WEBVTT - Fed Rate Bets Change; Biden Aims to Reduce Gun Violence

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<v Speaker 1>Bloomberg Audio Studios, Podcasts, radio news. Good morning, I'm Nathan

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<v Speaker 1>Hager and I'm Karen Moscow. Here are the stories we're

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<v Speaker 1>following today.

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<v Speaker 2>Karen Willcom has been restored to stock in bond markets

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<v Speaker 2>for now. After the hotter than estimated inflation report for March, yesterday,

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<v Speaker 2>a gauge of global bond suffered it's worst performance since

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<v Speaker 2>February of last year. Investors now bet the FED will

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<v Speaker 2>cut interest rates just twice this year. Neil Dutta, partner

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<v Speaker 2>at Renaissance Macro Research, talked about the difference between the

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<v Speaker 2>Consumer Price Index and the feds preferred inflation gauge, the PCE.

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<v Speaker 3>You know, there are differences of scope between the CPI

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<v Speaker 3>data and the pc data, and the CPI data is running,

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<v Speaker 3>you know, over a full percentage point higher than PCE.

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<v Speaker 3>That's about twice almost three times what's normal, and so

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<v Speaker 3>you know, in some respects, I do think the market

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<v Speaker 3>might be overstating how important CPI is for the FED

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<v Speaker 3>reaction function, but you know, it's a bad number.

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<v Speaker 2>Renaissance Macro Research partner Neil Dutta now expects the FED

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<v Speaker 2>to cut rates twice this year, with the first move in.

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<v Speaker 1>July, Well Nathan, Former Treasury Secretary Larry Summers says cutting

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<v Speaker 1>rates would be a mistake. In fact, Summer says a

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<v Speaker 1>rate hike may be necessary.

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<v Speaker 4>You have to take seriously the possibility that the next

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<v Speaker 4>rate move will be upwards rather than downwards, and anything

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<v Speaker 4>could happen. Markets could crash, the indicators could turn down.

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<v Speaker 4>But on current facts, a rate cut in June, it

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<v Speaker 4>seems to me would be a dangerous and egregious error.

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<v Speaker 1>Former Treasury Secretary Larry Summers estimates the chance of a

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<v Speaker 1>rate hike in the fifteen to twenty five percent range.

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<v Speaker 1>Here the full conversation on the Bloomberg Wall Street Week

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<v Speaker 1>podcast downloaded on Apples, Spotify, or anywhere else you get

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<v Speaker 1>your podcasts.

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<v Speaker 5>Karen.

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<v Speaker 2>Investors now turn their attention to another key inflation reading,

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<v Speaker 2>the March Producer Price Index. Let's get a preview from

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<v Speaker 2>Bloomberg's Michael McKee.

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<v Speaker 6>The Producer Price Index is forecast to come in cooler

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<v Speaker 6>than yesterday's Consumer price index, and that may matter more

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<v Speaker 6>to the Fed than the CPI. The reason the Fed's

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<v Speaker 6>target is based on a third inflation measure, the Personal

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<v Speaker 6>Consumption Expenditures Index or PCE. It tends to run lower

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<v Speaker 6>than CPI. Some sectors in the PPI feed directly into PCE.

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<v Speaker 6>For example, while CPI measures what consumers pay for medical care,

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<v Speaker 6>PPI and PCE measure what insurance companies pay. So today's

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<v Speaker 6>numbers matter for analysts and central bankers as they try

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<v Speaker 6>to understand the direction of inflation. A strong PPI would

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<v Speaker 6>reinforce pessimism about rate cuts a week one would revive hope.

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<v Speaker 6>Michael McKee Bloomberg Radio.

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<v Speaker 1>Right, Mike, thanks well. Interest rates are very much in

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<v Speaker 1>focus overseas. Later this morning, the European Central Bank makes

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<v Speaker 1>a policy decision, and we go to London and get

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<v Speaker 1>a preview of the Bloomberg's You and Pots You in

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<v Speaker 1>Good Morning.

