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Speaker 1: Bloomberg Audio Studios, Podcasts, radio News.

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Speaker 2: This is Bloomberg day Break Weekend, our global look at

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Speaker 2: the top stories in the coming week from our day

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Speaker 2: Break anchors all around the world. Straight ahead on the program,

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Speaker 2: but look ahead to some key inflation data in the

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Speaker 2: US how that may impact FED policy. I'm Tom Busby

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Speaker 2: in New York.

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Speaker 3: I'm Carolyn Hedke in London, where we're considering the role

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Speaker 3: of the ECB and a changing Europe.

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Speaker 4: I'm Doug Christner looking at the outlook for China's economy

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Speaker 4: with those new US tariffs in effect.

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Speaker 1: That's all straight ahead on Bloomberg Daybreak Weekend on Bloomberg

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Speaker 1: eleven to three, Yeero, New York, Bloomberg ninety nine to one, Washington, DC,

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Speaker 2: Good day to you. I'm Tom Busby, and we begin

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Speaker 2: today's program with some key inflation data out this week

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Speaker 2: here in the US CPI data for February on Wednesday,

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Speaker 2: PPI for that same month on Thursday, and for more

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Speaker 2: and much more. We're joined by Bloomberg's Edward Harrison, editor

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Speaker 2: of the Everything Risk newsletter. Well, Edward, inflation the problem

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Speaker 2: that won't seem to go away, with all the uncertainty

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Speaker 2: cause by President Trump goes on again off again tariffs

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Speaker 2: and policy changes. What do you expect to see in

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Speaker 2: these two reports, the first inflation reports of the new

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Speaker 2: Trump administration.

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Speaker 5: Hey, Tomm, good to talk to you. In terms of

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Speaker 5: what I'm expecting, I know the market is expecting two

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Speaker 5: point nine percent to be the headline number year over year.

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Speaker 5: It was three percent in the prior month, that's in January.

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Speaker 5: These are the February numbers. And so to the degree

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Speaker 5: that we get a two handle on the number, the

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Speaker 5: first number being two, which is the Fed's target two percent,

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Speaker 5: that's good. But you know, any upside surprises will leave

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Speaker 5: us at three percent inflation or more. And we know

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Speaker 5: that the CPI is going to be followed, as you

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Speaker 5: were saying, by the PPI, where the expectation is actually

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Speaker 5: three percent three point three percent.

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Speaker 2: Well, that's good news, and that's looking back looking ahead.

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Speaker 2: Do you see anything being done right now by the

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Speaker 2: White House to drive consumer prices lower? Or could we

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Speaker 2: be seeing you know, more trouble ahead.

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Speaker 5: There's nothing that I see in terms of the actual

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Speaker 5: policy on tariffs that is helpful for inflation. However, I

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Speaker 5: would say that a lot of the what we've seen

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Speaker 5: in terms of the overall policy makes is dampening growth.

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Speaker 5: And to the degree that dampening growth means that you know,

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Speaker 5: there's less demand, that could actually mean that prices fall. So,

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Speaker 5: you know, you talked about the jobs numbers that we

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Speaker 5: saw last week. Those were pretty bad if you look

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Speaker 5: at the internals that the numbers underneath in terms of

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Speaker 5: what it says about the wherewithal, particularly of low income households,

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Speaker 5: and so that's going to be a largely positive coortinflation,

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Speaker 5: although negative for the economy.

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Speaker 2: Well, let's talk about what else we didn't see in

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Speaker 2: those numbers. That's all those massive job cuts at the

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Speaker 2: federal level. We won't see maybe till March's numbers April

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Speaker 2: or even beyond.

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Speaker 5: Right, that's right, Yeah, And you know, if you look

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Speaker 5: at the jobless claims that we've seen over the last

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Speaker 5: few months, they've actually been relatively good. For instance, the

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Speaker 5: one that came out last week showed a decrease in

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Speaker 5: the number of initial jobless claims and it was lower

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Speaker 5: than expectations, So that says that it's really at a

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Speaker 5: gross level, you know, the economy wide not having an

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Speaker 5: impact yet. It may have an impact later, but we're

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Speaker 5: not seeing that in any of the job's numbers that

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Speaker 5: we've seen so far. But even though we haven't seen it,

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Speaker 5: we did see a huge spike in underemployment. That's the

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Speaker 5: so called U six number, which takes into account you know,

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Speaker 5: people who are who want to work but can't find

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Speaker 5: full time employment and those who are underutilized. This underemployment

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Speaker 5: number eight point zero percent is up from seven point

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Speaker 5: five percent the previous month. And this is the largest

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Speaker 5: spike that we've seen in the last two to three years.

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Speaker 5: This is the highest number since like twenty twenty one.

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Speaker 2: And what does it tell us looking ahead? I mean,

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Speaker 2: are more people going to be fighting for fewer jobs

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Speaker 2: more qualified people?

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Speaker 5: Yes, it tells us number one, that there's a trend

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Speaker 5: towards underemployment. It's been going on for you know, two

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Speaker 5: years now. We hit sort of a low in the

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Speaker 5: beginning of twenty twenty three, and we've spiked up. This

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Speaker 5: particular spike being the worst in that time period. And

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Speaker 5: it also says that in conjunction with other data, that

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Speaker 5: we see that lower income households in particular are really hurting.

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Speaker 5: You know, we've seen the highest car payments than the

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Speaker 5: the largest number of Americans falling behind on their carent

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Speaker 5: payments in three decades. We see spiking credit card delinquencies,

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Speaker 5: and in this particular report, we also saw that the

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Speaker 5: number of hours worked was down as well as the

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Speaker 5: libor force participation. So all of that is like, if

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Speaker 5: you think of this as forward looking, it's saying that

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Speaker 5: the number which was only slightly higher and unemployment will

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Speaker 5: go even higher going forward, and that's a negative sign

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Speaker 5: for the economy.

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Speaker 2: Well, this is all fuel for the FED. Again, they're

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Speaker 2: battling stubbornly high inflation. We've got this mixed information coming

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Speaker 2: on jobs. Is there anything you see that could make

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Speaker 2: the FOMC consider a change in rates, whether up or

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Speaker 2: down or is it just hold steady.

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Speaker 5: They've played their cards close to their vest recently. However,

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Speaker 5: I would say that the market at a minimum has

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Speaker 5: been leaning into pulling forward the rate cuts that the

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Speaker 5: Fed would make. You know, if you think about the

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Speaker 5: who pushes in put the pull and push of higher

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Speaker 5: inflation and lower growth. You know, the market has definitely

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Speaker 5: been leaning towards the lower growth, pushing the FED forward

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Speaker 5: in terms of their rate cuts, and given the fact

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Speaker 5: that growth looks to be declining. A GDP now, for instance,

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Speaker 5: shows a negative number for the Q one that would

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Speaker 5: say that yes, they could cut as soon as June.

