34.720 be Russia's invasion of Ukraine. He talked about this last year. 0:11:34.760 --> 0:11:37.920 He said it's a war where Russia wants to extinguish 0:11:38.080 --> 0:11:40.480 Ukraine's right to exist. You're going to see him want 0:11:40.520 --> 0:11:43.959 to really continue to ramp up the support in favor 0:11:44.120 --> 0:11:49.000 of Ukraine against Russia at the international community, especially when 0:11:49.040 --> 0:11:51.240 Russia will be in the room, not by President Putin, 0:11:51.320 --> 0:11:54.960 but far Missus Sergei Lavrov will be there. Of course, 0:11:55.160 --> 0:11:57.439 China will be the other elephant in the room. Shijiping 0:11:57.640 --> 0:11:59.719 is also not going to be in attendance. Both those 0:11:59.800 --> 0:12:02.520 leader Putin and she didn't also go to the G twenty. 0:12:03.400 --> 0:12:05.640 But this is a chance for Biden to show that 0:12:05.720 --> 0:12:09.200 the US is in that presence, even those other leaders 0:12:09.200 --> 0:12:11.920 are not going to be there. Once again, I think 0:12:11.960 --> 0:12:15.559 you'll hear from the American President and from any American 0:12:15.600 --> 0:12:19.040 official that's asked about China, they continuously say, it's not 0:12:19.440 --> 0:12:22.000 that we want to have a conflict with China. We 0:12:22.040 --> 0:12:24.280 want to be able to have competition and put guard 0:12:24.360 --> 0:12:27.599 rails around that competition. It's becoming a little bit of 0:12:27.640 --> 0:12:30.960 a joke. But everyone in DC says what they constantly say. 0:12:30.960 --> 0:12:35.079 They're not decoupling, they're risking. If you're able to figure 0:12:35.080 --> 0:12:38.000 out the difference between those two, let me know. And 0:12:38.000 --> 0:12:42.000 then I think the final big point that the President 0:12:42.040 --> 0:12:44.720 may talk about is going to be Iran, because I 0:12:44.760 --> 0:12:47.600 have some reporting that the Iran hostage swap will happen 0:12:47.679 --> 0:12:50.679 as soon as Monday, and that's just before these leaders 0:12:50.840 --> 0:12:55.880 come together. And you have Ibraham Rayisi speaking to NBC 0:12:56.080 --> 0:13:00.319 News before the UN General Assembly saying that this unforen 0:13:00.960 --> 0:13:04.079 fund of six billion dollars that's going to be released 0:13:04.080 --> 0:13:06.640 in exchange for the prisoners, it is Iranian money, but 0:13:06.679 --> 0:13:09.600 it was frozen in South Korea. He's saying that they 0:13:09.640 --> 0:13:11.800 can use it on whatever they need in Iran. The 0:13:11.840 --> 0:13:14.520 administration continues to say that is not true. It's for 0:13:14.600 --> 0:13:18.120 humanitarian purposes only. And imagine, given the fact that's happening 0:13:18.480 --> 0:13:21.160 likely on Monday, the President's going to have to address this. 0:13:21.640 --> 0:13:24.280 Okay, so Iran will be on the agenda for him, 0:13:24.320 --> 0:13:27.200 perhaps an unavoidable subject. But to go back to the 0:13:27.280 --> 0:13:31.080 idea of this also really being about China and Russia. 0:13:31.120 --> 0:13:35.080 How complicated is that considering they are also permanent members 0:13:35.080 --> 0:13:37.920 of the UN Security Council. Does that hinder what can 0:13:38.000 --> 0:13:41.199 actually be achieved it to something like this, well, I think. 0:13:41.000 --> 0:13:43.240 It hinders what the UN has been able to achieve 0:13:43.280 --> 0:13:47.439 at all regarding Russia's invasion of Ukraine. They're members of 0:13:47.480 --> 0:13:51.719 Security Council. The UN hasn't been able to act on 0:13:51.800 --> 0:13:54.560 this war. So while the UN General Assembly offers a 0:13:54.600 --> 0:13:56.959 place for dialogue, there hasn't been a lot of action 0:13:57.080 --> 0:14:00.520 when it comes to that, which is why many people 0:14:00.559 --> 0:14:04.920 say the UN. Many call it obsolete and useless. But 0:14:04.960 --> 0:14:06.920 it will be a place for dialogue, but at the 0:14:06.960 --> 0:14:11.880 moment nothing can really happen because you do have Shijipang 0:14:11.920 --> 0:14:14.200 and Russia's hold on the Security Council. 