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Speaker 1: Bloomberg Audio Studios, podcasts, radio news.

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Speaker 2: This is the Bloomberg Day BAQ podcast. Give Morning. It's Monday,

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Speaker 2: the twenty sixth of January. I'm Caroline Hepka in London and.

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Speaker 1: I'm Stephen Caroline Brussels. Coming up today. Anger and political

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Speaker 1: outrage mount in the United States after another American citizen

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Speaker 1: is killed in an immigration crackdown.

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Speaker 2: Gold rises above five thousand dollars an ounce, pushed higher

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Speaker 2: by a weeker dollar and global uncertainty while markets are

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Speaker 2: on alert for intervention in the Japanese yen after a

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Speaker 2: shop strengthening of the currency.

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Speaker 1: Plus Europe's defense dilemma, the challenges of building capacity as

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Speaker 1: fears over relying on the US for security grow.

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Speaker 2: Let's start with a roundup of our top stories.

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Speaker 1: Congressional Democrats are threatening a US government shutdown after federal

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Speaker 1: immigration agents shot dead a second American citizen on Saturday.

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Speaker 1: In Minnesota, ice officers killed intensive care nurse Alex Pretty

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Speaker 1: as they subdued him. Widely circulated videos showing the incident

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Speaker 1: from multiple angles suggest that a handgun, which Pretty had

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Speaker 1: a permit to carry, may have been removed from him

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Speaker 1: by an agent before other officers opened fire. Democratic Senator

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Speaker 1: Amy Klobashar of Minnesota spoke to ABC's This Week program.

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Speaker 3: Somehow fifty thousand peaceful protesters in ten below weather. I

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Speaker 3: was there with them marching when we're able to march

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Speaker 3: without any problems, and then the next day a half

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Speaker 3: a dozen ICE and Border Control agents couldn't handle a

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Speaker 3: guy with a cell phone taking video of them and

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Speaker 3: shot him. So I think it's pretty obvious what's going

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Speaker 3: on here, so sort and what needs to happen is

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Speaker 3: they need to leave.

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Speaker 1: Senator Abi Klobachar was speaking to ABC after Border Patrol

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Speaker 1: Commander at Large Gregory Vino said Alex Pratty approached officers

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Speaker 1: with a handgun and violently resisted attempts to disarm him. However,

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Speaker 1: neither he nor other federal officials said he had brandished

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Speaker 1: the weapon.

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Speaker 2: Growing anger over the Trump administration now threatens to trigger

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Speaker 2: a partial government shut down this week. Senate Democratic leader

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Speaker 2: Chuck Schumer says his party will vote against a sweeping

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Speaker 2: funding package needed to keep the US government running and less.

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Speaker 2: Republicans strip out funding for the Department of Homeland Security,

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Speaker 2: which oversees ICE. Democratic Senator Adam Schiff of California spoke

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Speaker 2: on NBC's Meet the Press, Well.

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Speaker 4: I'm not giving ICE or Border Patrol another dime given

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Speaker 4: how this agency, these agencies are operating. Democrats are not

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Speaker 4: going to fund that the government will shut down. If

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Speaker 4: Republicans insist that that be joined with other government funding,

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Speaker 4: it will be a Republican decision.

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Speaker 2: Adam Schiff speaking there. With the effects of another shutdown

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Speaker 2: expected to be widespread, including possibly delaying the next Bureau

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Speaker 2: of Labour Statistics report, and there are signs that some

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Speaker 2: congressional Republicans are wavering. Speaking on Fox News, House Oversight

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Speaker 2: Chairman James Corner suggested that President Trump should consider taking

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Speaker 2: his immigration crackdown to another city.

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Speaker 1: The price of gold has surged past five thousand dollars

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Speaker 1: an ounce for the first time. It extends a breakneck

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Speaker 1: rally that's seen bullion more than double in value over

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Speaker 1: the past two years. The latest gains come as pressure

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Speaker 1: from the Trump administration on the FED threat to annexed

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Speaker 1: Greenland and the prospective military intervention in Venezuela have fueled

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Speaker 1: a flight away from sovereign bonds and currencies, and that

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Speaker 1: uncertainty was underlined again this weekend after the US President

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Speaker 1: threatened a one hundred percent tariff on all Canadian goods

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Speaker 1: if the country becomes what Trump described as a drop

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Speaker 1: off port for Chinese exports to the US.