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Speaker 5: The market has June as the first cut and it's

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Speaker 5: looking for almost three cuts for the entirety of twenty

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Speaker 5: and twenty five.

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Speaker 2: The February Consumer Price Index out there Wednesday, the Producer

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Speaker 2: Price Index out on Thursday, and our thanks to Bloomberg's

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Speaker 2: Edward Harrison, editor of the Everything Risk newsletter. We move

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Speaker 2: now to corporate earnings from computer software giants Oracle and Adobe.

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Speaker 2: Oracle earnings out on Monday. Adobe comes out on Wednesday,

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Speaker 2: and for more on what to expect, we're joined by

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Speaker 2: Brody Ford, Bloomberg Tech reporter. Now, Brody, let's start with Oracle,

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Speaker 2: a pioneer in cloud computing, use that to enhance its

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Speaker 2: AI solutions to customers. What do you expect to see

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Speaker 2: this week?

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Speaker 6: Oracle is so interesting because yeah, there is pioneer and

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Speaker 6: database technology that for a couple of years they was

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Speaker 6: kind of written off as a bit of a software dinosaur,

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Speaker 6: but they've managed to really remake themselves as a large

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Speaker 6: cloud provider. I mean, the best example of that being

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Speaker 6: what happened at the White House a couple of weeks ago,

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Speaker 6: when you know, Trump brought Larry Ellison up on the

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Speaker 6: podium and announced this giant Stargate initiative, saying that one

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Speaker 6: hundred billion dollars will be spent building data centers across

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Speaker 6: the country. And so investors are really curious, like do

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Speaker 6: we see this happening in Oracle's earnings, what are the

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Speaker 6: trends and their cloud infrastructure, which is really what folks

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Speaker 6: are trading on right now. There's been this whole storyline

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Speaker 6: too of whether the cloud infrastructure providers like Microsoft are

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Speaker 6: starting to pull back on building data centers. If so,

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Speaker 6: that would maybe you know, indicate poorly for or AI

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Speaker 6: demand and how sustainable this boom can be. And so

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Speaker 6: any commentary around the pace of building data centers and

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Speaker 6: any pullback will be really important.

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Speaker 2: Well, part of that Stargate project that you mentioned, I mean,

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Speaker 2: that seems to be Oracle's main project in that main

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Speaker 2: participation is building those data centers out, is that right?

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Speaker 7: Right?

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Speaker 6: So with Stargate the infrastructure, there's a lot of names involved, right,

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Speaker 6: Open AI, Oracle, soft Bank, but really who's building this

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Speaker 6: stuff is Oracle, right, And so they're effectively a vendor

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Speaker 6: here and that's that. You know, any of this spending

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Speaker 6: would in theory boost Oracle sales. Of course, you have

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Speaker 6: to ask how much is this marketing? Because Oracle the

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Speaker 6: one project we know about Oracle is already working on

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Speaker 6: before this announcement, and so there's some potential that this

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Speaker 6: is a you know, rebranding of work Oracles already doing.

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Speaker 6: And if it is net new, I think we will

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Speaker 6: find out, you know, with earnings.

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Speaker 2: And you mentioned Microsoft's the big leaders, Microsoft's as your

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Speaker 2: Amazon Web Services. How is Oracle competing against those giants

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Speaker 2: and is it a giant itself and all this.

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Speaker 6: They have tried to brand themselves as particularly effective for

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Speaker 6: AI workloads and I think successfully. So, I mean they've

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Speaker 6: really had a pretty crazy boost in sales. You got

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Speaker 6: to remember that, Yeah, I mean Aws, Microsoft, to a

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Speaker 6: lesser extent, Google, they are magnitudes larger than Oracle. But

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Speaker 6: Oracle's growing really quickly. I mean they really burst on

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Speaker 6: the scene with being the main vendor for TikTok, which

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Speaker 6: creates a ton of you know, computational demand and is

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Speaker 6: a huge customer. And then kind of from there they

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Speaker 6: were able to land these more kind of AI native startups,

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Speaker 6: and they landed Uber and so they're taken very seriously

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Speaker 6: now as a contender in this cloud world, but they're

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Speaker 6: still in that challenger basket. If they're able to be

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Speaker 6: become more of a primary vendor for open Ai with

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Speaker 6: all their massive AI workloads, I think that would be

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Speaker 6: a game changer for Oracle, But it's still yet to

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Speaker 6: be seen whether they can continue. I mean, they've been

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Speaker 6: posting numbers like sixty seventy percent revenue growth in their

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Speaker 6: cloud unit, which is I mean, in this market is

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Speaker 6: pretty unheard.

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Speaker 2: Of runaway success. Well let me ask you then, you know, besides,

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Speaker 2: it's a participation in Stargate, which, as you mentioned, maybe

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Speaker 2: a rebranding, some other plans. What kind of capital spending

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Speaker 2: do you see in the year ahead? Where is their

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Speaker 2: money going with all that revenue coming in from their

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Speaker 2: cloud business?

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Speaker 6: Right now, that Capex is all about data centers, right,

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Speaker 6: I mean, outside of Stargate, they're building data centers all

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Speaker 6: over America and the Middle East. I mean, it's a

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Speaker 6: real data center boom right now. And it's kind of

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Speaker 6: like how in previous eras of the tech booms, we

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Speaker 6: would watch headcount as an as kind of a leading

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Speaker 6: indicator of how the business is going. That's kind of

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Speaker 6: what's happened with cap you know, it's become a number

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Speaker 6: that investors track to be able to say are they

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Speaker 6: experiencing enough demand that they're going to keep building data centers.

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Speaker 6: It's watched as leading indicator, and so if that misses expectations,

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Speaker 6: that might sell investors. Oh man, are they seeing a

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Speaker 6: little demand slow down? So that's a kind of a

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Speaker 6: key number here that it wasn't, you know, a year

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Speaker 6: or two ago.

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Speaker 2: Yeah, oh well look for that. Well let's let's now

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Speaker 2: get your expectations for Adobe, which issued a pretty weak

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Speaker 2: outlook back at its last earnings in December, ciding uncertainty

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Speaker 2: about losing business to AI startups. So what do you

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Speaker 2: expect to see in its earnings this week?

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Speaker 6: The big question for Adobe is that in the age

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Speaker 6: of AI, are people still going to pay for programs

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Speaker 6: like Photoshop? You know, if I can google AI image

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Speaker 6: generator and make a pretty good photo. Am I going

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Speaker 6: to pay my you know, forty dollars a month license?

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Speaker 6: And investors can't decide the answer here. If you look

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Speaker 6: at the stock, it goes up, it goes down. Adobe

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Speaker 6: itself has unveiled all types of generative AI products, saying

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Speaker 6: that look, professionals use our services and they're going to

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Speaker 6: want to have AI within it. They're not going to

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Speaker 6: abandon us for you know, some startup that only has

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Speaker 6: a web interface. I think that argument makes sense, but

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Speaker 6: it's unclear that in the age of AI, when more

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Speaker 6: work can be automated, maybe you need less people for

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Speaker 6: a business like Adobe which charges per user.