0:14:14.640 --> 0:14:16.960 So you say it's a place for dialogue, and obviously 0:14:17.000 --> 0:14:20.640 that is you know, wider dialogue among the entire General Assembly. 0:14:20.720 --> 0:14:23.800 But also we often see at meetings like this sideline 0:14:23.800 --> 0:14:27.760 meetings between different leaders, and our understanding is President Biden 0:14:28.240 --> 0:14:30.560 maybe having a few of those as well, including with 0:14:31.160 --> 0:14:35.320 reportedly Prime Minister of Israel Benjamin Netanyahu, who has had 0:14:35.320 --> 0:14:38.840 a pretty tense relationship with the President of the US. 0:14:38.880 --> 0:14:41.560 At this point, I would argue, Anne Marie, what do 0:14:41.600 --> 0:14:44.640 we expect out of that meeting? Why have that one. 0:14:44.840 --> 0:14:48.560 So right now? You have not had net Yahoo yes 0:14:48.760 --> 0:14:51.360 yet have this invite to the White House. He and 0:14:51.440 --> 0:14:54.200 Joe Biden go years back. They know each other, They've 0:14:54.200 --> 0:14:56.920 been in this circle for a while. But the issue is, 0:14:56.960 --> 0:15:00.240 of course, the White House has taken aim on a 0:15:00.360 --> 0:15:04.040 number of policies the net Yahoo government has wanted to 0:15:04.040 --> 0:15:08.000 push forward, especially coming from the right wing of his government, 0:15:08.440 --> 0:15:12.800 most notably the judicial overhaul plan. So this is gonna 0:15:12.800 --> 0:15:14.520 be the first time they're seeing each other in person 0:15:14.600 --> 0:15:17.560 since he took office again in December. All eyes are 0:15:17.560 --> 0:15:19.840 going to be on this meeting, not only because these 0:15:19.840 --> 0:15:22.200 two individuals will be meeting and there's been some some 0:15:22.240 --> 0:15:24.520 of that tension you just mentioned, but also the fact 0:15:24.560 --> 0:15:28.320 that this administration is working at the same time to 0:15:28.320 --> 0:15:32.160 try to bring normalization between Saudi Arabia and Israel. They 0:15:32.200 --> 0:15:35.000 were just at the G twenty they did this infrastructure deal, 0:15:35.000 --> 0:15:37.080 which Saudi Arabia is a part of, Israel is also 0:15:37.160 --> 0:15:40.800 tangently a part of, and everyone is trying to see 0:15:40.800 --> 0:15:43.440 if this can actually happen, So this will be an 0:15:43.440 --> 0:15:46.720 interesting pull aside meeting. But it's also interesting that it's 0:15:46.760 --> 0:15:49.600 not a White House meeting. It's happening at Anga. Also, 0:15:49.640 --> 0:15:52.200 apparently net and Yahoo will also be meeting Elon Musk 0:15:52.440 --> 0:15:54.960 next week. He's doing a little bit of a US 0:15:54.960 --> 0:15:58.520 tour that might be just as interesting as the POTUS meeting. 0:15:58.760 --> 0:16:01.880 To go back to what you were talking about earlier, 0:16:01.920 --> 0:16:05.240 with the idea of some kind of normalization happening, you 0:16:05.280 --> 0:16:08.280 of course spoke this past week with Amos Hawkstein of 0:16:08.320 --> 0:16:10.040 the White House and you touched on this a little bit. 0:16:10.040 --> 0:16:11.560 How close realistically are we. 0:16:11.920 --> 0:16:14.800 I think there's some cold water on that, meaning the 0:16:14.920 --> 0:16:17.600 US has been very honest that they would want to 0:16:17.600 --> 0:16:20.040 see that extension really of the Abraham Accords that were 0:16:20.040 --> 0:16:23.280 done to the Trump administration, where you saw a number 0:16:23.320 --> 0:16:26.760 of Gulf countries, notably the UAE, have these normalized ties 0:16:26.800 --> 0:16:32.080 with Israel. Travel started, embassies opened, lots of commercial ties 0:16:32.760 --> 0:16:36.160 came to fruition after that. But they're just not there yet. 0:16:36.200 --> 0:16:39.480 There's a number of steps that have to happen, but 0:16:40.560 --> 0:16:42.800 it's still on the table, and it's something that could happen. 