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<v Speaker 7>Karen and Nathan boringcoss Across the euro Area are set

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<v Speaker 7>to be held at a record high today of four percent,

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<v Speaker 7>but investors are expecting the ECB to further lay the

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<v Speaker 7>ground for cuts to get underway in June. Euro Area

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<v Speaker 7>inflation is within sights of the two percent target, but

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<v Speaker 7>President Christine the Guard has indicated they'll need more confidence

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<v Speaker 7>in the data, particularly wage growth, by the middle of

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<v Speaker 7>the year. That decision comes at seven fifteen Eastern time

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<v Speaker 7>in London. Immune pots beenber radio.

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<v Speaker 2>Okay ewan, thank you. Oil is on the rise, and

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<v Speaker 2>speculation hostilities may be escalating in the Middle East. Source

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<v Speaker 2>to say the US and its allies think an Iranian

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<v Speaker 2>strike on Israel is imminent. We get more from Bloomberg

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<v Speaker 2>Israel Bureau chief Ethan Bronner.

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<v Speaker 8>This is in retaliation for an attack that is presumed

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<v Speaker 8>to have been done by Israel about ten days ago

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<v Speaker 8>in Damascus on a diplomatic compound in which seven people

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<v Speaker 8>were killed.

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<v Speaker 9>The key point there is that the two of.

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<v Speaker 8>The people were Revolutionary Guard command as to say, Iranian

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<v Speaker 8>commanders of militias in Lebanon in Syria.

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<v Speaker 2>Bloomberg's Ethan Bronner says Israeli officials have publicly threatened Iran

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<v Speaker 2>that if it hits Israeli soil, Israel will hit Iranian soil.

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<v Speaker 1>Well back here in the US, Nathan, the Biden administration

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<v Speaker 1>is cracking down on unlicensed gun dealers, and we get

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<v Speaker 1>the very latest at Bloomberg's John Tucker, John, Good Morning.

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<v Speaker 5>And Karen.

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<v Speaker 9>The Biden administration is issuing the rule designed to close

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<v Speaker 9>a gap that allows gun buyers to avoid background checks.

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<v Speaker 9>It targets the so called gun show loophole by expanding

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<v Speaker 9>the definition of who must obtain a license to engage

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<v Speaker 9>in firearm sales. The regulation specifically singles out sellers online

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<v Speaker 9>and at gun shows, where the background checks are often

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<v Speaker 9>not conducted. According to a White House official, more than

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<v Speaker 9>twenty thousand individuals engaged in unlicensed dealings could be affected

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<v Speaker 9>by the changes. The President has seized on the issue

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<v Speaker 9>of gun violence to contrast himself with former President Trump

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<v Speaker 9>and Republicans. In a State of the Union address in March,

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<v Speaker 9>mister Biden sattled his administration's efforts to address gun crime,

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<v Speaker 9>including establishing the first ever Office of Gun Violence Prevention.

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<v Speaker 9>John Tucker, Bloomberg Radio.

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<v Speaker 1>All Right, John, Thanks at a disclaimer, Michael Bloomberg, founder

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<v Speaker 1>and majority owner of Bloomberg Radio parent Bloomberg Lp, donates

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<v Speaker 1>to groups at support gun control.

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<v Speaker 5>All Right, Karen.

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<v Speaker 2>In Legal News this morning, Donald Trump has lost his

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<v Speaker 2>third try in a week to delay his Manhattan hush

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<v Speaker 2>money trial. Bloomberg's Ed Baxter has the story.

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<v Speaker 10>The week legally has had his attorneys trying to delay

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<v Speaker 10>the trial on charges that he faked business records to

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<v Speaker 10>cover up a sex scandal. The so called hush money trial.

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<v Speaker 10>His attorneys say they want a delay based on several

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<v Speaker 10>rulings that have been made, including waiting until after the

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<v Speaker 10>final ruling comes down on immunity. How this latest ruling

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<v Speaker 10>could be heard by a panel of five appellate court

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<v Speaker 10>justices going forward, but it would be nearly impossible for

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<v Speaker 10>the court to hear and rule before the trial's beginning.

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<v Speaker 10>Jury selection is scheduled from Monday the fifteenth at Baxter bloom.

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<v Speaker 1>Radio, all right ed, thanks well. Staying in Manhattan. There

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<v Speaker 1>is not as much of a hush in New York

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<v Speaker 1>City office buildings. The return to work rate is now

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<v Speaker 1>close to eighty percent of where it was before the pandemic.