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Speaker 3: You know.

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Speaker 6: It doesn't seem to bode well ultimately.

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Speaker 2: Oracle Q three earnings out on Monday after Wall Street's

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Speaker 2: closing bill. Adobe Q one earnings out after the bill

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Speaker 2: on Wednesday. Our thanks to Brody Ford, Bloomberg Tech reporter.

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Speaker 2: Coming up on Bloomberg Day Break weekend, we'll look ahead

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Speaker 2: to the role of the ECB in a changing Europe.

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Speaker 2: I'm Tom Busby and this is Bloomberg. This is Bloomberg

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Speaker 2: Daybreak Weekend, our global look ahead at the top stories

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Speaker 2: for investors in the coming week. I'm Tom Busby in

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Speaker 2: New York. Up Later in our program will look at

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Speaker 2: whether China can maintain its growth target for twenty twenty five.

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Speaker 2: But first, after a week filled with geopolitical uncertainty at

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Speaker 2: potential inflation boosting tariff announcements, European Central Bank chief Christine

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Speaker 2: Lagarde will address central bankers, financial market participants, and academics

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Speaker 2: this week. How will she make sense of a changing landscape? Well,

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Speaker 2: for more, let's go to London and bring in Bloomberg

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Speaker 2: Daybreak europe Banker Caroline Hepgar Tom.

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Speaker 3: While Europe is reckoning with questions of defense and security

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Speaker 3: and trade uncertainty, its central Bank is mulling how to respond.

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Speaker 3: Nearing the final leg of the interest rate cutting cycle,

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Speaker 3: policymakers in Europe must now navigate internal divisions and complicated

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Speaker 3: decision making in the months ahead. At the March meeting,

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Speaker 3: the group delivered a widely anticipated cut in the deposit

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Speaker 3: rate to two and a half percent. Now attention shifts

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Speaker 3: to how the institution can support a regent facing significant

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Speaker 3: threats to peace and prosperity. Impetus to fill defense coffers

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Speaker 3: spurred by waning US military commitments in what has been

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Speaker 3: one of the most consequential changes of recent decades. Germany

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Speaker 3: says that it will alter its own ironclad fiscal rules

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Speaker 3: and unlock hundreds of billions of euros for rearmament. Other

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Speaker 3: European leaders are turning more united in their support of

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Speaker 3: Ukraine and also fast tracking defense capabilities. It could all

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Speaker 3: still come unstuck, but all told, it will surely be

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Speaker 3: a major focus now for the European Central Bank and

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Speaker 3: its leader, Christine Lagarde. We've been speaking to Natalia Lippikina,

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Speaker 3: head of EMEA Equity Strategy at JP Morgan, about the

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Speaker 3: broader new reality now facing Europe.

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Speaker 8: I think it's just uncertainty that you will have to

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Speaker 8: live with, and we still don't know how big the

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Speaker 8: terrafs will be, will they be temporary or not. So

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Speaker 8: there will be still this overhang risk that most likely

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Speaker 8: will stay with the market for some time. And what

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Speaker 8: is interesting is that there probably will be more volatility

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Speaker 8: in the market, which we really haven't seen in the

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Speaker 8: last couple of years. But this year shows us that

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Speaker 8: there is just so much going on in the world

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Speaker 8: that we will see the markets going up and down,

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Speaker 8: and you know, having this volatility in between.

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Speaker 3: Some of the very big names in the US sold

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Speaker 3: off a great deal yesterday and they have done since

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Speaker 3: the February high. Is US exceptionalism at risk? That's the

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Speaker 3: other kind of big thought in markets right now.

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Speaker 8: I would say that there are probably cracks in that theme,

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Speaker 8: but overall, we do continue to think that the US

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Speaker 8: will perform Europe into the year end. We do continue

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Speaker 8: to see very strong earnings growth in the US market,

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Speaker 8: call it ten twelve percent this year, followed by very

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Speaker 8: similar growth next year. The market is getting worried about

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Speaker 8: this AI trade. We think that it's still a secular

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Speaker 8: growth story and there are loads of interesting, you know,

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Speaker 8: themes and companies that have from been beaten up recently

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Speaker 8: that are quite attractive right now.

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Speaker 3: That was Natarlie Lippikin, a head of EMEA equity strategy

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Speaker 3: at JP Morgan, speaking to us on Bloomberg Radio. So

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Speaker 3: how will Christine Legard present the place of her institution

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Speaker 3: amidst all of this uncertainty? I've been speaking to Bloomberg's

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Speaker 3: ECB reporter Yanna Randau about the ECB and its watchers' conference.

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Speaker 3: Who will be there and why is it so important?

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Speaker 7: There is some sentiment in the market and in the

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Speaker 7: ECB watchers community that that quarter point interest rate cut,

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Speaker 7: that was the last easy decision for the ECB for

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Speaker 7: a very long time, and that has to do with

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Speaker 7: the fact that the economic outlook is just so uncertain.

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Speaker 7: We don't know what's going to happen to tariffs, we

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Speaker 7: don't know what's going to happen to massive fiscal spending

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Speaker 7: across the region. Is it going through? The plans are

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Speaker 7: there now, but they have to go through parliaments, that

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Speaker 7: those bonds have to be issued, those orders for equipment

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Speaker 7: have to be made, and that doesn't happen overnight. We

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Speaker 7: all know how how difficult it is. So you know,

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Speaker 7: the ECB is flying blind once again and that makes

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Speaker 7: you know, predictions about where they're headed very very difficult

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Speaker 7: for April, but also for beyond.

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Speaker 3: Tell us about the ECB and it's watchers conference. Who

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Speaker 3: will be there? Why is it important?

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Speaker 7: Yeah? So the ECB Watchers Conference is this one conference

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Speaker 7: a year which is hosted at the at the University

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Speaker 7: in Frankfurt, where ECB watchers from from the world of academia,

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Speaker 7: economists from from some of the biggest banks, but also

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Speaker 7: the ECB policymakers themselves get together to discuss whatever is

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Speaker 7: happening in the world, whatever is on their mind. So

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Speaker 7: it's the place to be if you're interested in DCB

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Speaker 7: next week. It's the one event that you cannot miss,

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Speaker 7: maybe aside from from the Cintra conference that the ECB

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Speaker 7: puts on at the start of summer every year, and

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Speaker 7: for a few years now, the President Laguard has has

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Speaker 7: yeah showed up there as the as the keynote speaker,

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Speaker 7: usually delivering a very meaty, heavy policy speech, outlining the challenges,

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Speaker 7: discussing the challenges, and outlining her vision of what policy

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Speaker 7: should do over the next couple of months. Now. I've

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Speaker 7: tried to find out what she might be talking about

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Speaker 7: next week, and I have gloriously failed because the ecv

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Speaker 7: UH has has kept very tight lit about about even

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Speaker 7: the topic of of of her comments. So I'm fully

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Speaker 7: expecting her to be very authoritative, very yeah, very clear

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Speaker 7: in her analysis. But what she is actually going to

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Speaker 7: be talking about, you know, it's going to be a

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Speaker 7: secret for a while longer.

