1
00:00:02,440 --> 00:00:12,119
Speaker 1: Bloomberg Audio Studios, podcasts, radio news. This is the Bloomberg Daybak,

2
00:00:12,160 --> 00:00:15,320
Speaker 1: your podcast, available every morning on Apple, Spotify or wherever

3
00:00:15,360 --> 00:00:18,360
Speaker 1: you listen. It's Tuesday, the seventeenth of September in London.

4
00:00:18,440 --> 00:00:19,840
Speaker 1: I'm Caroline Hipkitt and.

5
00:00:19,720 --> 00:00:23,280
Speaker 2: I'm Stephen Carroll. Coming up today, trader's uncertainty about the

6
00:00:23,320 --> 00:00:26,439
Speaker 2: size of a FED cut hits its highest level since

7
00:00:26,480 --> 00:00:27,960
Speaker 2: before the financial crisis.

8
00:00:28,200 --> 00:00:31,600
Speaker 1: Amazon CEO ends the firm's work from home policy as

9
00:00:31,640 --> 00:00:33,839
Speaker 1: he vows to cut management jobs.

10
00:00:34,360 --> 00:00:37,199
Speaker 2: Plus, we head to Norway, where a weekening currency is

11
00:00:37,280 --> 00:00:39,360
Speaker 2: upsetting a lot of people in one of the world's

12
00:00:39,479 --> 00:00:41,840
Speaker 2: richest and priciest countries.

13
00:00:42,120 --> 00:00:44,199
Speaker 1: Let's start with a roundup of our top stories.

14
00:00:44,600 --> 00:00:47,519
Speaker 2: Bond traders are more divided about the outcome of this

15
00:00:47,560 --> 00:00:51,160
Speaker 2: week's Federal Reserve meeting than any scheduled US Central Bank

16
00:00:51,240 --> 00:00:55,080
Speaker 2: decision since two thousand and seven. FED policymakers have all

17
00:00:55,080 --> 00:00:58,320
Speaker 2: but guaranteed a first rate cut in more than four years,

18
00:00:58,680 --> 00:01:01,520
Speaker 2: but with just one day to go, markets are showing

19
00:01:01,520 --> 00:01:04,720
Speaker 2: a toss up between a quarter point or half point reduction.

20
00:01:05,319 --> 00:01:07,440
Speaker 2: Bill Dudley, a former president of the New York Fat

21
00:01:07,480 --> 00:01:10,280
Speaker 2: and Bloomberg Opinion columnist is calling for fifty.

22
00:01:10,680 --> 00:01:13,280
Speaker 3: Doing twenty five would have been awkward because it would

23
00:01:13,319 --> 00:01:16,479
Speaker 3: have disappointed market expectations. They probably would have shown only

24
00:01:16,520 --> 00:01:19,800
Speaker 3: another fifty basis points in their summary wreck and our projections.

25
00:01:19,959 --> 00:01:22,080
Speaker 3: So the thing would be essentially saying we're goingly going

26
00:01:22,120 --> 00:01:23,920
Speaker 3: to do seventy five basis points this year when the

27
00:01:23,920 --> 00:01:26,399
Speaker 3: market was priced for about one hundred and twenty. So

28
00:01:26,520 --> 00:01:29,600
Speaker 3: I think doing fifty brings the FED more in alignment

29
00:01:29,640 --> 00:01:32,240
Speaker 3: with the market, and it also fits the logic of

30
00:01:32,280 --> 00:01:32,679
Speaker 3: the moment.

31
00:01:33,840 --> 00:01:36,320
Speaker 2: But not everyone agrees with Bill Dudley's assessment to do.

32
00:01:36,560 --> 00:01:39,920
Speaker 2: The CEO of Penco, Maney Roman, well.

33
00:01:39,760 --> 00:01:41,560
Speaker 4: We're in the camp of twenty five. But you know,

34
00:01:41,760 --> 00:01:44,560
Speaker 4: I always say we have a crystal ball and at

35
00:01:44,600 --> 00:01:47,480
Speaker 4: the end of the day, we'll see what the market does.

36
00:01:47,720 --> 00:01:49,400
Speaker 4: You know, it may very well be that he doesn't

37
00:01:49,440 --> 00:01:52,360
Speaker 4: make that much of a difference, and our view is

38
00:01:52,440 --> 00:01:55,320
Speaker 4: that there will be three cuts off twenty five and

39
00:01:55,400 --> 00:01:57,080
Speaker 4: at the end of the day, what matters is where

40
00:01:57,080 --> 00:01:58,000
Speaker 4: we are at the end of the.