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<v Speaker 1>We get more from Bloomberg's Doug Prisner.

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<v Speaker 11>The data come from placer Ai. They show how Wall

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<v Speaker 11>Street firms including Goldman, Sachs and JP Morgan helped drive

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<v Speaker 11>New York City's return to office rate. A similar rebound

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<v Speaker 11>was also seen in Miami, with a rate of seventy

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<v Speaker 11>eight percent last year. The return to office rates for

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<v Speaker 11>these two cities were the highest among seven major US markets.

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<v Speaker 11>They were also above the national average of about sixty

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<v Speaker 11>three percent. San Francisco saw the greatest growth in office

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<v Speaker 11>visitations in twenty twenty three. However, it still lagged behind

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<v Speaker 11>other major cities with an RT rate of forty five

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<v Speaker 11>percent in New York. I'm Doug Prisner, Bloomberg Radio.

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<v Speaker 2>Okay, Doug, thanks for watching shares of Alpine Immune Sciences

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<v Speaker 2>on some deal news this morning. They're up thirty six

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<v Speaker 2>percent in early trading. The kidney drug developers being bought

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<v Speaker 2>by Tech Pharmaceuticals for four point nine billion dollars in cash.

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<v Speaker 1>And it is time now for a look at some

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<v Speaker 1>of the other stories making news in New York and

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<v Speaker 1>around the world. For that, we're joined by Bloomberg's and

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<v Speaker 1>Michael Barr. Michael, good Morning, Good morning, Karen.

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<v Speaker 12>House.

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<v Speaker 5>Republicans have failed to advance a bill that would renew

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<v Speaker 5>the Foreign Intelligence Surveillance Act FISA, gives law enforcement the

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<v Speaker 5>authority to monitor suspicious interactions with foreign adversaries. After former

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<v Speaker 5>President Trump posted kill FAISA. Nineteen Republicans voted against the

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<v Speaker 5>procedural vote, despite House Speaker Mike Johnson urging them to

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<v Speaker 5>approve it. Republican Congressman Dan Crenshaw, Texas says he believes

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<v Speaker 5>the laws renewal is necessary for the US to monitor

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<v Speaker 5>bad actors all over the world.

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<v Speaker 2>You lose our collection on our adversaries. That's one of

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<v Speaker 2>the most seriously bad things that I can think of happening.

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<v Speaker 2>I've never been worried like I'm worried now.

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<v Speaker 5>However, critics on both sides of the aisle saying that

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<v Speaker 5>Americans often get surveiled improperly because of it. The fallout

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<v Speaker 5>continues in the fight over a newly revived eighteen sixty

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<v Speaker 5>four Arizona law criminalizing abortion throughout pregnancy unless a woman's

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<v Speaker 5>life is at risk. The Arizona Legislature devolved into jeering

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<v Speaker 5>yesterday as Republican lawmakers shut down discussion on a proposed

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<v Speaker 5>repeal of the law. The Arizona Supreme Court cleared the

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<v Speaker 5>way this week for enforcing the pre statehood abortion ban

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<v Speaker 5>throughout pregnancy, without exceptions for rape or incest. Democratic State

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<v Speaker 5>Senator Anna Hernandez called the GOP bloc politically foolish.

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<v Speaker 13>It's not about convincing somebody to have an abortion or not.

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<v Speaker 14>That is their choice.

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<v Speaker 10>This is about do we trust the people to make

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<v Speaker 10>the best decision for themselves, And we're saying yes, we do.

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<v Speaker 5>A proposed ballot initiative may ask voters in November whether

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<v Speaker 5>to place abortion protections into the state constitution. New York City,

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<v Speaker 5>fighting back against people who steal packages delivered to residents,

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<v Speaker 5>city officials have now introduced new public delivery lockers. Each

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<v Speaker 5>locker can hold twenty five packages at one time. New

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<v Speaker 5>York Mayor Eric Adams New.

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<v Speaker 14>Yorkers will be able to receive and send packages using

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<v Speaker 14>secure lockers on public sidewalks. The program is available to

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<v Speaker 14>all New Yorkers twenty four to seven and it is

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<v Speaker 14>the favorite four letter road of New Yorkers free.