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Speaker 3: That's fascinating. It is such an uncertain time for you,

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Speaker 3: for the region. It will be very interesting to see

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Speaker 3: how Christine le Gard maybe tackles that, what is the

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Speaker 3: role of the ECB here? Then how will the Gard

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Speaker 3: and her team be thinking about this huge moment for

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Speaker 3: the continent.

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Speaker 7: Yeah, I mean, first of all, you know, she has

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Speaker 7: she has a very large number of very talented economists,

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Speaker 7: and I think they will They will do the heavy

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Speaker 7: work now trying to understand what all these announcements and

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Speaker 7: all the news we've seen over the over the past

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Speaker 7: couple of days, uh, and also are still going to

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Speaker 7: see as we march forward, how that is going to

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Speaker 7: affect the economy. She was as at her post decision

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Speaker 7: press conference, does the EASB have a role in maybe

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Speaker 7: helping to finance these massive investments that are going to come?

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Speaker 7: And she was very very clear there saying, our job

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Speaker 7: is to guarantee press stability, and you know that is

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Speaker 7: the best contribution we can make. And after that it's

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Speaker 7: for somebody else or other people to step up. And

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Speaker 7: I think that tells you a little bit about their

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Speaker 7: state of mind. They are going to watch the implications,

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Speaker 7: They will take the decisions necessary to keep inflation stable,

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Speaker 7: keep the economy in a good place, and will be

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Speaker 7: very very attentive to the data as they arrive and

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Speaker 7: to projections that hopefully, unlike the ones that came out

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Speaker 7: the recent ones, will actually tell them where where the

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Speaker 7: region is headed.

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Speaker 3: And yet the ECB has been so influential and often

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Speaker 3: central in past crises in Europe. So one wonders what

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Speaker 3: the ECB will be thinking about tariffs, the threat to.

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Speaker 7: Peace in Europe?

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Speaker 3: Will they be on Legard's agenda, on the agenda of

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Speaker 3: the European Central Bank.

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Speaker 7: For sure? And if there's one thing that can be

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Speaker 7: said about President Leguarde is that she's a very political,

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Speaker 7: easyb president and she has her very own opinions. She

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Speaker 7: you know, is not shy to to lash out at

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Speaker 7: Donald Trump. She's she's made her opinions very well understood

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Speaker 7: in the past on on what she thinks about tariffs,

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Speaker 7: what she thinks about certain types of policies, and I'm

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Speaker 7: sure you know we can we can expect to her

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Speaker 7: to hear more from from her about that. But she

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Speaker 7: also very well knows how sensitive the situation is and

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Speaker 7: how how charged the situation is, and and that central

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Speaker 7: banks in the current moment, and especially when you sit

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Speaker 7: in Europe, are very well advised to to be a

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Speaker 7: force of calm and not add to the tension. So

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Speaker 7: she's got to do her job as much as she

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Speaker 7: can and keeping inflation stable in the Eurozone, be a

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Speaker 7: voice of reason when it comes to warning against tariffs

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Speaker 7: and navigating the challenges with defense. I wouldn't add expect

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Speaker 7: her to add to tensions, but she will make yourself heard.

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Speaker 3: Talk to us then, about whether there are internal divisions

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Speaker 3: in the meeting of European leaders. In just the last

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Speaker 3: few days, the divisions have been clear when it comes

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Speaker 3: to Hungary and the rest of Europe one out of

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Speaker 3: twenty seven. Do you think on the Council the ECB divisions,

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Speaker 3: internal divisions might might deepen or might even emerge.

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Speaker 7: I think yes, I think so. I mean there were speculation,

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Speaker 7: or there was speculation already going into the March meeting

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Speaker 7: about what happens next, and April was always a bit

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Speaker 7: of a question mark. It's even more of a question

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Speaker 7: mark now we're going to see another cut or we

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Speaker 7: maybe going to see a pause. And and my impression

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Speaker 7: from speaking to to people after after the meeting was out,

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Speaker 7: is that that you know, the Dovish camp is worried

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Speaker 7: about the economy in in in the in the current

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Speaker 7: state sees room for more interest rate cuts. The more

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Speaker 7: hawkish members, Uh, they are slightly more concerned about the

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Speaker 7: implications of foreign inflation from terrorists, from fiscal policy, and

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Speaker 7: that they, uh, they might want to you know, just

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Speaker 7: pause and take stock and and be a bit careful.

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Speaker 7: Also because interest rates are now broadly approaching that territory

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Speaker 7: that we can we can describe as neutral where you know,

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Speaker 7: it's not restricting the economy anymore. And so so there

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Speaker 7: are different different views on what the economy needs, but

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Speaker 7: overall there is this sentiment that they don't want to

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Speaker 7: add to the fighting and and the controversy. Uh. And

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Speaker 7: this is what we saw yesterday. I saw last at

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Speaker 7: the last meeting as well, that there was this sense

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Speaker 7: of coming together and rallying behind the consensus. And as

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Speaker 7: much as I expect, you know, a lot of loud

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Speaker 7: noises going or approaching the April meeting with very forceful opinions,

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Speaker 7: I also see a lot of room for them coming together,

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Speaker 7: coming to the table and making a decision that everybody

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Speaker 7: can support in April, or at least a broad majority

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Speaker 7: can support.

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Speaker 3: Just very briefly, Yanna, as ECB reporter, you know, the

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Speaker 3: EASYB in its Watches event, the annual event, as you

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Speaker 3: describe it, very important, you know, on the same sort

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Speaker 3: of footing as the Cintra meeting in terms of what

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Speaker 3: you're going to try to glean out of the events.

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Speaker 3: What are you going to be beetling around and trying

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Speaker 3: to trying to do and write about you think, just briefly.

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Speaker 7: Yeah, I mean, I think it's just the way the

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Speaker 7: ECB analyzes the current situation. There wasn't a whole lot

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Speaker 7: yet in the post EASYB press conference, just because it

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Speaker 7: was so fresh and maybe policymakers didn't have a whole

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Speaker 7: lot of time to reflect on the new situation, the

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Speaker 7: new reality they're in. So I expect a lot more

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Speaker 7: reflection on the challenges for Europe, on what might be

436
00:25:20,440 --> 00:25:24,840
Speaker 7: necessary in running the economy, and I think that will

437
00:25:24,880 --> 00:25:28,399
Speaker 7: be interesting because we can infer how policy, how they

438
00:25:28,440 --> 00:25:30,800
Speaker 7: might also think about policy in the months ahead.