41
00:01:58,040 --> 00:02:02,480
Speaker 2: Year and Penco's money. Roman isn't alone and his assessment.

42
00:02:03,040 --> 00:02:06,680
Speaker 2: Apollo Global Management Co President Scott Kleinman has warned that

43
00:02:06,760 --> 00:02:10,640
Speaker 2: investors are placing overly high expectations on the scale of

44
00:02:10,760 --> 00:02:12,360
Speaker 2: FED cuts in the coming year.

45
00:02:13,520 --> 00:02:16,840
Speaker 1: Now, more details are emerging about the suspect in the

46
00:02:16,919 --> 00:02:21,360
Speaker 1: apparent assassination attempt on former President Donald Trump. The FBI

47
00:02:21,480 --> 00:02:24,040
Speaker 1: says that Ryan Routh may have been in the area

48
00:02:24,160 --> 00:02:27,560
Speaker 1: near Trump's golf course in Florida for about twelve hours

49
00:02:27,760 --> 00:02:30,760
Speaker 1: before he was spotted. Meanwhile, Donald Trump has been looking

50
00:02:30,840 --> 00:02:35,080
Speaker 1: to gain political momentum from the incident, claiming without evidence

51
00:02:35,160 --> 00:02:40,440
Speaker 1: that his Democratic rival Kamala Harris's quote highly inflammatory rhetoric

52
00:02:40,800 --> 00:02:44,600
Speaker 1: inspired the government. The comments were echoed by Trump's running

53
00:02:44,600 --> 00:02:46,240
Speaker 1: mate jd Vance yesterday.

54
00:02:46,880 --> 00:02:49,880
Speaker 5: No one has tried to kill Kamala Harris in the

55
00:02:49,960 --> 00:02:52,799
Speaker 5: last couple of months, and two people now have tried

56
00:02:52,800 --> 00:02:54,880
Speaker 5: to kill Donald Trump in the last couple of months.

57
00:02:55,000 --> 00:02:58,040
Speaker 5: I'd say that's pretty strong evidence that the left needs

58
00:02:58,080 --> 00:03:01,200
Speaker 5: to tone down the rhetoric to cut this crap out.

59
00:03:01,400 --> 00:03:02,760
Speaker 5: Somebody is going to get hurt by it.

60
00:03:03,680 --> 00:03:06,960
Speaker 1: Despite the acclaims by J. D Vance, Vice persident Taris

61
00:03:07,040 --> 00:03:11,120
Speaker 1: has condemned political violence after both attacks, saying that violence

62
00:03:11,160 --> 00:03:12,440
Speaker 1: has no place in America.

63
00:03:13,360 --> 00:03:15,720
Speaker 2: Amazon has told staff they have to return to the

64
00:03:15,760 --> 00:03:19,200
Speaker 2: office five days a week from January and announced plans

65
00:03:19,200 --> 00:03:22,359
Speaker 2: to cut jobs and management. CEO Andy Jasse wrote in

66
00:03:22,400 --> 00:03:24,920
Speaker 2: a memo to employees, we want to operate like the

67
00:03:24,960 --> 00:03:29,280
Speaker 2: world's largest startup. Many of its warehouse staff already work

68
00:03:29,360 --> 00:03:32,600
Speaker 2: full time in person, but the move will affect hundreds

69
00:03:32,639 --> 00:03:36,640
Speaker 2: of thousands of office workers. Employees have fought the delivery

70
00:03:36,640 --> 00:03:39,920
Speaker 2: giant's past efforts to end work from home, saying that

71
00:03:40,000 --> 00:03:44,160
Speaker 2: Amazon failed to provide data showing in person work achieved

72
00:03:44,200 --> 00:03:45,080
Speaker 2: better results.

73
00:03:46,120 --> 00:03:50,360
Speaker 1: Intel is set to make a custom AI chip for Amazon,

74
00:03:50,440 --> 00:03:54,800
Speaker 1: boosting turnaround efforts at that firm. According to a joint statement,

75
00:03:54,920 --> 00:03:58,120
Speaker 1: Intel and Amazon Web Services will co invest in a

76
00:03:58,280 --> 00:04:03,240
Speaker 1: custom semiconductor in a quote multi year, multi billion dollar framework.

