WEBVTT - Bloomberg Daybreak: January 13, 2022 - Hour 2 (Radio) 0:00:01.760 --> 0:00:04.960 Live from the Bloomberg in Director Brooker Studios. Is Bloomberg 0:00:05.040 --> 0:00:09.080 day Break for Thursday, January two. Coming up this hour, 0:00:09.440 --> 0:00:12.039 the call for higher interest rates from the Fed grows. 0:00:12.119 --> 0:00:15.280 Louder Le Brainerd heads to Capitol Hill for her Senate 0:00:15.320 --> 0:00:19.360 confirmation hearing traders prepare for another reading on inflation this morning, 0:00:19.440 --> 0:00:21.639 and a big name on Wall Street tells staff to 0:00:21.640 --> 0:00:25.720 get booster shots or get out. House Minority Leader McCarthy 0:00:25.720 --> 0:00:28.920 says he will not cooperate with the Capitol Riot panel. Plus, 0:00:29.000 --> 0:00:31.480 New York subways are getting a big chunk of federal 0:00:31.520 --> 0:00:35.400 COVID funds. I'm Michael barr more ahead, I'm John stashweron 0:00:35.479 --> 0:00:37.760 forts the nixt beat Dallas to reach five hundred, The 0:00:37.880 --> 0:00:40.720 nets one big in Chicago. St John's lost at Yukon 0:00:40.840 --> 0:00:46.840 in overtime. That's all straight ahead on Bloomberg day Break 0:00:47.040 --> 0:00:51.880 on Bloomberg Elementaro, New York, Bloomberg nine one, Washington, d C, 0:00:52.280 --> 0:00:56.640 Bloomberg one O six one, Boston, Bloomberg nine sixties, San Francisco, 0:00:57.000 --> 0:01:00.200 Sirius x M one nineteen and around the world Old 0:01:00.240 --> 0:01:03.520 on Bloomberg Radio dot Com and via The Bloomberg Business 0:01:03.560 --> 0:01:10.320 at Good Morning I'm Nathan Hagar and I'm Karen Moscow 0:01:10.600 --> 0:01:14.280 and US Dock Index futures are on the rise this morning. 0:01:14.400 --> 0:01:16.119 We are coming up to six one on Wall Street, 0:01:16.120 --> 0:01:18.120 and we check the markets every fifteen minutes throughout the 0:01:18.120 --> 0:01:21.200 trading day. On Bloomberg right now, SMP futures are up 0:01:21.200 --> 0:01:24.880 five points down, futures up thirty one, nosday futures up, seventeen. 0:01:25.480 --> 0:01:27.680 Ten year Treasury down one thirty second. You at one 0:01:27.680 --> 0:01:30.320 point seven four percent yield on the two year point 0:01:30.400 --> 0:01:33.840 nine pent Nathan, Karen, we begin with more calls for 0:01:33.920 --> 0:01:37.040 higher interest rates this morning. At least four FED officials 0:01:37.040 --> 0:01:39.920 now are calling for liftoff as early as March. Here's 0:01:39.920 --> 0:01:42.840 Minneapolis FED President Neil cash Cary. If you look at 0:01:43.400 --> 0:01:47.680 financial market indicators of where you finisial market stake, inflation 0:01:47.800 --> 0:01:50.560 is going over the long term. Over the long term, 0:01:50.560 --> 0:01:53.000 they're solving the camp and inflation is going back to 0:01:53.480 --> 0:01:57.640 historical levels of arab So that's I mean, I don't 0:01:58.160 --> 0:02:01.040 overweight that. That's one data point that we pay attention to, 0:02:01.520 --> 0:02:04.840 but that at least gives us some confidence. Minneapolis Fed 0:02:04.880 --> 0:02:07.320 President Neil cash Carry made the comments at a town 0:02:07.360 --> 0:02:10.320 hall in Minnesota Other FED presidents are also calling for 0:02:10.400 --> 0:02:13.680 faster tightening. San Francisco's Mary Daily wants to start in March. 0:02:13.880 --> 0:02:17.520 Patrick Harker of Philadelphia wants at least three hikes this year. St. 0:02:17.520 --> 0:02:20.400 Louis chief Jim Bullard sees as many as four increases 0:02:20.400 --> 0:02:22.760 on the calendar. Well, Nathan, the FEDS looking to fight 0:02:22.800 --> 0:02:25.720 the hottest inflation in nearly four decades, and today we 0:02:25.760 --> 0:02:29.120 get more data on prices. Economist forecast the producer price 0:02:29.160 --> 0:02:32.600 index for December will post a record annual increase of 0:02:32.720 --> 0:02:35.720 nine point eight percent. Bloomberg has any Dale Juda's reports 0:02:35.840 --> 0:02:39.000 inflation is rattling main street. The cost of living is 0:02:39.120 --> 0:02:44.000 rising at the fastest pace. Based on December consumer price data. 0:02:44.320 --> 0:02:47.600 November producer prices meantime scored the largest you re or 0:02:47.639 --> 0:02:50.840 increased so far, up nine point six percent. And yet 0:02:50.840 --> 