439
00:25:30,920 --> 00:25:34,280
Speaker 3: My thanks to Bloomberg's EASYB reporter Yanna Ruandau, and we

440
00:25:34,320 --> 00:25:37,000
Speaker 3: will keep you up to date with the European Central

441
00:25:37,040 --> 00:25:40,640
Speaker 3: Bank and its Watchers Conference in the coming days here

442
00:25:40,720 --> 00:25:44,200
Speaker 3: on Bloomberg Radio. I'm Caroline Hepgitt in London. You can

443
00:25:44,240 --> 00:25:46,919
Speaker 3: catch us every weekday morning for Blueberg Daybreak. You up

444
00:25:47,080 --> 00:25:49,639
Speaker 3: beginning at six am in London. That's one am on

445
00:25:49,760 --> 00:25:51,560
Speaker 3: Wall Street, Tom, Thank.

446
00:25:51,359 --> 00:25:54,000
Speaker 2: You, Caroline. And coming up on Bloomberg day Break Weekend,

447
00:25:54,080 --> 00:25:56,520
Speaker 2: we'll look at whether China can maintain its growth target

448
00:25:56,680 --> 00:26:01,000
Speaker 2: in twenty twenty five. I'm Tom Busby and this is Bloomberg.

449
00:26:11,680 --> 00:26:14,040
Speaker 2: This is Bloomberg day Break Weekend, our global look ahead

450
00:26:14,080 --> 00:26:16,400
Speaker 2: at the top stories for investors in the coming week.

451
00:26:16,560 --> 00:26:18,120
Speaker 2: I'm Tom Busby in New York.

452
00:26:18,560 --> 00:26:18,760
Speaker 7: US.

453
00:26:18,840 --> 00:26:22,040
Speaker 2: Tariffs on Canada and Mexico capturing the headlines last week,

454
00:26:22,080 --> 00:26:26,200
Speaker 2: but the Trump administration also slapped additional tariffs on China.

455
00:26:26,640 --> 00:26:28,520
Speaker 2: For more on what those levees could mean for the

456
00:26:28,520 --> 00:26:30,960
Speaker 2: world's second largest economy, Let's get to the host of

457
00:26:31,000 --> 00:26:33,680
Speaker 2: the Daybreak Asia podcast, Doug Krisner.

458
00:26:34,040 --> 00:26:37,159
Speaker 4: Tom. In the last week, Chinese leadership set an ambitious

459
00:26:37,240 --> 00:26:40,560
Speaker 4: goal for economic growth at around five percent for twenty

460
00:26:40,640 --> 00:26:43,320
Speaker 4: twenty five. You know, this marks the third straight year

461
00:26:43,359 --> 00:26:46,639
Speaker 4: that China has maintained that growth target, and Premier Lee

462
00:26:46,720 --> 00:26:49,560
Speaker 4: Chan did say that meeting it again will be difficult.

463
00:26:49,880 --> 00:26:54,119
Speaker 4: I'm joined now by Katya Dmitrieva, Bloomberg News Asia Economy reporter.

464
00:26:54,240 --> 00:26:57,440
Speaker 4: She joins us from our studios in Hong Kong. Katya,

465
00:26:57,480 --> 00:26:59,560
Speaker 4: thank you for joining us. Can we talk about the

466
00:26:59,600 --> 00:27:02,600
Speaker 4: growth target to begin with? Does it seem realistic at

467
00:27:02,600 --> 00:27:03,200
Speaker 4: this point?

468
00:27:03,520 --> 00:27:08,400
Speaker 9: Depends who you ask. Chinese officials definitely think they can

469
00:27:08,440 --> 00:27:11,280
Speaker 9: make it. It's the exact same target they've set in

470
00:27:11,320 --> 00:27:14,480
Speaker 9: twenty twenty four. They've met their targets for the past

471
00:27:14,640 --> 00:27:19,120
Speaker 9: three years, so history would suggest that once they set something,

472
00:27:19,880 --> 00:27:22,199
Speaker 9: they're going to do everything they can to meet it.

473
00:27:22,840 --> 00:27:25,840
Speaker 9: If you ask economists, however, we've got a Bloomberg survey

474
00:27:26,119 --> 00:27:29,600
Speaker 9: and it says that they're likely China is more likely

475
00:27:29,680 --> 00:27:33,040
Speaker 9: to hit four point five percent. Now, the question is

476
00:27:33,080 --> 00:27:38,760
Speaker 9: really how much the stimulus can help revive consumption. I

477
00:27:38,800 --> 00:27:42,440
Speaker 9: know that's always the question, but this year in particular,

478
00:27:42,520 --> 00:27:48,159
Speaker 9: because from Premiere Li Cheang's speech, it's very clear that

479
00:27:48,560 --> 00:27:52,720
Speaker 9: they're doing a couple things. So they're boosting how much

480
00:27:52,760 --> 00:27:55,119
Speaker 9: they're going to be spending in their budget deficit or

481
00:27:55,160 --> 00:27:57,960
Speaker 9: how much they're comfortable with spending this year.

482
00:27:58,200 --> 00:27:59,760
Speaker 4: What is that percentage right now?

483
00:28:00,280 --> 00:28:03,640
Speaker 9: So they've got a fiscal deficit target of four percent,

484
00:28:04,440 --> 00:28:06,800
Speaker 9: which means that they're going to be spending a lot

485
00:28:06,880 --> 00:28:09,640
Speaker 9: more on a number of programs. We only know kind

486
00:28:09,640 --> 00:28:12,920
Speaker 9: of a handful of what those will be. They're raising

487
00:28:12,960 --> 00:28:16,600
Speaker 9: the pension payout levels, there's a public subsidy for medical

488
00:28:16,640 --> 00:28:20,639
Speaker 9: insurance that they're going to be boosting. The question, though,

489
00:28:21,000 --> 00:28:23,840
Speaker 9: is what else are they going to do? And if

490
00:28:23,960 --> 00:28:27,119
Speaker 9: history again serves as a guide, we know that throughout

491
00:28:27,160 --> 00:28:30,760
Speaker 9: the year, the first few months growth is quite strong.

492
00:28:30,840 --> 00:28:33,400
Speaker 9: They roll out these programs, and then about halfway through

493
00:28:33,440 --> 00:28:37,200
Speaker 9: the year they're forced to do more because the numbers

494
00:28:37,560 --> 00:28:38,280
Speaker 9: aren't stacking it.

495
00:28:38,400 --> 00:28:41,000
Speaker 4: Do you think that leadership in Beijing is operating under

496
00:28:41,040 --> 00:28:44,959
Speaker 4: the assumption that it is inevitable that more US tariffs,

497
00:28:45,040 --> 00:28:47,120
Speaker 4: or at least higher US tariffs are on the way.