77
00:04:03,520 --> 00:04:06,000
Speaker 1: The announcement sparked a jump of more than eight percent

78
00:04:06,040 --> 00:04:10,240
Speaker 1: in il to Intel's shares in late trading. Bloomberg's Annabel

79
00:04:10,320 --> 00:04:13,119
Speaker 1: Drulers says the deal is significant for the company.

80
00:04:13,360 --> 00:04:16,839
Speaker 6: Getting AWS here is a real vote of confidence, particularly

81
00:04:16,920 --> 00:04:19,800
Speaker 6: for that foundry business in particular, which of course makes

82
00:04:19,800 --> 00:04:23,560
Speaker 6: it a contract manufacturer for semiconductors. But AWS is the

83
00:04:23,680 --> 00:04:27,360
Speaker 6: largest provider of cloud computing. It has been using Intel

84
00:04:27,440 --> 00:04:29,840
Speaker 6: processes at different points over the years, but now it's

85
00:04:29,839 --> 00:04:32,400
Speaker 6: shifting more to in house designs, and that's what it

86
00:04:32,440 --> 00:04:34,440
Speaker 6: wants Intel to help build now.

87
00:04:34,360 --> 00:04:37,359
Speaker 1: Our tech reporter Annabel Drulias speaking them for Intel. The

88
00:04:37,400 --> 00:04:40,600
Speaker 1: move could also potentially bring work to new plants under

89
00:04:40,640 --> 00:04:44,640
Speaker 1: construction in the US. The firm is postponing new factories

90
00:04:44,640 --> 00:04:48,039
Speaker 1: in Germany and Poland for two years, but remains committed

91
00:04:48,080 --> 00:04:52,479
Speaker 1: to its US expansion in Arizona, New Mexico, Oregon and Ohio.

92
00:04:52,880 --> 00:04:56,240
Speaker 2: Emmanuel macromis and talks to win a pivotal EU commission

93
00:04:56,360 --> 00:04:59,720
Speaker 2: job for France. Sources of Tel Bloomberg. The plan would

94
00:04:59,760 --> 00:05:03,400
Speaker 2: see the outgoing Foreign Minister Stefan Sajane become an executive

95
00:05:03,480 --> 00:05:08,120
Speaker 2: vice president, overseeing the EU's efforts to boost competitiveness. His

96
00:05:08,160 --> 00:05:10,599
Speaker 2: appointment would see Macron gain control over one of the

97
00:05:10,640 --> 00:05:15,279
Speaker 2: region's most important issues, insuring its industry and defense capabilities

98
00:05:15,320 --> 00:05:18,240
Speaker 2: can keep up with countries like China and the United States.

99
00:05:18,680 --> 00:05:22,480
Speaker 2: YOU Commissioned President Dreslvanderlin is expected to announce her appointments

100
00:05:22,480 --> 00:05:25,840
Speaker 2: of the College of Commissioners today, with final approval still

101
00:05:25,839 --> 00:05:27,240
Speaker 2: needed from the European Parliament.

102
00:05:27,680 --> 00:05:30,960
Speaker 1: Kis Starmer says he is looking to Italy's right wing

103
00:05:31,000 --> 00:05:33,960
Speaker 1: government for lessons on how to tackle migration. On a

104
00:05:34,040 --> 00:05:37,680
Speaker 1: visit to Rome, he praised his counterpart, Georgia Maloney's asylum

105
00:05:37,720 --> 00:05:41,800
Speaker 1: deal with Albania. Britain's Prime minister told reporters he's being

106
00:05:41,839 --> 00:05:42,960
Speaker 1: pragmatic here.

107
00:05:42,960 --> 00:05:45,400
Speaker 7: There's been some quite dramatic reductions, so I want to

108
00:05:45,440 --> 00:05:48,760
Speaker 7: understand how that came about. It looks as though that's

109
00:05:48,800 --> 00:05:50,840
Speaker 7: down to the upstream work that's being done in some

110
00:05:50,880 --> 00:05:53,160
Speaker 7: of the countries where people are coming from. I've long

111
00:05:53,200 --> 00:05:56,440
Speaker 7: believed prevention and stopping people traveling in the first place

112
00:05:56,680 --> 00:05:58,120
Speaker 7: is one of the best ways to deal with this

113
00:05:58,240 --> 00:05:59,320
Speaker 7: particular issue.