0:02:54.880 Boomberg Economics he's hope forecasting producer prices topping out this 0:02:54.960 --> 0:02:58.680 quarter based on factory data and noting order backlots and 0:02:58.760 --> 0:03:04.119 supplier delivery leaf peaked in May. Vine Jude Bloomberg day 0:03:04.120 --> 0:03:06.720 break right, Vinnie, thank you. As the FED fights inflation, 0:03:06.760 --> 0:03:09.560 the Biden administration is working to fill vacant seats at 0:03:09.600 --> 0:03:11.800 the Central Bank. It looks like it's getting close. We 0:03:11.880 --> 0:03:14.519 get more from Bloomberg's Doug Prisner. The director of the 0:03:14.600 --> 0:03:18.119 National Economic Council, Brian Deese, told reporters the White House 0:03:18.200 --> 0:03:21.640 is working closely with congressional leadership to finalize the list. 0:03:21.960 --> 0:03:25.000 As we previously reported, Sarah bloom Raskin is a leading 0:03:25.000 --> 0:03:28.480 contender for the vice chair of Supervision, but earlier this week, 0:03:28.480 --> 0:03:31.320 the top Republican on the Senate Banking Committee, Pat Toomey, 0:03:31.400 --> 0:03:35.000 said he has serious concerns about the possible nomination of Raskin. 0:03:35.360 --> 0:03:38.960 There are two additional openings, were told. Economist Philip Jefferson 0:03:39.040 --> 0:03:41.920 is a likely nominee, and FED Governor Lyle Brainerd has 0:03:41.960 --> 0:03:45.000 been nominated as FED vice chair. Today she'll have her 0:03:45.040 --> 0:03:48.440 confirmation hearing in New York. I'm Doug Prisoner Bloomberg day break, 0:03:48.560 --> 0:03:50.560 All right, Tyke, thank you. In that confirmation hearing for 0:03:50.720 --> 0:03:53.320 Lyle Brainerd will be front and center this morning. We 0:03:53.360 --> 0:03:57.040 get a preview now from Bloomberg's Michael McKee. Governor Brainerd's 0:03:57.040 --> 0:03:59.960 nomination hearing maybe a bit more contentious than the reception 0:04:00.120 --> 0:04:03.760 Fed Chair Powell got on Tuesday. Banking Committee Senators were 0:04:03.800 --> 0:04:06.280 largely content to get Powell's views on the economy and 0:04:06.320 --> 0:04:10.240 inflation and the implications for interest rates. Brainerd, however, is 0:04:10.280 --> 0:04:12.960 likely to face tougher questions about the future of FED 0:04:13.040 --> 0:04:17.440 policies involving diversity and climate change. She has advocated for 0:04:17.520 --> 0:04:20.719 both positions Republicans don't see as part of the Central 0:04:20.760 --> 0:04:23.800 Banks mandate. She will defend those efforts as vital to 0:04:23.839 --> 0:04:27.080 the feds ability to boost growth and promote financial stability, 0:04:27.400 --> 0:04:30.440 and although the questioning may be tougher, Brainerd, like Powell, 0:04:30.760 --> 0:04:35.000 is expected to win confirmation. Mial McKey, Bloomberg Debreak, Mike thanks, 0:04:35.160 --> 0:04:37.800 Let's turn our attention to the pandemic now. Daily COVID 0:04:37.839 --> 0:04:40.920 cases remain high, but there are signs the omicron wave 0:04:41.000 --> 0:04:43.880 could be easing. The most serious illness continues to be 0:04:43.920 --> 0:04:47.840 among the unvaccinated. The CDC says almost all teenagers that 0:04:47.880 --> 0:04:51.560 need intensive care have not received shots. Bloomberg's Sad Baxter 0:04:51.680 --> 0:04:55.000 has the story. The CDC says this bolsters the research 0:04:55.080 --> 0:04:57.840 that says the fiser regiment of works and preventing severe 0:04:57.880 --> 0:05:02.000 disease and teens. It says venting per cent of the 0:05:02.040 --> 0:05:06.359 i c U visits and nine percent of hospitalizations. The 0:05:06.440 --> 0:05:08.960 sample sizes and teams are too small for the CDC 0:05:09.160 --> 0:05:12.160 to translate it to older populations, but what it does 0:05:12.200 --> 0:05:16.599 say is that having a very sixteen is preventable. CDC 0:05:16.800 --> 0:05:22.120 says the reports of deaths were all unvaccinated in San Francisco. 