498
00:28:47,520 --> 00:28:50,600
Speaker 9: Absolutely, and you can see that in their reaction. So

499
00:28:51,400 --> 00:28:54,840
Speaker 9: if you just look at Trump's previous statements, everything from

500
00:28:55,120 --> 00:28:58,440
Speaker 9: sixty percent to one hundred percent tariffs on China, which

501
00:28:58,440 --> 00:29:00,640
Speaker 9: he said during the campaign trail, Now one hundred percent,

502
00:29:00,680 --> 00:29:02,560
Speaker 9: take that with a grain of salt, But I think

503
00:29:02,640 --> 00:29:05,480
Speaker 9: sixty percent was mentioned enough that that's what a lot

504
00:29:05,520 --> 00:29:08,920
Speaker 9: of economists and analysts and people in Beijing are now

505
00:29:09,120 --> 00:29:13,640
Speaker 9: pricing in. And so the reason why this NPC was

506
00:29:13,640 --> 00:29:16,880
Speaker 9: particularly important is because it was the first chance that

507
00:29:16,960 --> 00:29:21,160
Speaker 9: Chinese officials could react to that eventuality or what is

508
00:29:21,200 --> 00:29:25,000
Speaker 9: perceived to be that eventuality. So raising the fiscal deficit

509
00:29:25,080 --> 00:29:29,640
Speaker 9: target and also raising the fiscal deficit target and also

510
00:29:29,720 --> 00:29:32,600
Speaker 9: focusing on the consumer is a sign that they're not

511
00:29:32,880 --> 00:29:36,240
Speaker 9: going to be or trying not to be as reliant

512
00:29:36,240 --> 00:29:39,480
Speaker 9: on exports, right, because if you have these tariffs coming

513
00:29:39,560 --> 00:29:42,040
Speaker 9: in from the US and you have this growing protectionism

514
00:29:42,320 --> 00:29:45,960
Speaker 9: really globally, then you can't rely on those tariffs, or

515
00:29:46,320 --> 00:29:49,240
Speaker 9: you can't rely on trade. You can't rely on exports

516
00:29:49,240 --> 00:29:52,000
Speaker 9: as much because it's just going to contribute to deflation.

517
00:29:52,160 --> 00:29:54,120
Speaker 9: It's not going to get your growth to about five

518
00:29:54,200 --> 00:29:55,160
Speaker 9: percent if.

519
00:29:55,160 --> 00:29:57,960
Speaker 4: Chinese leadership has to do more on the stimulus side.

520
00:29:58,000 --> 00:30:00,160
Speaker 4: Are the people talking about the risk that may be

521
00:30:00,200 --> 00:30:03,640
Speaker 4: associated with that. I'm thinking about the debt levels that

522
00:30:03,680 --> 00:30:05,520
Speaker 4: are maybe problematic already.

523
00:30:05,840 --> 00:30:08,680
Speaker 9: Yeah, there's going to be a lot of debt issuance

524
00:30:08,960 --> 00:30:13,960
Speaker 9: for sure, and of course fiscal deficit increasing. But this

525
00:30:14,040 --> 00:30:18,840
Speaker 9: is kind of with China is a special case in

526
00:30:18,880 --> 00:30:21,600
Speaker 9: some ways, and in some ways it's also not so

527
00:30:21,640 --> 00:30:23,880
Speaker 9: it's a special case and that they have more control

528
00:30:24,000 --> 00:30:26,640
Speaker 9: over these things. So we're going to see a lot

529
00:30:26,680 --> 00:30:29,160
Speaker 9: more bond issuance. There's some response in markets. They're still

530
00:30:29,240 --> 00:30:31,400
Speaker 9: hungry for that debt.

531
00:30:31,720 --> 00:30:33,719
Speaker 4: So we're dealing with a trade war right now. And

532
00:30:33,760 --> 00:30:36,480
Speaker 4: one of the things that I thought was very interesting

533
00:30:36,640 --> 00:30:40,920
Speaker 4: is Beijing reiterating this stance on opening up markets to

534
00:30:41,080 --> 00:30:45,560
Speaker 4: foreign investors. Where is this foreign capital going to come from,

535
00:30:45,720 --> 00:30:48,920
Speaker 4: in the mind of Chinese leadership, other than the US.

536
00:30:49,560 --> 00:30:53,760
Speaker 9: They're hoping it'll come from all over the US, maybe Europe,

537
00:30:53,800 --> 00:30:58,200
Speaker 9: but Southeast Asia and Asia in particular. You've seen since

538
00:30:58,240 --> 00:31:04,080
Speaker 9: twenty eighteen really solidifying of trade and foreign direct investment

539
00:31:04,760 --> 00:31:09,000
Speaker 9: ties between China and Asia, especially as companies kind of

540
00:31:09,000 --> 00:31:11,040
Speaker 9: pulled back from the States in Europe and there were

541
00:31:11,480 --> 00:31:14,720
Speaker 9: a lot more restrictions in those regions and kind of

542
00:31:14,760 --> 00:31:17,960
Speaker 9: the Western world. So there is a sense that Asia

543
00:31:18,040 --> 00:31:21,240
Speaker 9: could contribute a lot more. You know, think of India,

544
00:31:21,480 --> 00:31:24,360
Speaker 9: think of even South Korea, and a lot of the

545
00:31:24,400 --> 00:31:28,520
Speaker 9: Southeast Asian economies that are growing at a much faster

546
00:31:28,680 --> 00:31:32,400
Speaker 9: clip and sort of minting new companies and millionaires and

547
00:31:32,400 --> 00:31:37,120
Speaker 9: billionaires every day. So I think the thinking is that

548
00:31:37,160 --> 00:31:40,680
Speaker 9: the investment will come from there. However, it'll be a

549
00:31:40,720 --> 00:31:44,760
Speaker 9: pretty tall order to get a foreign investment to come back.

550
00:31:45,240 --> 00:31:47,680
Speaker 9: There's still a lot of questions about the property sector

551
00:31:47,720 --> 00:31:50,720
Speaker 9: bottoming out. In fact, if you speak to any investor,

552
00:31:51,560 --> 00:31:55,520
Speaker 9: they will flag that particular issue. In fact, the data

553
00:31:55,560 --> 00:32:01,080
Speaker 9: shows the opposite, that domestic investors are taking their money

554
00:32:01,160 --> 00:32:04,080
Speaker 9: out of China at a much faster clip and money

555
00:32:04,120 --> 00:32:08,280
Speaker 9: is going into China at a much slower rate. So

556
00:32:08,800 --> 00:32:10,880
Speaker 9: it's not looking optimistic for that.