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<v Speaker 5>Currently, seven lockers are installed around the city, including in

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<v Speaker 5>Brooklyn and Hell's Kitchen. Global News twenty four hours a

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<v Speaker 5>day and whenever you want it with the Bloomberg News. Now,

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<v Speaker 5>I'm Michael Barr, and this is Bloomberg Karen.

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<v Speaker 1>All right, Michael Barr, thank you time now for the

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<v Speaker 1>Bloomberg Sports Update with John stash Hour. John, good morning,

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<v Speaker 1>Good morning, Karen.

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<v Speaker 15>There hasn't been a Master's without a drop of rain

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<v Speaker 15>since twenty eighteen, and ranged in the forecast for this

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<v Speaker 15>morning sounds like togat at least some of the opening

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<v Speaker 15>round in It is expected to be clear Skys the

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<v Speaker 15>rest of the weekend. The eighty eighth Masters, John Rahm,

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<v Speaker 15>the defending jam Scottie Sheffer won two years ago. Here's

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<v Speaker 15>the world number one on playing.

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<v Speaker 13>That's the national I mean to me, it's just a

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<v Speaker 13>special place. It's kind of the mecca for us growing

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<v Speaker 13>up being you know, grown up here in the States

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<v Speaker 13>and you know, being Americans. I think this is the

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<v Speaker 13>tournament that we all look for, and to be here

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<v Speaker 13>on property every year is extremely special. And I mean

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<v Speaker 13>it seems like it all stands out. Everything has done

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<v Speaker 13>so well here.

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<v Speaker 15>Yesterday's par three won by Ricky Fowler, no one has

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<v Speaker 15>ever won it, and then won the green jacket. They

0:10:37.200 --> 0:10:39.640
<v Speaker 15>were five holes and won in the event, and including

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<v Speaker 15>one by Gary Woodland, who's playing the Masters after undergoing

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<v Speaker 15>brain surgery. Last fall at the Stadium Marlin's with the Yankees,

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<v Speaker 15>five's too, Jake Berger a three run homer off Marcus Stroman,

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<v Speaker 15>John Carlos Stanton homer for the Yanks. Mets and Braves

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<v Speaker 15>reigned out in Atlanta. The Red Sox had a five

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<v Speaker 15>to nothing lead in the sixth inning, lost to the

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<v Speaker 15>Orioles seven to five. Twenty year old Jackson Holiday went

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<v Speaker 15>over four Big League debut for Baltimore. He's the son

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<v Speaker 15>of Matt Holliday. He's considered MLB's top prospect. Giants beat

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<v Speaker 15>the National seven to one. Cleveland top the White Sox.

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<v Speaker 15>The Guardians have brothers in their lineup, and Bow and

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<v Speaker 15>Josh Naylor both homeward in the fourth inning. Big NBA

0:11:14.760 --> 0:11:17.200
<v Speaker 15>game for first place in the West. Denver beat Minnesota.

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<v Speaker 15>Nikolaoa could scored forty one. The netsbeat Toronto one of

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<v Speaker 15>six to one oh two. The next play tonight in Boston.

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<v Speaker 15>Rangers trying to finish first overall. They host Philadelphia, the Islanders,

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<v Speaker 15>seeking a playoff for their home for Montreal. The WNBA

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<v Speaker 15>TV schedule is out. Thirty six of Indiana's forty games

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<v Speaker 15>will be on National TV. The Fever Expecutive Draft Caitlin

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<v Speaker 15>Clark on Monday, John Stashawer Blueberg Sports, Karen Nathan.

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<v Speaker 1>All Right, John Stashauer, thank you. SMP futures down to

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<v Speaker 1>tenth seven percent, so our down futures Now's day futures

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<v Speaker 1>down about the same. In the ten year treasury yield

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<v Speaker 1>is that four point five six percent.

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<v Speaker 5>Coast to coast on Bloomberg Radio nationwide, on Sirius XM and.

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<v Speaker 10>Around the world on Bloomberg dot com and the Bloomberg

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<v Speaker 10>Business app.

