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Speaker 1: Bloomberg Audio Studios, podcasts, radio news. This is the Bloomberg

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Speaker 1: Daybreak youurate podcast available every morning on Apple, Spotify, or

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Speaker 1: wherever you listen. It's Thursday, the fourth of April in London.

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Speaker 1: I'm Stephen Carroll. Coming up today. Jerome Powell says the

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Speaker 1: Federal Reserve still has time to assess more data before

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Speaker 1: deciding when to cut interest rates. Apple explores personal robotics

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Speaker 1: as the next big thing. After pulling the plug on

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Speaker 1: plans for an electric car, and after credit sweese comes

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Speaker 1: the cleanup. We look at the sweeping changes Switzerland is

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Speaker 1: making to bank regulations to avert another collapse. Let's start

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Speaker 1: with a roundup of our top stories. The Federal Reserve

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Speaker 1: Charge your Own Pal says the Central Bank has time

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Speaker 1: to wait for more data before cutting interest rates. In

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Speaker 1: a speech at Stanford University, Powell reiterated that it will

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Speaker 1: likely be appropriate to begin lowering rates at some point

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Speaker 1: this year. Over the Fed chief also the recent bump

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Speaker 1: in prices didn't alter their broader trajectory on inflation.

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Speaker 2: It is too soon to say whether the recent readings

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Speaker 2: represent more than just a bump. We do not expect

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Speaker 2: that it will be appropriate to lower our policy rate

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Speaker 2: until we have greater confidence that inflation is moving sustainably

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Speaker 2: down toward two percent.

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Speaker 1: Powells prepared remarks echo those he made following the March meeting.

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Speaker 1: They also suggest the FED is unlikely to reduce rates

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Speaker 1: at their next gathering. At the end of the month,

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Speaker 1: gold has hit another record on the likelihood that the

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Speaker 1: FED will cut interest rates this year. The price of

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Speaker 1: the press precious metal top twenty three hundred dollars an

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Speaker 1: a ince, with investors betting that it stands to benefit

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Speaker 1: from the impending pivot by the US Central Bank. Senior

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Speaker 1: commodity strategist at ANZ Daniel Hines says the rally has

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Speaker 1: surprised many.

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Speaker 3: Look, it looks pretty strong, but in saying that, in

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Speaker 3: my experience, these top of rallies tend to end quite unexpectedly,

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Speaker 3: So I would be looking for a bit of a

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Speaker 3: pullback at some point over the next month or two,

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Speaker 3: but you know, the extent of that, I think we

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Speaker 3: should be relatively limited. There's still plenty going for it

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Speaker 3: over the medium term.

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Speaker 1: Daniel Hines's analysis comes as the latest data compiled by

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Speaker 1: the World Gold Council shows central banks continued to add

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Speaker 1: to their holdings of the metal in February, I'll be

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Speaker 1: at a slower pace than before. The United Nations has

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Speaker 1: put night missions in Gaza on hold while charities review

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Speaker 1: their humanitarian work there after seven World Central Kitchen AID

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Speaker 1: workers were killed in an Israeli air strike. The decision

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Speaker 1: comes as US President Joe Biden and Israeli Prime Minister

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Speaker 1: benjaminette Yahu are scheduled to speak by phone today. The

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Speaker 1: Israeli military's chief of staff, he see how Halevi, says

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Speaker 1: the strike was a mistake.

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Speaker 4: The strike was not carried out with the intention of

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Speaker 4: harming w CK AID workers. It was a mistake that

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Speaker 4: followed a misidentification at night during the war in a

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Speaker 4: very complex conditions. It shouldn't have happened.

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Speaker 1: For hertzi Haalevii's account has been disputed by jose Andress,

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Speaker 1: the founder of worlds Central Kitchen and into with Reuters.

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Speaker 1: He said the AID workers were targeted quote systematically, car

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Speaker 1: by car Vladimir Putin is now focused on achieving his

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Speaker 1: war goals. After securing another six year term in power.

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Speaker 1: The Russian president has stepped up missile barragest Ukrainian cities

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Speaker 1: and is planning to form two new combined armies, but

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Speaker 1: a breakthrough will be challenging for either side, with Russia

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Speaker 1: short of manpower in Ukraine running low on ammunition. NATO

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Speaker 1: Secretary General Jain Staltenberg says the Alliance is doing what

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Speaker 1: it can to help Ukraine.