114
00:06:00,040 --> 00:06:03,200
Speaker 1: Comments reflect a push to reassure voters who switched to

115
00:06:03,360 --> 00:06:06,960
Speaker 1: anti migration parties like the Reform Party in the last election,

116
00:06:07,560 --> 00:06:10,119
Speaker 1: but the hard line may worry some on the left.

117
00:06:10,480 --> 00:06:14,360
Speaker 1: Maloney's government has faced criticism from human rights groups.

118
00:06:14,839 --> 00:06:17,599
Speaker 2: The rapper and businessman Sean Combs, known as p Diddy,

119
00:06:17,640 --> 00:06:20,680
Speaker 2: has been arrested in New York. The charges against the

120
00:06:21,040 --> 00:06:24,160
Speaker 2: US rapper have not been made public, but the star's

121
00:06:24,200 --> 00:06:28,640
Speaker 2: legal team has called it an unjust prosecution and to quote,

122
00:06:28,760 --> 00:06:32,680
Speaker 2: reserve your judgment. In recent months, Combs has faced allegations

123
00:06:32,680 --> 00:06:35,560
Speaker 2: of sexual assault and abuse. In a moment, we'll bring

124
00:06:35,600 --> 00:06:37,479
Speaker 2: you more on how markets are thinking about the FED

125
00:06:37,560 --> 00:06:40,720
Speaker 2: rate decision, plus why Norway's oil capital is the best

126
00:06:40,760 --> 00:06:44,120
Speaker 2: place to illustrate how inflation has affected the country. But

127
00:06:44,240 --> 00:06:47,400
Speaker 2: first story from here in London as well, another proposal

128
00:06:47,480 --> 00:06:51,240
Speaker 2: to close Oxford Street to vehicle traffic. It's our colleague

129
00:06:51,279 --> 00:06:53,240
Speaker 2: Jennifer Creery has been writing about the Mayor of London

130
00:06:53,320 --> 00:06:56,040
Speaker 2: reopening this debate with the backing of the Labor government

131
00:06:56,080 --> 00:06:58,880
Speaker 2: this time. A previous attempt at pedestrianization of Oxford Street

132
00:06:59,360 --> 00:07:03,000
Speaker 2: failed in eighteen. This is of course part of the

133
00:07:03,040 --> 00:07:05,839
Speaker 2: efforts to try and drive more people back to Oxford Street.

134
00:07:05,880 --> 00:07:07,880
Speaker 2: Numbers have been down since the pandemic. More people are

135
00:07:07,920 --> 00:07:10,880
Speaker 2: shopping online. We've all seen the number of vacant shops

136
00:07:10,920 --> 00:07:14,520
Speaker 2: on Oxford Street as well. These days too, the street

137
00:07:14,680 --> 00:07:17,560
Speaker 2: is still a retail hub, three point one billion pounds

138
00:07:17,600 --> 00:07:20,600
Speaker 2: in sales last year according to the New West End Company,

139
00:07:20,640 --> 00:07:23,280
Speaker 2: which is a group that supports businesses in the area.

140
00:07:23,320 --> 00:07:25,800
Speaker 2: They're supporting this move that I'll draw you back to

141
00:07:25,840 --> 00:07:26,480
Speaker 2: Oxford Street.

142
00:07:26,960 --> 00:07:29,560
Speaker 1: Well, there are two enormous smalls now in London that

143
00:07:29,640 --> 00:07:32,400
Speaker 1: are still fairly recent additions, aren't they in the east

144
00:07:32,440 --> 00:07:34,800
Speaker 1: and the west. So that's one issue for shopper is

145
00:07:35,040 --> 00:07:38,200
Speaker 1: I think the other one underlying this is the issue

146
00:07:38,240 --> 00:07:41,640
Speaker 1: around London being such an old city, having small streets

147
00:07:41,680 --> 00:07:44,760
Speaker 1: and only a few big arteries, one of them being

148
00:07:44,800 --> 00:07:48,280
Speaker 1: Oxford Street. At the moment. Buses can go down, but

149
00:07:48,320 --> 00:07:50,920
Speaker 1: it's limited to sort of taxis buses and actually cars

150
00:07:50,920 --> 00:07:53,040
Speaker 1: can't go down Oxford Street most of the time anyway.