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<v Speaker 2>This is Bloomberg Daybreak. Good morning, I'm Nathan Hager. Well,

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<v Speaker 2>the third month was definitely not the charm on the

0:12:10.320 --> 0:12:13.000
<v Speaker 2>road to disinflation. The March Consumer Price Index did come

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<v Speaker 2>in hotter than expected, once again, keviny investors pushing back

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<v Speaker 2>bets on rate cut timing from the Federal Reserve. For more,

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<v Speaker 2>we're joined by City US economist Veronica Clark. Veronica, good morning,

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<v Speaker 2>Thanks so much.

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<v Speaker 12>For being with us.

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<v Speaker 16>Good morning, Yeah, thank you for having me.

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<v Speaker 2>So is the road to disinflation still bumpy or is

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<v Speaker 2>this third in a row CPI hotness the new trend?

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<v Speaker 16>Yeah, I mean I think most food officials will probably

0:12:39.160 --> 0:12:42.719
<v Speaker 16>still characterize this as bumpy. Of course, it will be

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<v Speaker 16>core PC inflation that matters most for the Fed, and

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<v Speaker 16>we'll see what that comes out today once we get

0:12:49.840 --> 0:12:53.560
<v Speaker 16>details of PPI data. But I think, you know, maybe

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<v Speaker 16>the hawks are getting a bit more uncomfortable and it

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<v Speaker 16>does kind of get harder to come to a consensus

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<v Speaker 16>to cut maybe as soon as June. But there are

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<v Speaker 16>a lot of uncertainties, of course, with all the other

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<v Speaker 16>data that we're going to get before June.

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<v Speaker 2>Also, do you guys over at City count yourselves as Hawks,

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<v Speaker 2>So are you getting more uncomfortable yourselves?

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<v Speaker 16>No, not necessarily. We're We're probably one of the more

0:13:13.240 --> 0:13:15.400
<v Speaker 16>dubvish forecasts out there right now. We think the Fed

0:13:15.480 --> 0:13:18.360
<v Speaker 16>is still cutting in June and then cutting every meeting

0:13:18.400 --> 0:13:21.040
<v Speaker 16>after June. So that is one hundred and twenty five

0:13:21.160 --> 0:13:24.040
<v Speaker 16>basis points of cuts this year. That's well more than

0:13:24.080 --> 0:13:26.800
<v Speaker 16>what's priced right now. But I think for us, you know,

0:13:26.800 --> 0:13:29.480
<v Speaker 16>we are trying to be more forward looking. We are

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<v Speaker 16>trying to assess the other types of data that we

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<v Speaker 16>might see over the coming months. You know, labor market

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<v Speaker 16>data that has been very strong, but some of the

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<v Speaker 16>details look a bit precarious, and I think the said

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<v Speaker 16>would be very dubvish if we know we're getting some

0:13:44.040 --> 0:13:45.320
<v Speaker 16>weaker labor market data.

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<v Speaker 2>Yeah, first cut in June is looking more and more

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<v Speaker 2>like a bold call given the data that we have

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<v Speaker 2>seen so far. In some of the commentary that we're

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<v Speaker 2>hearing from the likes of Larry Summers, the former Treasury

0:13:57.120 --> 0:14:00.319
<v Speaker 2>secretary who was on Bloomberg yesterday, saying, maybe we they

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<v Speaker 2>hold out the possibility that the next move from the

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<v Speaker 2>Fed is a hike. I mean, how do you push

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<v Speaker 2>back against that?

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<v Speaker 16>Yeah, I mean I think that is probably pretty unlikely.

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<v Speaker 16>I think at least Fed officials will see at least

0:14:11.559 --> 0:14:14.760
<v Speaker 16>that the current level of rates is restrictive. And we've

0:14:14.800 --> 0:14:18.440
<v Speaker 16>heard that most FED officials, certainly from fair Powell. And

0:14:18.520 --> 0:14:21.040
<v Speaker 16>so if you know, inflation is coming in a bit

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<v Speaker 16>hotter than comfortable and they're comfortable with they're not, you know,

0:14:24.040 --> 0:14:27.480
<v Speaker 16>getting that further confidence that they want to see. It's

0:14:27.520 --> 0:14:29.800
<v Speaker 16>not necessarily that we're talking about hikes again. They would

0:14:29.800 --> 0:14:32.800
<v Speaker 16>probably just lead rights elevated for a bit longer. We're

0:14:32.800 --> 0:14:34.680
<v Speaker 16>just talking about pushing out those cuts.