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Speaker 5: We are transforming NATO's comprehensive assistance package into a multi

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Speaker 5: year program of assistance. We are helping Ukraine move closer

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Speaker 5: to NATO NATO standards on everything from procurement or logistics.

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Speaker 5: We are supporting Ukraine's reform at forced to bring Ukraine

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Speaker 5: closer to the Alliance.

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Speaker 1: NATO's yeah Stelzenberg's speaking there. Meanwhile, Ukrainian President Vladimo Zelenski

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Speaker 1: signed a bill this week to lower the age of

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Speaker 1: wartime conscription to twenty five from twenty seven, as this

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Speaker 1: military seeks to replenish its depleted ranks. Barklays has kept

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Speaker 1: a cap on bankers bonuses in place, despite the ceiling

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Speaker 1: being lifted by UK regulators. Bloomberg's tewa Adebayo has the details.

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Speaker 6: The UK government has scrapped its banker bonus cap in

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Speaker 6: a bid to make post Brexit Britain a global financial hub,

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Speaker 6: but it seems like Barklays hasn't gotten the memo. Additional

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Speaker 6: payment at the lender is still restricted at a maximum

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Speaker 6: of two times one's base salary. According to a letter

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Speaker 6: to shareholders, Chairman Nigel Higgins says the policy is in

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Speaker 6: line with Barclays's focus on rewarding sustainable performance, but his

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Speaker 6: words unlikely to reassure staff, some of whom received no

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Speaker 6: bonus at all last year. The bank's failure to on

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Speaker 6: the matter highlights the challenges faced by lenders attempting to

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Speaker 6: revert to pre bonus cap payment structures in London. TIA

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Speaker 6: added by Bloomberg Radio.

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Speaker 1: Apple is exploring a move into personal robotics, sources told

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Speaker 1: Bloomberg the tech giants engineers are looking for the next

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Speaker 1: big thing after canceling its major EV project in February.

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Speaker 1: Bloomberg's Mark German explains what Apple is working on.

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Speaker 7: A few years ago, they started development of what it's

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Speaker 7: essentially a large iPad on a robotic arm that can

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Speaker 7: move on a FaceTime call to follow a user. So

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Speaker 7: let's say you and I are facetiming, and you have

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Speaker 7: one of these devices and I tilt my head or

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Speaker 7: nod my head or some such the display that you're

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Speaker 7: seeing would nod or move around to mimic my head

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Speaker 7: movements on that robotic arm.

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Speaker 1: Shares of I robot if possible, M and A target

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Speaker 1: rows by seventeen percent after Bloomberg broke the news. The

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Speaker 1: potential new venture comes as pressure on Apple grows to

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Speaker 1: find new sources of revenue beyond the iPhone, and the

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Speaker 1: UK government is so far rejecting any taxpayer funded rescue

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Speaker 1: plan for Thames Water. Sources tell Bloomberg that ministers are

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Speaker 1: pushing Britain's largest water company to find a privately funded solution.

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Speaker 1: Bloom Brook James Wilcock has more.

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Speaker 8: The UK government are daring Thameswater's investors to blink first.

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Speaker 8: It's a risky strategy. The company has been called uninvestible

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Speaker 8: by its nine main shareholders. They say, with eighteen billion

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Speaker 8: pounds of debt worth eighty percent of the utility firm's equity,

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Speaker 8: that they're not stumping up any more money for it.

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Speaker 8: In the type fiscal environment, no politician of any party

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Speaker 8: wants to pay a penny for what they see as

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Speaker 8: a disaster of private management. Meanwhile, Thames Water continues to

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Speaker 8: burn through cash and public goodwill. Current estimates say it

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Speaker 8: will run out of money in June twenty twenty five.

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Speaker 8: The good will date may already have passed in London.

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Speaker 8: James Wilcock, Bloomberg Radio.

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Speaker 1: Now in a moment, we'll get analysis on the fed

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Speaker 1: chairs speech, plus dig into the overhaul of financial regulation

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Speaker 1: in Switzerland a year on from the collapse of credit Sweese.