151
00:07:53,440 --> 00:07:55,240
Speaker 1: But I think that is the issue, isn't it. It's

152
00:07:55,280 --> 00:07:59,000
Speaker 1: actually how you map a reduction of traffic across London

153
00:07:59,040 --> 00:08:01,320
Speaker 1: and don't make it in p to get anyway.

154
00:08:00,960 --> 00:08:03,040
Speaker 2: To get from me. So wes yeat indeed one to

155
00:08:03,080 --> 00:08:05,360
Speaker 2: watch anyway to see if their progress being made on that.

156
00:08:05,480 --> 00:08:07,680
Speaker 2: Let's bring you more now though, and how markets are

157
00:08:07,720 --> 00:08:10,360
Speaker 2: gearing up for the Federal Reserve meeting which begins today.

158
00:08:10,720 --> 00:08:12,920
Speaker 2: Our executive editor for Asian Markets, Paul dubs And is

159
00:08:12,920 --> 00:08:15,920
Speaker 2: with us for more. Poul Traders the most uncertain they've

160
00:08:15,960 --> 00:08:18,960
Speaker 2: been since two thousand and seven over tomorrow's decision and

161
00:08:18,960 --> 00:08:21,160
Speaker 2: whether or not we'll get a twenty five or fifty

162
00:08:21,200 --> 00:08:22,840
Speaker 2: basis point cut from the Fed.

163
00:08:22,920 --> 00:08:26,360
Speaker 8: Why the uncertainty, Yes, good morning, Stephen, Well, the one

164
00:08:26,400 --> 00:08:28,800
Speaker 8: thing that they are all united on is the idea

165
00:08:28,840 --> 00:08:31,520
Speaker 8: that the Federal Reserve is going to begin cutting interest

166
00:08:31,600 --> 00:08:34,560
Speaker 8: rates this week. That much is at least boiled in

167
00:08:34,720 --> 00:08:38,960
Speaker 8: or nailed on at that point, But the scale of

168
00:08:39,160 --> 00:08:42,520
Speaker 8: that cut is what everybody is paying attention to. And

169
00:08:42,559 --> 00:08:46,400
Speaker 8: there's two camps here. One that's thinking, you know, the

170
00:08:46,440 --> 00:08:50,440
Speaker 8: Federal Reserve still has some lingering doubts about the stickiness

171
00:08:50,440 --> 00:08:52,760
Speaker 8: of inflation in the US, and it wants to ensure

172
00:08:53,200 --> 00:08:57,160
Speaker 8: the policy is sufficiently restrictive to get that inflation properly

173
00:08:57,240 --> 00:09:02,040
Speaker 8: under control and vanquished before it begins eating in earnest.

174
00:09:02,480 --> 00:09:04,880
Speaker 8: On the other side of that, those who think that

175
00:09:04,920 --> 00:09:07,520
Speaker 8: the Federal Reserve is likely to begin or it's likely

176
00:09:07,559 --> 00:09:11,040
Speaker 8: to be cutting this year in fifty basis point steps

177
00:09:11,160 --> 00:09:13,120
Speaker 8: later on. In any case, thing, why don't they just

178
00:09:13,200 --> 00:09:14,040
Speaker 8: get on with it now?

179
00:09:14,120 --> 00:09:14,320
Speaker 2: You know?

180
00:09:14,640 --> 00:09:18,040
Speaker 8: Why need to weigh the labor market is showing signs

181
00:09:18,320 --> 00:09:20,840
Speaker 8: of weakness, some of the rest of the data is

182
00:09:20,880 --> 00:09:24,079
Speaker 8: pointing in their same direction, and the Fed risks getting

183
00:09:24,120 --> 00:09:27,720
Speaker 8: behind the curve. So that's where those arguments are. I think.

184
00:09:27,840 --> 00:09:30,360
Speaker 8: You know, we've seen in recent days some of the

185
00:09:32,160 --> 00:09:38,680
Speaker 8: former presidents of local federal reserves talking about their sort

186
00:09:38,720 --> 00:09:41,319
Speaker 8: of calculation or the way that they would see it

187
00:09:41,360 --> 00:09:44,280
Speaker 8: and the balance of risks, and they'd be mostly leaning

188
00:09:44,320 --> 00:09:48,560
Speaker 8: towards a fifty basis point cup given the right now

189
00:09:49,160 --> 00:09:53,160
Speaker 8: they see the risk of the economy slowing down in

190
00:09:53,200 --> 00:09:57,880
Speaker 8: a quite nasty or worrying way being the bigger risk

191
00:09:57,960 --> 00:10:00,520
Speaker 8: relative to the risk of inflation coming back up again.