557
00:32:11,280 --> 00:32:12,880
Speaker 4: I think we're going to get figures in the week

558
00:32:12,880 --> 00:32:16,479
Speaker 4: ahead on foreign direct investment for China. But what are

559
00:32:16,520 --> 00:32:18,920
Speaker 4: some of the important data points that you are looking

560
00:32:19,000 --> 00:32:21,240
Speaker 4: at in the coming days. I know over the weekend

561
00:32:21,280 --> 00:32:25,360
Speaker 4: we'll have some inflation numbers, also new loans data. But

562
00:32:25,520 --> 00:32:28,600
Speaker 4: is there anything in particular that you think can shed

563
00:32:28,640 --> 00:32:32,400
Speaker 4: a light on the vibrancy or the lack of vibrancy

564
00:32:32,840 --> 00:32:34,040
Speaker 4: in the Chinese economy.

565
00:32:34,400 --> 00:32:38,840
Speaker 9: I think three things. There's three indicators that I always

566
00:32:38,840 --> 00:32:43,320
Speaker 9: watch when it comes to China. There's the CPI and PPI,

567
00:32:43,440 --> 00:32:49,040
Speaker 9: which I'm wrapping into one as inflation. There's housing and

568
00:32:49,520 --> 00:32:55,160
Speaker 9: in particular how in particular home sales home prices for

569
00:32:55,240 --> 00:32:58,320
Speaker 9: some of the biggest cities. So we get that, we

570
00:32:58,400 --> 00:33:02,280
Speaker 9: get the inflation data this week, we get new home prices,

571
00:33:02,400 --> 00:33:05,360
Speaker 9: used home prices in a couple of weeks, and then

572
00:33:05,360 --> 00:33:09,640
Speaker 9: I would say the third thing is retail spending.

573
00:33:10,400 --> 00:33:13,240
Speaker 4: So talk to me about the behavior of the Chinese consumer.

574
00:33:13,360 --> 00:33:16,600
Speaker 4: Do we know anything about how well retail spending has

575
00:33:16,640 --> 00:33:17,440
Speaker 4: been performing.

576
00:33:17,960 --> 00:33:21,120
Speaker 9: It has been very weak. In fact, the last few

577
00:33:21,160 --> 00:33:26,040
Speaker 9: months in particular have been surprisingly weak. Given that the

578
00:33:26,040 --> 00:33:28,480
Speaker 9: start of the year we had a major holiday. We

579
00:33:28,520 --> 00:33:32,640
Speaker 9: thought spending was going to lift as a result of that,

580
00:33:32,960 --> 00:33:36,000
Speaker 9: but actually to end the year there was this unexpected

581
00:33:36,480 --> 00:33:39,440
Speaker 9: slow down and sort of starting the year as well.

582
00:33:39,880 --> 00:33:42,160
Speaker 9: I mean, in general, the issue is that there's still

583
00:33:42,160 --> 00:33:46,520
Speaker 9: a two speed economy, right. You have industrial production that's

584
00:33:46,520 --> 00:33:51,360
Speaker 9: picking up, you have retail sales and consumption that's flatlining,

585
00:33:51,560 --> 00:33:55,080
Speaker 9: and growth is just nowhere near where it should be

586
00:33:55,200 --> 00:33:59,200
Speaker 9: to support economic growth, and certainly nowhere near where it

587
00:33:59,200 --> 00:34:02,920
Speaker 9: needs to be five percent growth, especially if you're going

588
00:34:02,960 --> 00:34:05,200
Speaker 9: to be relying on the consumer specifically.

589
00:34:05,520 --> 00:34:08,560
Speaker 4: Katya, thank you so much for joining us. Katya Dmitrieva,

590
00:34:08,600 --> 00:34:12,560
Speaker 4: Bloomberg News Asia Economy reporter, joining us. For more on

591
00:34:12,600 --> 00:34:16,040
Speaker 4: the outlook for China's economy, we turned to Shazad Kazi.

592
00:34:16,120 --> 00:34:19,600
Speaker 4: He is the chief operating Officer, also managing director at

593
00:34:19,680 --> 00:34:23,960
Speaker 4: China beije Book International, Shahzad, It's always a pleasure. China

594
00:34:23,960 --> 00:34:27,480
Speaker 4: beige Book International has just released its report for the

595
00:34:27,520 --> 00:34:31,040
Speaker 4: month of February. February, can you help me understand what

596
00:34:31,120 --> 00:34:32,640
Speaker 4: you guys have discovered.

597
00:34:32,880 --> 00:34:36,799
Speaker 10: Yeah, last week's China Beigebook economic release show that the

598
00:34:37,160 --> 00:34:41,400
Speaker 10: economy continues to improve in twenty twenty five as a

599
00:34:41,440 --> 00:34:44,200
Speaker 10: second straight month at least where we've seen growth accelerate,

600
00:34:45,000 --> 00:34:48,239
Speaker 10: and this time around you had the industrial sector doing

601
00:34:48,320 --> 00:34:51,719
Speaker 10: quite well. However, the one thing that stood out in

602
00:34:51,920 --> 00:34:54,919
Speaker 10: the report that we talk about is that consumption took

603
00:34:55,280 --> 00:34:56,000
Speaker 10: a back seat.

604
00:34:56,640 --> 00:34:58,719
Speaker 4: What do you think is going on there that is

605
00:34:58,760 --> 00:35:02,120
Speaker 4: holding consumption back beyond just negative sentiment.

606
00:35:02,640 --> 00:35:04,400
Speaker 10: Well, what happened was that in the lead up to

607
00:35:04,600 --> 00:35:07,359
Speaker 10: the Lunar New Year, you saw the travel sector do good,

608
00:35:07,360 --> 00:35:10,160
Speaker 10: restaurants do good, people going out there and buying things

609
00:35:10,160 --> 00:35:13,960
Speaker 10: that the retailing segment was doing well also, but there

610
00:35:14,000 --> 00:35:16,879
Speaker 10: was a pair back from that speed or that intensity.

611
00:35:17,320 --> 00:35:19,640
Speaker 10: And I think what this comes down to is the

612
00:35:19,680 --> 00:35:22,160
Speaker 10: fact that you don't have right now any type of

613
00:35:22,520 --> 00:35:27,040
Speaker 10: sustained consumer or household focused stimulus in China.

614
00:35:27,160 --> 00:35:29,000
Speaker 4: One of the things that we talk a lot about

615
00:35:29,080 --> 00:35:32,200
Speaker 4: in terms of consumer confidence in China that it's very

616
00:35:32,280 --> 00:35:34,399
Speaker 4: much linked to the property market, and we know that

617
00:35:34,560 --> 00:35:37,920
Speaker 4: home prices are still struggling, right, Is that sharing a

618
00:35:37,960 --> 00:35:39,160
Speaker 4: big part of the blame here?