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Speaker 1: But another story that caught our eye this Fursday, a

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Speaker 1: billionaire saying he sees more of us moving to a

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Speaker 1: four day week. This is Steve Cohen, the founder of

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Speaker 1: Point seventy two asset Management in the owner of the

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Speaker 1: New York Mets baseball team. He made the comments in

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Speaker 1: his first ever interview with CNBC. He says the rise

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Speaker 1: of AI and hybrid work, in which he believes makes

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Speaker 1: people not as productive on Fridays, are some of the

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Speaker 1: factors bringing us towards a four day week now. Steve

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Speaker 1: Cone is an avid golfer. He's even investing in the

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Speaker 1: sport because he thinks people will have more time to

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Speaker 1: play it in the future. But he did say that

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Speaker 1: he wants his own traders and portfolio managers to keep

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Speaker 1: working five days a week because taking Fridays off when

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Speaker 1: you have a portfolio, he says, would be a problem. Well,

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Speaker 1: let's turn to our top story. Jerome Peell says it's

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Speaker 1: too soon to say whether the recent pickup inflation was

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Speaker 1: more than a bump, and that he still expects to

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Speaker 1: cut interest rates at some point this year. The Fair Chair,

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Speaker 1: speaking at Stanford University, the highlights of a week that's

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Speaker 1: seeing more than a dozen speeches by policymakers being passed

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Speaker 1: for clues of when interest rate cuts will begin. Joining

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Speaker 1: us now to discuss is Bloomberg opinion Columus Daniel Mus

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Speaker 1: done great to have you on with us, as John

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Speaker 1: Powell then given us any useful clues as to the

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Speaker 1: fads thinking on the rate path I had.

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Speaker 9: It feels like we've had this conversation a lot the

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Speaker 9: past few weeks. People keep looking for, you know, a

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Speaker 9: change of narrative from the Fed leadership, and thus far, sorry,

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Speaker 9: hasn't happened. He said, Nothing at Stanford that is inconsistent

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Speaker 9: with the idea of a couple or several cuts later

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Speaker 9: this year. Nothing whatsoever. Yes, they can take their time,

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Speaker 9: but there was never a rush, you know, as soon

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Speaker 9: as he started talking about this late last year traders

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Speaker 9: started thinking getting fixated on March because that was when

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Speaker 9: the next dot plot was coming out. But that always

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Speaker 9: seemed like a stretch. So we're back to where we were.

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Speaker 9: It's also where we should have been. He's right, they

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Speaker 9: don't have to rush it, but it's going to come.

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Speaker 1: It was interesting, though, to hear your own Pale talk

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Speaker 1: about other issues and their speech away from the rate path,

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Speaker 1: and particularly the importance of the independence of the FAD

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Speaker 1: and it's apolitical nature. Why do you think he chose

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Speaker 1: to talk about that in that speech.

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Speaker 9: Yes, it's interesting. It's particularly interesting that it's in his

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Speaker 9: open remarks, opening remarks.

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Speaker 7: You know.

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Speaker 9: The rest of the conversation at the university was a

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Speaker 9: sort of a fireside chat, a little less formal, little

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Speaker 9: less scripted. So he's looking down the track six months

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Speaker 9: potentially the return of a president that has been hostile

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Speaker 9: to the Federal Reserve. But more importantly, this is about

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Speaker 9: the optics of how the Fed presents itself, particularly to Congress.

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Speaker 9: Congress has been a little ANTSI shall we say about

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Speaker 9: where some bank rules relating to climate and climate change

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Speaker 9: might be going. Central banks in Europe are pushing very

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Speaker 9: hard for global standards that are more cognizant of climate risks.

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Speaker 9: The FED is saying, well, no, we don't have a

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Speaker 9: mandate for that. You know, we're apolitical. We don't have

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Speaker 9: a mandate for this. We don't have a mandate for

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Speaker 9: fiscal policy, we don't have a mandate for immigration. Da

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Speaker 9: It's all about what they don't do. Kind of selective

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Speaker 9: in my view, and it's a reading of the political temperature.

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Speaker 9: When the FED overhauled its policy framework in twenty twenty,

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Speaker 9: they broadened the way they spoke about the labor market.

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Speaker 9: They were talking about issues of equity in the labor market.

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Speaker 9: So we're seeing them kind of you know, when the

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Speaker 9: overall climate is sympathetic to a little more policy adventurism

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Speaker 9: or policy reinterpretation, they can certainly do that. Clearly, this

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Speaker 9: is not something they see right now.

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Speaker 1: Doniel thinking about the data to You've been writing recently

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Speaker 1: about how we should be taking some positivity from good

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Speaker 1: news rather than necessarily reading good news as bad news.