192
00:10:02,000 --> 00:10:04,319
Speaker 1: In terms of the other data that we get today,

193
00:10:04,440 --> 00:10:09,600
Speaker 1: US retail sales figures, how might that feed into market calculations?

194
00:10:09,640 --> 00:10:11,880
Speaker 1: Is that the kind of data that people are watching.

195
00:10:12,880 --> 00:10:15,480
Speaker 8: With nothing else left, Caroline, I think that that's exactly

196
00:10:15,520 --> 00:10:17,439
Speaker 8: what people are all going to be watching, just for

197
00:10:17,559 --> 00:10:20,840
Speaker 8: one final piece of the puzzle. One way or the other.

198
00:10:21,040 --> 00:10:24,040
Speaker 8: It's more likely probably to swing market positions than it

199
00:10:24,080 --> 00:10:26,840
Speaker 8: is to swing the actual fare policy makers. But the

200
00:10:26,880 --> 00:10:29,360
Speaker 8: strength of the consumer is one of those things that's

201
00:10:29,400 --> 00:10:33,679
Speaker 8: really intured all the way through this cycle, and in

202
00:10:33,720 --> 00:10:35,360
Speaker 8: turn has led to a little bit more of that

203
00:10:35,440 --> 00:10:38,760
Speaker 8: stickiness in the inflation picture. So if we see strong

204
00:10:38,880 --> 00:10:42,760
Speaker 8: retail sales that they will convince people that the federal

205
00:10:42,760 --> 00:10:45,600
Speaker 8: Reserve will only begin with a twenty five basis point cut.

206
00:10:45,640 --> 00:10:48,000
Speaker 8: On the other hands, if we get some weakness and

207
00:10:48,080 --> 00:10:53,240
Speaker 8: the focus on that high overall, then that might convince

208
00:10:53,320 --> 00:10:55,600
Speaker 8: more in the market that the Fed will be more

209
00:10:55,640 --> 00:10:57,160
Speaker 8: aggressive with this first cut.

210
00:10:57,520 --> 00:10:59,920
Speaker 2: Paul, can we talk about how traders in Asia were

211
00:11:00,080 --> 00:11:02,160
Speaker 2: you are gearing up for this as well, because we've

212
00:11:02,200 --> 00:11:04,520
Speaker 2: also been watching, of course, the Japanese yen strength. Things

213
00:11:04,559 --> 00:11:06,720
Speaker 2: significantly a little bit weaker on the day today, but

214
00:11:06,720 --> 00:11:10,199
Speaker 2: strengthing is significantly yesterday, in particular ahead of a Bank

215
00:11:10,240 --> 00:11:12,720
Speaker 2: of Japan decision later this week as well. Where are

216
00:11:12,720 --> 00:11:14,280
Speaker 2: the focus for traders in Asia.

217
00:11:14,520 --> 00:11:17,560
Speaker 8: Yeah, it's a great question. It's kind of split two ways.

218
00:11:17,600 --> 00:11:19,800
Speaker 8: It all really depends on that weakness of the dollar

219
00:11:20,120 --> 00:11:23,280
Speaker 8: and where other countries stand relative to that. So for Japan,

220
00:11:23,559 --> 00:11:25,840
Speaker 8: which has a lot of explorers and its reliant on that,

221
00:11:25,920 --> 00:11:28,320
Speaker 8: a much stronger yen against the dollar as a negative

222
00:11:28,360 --> 00:11:31,200
Speaker 8: and that's why you're seeing that way on the Japanese

223
00:11:31,240 --> 00:11:34,320
Speaker 8: equity market so much. On the other hand, people that

224
00:11:34,440 --> 00:11:36,920
Speaker 8: think that an easier FED policy and a weaker dollar

225
00:11:37,160 --> 00:11:41,480
Speaker 8: is going to broaden and spread risks demand further across

226
00:11:41,520 --> 00:11:44,679
Speaker 8: the region, looking to pick up bargains. In particular, we've

227
00:11:44,679 --> 00:11:48,079
Speaker 8: seen lots of strength in Southeast Asia in recent weeks,

228
00:11:48,400 --> 00:11:51,520
Speaker 8: not just the equities, but also the currencies and the

229
00:11:51,559 --> 00:11:54,480
Speaker 8: bombs are all united in a big rally, so it

230
00:11:54,480 --> 00:11:56,840
Speaker 8: depends whereabouts in Asia you're looking to see whether this

231
00:11:57,000 --> 00:12:01,640
Speaker 8: is likely to be favorable or punishing for the markets there.