0:05:22.160 --> 0:05:24.800 I'm at Baxter Bloomberg daybreak, all right, and thank you. Well. 0:05:24.839 --> 0:05:27.880 As COVID cases remain high, so does the cost of 0:05:28.080 --> 0:05:31.000 N ninety five mass. The CDC has considered changing its 0:05:31.040 --> 0:05:34.080 guidance to advise using only AND ninety five and k 0:05:34.279 --> 0:05:37.800 N ninety five face coverings, and that sent prices surging 0:05:37.800 --> 0:05:40.560 on sites like Amazon. In one case, a pack of 0:05:40.640 --> 0:05:44.400 forty kN ninety five mass now costs eighty dollars. That's 0:05:44.440 --> 0:05:47.600 sixty bucks higher than it was in November. Well meantime 0:05:47.640 --> 0:05:50.760 on Wall Street, Karen, another firm is requiring booster shots 0:05:50.760 --> 0:05:52.680 for workers to get back to the office. Let's get 0:05:52.680 --> 0:05:55.480 the latest life from Bloomberg's Rnita Young, Good morning, Granita, 0:05:55.520 --> 0:05:58.919 Good morning. Nathan. Blackstone is the latest financial firm telling 0:05:59.040 --> 0:06:01.279 us staff to get at a booster shot as soon 0:06:01.320 --> 0:06:04.440 as possible or get out of the office. The company 0:06:04.520 --> 0:06:07.520 is also requiring staff to be tested on site three 0:06:07.560 --> 0:06:10.760 times a week now. Last year, Blackstone asked employees to 0:06:10.800 --> 0:06:14.120 return to offices full time by June, but when COVID 0:06:14.160 --> 0:06:17.760 cases later skyrocketed across the country, it gave staff the 0:06:17.839 --> 0:06:20.840 green light to work from home. Now, black Stone once 0:06:20.880 --> 0:06:25.159 employees back in the office on January. That's two weeks 0:06:25.160 --> 0:06:27.919 from tomorrow, Live in New York. I'm gonna need a 0:06:27.920 --> 0:06:30.280 Young Bloomberg daybreak, all right, ned to thank you, and 0:06:30.320 --> 0:06:34.040 finally politics is in focus across the pond this morning. 0:06:34.040 --> 0:06:37.559 Boris Johnson has apologized for what's being called party Gate, 0:06:37.800 --> 0:06:40.560 but the UK Prime Minister still remains under heavy pressure. 0:06:40.600 --> 0:06:42.200 We got live to London and get the latest with 0:06:42.240 --> 0:06:46.120 Bloomberg's Max Ramsey. Good morning, Max, Morning to you, Karen 0:06:46.200 --> 0:06:49.320 and Nathan. Yes, it's really been a massive political story here. 0:06:49.360 --> 0:06:52.080 Boris Johnson finally came out and apologized. He said he 0:06:52.160 --> 0:06:55.599 did attend a party during the first pandemic lockdown in Britain. 0:06:55.880 --> 0:06:58.159 He's faced a lot of anger, not only from opposition 0:06:58.200 --> 0:07:00.200 politicians who have called on him to his and but 0:07:00.240 --> 0:07:02.839 also some from his own party. It puts him really 0:07:02.880 --> 0:07:04.760 in a difficult position as we wait for the results 0:07:04.880 --> 0:07:08.040 of an official investigation live in London. I'm Max Ramsey, 0:07:08.040 --> 0:07:10.400 bloom Back daybreak. Okay, Max, thanks, says we await the 0:07:10.440 --> 0:07:13.160 market open. Futures are moving higher with SMP futures up 0:07:13.200 --> 0:07:15.960 four points, NANSTAC futures up twenty. Straight ahead your latest 0:07:15.960 --> 0:07:19.360 local headlines in the check of Sports. This is Bloomberg 0:07:23.040 --> 0:07:25.160 in six o seven on Wall Street where thirty five 0:07:25.200 --> 0:07:27.360 degrees in Central Park. We have an accident in the 0:07:27.400 --> 0:07:29.840 northbound Lew England threw away at Boston Post Road in 0:07:30.280 --> 0:07:33.160 Westchester County. Michael Barr has more on what's going on 0:07:33.200 --> 0:07:35.160 in New York and around the world. The Morning Might Call, 0:07:35.320 --> 0:07:38.400 Good Morning, Nathan. House. Minority leader Kevin McCarthy says he 0:07:38.440 --> 0:07:41.679 will not cooperate with the panel investigating the Capitol riot. 0:07:42.000 --> 0:07:45.560 McCarthy claims the investigation is not legitimate and is accusing 0:07:45.600 --> 0:07:48.720 the panel of abuse of power. The panel asked McCarthy 0:07:48.760 --> 0:07:52.520 to volunteerily testify about his conversations with then President Trump 0:07:52.920 --> 0:07:56.720 as the riot was underway. Senator Mitch McConnell lashed out 0:07:56.720 --> 0:07:59.920 at President Biden after the President in Atlanta spoke strongly 0:08:00.000 --> 0:08:04.480 in favor of voting rights legislation. Senator McConnell has recently 0:08:04.520 --> 0:08:07.280 been called out by the White House for supporting voting 0:08:07.360 --> 0:08:10.840 rights in the past, but more recently refusing to let 0:08:10.840 --> 0:08:14.240 the Senate even debate such bills. The Senate Minority leader 0:08:14.280 --> 0:08:17.480 accused Biden of dividing the country. He promised to unite 0:08:17.640 --> 0:08:21.320 the demon as Americans who disagree with him. He compared, 0:08:21.440 --> 0:08:27.480 listen to this a bipartisan majority of senators too literal traders. 