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Speaker 1: Talk us through your piece.

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Speaker 9: There are a lot of long faces around, and you know,

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Speaker 9: the approximate cause for the handwringing this week was the

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Speaker 9: first expansion in US manufacturing since twenty twenty two. I'm

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Speaker 9: talking about the release of the ISM number on Monday,

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Speaker 9: and that was the latest. Oh you know, good news

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Speaker 9: is bad news because we're going to push back market

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Speaker 9: projections of when the FED may is. But okay, look,

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Speaker 9: the first positive reading in close to two years. And also,

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Speaker 9: let's not be myopic about this. The US as significant

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Speaker 9: as it is, I've said that a lot on the show,

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Speaker 9: but it is not the only game in town. Okay.

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Speaker 9: We saw earlier in the week a meaningful uptick in

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Speaker 9: manufacturing in China. We have seen in the past week

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Speaker 9: some extremely bullish export numbers from South Korea. South Korea

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Speaker 9: big node in the global manufacturing scene, particularly relates to tech.

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Speaker 9: We had good PMI numbers from Taiwan and from Japan. Look,

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Speaker 9: if the US does not have to carry the world

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Speaker 9: economy on its shoulders, how can that be bad? How

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Speaker 9: can that be bad?

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Speaker 7: Well?

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Speaker 1: Indeed been ber companion colomist Daniel Mass thank you very

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Speaker 1: much for joining us with your analysis a year ago

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Speaker 1: the collapse of credits weeze cast in to date, Switzerland's

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Speaker 1: HIRD one reputation is a stable place to put your money.

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Speaker 1: Years of light touch regulation. It fails to stop the

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Speaker 1: route at the Global Investment Bank. The country's regulation and

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Speaker 1: politicians are now in repair mode, working to revamp the

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Speaker 1: law and give its financial watchdog powers to intervene much

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Speaker 1: earlier in the game. Next time, European Finance editor Jeff

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Speaker 1: Black joins us Now for more on this story. Jeff,

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Speaker 1: great to have you on what are the fundamental problems

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Speaker 1: into how the Swiss financial center is run.

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Speaker 10: The fundamental quality, of course of the Swiss Financial Center

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Speaker 10: for a very long time is that it's been very

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Speaker 10: stable and run in a sort of self regulating way,

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Speaker 10: and that worked very well for a long time. It

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Speaker 10: didn't work well, however, when there was a big institution

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Speaker 10: that had a lot of cultural and structural problems inside it.

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Speaker 10: And the simple fact was that over a number of years,

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Speaker 10: everyone outside of credit sweet was more or less powerless

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Speaker 10: to change anything that was going wrong, even if they

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Speaker 10: could see things going wrong. And that was what the

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Speaker 10: position of the regulator FINMA was, and that kind of

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Speaker 10: blew up the old consensus based system because credits is

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Speaker 10: fell apart.

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Speaker 1: So what are the changes being put in place now?

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Speaker 7: Then those are quite far reaching.

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Speaker 10: On the one hand, there's pretty much broad support to

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Speaker 10: give FINMA much greater powers to be able to hold

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Speaker 10: the financial sector to account, and the major one of

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Speaker 10: those is to be able to find banks and other

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Speaker 10: types of financial companies. It might seem quite amazing that

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Speaker 10: FINMA does not have that power, which is pretty much

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Speaker 10: standard all across other major financial centers, but it doesn't.

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Speaker 10: But that is more or less certain to arrive now.

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Speaker 10: And then one of the other major changes would be

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Speaker 10: the introduction of a so called senior manager's regime, which

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Speaker 10: means making everyone in a bank able to say who's

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Speaker 10: in charge of what, so that when things go wrong,

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Speaker 10: you know who's accountable.

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Speaker 1: So is everyone on board with this new plan then, So, like.

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Speaker 10: I said, there is very broad support, including from the banks,

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Speaker 10: for these major changes. The chairman of UBS, which is

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Speaker 10: now by far the biggest bank in Switzerland, of course

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Speaker 10: the world's one of the world's largest wealth managers, they

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Speaker 10: broadly support both of those pillars. What they're not massively

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Speaker 10: keen on, of course, is higher capital and liquidity requirements,

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Speaker 10: and that's also a possibility that they could be getting

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Speaker 10: special treatment in that sense.

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