619
00:35:39,280 --> 00:35:43,280
Speaker 10: Well, the property market is actually starting to trend, especially

620
00:35:43,360 --> 00:35:46,280
Speaker 10: the housing market, in the right direction. Yes, of course,

621
00:35:46,320 --> 00:35:50,399
Speaker 10: you're still far below levels from years ago. However that

622
00:35:50,440 --> 00:35:54,440
Speaker 10: pain has eased quite significantly over the last year or

623
00:35:54,480 --> 00:35:57,680
Speaker 10: so as Beijing has tried to take its sort of

624
00:35:57,680 --> 00:35:59,960
Speaker 10: foot off the neck of the market.

625
00:36:00,200 --> 00:36:02,960
Speaker 4: What do we know about the labor market? Speaking of markets, the.

626
00:36:02,960 --> 00:36:06,640
Speaker 10: Labor market is doing our right. You haven't seen hiring

627
00:36:06,760 --> 00:36:11,000
Speaker 10: go back to those pre COVID levels and our economic surveys.

628
00:36:11,239 --> 00:36:14,320
Speaker 10: I mean, you've certainly seen periods last year where hiring

629
00:36:14,360 --> 00:36:17,400
Speaker 10: slowed down, which we're concerning, but all around the picture

630
00:36:17,520 --> 00:36:21,560
Speaker 10: isn't very inspiring. But again, there isn't that alarm or

631
00:36:21,680 --> 00:36:23,479
Speaker 10: crisis in the labor market data.

632
00:36:23,560 --> 00:36:25,560
Speaker 4: So when you look at the types of companies that

633
00:36:25,600 --> 00:36:29,960
Speaker 4: you are talking to, I'm thinking there's obviously state owned enterprises,

634
00:36:30,080 --> 00:36:34,200
Speaker 4: the gargantuan companies that exist in China, and then medium,

635
00:36:34,400 --> 00:36:38,960
Speaker 4: smaller sized, more entrepreneurial type organizations. Do we need to

636
00:36:39,040 --> 00:36:42,760
Speaker 4: differentiate and talk about sentiments within those camps.

637
00:36:43,080 --> 00:36:45,320
Speaker 10: Yeah, I think that's going to become even more important,

638
00:36:45,440 --> 00:36:48,520
Speaker 10: especially if the party is now pledging that the private

639
00:36:48,520 --> 00:36:51,480
Speaker 10: sector is going to get very good credit support finally,

640
00:36:51,600 --> 00:36:55,160
Speaker 10: and they're going to be provided the type of a

641
00:36:55,200 --> 00:36:58,560
Speaker 10: policy support rather I actould say that they need in

642
00:36:58,680 --> 00:37:01,480
Speaker 10: order to succeed. Well, that's going to play out in

643
00:37:01,480 --> 00:37:03,920
Speaker 10: the numbers, and that has not been the case. SMEs

644
00:37:04,000 --> 00:37:08,160
Speaker 10: have historically really struggled to go out there and get

645
00:37:08,200 --> 00:37:11,080
Speaker 10: credit and to get the kind of money that they

646
00:37:11,080 --> 00:37:13,480
Speaker 10: need in order to have a successful, thriving business in

647
00:37:13,560 --> 00:37:16,239
Speaker 10: order to invest in higher They've always come second. They've

648
00:37:16,239 --> 00:37:19,040
Speaker 10: always been second fiddle to the big state or enterprises.

649
00:37:19,120 --> 00:37:21,160
Speaker 4: How well capitalized are the banks right now?

650
00:37:21,800 --> 00:37:23,640
Speaker 10: The banks are not in any kind of crisis. Yes,

651
00:37:23,719 --> 00:37:27,160
Speaker 10: China is recapitalizing and that took up a lot of headlines,

652
00:37:27,440 --> 00:37:30,600
Speaker 10: but the major banks are not in any kind of crisis. Now,

653
00:37:30,640 --> 00:37:33,160
Speaker 10: do you have some kind of financial crisis brewing? Maybe

654
00:37:33,200 --> 00:37:36,480
Speaker 10: at some local levels potentially, I think the property market

655
00:37:36,520 --> 00:37:39,600
Speaker 10: story will be playing out there. Obviously continued issues with

656
00:37:39,640 --> 00:37:42,200
Speaker 10: local government finances, so that may be a story for

657
00:37:42,239 --> 00:37:43,680
Speaker 10: the long run. But I think the big banks are

658
00:37:43,680 --> 00:37:44,879
Speaker 10: doing all right for now.

659
00:37:45,000 --> 00:37:47,000
Speaker 4: One of the big things that we've been talking about

660
00:37:47,239 --> 00:37:50,799
Speaker 4: is the deep Seek artificial intelligence chat bought that was

661
00:37:50,840 --> 00:37:53,439
Speaker 4: released a couple of weeks ago, and how that has

662
00:37:53,600 --> 00:37:56,880
Speaker 4: reinvigorated the high tech space in China. Talk to me

663
00:37:56,920 --> 00:37:59,239
Speaker 4: a little bit about the momentum the follow through that

664
00:37:59,280 --> 00:38:01,279
Speaker 4: you're seeing as result of that development.

665
00:38:01,480 --> 00:38:01,680
Speaker 7: Yeah.

666
00:38:01,760 --> 00:38:03,840
Speaker 10: Look, I think we're certainly picking up some amounts of

667
00:38:03,920 --> 00:38:07,399
Speaker 10: positive sentiment from that even within the surveys early on.

668
00:38:07,880 --> 00:38:09,680
Speaker 10: We'll see how that plays out over the rest of

669
00:38:09,680 --> 00:38:12,839
Speaker 10: the year, especially in the e commerce area, and of

670
00:38:12,840 --> 00:38:16,120
Speaker 10: course how some of the more high end tech manufacturing

671
00:38:16,160 --> 00:38:19,560
Speaker 10: firms are performing as we learn more about deep Seak

672
00:38:19,560 --> 00:38:21,560
Speaker 10: and as we learn about some of the other potential

673
00:38:21,560 --> 00:38:22,520
Speaker 10: model similar models.

674
00:38:22,680 --> 00:38:27,240
Speaker 4: Jizad Kazi, COO and managing director at China Beijbook International.

675
00:38:27,640 --> 00:38:30,360
Speaker 4: I'm Doug Chrisner. You can catch us weekdays for the

676
00:38:30,440 --> 00:38:35,200
Speaker 4: Daybreak Asia podcast. It's available wherever you get your podcast. Tom.

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00:38:35,680 --> 00:38:38,080
Speaker 2: Thank you Doug, And that does it for this edition

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00:38:38,080 --> 00:38:40,680
Speaker 2: of Bloomberg day Break Weekend. Join us again Monday morning

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00:38:40,680 --> 00:38:42,600
Speaker 2: at five am Wall Street Time for the latest on

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00:38:42,719 --> 00:38:45,520
Speaker 2: markets overseas and the news you need to start your day,

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00:38:46,040 --> 00:38:49,000
Speaker 2: I'm Tom Buzzby. Stay with us. Top stories and global

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Speaker 2: business headlines are coming up right now