0:08:27.760 --> 0:08:30.720 McConnell says, after knowing Biden for years, he did not 0:08:30.840 --> 0:08:34.520 recognize the man at the podium. Tuesday. President Joe Biden 0:08:34.600 --> 0:08:39.120 is highlighting the federal government's effort to surge medical personnel 0:08:39.240 --> 0:08:43.080 to help overwhelm medical facilities. Starting next week, a thousand 0:08:43.120 --> 0:08:46.760 military medical personnel will begin arriving in six states, including 0:08:46.800 --> 0:08:50.079 New York and New Jersey, to help mitigate staffing crunches 0:08:50.120 --> 0:08:53.920 at hospitals across the country. Senate Majority Leader Chuck Schumer 0:08:54.000 --> 0:08:56.280 says he will try to break a log jam on 0:08:56.400 --> 0:08:59.959 two Democrat drafted voting rights bills and begin to bate 0:09:00.200 --> 0:09:03.200 on the Senate floor this week. Schumer told all Senate 0:09:03.240 --> 0:09:06.520 Democrats he plans to use the procedural gambit to prevent 0:09:06.559 --> 0:09:10.120 Republicans from blocking the beginning of debate. Democratic senators are 0:09:10.160 --> 0:09:13.200 trying to get fellow Senators Joe Manchin and Kirsten Cinema 0:09:13.440 --> 0:09:17.160 on board to vote to abolish the filibuster. Schumers says 0:09:17.240 --> 0:09:21.360 there have been serious, long, intense discussions with the two 0:09:21.360 --> 0:09:24.319 moderate Democrats. We're not there yet. I wouldn't want to 0:09:24.520 --> 0:09:28.800 delude anybody to thinking this is easy, but we're trying 0:09:28.840 --> 0:09:31.720 to come to a place where decty senators can support 0:09:33.000 --> 0:09:36.800 two bills. Senator Schumer also says New York City subways 0:09:36.880 --> 0:09:39.480 and commuter rails are getting a big junk of federal 0:09:39.520 --> 0:09:42.520 COVID nineteen relief funds. Schumers says the m t A 0:09:42.600 --> 0:09:45.920 has received six billion dollars, part of more than fourteen 0:09:45.920 --> 0:09:49.920 point five billion in overall federal relief aid. Global News 0:09:49.920 --> 0:09:53.000 twenty four hours a day on airhand on Bloomberg Quicktake, 0:09:53.240 --> 0:09:56.080 powered by more than twenty seven und journalists and analyists 0:09:56.120 --> 0:09:58.400 more than a hundred twenty countries. How Michael bar this 0:09:58.679 --> 0:10:06.000 is Bloomberg. Nathan Thank Smichael coming up to six ten 0:10:06.040 --> 0:10:08.079 on Wall Street time for the Bloomberg Sports Update with 0:10:08.160 --> 0:10:10.800 Johnston shown all right, Nathan. Halfway through the regular season, 0:10:10.840 --> 0:10:12.600 the Knicks were twenty and twenty one. They had the 0:10:12.600 --> 0:10:14.760 same record at that point last year, when they then 0:10:14.840 --> 0:10:17.640 went twenty one and ten finished fourth in the East. 0:10:17.679 --> 0:10:20.199 Knicks began the second half with an easy win at 0:10:20.200 --> 0:10:22.319 the Garden, where they had been struggling, but they've had 0:10:22.320 --> 0:10:24.720 won five in a row at home five hundred overall, 0:10:24.760 --> 0:10:27.800 one oh eighty five win over Dallas, all five Knicks 0:10:27.800 --> 0:10:30.400 starters and double figures, led once again by R. J. Barrett, 0:10:30.400 --> 0:10:32.640 he scored thirty two points. After the Knicks one by 0:10:32.679 --> 0:10:35.400 twenty three, Lenettes in a late start in Chicago one 0:10:35.440 --> 0:10:38.200 by twenty six, one, eight, one twelve. Brooklyn now scored 0:10:38.240 --> 0:10:40.840 the Bulls by twenty just in the third quarter. Kevin 0:10:40.920 --> 0:10:43.640 Rant scored twenty seven. James Harden had twenty five with 0:10:43.800 --> 0:10:46.120 sixteen a six to loss for St. John's fell in 0:10:46.200 --> 0:10:49.800 overtime at Yukon eighties six seventy eight too much. Adamo 0:10:49.960 --> 0:10:53.720 Sagano for the Huskies twenty six points, eighteen rebounds, six 0:10:53.760 --> 0:10:56.240 block shots. Fordham to it ow in the Atlantic ten 0:10:56.280 --> 0:10:58.160 at one point, when at rose Hill over du Kane, 0:10:58.720 --> 0:11:02.160 they announced a draw for the Australian Open which begins Monday. 