0:16:43.120 --> 0:16:46.880 I just think you know, potentially we're a little over 0:16:46.880 --> 0:16:49.000 our skis if we think that might happen at this 0:16:49.160 --> 0:16:51.440 U and General Assembly or before the year is up. 0:16:51.560 --> 0:16:53.640 I think that a lot of work needs to still 0:16:54.000 --> 0:16:56.000 be deciphered through, and then they really need to make 0:16:56.040 --> 0:16:58.120 sure they're selling it to their constituents. 0:16:58.480 --> 0:17:00.720 So when we're talking about selling thing, and this goes 0:17:00.760 --> 0:17:03.240 back to the Ukraine issue, which you said is going 0:17:03.280 --> 0:17:05.439 to be high on the agenda for Biden, I just 0:17:05.520 --> 0:17:07.879 wonder how much harder that job is in a body 0:17:08.000 --> 0:17:11.040 like this one full of those who come from different 0:17:11.040 --> 0:17:13.080 countries and are looking in on the US and the 0:17:13.080 --> 0:17:17.280 conversation happening here in Washington on Capitol Hill around continued 0:17:17.280 --> 0:17:20.360 funding for Ukraine, and what that does to the President's 0:17:20.400 --> 0:17:22.320 position is he's trying to make the case that other 0:17:22.359 --> 0:17:25.879 countries should be still engaging, still funding, still trying to 0:17:25.880 --> 0:17:28.320 support the war, when it's clear that not everyone here 0:17:28.320 --> 0:17:29.639 in Washington is with him on that. 0:17:30.320 --> 0:17:32.320 It's going to be challenging for the President because he's 0:17:32.359 --> 0:17:34.000 going to want to come to the podium and he's 0:17:34.040 --> 0:17:37.640 going to want to be so forthright about America's stance 0:17:37.840 --> 0:17:40.919 in supporting Ukraine. At the same time, he will be 0:17:41.520 --> 0:17:44.679 in New York City at the UN giving this speech. 0:17:44.760 --> 0:17:47.840 There's going to be debates behind Congress closed doors whether 0:17:47.960 --> 0:17:50.600 or not they're going to sign off on his request 0:17:50.640 --> 0:17:54.359 and that supplemental funding request for aid for Ukraine. It 0:17:54.359 --> 0:17:56.520 does look like the Senate wants to go forward with that, 0:17:57.040 --> 0:17:59.800 but in the House it's really anyone's guest on how 0:18:00.119 --> 0:18:03.280 it gets done. Does McCarthy have to remove it from 0:18:03.320 --> 0:18:06.040 the supplemental put it with maybe border concerns to make 0:18:06.040 --> 0:18:09.040 sure the hard right flank of his party joins in 0:18:09.440 --> 0:18:12.080 and votes for it because they see something enticing and 0:18:12.160 --> 0:18:15.480 border money and potentially some controversial what the Democrats would 0:18:15.480 --> 0:18:20.600 call controversial asylum provisions. So Ukraine is this issue where 0:18:20.920 --> 0:18:24.120 not just in Congress, but on the debate stage Republican candidates, 0:18:24.160 --> 0:18:28.639 you see people taking different points of views. And President 0:18:28.800 --> 0:18:30.840 Lenski is going to be really honest when he's also 0:18:30.880 --> 0:18:33.840 in New York next week and he wants to make 0:18:33.840 --> 0:18:37.640 this case for a peace formula plan. And then Reuter's 0:18:37.680 --> 0:18:40.280 also reported that he's going to come to Washington to 0:18:40.320 --> 0:18:43.440 have another meeting with the President, and the timing, of course, 0:18:43.480 --> 0:18:47.560 is interesting. Zelenski obviously sees and is privy to the 0:18:47.600 --> 0:18:50.119 debate that's ongoing in America and on how long and 0:18:50.160 --> 0:18:53.480 how much Americans are willing to fund and support Ukraine. 