232
00:12:02,080 --> 00:12:04,280
Speaker 1: Okay, Paul, thank you so much for being with us.

233
00:12:04,440 --> 00:12:07,600
Speaker 1: Our executive editor for Asian Markets, Paul Dobson. Let's see

234
00:12:07,600 --> 00:12:10,320
Speaker 1: where the f RMC meeting ends up tomorrow.

235
00:12:11,360 --> 00:12:13,680
Speaker 2: Let's turn to Norway now, where the crone is the

236
00:12:13,720 --> 00:12:16,480
Speaker 2: worst performing G ten currency against the Euro and the

237
00:12:16,559 --> 00:12:19,480
Speaker 2: dollar this year. The weakness across recent years has made

238
00:12:19,480 --> 00:12:22,560
Speaker 2: the surgeon inflation more painful for Norwegians and has recently

239
00:12:22,640 --> 00:12:25,720
Speaker 2: led to rare criticism of its central bank by the

240
00:12:25,760 --> 00:12:28,839
Speaker 2: country's politicians. Our reporters went to look for effects of

241
00:12:28,880 --> 00:12:31,800
Speaker 2: the weak currency at Stavanger, who is which is Norway's

242
00:12:31,920 --> 00:12:35,640
Speaker 2: oil capital. Bloomberg's Automolas joins us Moslow for more this morning.

243
00:12:35,800 --> 00:12:38,319
Speaker 2: Good morning to you. Why is Davanga the best place

244
00:12:38,360 --> 00:12:39,520
Speaker 2: to tell this story?

245
00:12:41,080 --> 00:12:45,040
Speaker 9: Morning, Dave. Yes, as you said, Stavangers is Norway's oil

246
00:12:45,080 --> 00:12:50,000
Speaker 9: capital and it's the headquarters of Norway's biggest company, Equinor.

247
00:12:51,000 --> 00:12:54,800
Speaker 9: Historically used to rely on shipping and shipbuilding and the

248
00:12:55,000 --> 00:12:59,160
Speaker 9: fish canning that after oil was discovered in the North

249
00:12:59,200 --> 00:13:02,520
Speaker 9: Sea at the end of the sixties, it turned from

250
00:13:02,600 --> 00:13:07,400
Speaker 9: what was then a relatively poor industrial town into one

251
00:13:07,480 --> 00:13:10,960
Speaker 9: of Norway's wealthiest areas. And in fact, at one point,

252
00:13:11,240 --> 00:13:14,920
Speaker 9: about a decade ago, before the oil price plunged, it

253
00:13:15,040 --> 00:13:19,520
Speaker 9: was among the most expensive cities globally. So it has

254
00:13:19,640 --> 00:13:23,200
Speaker 9: been one of the biggest contributors to Norwegian Krona's strength

255
00:13:23,400 --> 00:13:27,200
Speaker 9: over the years, and it made sense to go look

256
00:13:27,240 --> 00:13:30,559
Speaker 9: for whether the krona wos are felt there as well

257
00:13:30,640 --> 00:13:32,360
Speaker 9: despite all the oil wealth.

258
00:13:32,960 --> 00:13:35,840
Speaker 1: Okay, so what evidence did you find then of Norwegians

259
00:13:35,880 --> 00:13:37,920
Speaker 1: suffering from the weakness of the krona?

260
00:13:39,679 --> 00:13:43,600
Speaker 9: Right, We did know from evidence that has been provided

261
00:13:43,640 --> 00:13:47,800
Speaker 9: by the Central Bank that corona weakness already last year

262
00:13:48,000 --> 00:13:51,600
Speaker 9: was a key factor behind the higher level of inflation

263
00:13:52,000 --> 00:13:56,000
Speaker 9: compared to the Euro area. And also we knew that

264
00:13:56,040 --> 00:14:01,880
Speaker 9: it's bit boosting input costs for company and so in stefhunger.