0:11:02.360 --> 0:11:05.160 Even though Novak Djokovic could still get deported, He's actually 0:11:05.200 --> 0:11:07.319 gonna face a fellow serve in the first round if 0:11:07.320 --> 0:11:10.199 he indeed played. Giants owner John Marra met the media 0:11:10.280 --> 0:11:13.760 the day after he fired coach Joe Judge. Um, there 0:11:13.880 --> 0:11:17.200 is nothing more painful to me than making that long 0:11:17.280 --> 0:11:21.640 walk down the hallway. UH, to tell somebody, particularly a 0:11:21.720 --> 0:11:26.200 good person like Joe Um, that we're making a change. 0:11:26.200 --> 0:11:29.160 It's gut wrenching for me. Um. It's been gut wrenching 0:11:29.200 --> 0:11:31.640 every time I've had to do it. Mara, his brother Chris, 0:11:31.640 --> 0:11:33.880 and co owner Steve Tish began zoom interviews with the 0:11:33.880 --> 0:11:37.520 Giants general manager's job. Met with Buffalo assistant GM Joe Shoon. 0:11:37.920 --> 0:11:40.840 Arian Wilson, who works for Arizona Giants, have seven other 0:11:40.960 --> 0:11:43.400 GM candidates. Hope to have a higher next week, then 0:11:43.400 --> 0:11:46.520 start looking for a new coach John Stash, Award Bloomberg Sports, 0:11:46.600 --> 0:11:48.480 Nathan all Right, John, thanks right now. S and P 0:11:48.600 --> 0:11:51.079 futures are up five point, staff futures up thirty eight. 0:11:51.160 --> 0:11:53.480 Dance act futures are highed by twenty three points. The 0:11:53.520 --> 0:11:57.040 tenure treasury is down to thirty seconds. The yield one 0:11:57.080 --> 0:12:00.959 point seven five on the benchmark tenure. Note you're listening 0:12:01.000 --> 0:12:08.439 to Bloomberg day Break. Bloomberg day Break is brought to 0:12:08.480 --> 0:12:10.559 you by Audie. Don't let someone else drive off in 0:12:10.600 --> 0:12:13.160 the Audi model. You've always wanted. Visit a tri state 0:12:13.160 --> 0:12:20.640 autie dealer to get behind the wheel of yours. Today, 0:12:21.960 --> 0:12:25.360 markets headlines and breaking news twenty four hours a day 0:12:25.480 --> 0:12:29.040 at Bloomberg dot com, the Bloomberg Business Outland at Bloomberg 0:12:29.120 --> 0:12:39.000 Quicktake's a Bloomberg business lash and I'm caring Moscow and 0:12:39.000 --> 0:12:41.640 we do this headline crossing the Bloomberg. There's Boeing seven 0:12:41.679 --> 0:12:44.800 thirty seven maxes to resume service in China as soon 0:12:44.920 --> 0:12:47.880 as this month. That just crossing the Bloomberg. And US 0:12:47.920 --> 0:12:51.480 Dock Index futures meanwhile are moving higher this morning. We 0:12:51.600 --> 0:12:54.040 check the markets every fifteen minutes throughout the trading day. 0:12:54.480 --> 0:12:56.840 On Bloomberg S and p Future is at five points, 0:12:56.920 --> 0:12:59.160 Dow Future is at fifty five. NAS day futures up 0:12:59.160 --> 0:13:02.000 about eighteen. The decks in Germany is little changed, and 0:13:02.120 --> 0:13:04.320 your treasury down one thirty second. He at one point 0:13:04.320 --> 0:13:06.959 seven four percent yield on the two year point on 0:13:07.120 --> 0:13:10.120 one percent Nomex crude oil is little change at eighty 0:13:10.120 --> 0:13:12.800 two dollar sixty two cents of barrel. Comex school down 0:13:12.840 --> 0:13:15.400 a quarter percent or five dollars at eighteen twenty two 0:13:15.440 --> 0:13:18.160 thirty announced the euro one point one four six two 0:13:18.200 --> 0:13:20.480 against the dollar, British found one point three seven four 0:13:20.559 --> 0:13:23.160 or five, and the YenS at one fourteen point four six. 0:13:23.480 --> 0:13:26.880 Bitcoin this morning is moving lower at forty three thousand, 0:13:27.080 --> 0:13:29.760 six hundred sixty dollars, and today we are watching for 0:13:29.800 --> 0:13:32.320 the producer price indext out at eight thirty Wall Street time, 0:13:32.559 --> 0:13:35.400 along with the weekly report on initial jobless claims. That's 0:13:35.400 --> 0:13:37.920 a Bloomberg business flash. Now here's Michael Barr with more 0:13:37.960 --> 0:13:40.800 on what's going on around the world, Uncle Karen, thank 0:13:40.800 --> 0:13:43.920 you very much. House Republican leader Kevin McCarthy now says 0:13:44.000 --> 0:13:47.720 he won't cooperate with the committee investigating the Capitol Riot 0:13:47.800 --> 0:13:52.079 piece as the House January sixth investigation is not legitimate. 