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<v Speaker 2>What is it that's keeping these price pressures so sticky?

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<v Speaker 2>What are you seeing in the data that has inflation

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<v Speaker 2>where it is and has you still thinking that there

0:14:46.960 --> 0:14:50.000
<v Speaker 2>is still room for the Fed to make a cut.

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<v Speaker 16>Yeah, I mean, we honestly do still see a lot

0:14:53.920 --> 0:14:57.400
<v Speaker 16>of stickiness and services inflation. So we've seen that for

0:14:57.440 --> 0:15:00.720
<v Speaker 16>a while in shelter inflation, which which should slowing at

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<v Speaker 16>some point and as we're getting into two later this year,

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<v Speaker 16>but a lot of the strength and yesterday's CPI data

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<v Speaker 16>with non shelter services. Actually about half of that strength

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<v Speaker 16>and non shelter services had to do with auto insurance,

0:15:15.120 --> 0:15:18.480
<v Speaker 16>which interestingly does not go into the Fed's preferred PC

0:15:18.680 --> 0:15:22.200
<v Speaker 16>inflation measure. But even in PC inflation, I think we're

0:15:22.440 --> 0:15:25.480
<v Speaker 16>we're still seeing a lot of stickiness to services inflation

0:15:25.680 --> 0:15:28.240
<v Speaker 16>and that has to do with, you know, a tight

0:15:28.320 --> 0:15:31.160
<v Speaker 16>labor market. We're still running wages that are around four

0:15:31.160 --> 0:15:33.600
<v Speaker 16>to five percent or so. That's a fit stronger than

0:15:33.600 --> 0:15:36.960
<v Speaker 16>you want to see to be consistent with two percent inflation.

0:15:37.640 --> 0:15:40.480
<v Speaker 16>So there is still some loosening to go. But I

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<v Speaker 16>think we do see the signs in the labor market,

0:15:44.200 --> 0:15:47.600
<v Speaker 16>details in demand for workers hiring that has really slowed down.

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<v Speaker 16>That leads us to think we are going into a

0:15:50.640 --> 0:15:51.960
<v Speaker 16>much looser label market.

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<v Speaker 2>So we only have about thirty seconds left here, Veronica,

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<v Speaker 2>what are you expecting when it comes to producer prices

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<v Speaker 2>out this morning and whether that could change the narrative

0:15:59.720 --> 0:16:00.960
<v Speaker 2>that we're in this market.

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<v Speaker 16>Yeah, this one one could be interesting. There's a couple

0:16:04.200 --> 0:16:07.479
<v Speaker 16>things to watch, you know, we're looking at the transportation

0:16:07.600 --> 0:16:10.840
<v Speaker 16>and the good kind of components of PPI data that

0:16:10.880 --> 0:16:14.240
<v Speaker 16>could be a bit stronger. We might see a stronger

0:16:14.320 --> 0:16:19.080
<v Speaker 16>headline PPI increase. But most importantly today, we're watching some

0:16:19.200 --> 0:16:23.640
<v Speaker 16>very specific components that go into our mapping of core

0:16:23.720 --> 0:16:26.200
<v Speaker 16>PCE inflation for March, and of course that's what the

0:16:26.280 --> 0:16:29.520
<v Speaker 16>said we'll care most about. We are expecting to see

0:16:29.520 --> 0:16:34.680
<v Speaker 16>some strength in components like medical services, certain financial services,

0:16:35.400 --> 0:16:38.480
<v Speaker 16>and that could mean that forecasters are expecting, you know,

0:16:38.520 --> 0:16:41.840
<v Speaker 16>a bit stronger core PCE even than we had in February.

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<v Speaker 16>We had a twenty six basis point increase in February.

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<v Speaker 16>We're tracking at around thirty basis points right now. That

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<v Speaker 16>could mean that we're just pushing these cuts further out

0:16:51.840 --> 0:16:54.600
<v Speaker 16>market continues to price outcuts. Yeah, but that might be

0:16:54.640 --> 0:16:55.600
<v Speaker 16>a little bit tree mature.

0:16:56.760 --> 0:16:59.640
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