265
00:14:02,600 --> 00:14:05,920
Speaker 9: Even with the backdrop that the lower level of krone

266
00:14:05,760 --> 00:14:11,160
Speaker 9: is helping experts, there's still plenty of evidence that domestically

267
00:14:11,160 --> 00:14:17,160
Speaker 9: oriented sectors like construction or retail are suffering. So some

268
00:14:17,360 --> 00:14:23,080
Speaker 9: companies are laying off staff, some are closing their businesses

269
00:14:24,080 --> 00:14:27,640
Speaker 9: because chrono weakness is pushing up their costs and the

270
00:14:27,760 --> 00:14:32,960
Speaker 9: higher prices are also damping demand. And what's perhaps even

271
00:14:33,000 --> 00:14:36,560
Speaker 9: worse in the long term, foreign workers no longer want

272
00:14:36,600 --> 00:14:39,520
Speaker 9: to come to Norway because it just doesn't pay. And

273
00:14:39,560 --> 00:14:42,840
Speaker 9: Norway does depend on foreign labor, mainly from Eastern Europe

274
00:14:42,880 --> 00:14:47,520
Speaker 9: in a number of sectors, so it really is hitting

275
00:14:48,160 --> 00:14:50,520
Speaker 9: Norway band stronger on several fronts.

276
00:14:51,000 --> 00:14:53,600
Speaker 2: Does this situation likely to change or are there any

277
00:14:53,640 --> 00:14:57,600
Speaker 2: prospects for this dynamic to shift well?

278
00:14:58,320 --> 00:15:03,280
Speaker 9: Most experts tend to playing it with several factors, both

279
00:15:03,760 --> 00:15:07,960
Speaker 9: short term and long term. So short term that's mainly

280
00:15:08,000 --> 00:15:13,240
Speaker 9: about differences in interest rates after Federal Reserves started raising

281
00:15:13,240 --> 00:15:17,120
Speaker 9: the rates in early in twenty twenty two, followed by

282
00:15:17,160 --> 00:15:22,160
Speaker 9: the ECB, and then those increases were made faster than

283
00:15:22,520 --> 00:15:26,320
Speaker 9: the rate hikes delivered, but norwis central bank, and another

284
00:15:26,400 --> 00:15:30,200
Speaker 9: factor is the heightened geopolitical uncertainty, which also weakened other

285
00:15:30,320 --> 00:15:34,160
Speaker 9: smaller developed nation currencies. But then there are other factors

286
00:15:34,600 --> 00:15:37,360
Speaker 9: behind the longer term decline, which has lasted for about

287
00:15:37,400 --> 00:15:42,560
Speaker 9: a decade now. So oil prices come down and you know,

288
00:15:42,600 --> 00:15:46,160
Speaker 9: the Krona still remains an oil dependent currency. But also

289
00:15:46,280 --> 00:15:49,320
Speaker 9: Norway's productivity growth hasn't been as good as most of

290
00:15:49,360 --> 00:15:51,760
Speaker 9: its spears, and then some experts also point to a

291
00:15:51,800 --> 00:15:53,560
Speaker 9: long term outflow of savings.

292
00:15:57,000 --> 00:15:59,680
Speaker 2: This is Bloomberg Daybreak Europe, your morning brief on the

293
00:15:59,720 --> 00:16:02,840
Speaker 2: story he's making news from London to Wall Street and beyond.

294
00:16:03,120 --> 00:16:07,120
Speaker 1: Look for us on your podcast feed every morning on Apple, Spotify,

295
00:16:07,200 --> 00:16:09,160
Speaker 1: and anywhere else you get your podcasts.

296
00:16:09,200 --> 00:16:12,240
Speaker 2: You can also listen live each morning on London Dab Radio,

297
00:16:12,280 --> 00:16:14,960
Speaker 2: the Bloomberg Business app, and Bloomberg dot Com.

298
00:16:15,000 --> 00:16:17,760
Speaker 1: Our flagship New York station is also available on your

299
00:16:17,800 --> 00:16:22,520
Speaker 1: Amazon Alexa devices. Just say Alexa play Bloomberg eleven thirty.

300
00:16:22,760 --> 00:16:24,040
Speaker 1: I'm Caroline Hepka and.

301
00:16:24,000 --> 00:16:26,640
Speaker 2: I'm Stephen Carroll. Join us again tomorrow morning for all

302
00:16:26,680 --> 00:16:29,080
Speaker 2: the news you need to start your day right here

303
00:16:29,160 --> 00:16:34,680
Speaker 2: on Bloomberg Daybreak Europe