0:13:52.480 --> 0:13:55.560 The Biden administration says it's seeking new u N sanctions 0:13:55.600 --> 0:13:58.400 against North Korea in response to be Young Yang's latest 0:13:58.480 --> 0:14:01.679 ballistic missile test. It's still up in the air whether 0:14:01.720 --> 0:14:05.080 Novak Djokovic will be able to defend is Australian Open title. 0:14:05.600 --> 0:14:09.319 The Australian Immigration Minister is still considering whether to deport 0:14:09.320 --> 0:14:12.800 the tennis star who was not vaccinated against COVID nineteen. 0:14:13.280 --> 0:14:16.240 In the NBA, the Knicks NAT, Celtics and Wizards all one. 0:14:16.440 --> 0:14:19.920 In the NHL, the Bruins won Global news twenty four 0:14:19.920 --> 0:14:23.320 hours a day on air and on Bloomberg Quicktake, powered 0:14:23.320 --> 0:14:26.320 by more than twenty seven under journalist and analyst more 0:14:26.320 --> 0:14:28.880 than a hundred twenty countries. I'm Michael bar and this 0:14:28.960 --> 0:14:32.280 is Bloomberg. Thanks Michael. It's six nineteen on Wall Street 0:14:32.280 --> 0:14:36.200 Live from the Bloomberg Interactive Broker Studios. This is Bloomberg Daybreak, 0:14:36.200 --> 0:14:39.840 as we continue to assess this environment of historically high 0:14:39.880 --> 0:14:42.840 inflation and what the FED can do about it. We're 0:14:42.880 --> 0:14:45.440 joined by Sarah Human, Managing director and head of Europe 0:14:45.440 --> 0:14:48.280 and America's Research at Standard Chartered Banks. Sarah, it's great 0:14:48.320 --> 0:14:52.440 to speak with you this morning. The seven percent CPI print, 0:14:52.560 --> 0:14:55.400 does that seal the deal for rate hikes starting in March? 0:14:57.080 --> 0:15:00.560 We think so, yes, we were looking for twenty basis 0:15:00.560 --> 0:15:03.720 points in March. If you look at said commentary, it's 0:15:03.760 --> 0:15:08.880 become increasingly hawkish. Um you've had several FED speakers yesterday 0:15:09.000 --> 0:15:13.880 and overnight talking specifically about a March lift off the rates, 0:15:14.000 --> 0:15:18.480 and I think that the you know, CPI data are 0:15:18.480 --> 0:15:21.840 the key driver there. The narrative has has really shifted 0:15:21.840 --> 0:15:26.840 as we know, the transitory comment has has disappeared, long 0:15:26.840 --> 0:15:30.840 since disappeared, and there's a real concern about inflation becoming embedded, 0:15:31.000 --> 0:15:34.880 but also recognition about the risks that it brings for 0:15:35.040 --> 0:15:39.280 economic recovery and the squeeze on wages. What's your view 0:15:39.320 --> 0:15:42.000 on whether inflation is becoming embedded? Is it could we 0:15:42.040 --> 0:15:45.360 see even more price pressures as we go through the 0:15:45.400 --> 0:15:50.800 early part of this year. I think certainly the headline 0:15:50.840 --> 0:15:54.520 numbers are likely to stay elevated, and probably year on 0:15:54.640 --> 0:15:58.800 year readings will rise further. That's partly because of base effects, 0:15:58.960 --> 0:16:01.680 partly because we asked still seeing the impact of supply 0:16:01.800 --> 0:16:07.200 side disruptions feeding through to the general price index. But 0:16:07.760 --> 0:16:10.840 over the course of the next few months, particularly once 0:16:10.880 --> 0:16:12.960 we get into the second half of the year, I 0:16:13.000 --> 0:16:15.800 think a number of these pressures are going to ease 0:16:16.280 --> 0:16:19.400 and we will see inflation moving back down towards the 0:16:19.400 --> 0:16:22.480 Fed's target. I mean, indeed, for next year, we think 0:16:22.520 --> 0:16:26.640 that we will see core PCE back at at or 0:16:26.760 --> 0:16:30.200 even below two percent here on yees, So that would 0:16:30.240 --> 0:16:33.240 suggest to us that the Fed can proceed cautiously. We're 0:16:33.240 --> 0:16:36.080 expecting a rate hike in March, another in June, but 0:16:36.160 --> 0:16:38.600 then we think the Fed will pause to see how 0:16:38.640 --> 0:16:43.760 the economy evolves. What's your expectation for producer prices when 0:16:43.800 --> 0:16:46.320 we get that coming out later this morning, there's a 0:16:46.400 --> 0:16:52.280 median estimate of nine percent. That would be a record, Yeah, 0:16:52.400 --> 0:16:55.120 it would. I mean, it's