0:18:53.520 --> 0:18:56.679 Looking forward to all of your coverage of UNGA, Bloomberg's 0:18:56.680 --> 0:18:59.840 and Marie Hordern, our very own chief Washington correspondent for 0:19:00.440 --> 0:19:02.879 Bloomberg Television, and Tom we'll send it back to you. 0:19:03.240 --> 0:19:05.840 Thank you, Kaylee. That was Bloomberg Sound On co host 0:19:05.920 --> 0:19:08.840 Kaylee Liones reporting from our Bloomberg ninety nine one newsroom 0:19:08.840 --> 0:19:11.680 in Washington, and you can hear sound on weekdays one 0:19:11.680 --> 0:19:14.920 to three pm on Bloomberg Radio. Coming up on Bloomberg 0:19:15.000 --> 0:19:18.240 day Break. Weekend interest rates also in focus overseas, we 0:19:18.320 --> 0:19:20.440 take you to London to preview the Bank of England's 0:19:20.480 --> 0:19:23.720 policy decision this week. I'm Tom Busby and this is 0:19:23.760 --> 0:19:45.879 Bloomberg broadcasting. 0:19:35.240 --> 0:19:38.320 Live from the Bloomberg it a Active Brokers studio in 0:19:38.440 --> 0:19:41.440 New York. Bloomberg elemon three oh to Washington d C, 0:19:41.600 --> 0:19:45.000 Bloomberg ninety nine one to Boston, Bloomberg one O six 0:19:45.119 --> 0:19:48.400 one to San Francisco, Bloomberg nine sixteen to the country, 0:19:48.480 --> 0:19:52.360 Sirius XM Channel one to nineteen to London DAB digital 0:19:52.440 --> 0:19:55.359 radio and around the globe the Bloomberg Business app in 0:19:55.440 --> 0:19:59.959 Bloomberg Radio dot com. This is Bloomberg Daybreak weekend. 0:20:05.680 --> 0:20:08.040 This is Bloomberg day Break weekend, our global look ahead 0:20:08.040 --> 0:20:10.240 at the top stories for investors in the coming week. 0:20:10.440 --> 0:20:14.040 I'm Tom Busby in New York. Bloomberg Economics expects the 0:20:14.080 --> 0:20:17.080 Bank of England to continue raising interest rates to five 0:20:17.240 --> 0:20:20.520 point five percent next week, despite signs of the impact 0:20:20.680 --> 0:20:22.959 on the economy. Now for more, let's say to London 0:20:23.040 --> 0:20:26.800 and bring in Bloomberg Daybreak Europe banker Caroline hepgar Tom. 0:20:26.840 --> 0:20:30.440 As the UK's economic outlook gets cloudier, the debate about 0:20:30.480 --> 0:20:33.439 whether the Bank of England will continue raising interest rates 0:20:33.800 --> 0:20:38.159 and for how long is intensifying. UK inflation remains the 0:20:38.240 --> 0:20:41.600 worst in the group of seven nations, but July saw 0:20:41.640 --> 0:20:46.160 a bigger than expected drop in UK economic growth. Remember, 0:20:46.200 --> 0:20:50.280 although the UK was the first amongst major central banks 0:20:50.520 --> 0:20:54.560 to start raising interest rates, inflation in Britain is stuck 0:20:54.600 --> 0:20:57.840 at six point eight percent according to the August figure. 0:20:57.880 --> 0:21:00.800 That is almost double the level that you're seeing over 0:21:00.840 --> 0:21:03.639 in the US, and it's still well above the eure 0:21:03.720 --> 0:21:07.160 Area rate of five point three percent. Now for more, 0:21:07.200 --> 0:21:09.000 on all of this. Tom McKenzie and I have been 0:21:09.000 --> 0:21:12.720 speaking to Blueberg Senior at UK Economists Dan Hansen about 0:21:12.720 --> 0:21:16.080 the Bank of England's upcoming decision. I started by asking 0:21:16.160 --> 0:21:20.680 Dan how badly the UK is losing steam after monthly 0:21:20.800 --> 0:21:24.080 GDP fell by half of one percent in July. 0:21:24.520 --> 0:21:27.040 We're certainly worried that the economy is losing steam a 0:21:27.080 --> 0:21:31.359 little bit faster than we'd anticipated it would. Obviously, you 0:21:31.400 --> 0:21:33.480