it's just about feasible that 0:16:55.200 --> 0:16:58.880 we could even see double figures year on year. But 0:16:59.120 --> 0:17:02.640 I think what's important is that the monthly reading is 0:17:03.480 --> 0:17:07.400 likely to be lower than we've we've had over recent months, 0:17:07.480 --> 0:17:10.640 and we are starting to see some very tentative signs 0:17:10.720 --> 0:17:15.840 of those um input prices fading. For example, China's producer 0:17:15.880 --> 0:17:19.800 price index, which have been extremely high, has been down 0:17:19.840 --> 0:17:23.320 for the last couple of months. We think we've seen 0:17:23.359 --> 0:17:26.800 a peak in energy prices, although of course prices you know, 0:17:26.840 --> 0:17:31.000 picking up again more recently. Freight costs still very elevated, 0:17:31.040 --> 0:17:34.760 but off where they were back in September October. So 0:17:34.880 --> 0:17:37.439 the year on year reading today is going to be 0:17:37.560 --> 0:17:40.680 very high, but we would expect that the trend over 0:17:40.720 --> 0:17:42.639 the course of the coming months is going to be 0:17:42.800 --> 0:17:45.880 for a gradual decline. Does a more hawk is turn 0:17:45.920 --> 0:17:48.480 from the FED risk dampening US growth or do you 0:17:48.520 --> 0:17:51.439 think the central bank can bring this in for a 0:17:51.480 --> 0:17:56.800 soft landing. I mean, it's the big challenge for central 0:17:56.800 --> 0:18:02.560 bankers facing these sorts of inflation shan pressures, trying to 0:18:02.600 --> 0:18:07.000 assess how far the risk, you know, how far wages 0:18:07.119 --> 0:18:10.960 start to pick up in response, and to what extent. 0:18:11.200 --> 0:18:16.119 Actually these costs are a major headwind to activity. So 0:18:16.200 --> 0:18:19.480 that's why we think that they will, you know, raise 0:18:19.640 --> 0:18:23.560 rates soon um for this first half of the year, 0:18:23.760 --> 0:18:26.399 but we'll then take a breather to see how the 0:18:26.440 --> 0:18:31.159 economy is evolving and also importantly how quickly invitation is 0:18:31.200 --> 0:18:34.720 coming down our last minute here, Do you expect Lyle 0:18:34.840 --> 0:18:38.399 Brainer to support that view when she goes before the 0:18:38.440 --> 0:18:40.639 Senate Banking Committee later this morning? What are you going 0:18:40.680 --> 0:18:45.160 to be listening for from the vice chair nominee, Yeah, 0:18:45.200 --> 0:18:48.160 I mean, certainly, I think it's all eyes on what 0:18:48.240 --> 0:18:53.600 she says regarding the inflation risks, and her recent comments 0:18:53.640 --> 0:18:57.359 have taken a more hawkish turn. So I think that 0:18:58.680 --> 0:19:01.920 you know that the surprise would be um if there 0:19:01.960 --> 0:19:05.680 were the sort reversively dubish comments. Um. I mean it's 0:19:05.680 --> 0:19:09.119 not all one way for sure. There are some reasons 0:19:09.160 --> 0:19:12.879 to believe that perhaps the peak pressure is over, but 0:19:12.960 --> 0:19:15.480 I'm not sure that that's the message that that Bernard 0:19:15.600 --> 0:19:19.000 is going to be giving it today's session. All right, 0:19:19.080 --> 0:19:21.919 As always, Sarah, thanks for the insights. Sarah Human is 0:19:22.000 --> 0:19:25.720 Managing director and head of Europe and America's Research at 0:19:25.880 --> 0:19:29.479 Standard Chartered Bank. As we await the Producer Price Index 0:19:29.520 --> 0:19:33.200 out at eight thirty Wall Street time and Lyle Brainerd's 0:19:33.240 --> 0:19:36.680 testimony before the Senate Banking Committee that begins around ten 0:19:36.800 --> 0:19:41.359 am on Capitol Hill, we'll have continuing coverage throughout the 0:19:41.440 --> 0:19:45.280 day for you here on Bloomberg Radio. Right now, SMP 0:19:45.480 --> 0:19:48.000 futures are up three points, STOUT futures up forty nine. 0:19:48.080 --> 0:19:52.160 Nasdaq futures are higher by eight points. Just ahead, more 0:19:52.200 --> 0:19:55.160 calls for March rate lift off, and another big bank 0:19:55.240 --> 0:19:58.479 puts out a booster mandate. It's all coming up, as 0:19:58.520 --> 0:20:00.840 we checked the five things you need to notice start 0:20:00.920 --> 0:20:09.359 your day on Bloomberg Daybreak Bloomberg eleven three oh weather, clouds, 0:20:09.440 --> 0:20:12.600 some sun today, low forties for highs, clearing and breezy tomorrow. 0:20:12.680 --> 0:20:15.080 Up for thirties a mix of sun and clouds and 0:20:15.160 --> 0:20:18.359 highs only in the low twenties on Saturday. Currently thirty 0:20:18.400 --> 0:20:26.080 five degrees broadcasting live from the Bloomberg Interacted Broker's studio 0:20:26.160 --> 0:20:29.359 in New York, Bloomberg E Living Tree to Washington, d C, 0:20:29.520 --> 0:20:34.240 Bloomberg to Boston, Bloomberg one O six one to San Francisco, 0:20:34.320 --> 0:20:38.199 Bloomberg N sixty to the country Sirius XM Cho one 0:20:37.840 --> 0:20:40.920 nine and around the globe the Bloomberg Business app in 0:20:41.000 --> 0:20:50.239 Bloomberg Radio dot com. This is Bloomberg Daybreak and at 0:20:50.280 --> 0:20:52.639 six thirty on Wall Street Coup Morning. I'm Nathan Hagar 0:20:52.960 --> 0:20:55.560 and I'm Karen Moscow, and we're just about three hours 0:20:55.600 --> 0:20:58.119 away from the open of US trading. Time for the 0:20:58.320 --> 0:21:01.160 five things you need to note start your day. Brought 0:21:01.240 --> 0:21:05.120 to you by Interacted Broker's Global Analysts. Global Analysts helps 0:21:05.160 --> 0:21:09.080 you find new global investment opportunities, to diversify your portfolio 0:21:09.119 --> 0:21:12.800 and discover undervalued companies. Try Global Analysts today at ib 0:21:12.920 --> 0:21:16.240 k R dot com. Slash g A up first, the 0:21:16.400 --> 0:21:20.160 FED and inflation as front and center. San Francisco President 0:21:20.200 --> 0:21:23.800 Mary Daily and Philadelphia Fed chief Patrick Harker are publicly 0:21:23.840 --> 0:21:26.960 discussing a rate hike in March. The Central Bank is 0:21:27.000 --> 0:21:29.879 looking to fight the hottest inflation in a generation, and 0:21:29.880 --> 0:21:33.000 they'll need increase to increase rates aggressively to do so. 0:21:33.280 --> 0:21:37.240 That's according to Bridgewater Associates Investment Research Director Rebecca Patterson. 0:21:37.600 --> 0:21:41.280 We think inflation is likely to be significantly above what's 0:21:41.320 --> 0:21:44.359 discounted and of course the fence target, unless they decide 0:21:44.359 --> 0:21:46.879 they're going to hike a lot more aggressively than once priced. 0:21:47.160 --> 0:21:50.800 Rebecca Patterson at Bridgewater Associate says markets are not prepared 0:21:50.840 --> 0:21:54.320 for just how sticky high inflation could be. And up next, Karen, 0:21:54.400 --> 0:21:57.399 there's more inflation data. We'll get the producer price index 0:21:57.440 --> 0:22:00.320 for December Today. An economists forecast a record or over 0:22:00.359 --> 0:22:03.320 your increase of nine point eight percent, and the report 0:22:03.359 --> 0:22:05.840 comes at eight thirty am Wall Street time, Nathan. Then 0:22:05.960 --> 0:22:08.960 ninety minutes later, their Senate Banking Committee holds a confirmation 0:22:09.040 --> 0:22:12.199 hearing for Lyle Brainerd. She's been tapped to serve as 0:22:12.280 --> 0:22:15.200 vice chair of the Fed. At Bloomberg's The New Judas reports, 0:22:15.320 --> 0:22:19.000 brainerdition economist and current member the Federal Reserve Board. She 0:22:19.119 --> 0:22:22.080 also held the top post at the Treasury. Her nomination 0:22:22.160 --> 0:22:25.720 preserves continuity at the Central Bank, along with the renomination 0:22:25.760 --> 0:22:28.960 of FED chairs Rome Powell to a second term. Brainert 0:22:29.000 --> 0:22:33.080 and Powell have similar views on monetary policy stamping out inflation, 0:22:33.440 --> 0:22:36.960 but different bank regulation. She wants to maintain tough curbs 0:22:36.960 --> 0:22:40.240 imposed after the two thousand and eight financial crisis. Bene 0:22:40.600 --> 0:22:43.160 Judas Sloomberg Daybreak. Al Right, Vinnie, thank you. Let's turn 0:22:43.160 --> 0:22:46.320 our attention to the pandemic now. Daily COVID cases remain high, 0:22:46.320 --> 0:22:48.600 but there are signs the omicron wave could be easing. 0:22:48.800 --> 0:22:51.959 The most serious illness continues to be among the unvaccinated, 0:22:52.000 --> 0:22:54.840 and when it comes to teenagers, the CDC says almost 0:22:54.840 --> 0:22:58.359 all of them that need intensive care have not received shots. Well. 0:22:58.440 --> 0:23:00.760 Nathan on Wall Street and their finding cho firm is 0:23:00.800 --> 0:23:03.480