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Speaker 2: The Japanese yen has extended gains against the dollar as

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Speaker 2: traders start the week on alert authorities intervening in the

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Speaker 2: FX market. Coordinated currency intervention is rare, but has been

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Speaker 2: fueled by comments on Sunday from Japanese Prime Minister Takei

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Speaker 2: Ichi about addressing quote speculative and highly abnormal movements. Traders

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Speaker 2: reported on Friday that the Federal Reserve Bank of New

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Speaker 2: York had contacted financial institutions to check on the yen's

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Speaker 2: exchange rates, something that is seen as a precursor to intervention.

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Speaker 1: In the UK, allies of the Prime Minister of blocked

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Speaker 1: Greater Manchester Mayor Andy Burnham from standing to become a

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Speaker 1: member of Parliament and an upcoming by election. The decision

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Speaker 1: leaves Burnham, a key rival of Keir Starmer, with no

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Speaker 1: clear route to Parliament. Steve Reids, the government's Housing secretary,

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Speaker 1: says it's the wrong time for him to return to Westminster.

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Speaker 5: Well, I look forward to seeing Andy Burnham back in Parliament.

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Speaker 5: In due course, but right now he's only halfway through

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Speaker 5: a four year term as mayor. Two million people helped

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Speaker 5: the right to vote in that area. They're not expected

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Speaker 5: a by election for their mayor halfway through the term

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Speaker 5: of the current mayor.

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Speaker 1: As ANG secretary Steve Read speaking there following the eight

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Speaker 1: to one vote by Labour's National Executive Committee against the

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Speaker 1: attempt in Gordon and Denton, Bloomberg understands that Keir Starmer

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Speaker 1: told the panel that Burnham standing would trigger month of

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Speaker 1: psychodrama and badly damaged labor ahead of May's local elections.

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Speaker 1: Posting on social media on Sunday, Andy Burnham said he

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Speaker 1: was disappointed by the decision and concerned about its potential impact.

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Speaker 2: New research by Morgan Stanley says that the UK is

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Speaker 2: losing more jobs than it's creating because of artificial intelligence.

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Speaker 2: Bloomberg's un Potts has more.

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Speaker 6: Morgan Stanley's study found AI innovations are coming at a

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Speaker 6: particularly heavy cost of workers in Britain. The reports surveyed

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Speaker 6: firms in five industries that have been using AI for

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Speaker 6: at least a year. It found that for many companies,

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Speaker 6: tech investments are already paying off, with an average eleven

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Speaker 6: and a half percent increase in productivity. But when it

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Speaker 6: comes to employment, so you get companies reported the highest

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Speaker 6: level of net job losses of any of the countries

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Speaker 6: in the survey. In London, I'm you and pots Spooberg

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Speaker 6: Radio and.

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Speaker 2: Those are some of our top stories for you this morning.

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Speaker 2: In terms of the markets, the Japanese yen currently surging

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Speaker 2: about one percent one hundred and fifty four to nineteen.

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Speaker 2: There is speculation that the US may assist Japan to

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Speaker 2: halt the currency's slide. This would be highly unusual, very

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Speaker 2: rare for there to be either coordinated action or indeed

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Speaker 2: action by the US. In the FX markets, Japanese stocks

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Speaker 2: have been falling sharply on the back of that. NIK

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Speaker 2: is currently down by one point seven percent the dollar

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Speaker 2: weekening against all FX majors. The other big story in

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Speaker 2: markets is the surge in metals, especially gold, which is

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Speaker 2: now by one point eight percent this morning, training at

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Speaker 2: five seventy eight dollars. Ryanair says that it sees full

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Speaker 2: year profit after tax being two point one to two

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Speaker 2: point two billion euros. US natural gas futures have also

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Speaker 2: surged because of the freezing weather. They're they've sowed above

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Speaker 2: six dollars for the first time since twenty twenty two.

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Speaker 2: Those are the markets.

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Speaker 1: In a moment, we will bring you more on the

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Speaker 1: potential backlash against the US immigration crackdown that could result

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Speaker 1: in a government shutdown, plus Europe's defense dilemma back in

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Speaker 1: focus after the recent tensions over Greenland. But another story

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Speaker 1: that we've been reading this morning in case you feel

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Speaker 1: like you achieved nothing with your weekend, or perhaps you

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Speaker 1: stayed in bed late on Sunday morning, contrasts that with

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Speaker 1: the climber Alex Hannold, who spent his Sunday morning climbing

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Speaker 1: the Type A one oh one tower without ropes while

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Speaker 1: being streamed live on Netflix. Took just over ninety minutes

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Speaker 1: to climb the five hundred and eight meter building, which

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Speaker 1: houses officers including the Taiwan Stock Exchange. Bigot even for him, obviously,

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Speaker 1: but also for Netflix it's part of their push into

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Speaker 1: live programming. Our colleagues though also writing that it's a

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Speaker 1: boost for Taiwan because publicity surrounding the climb are a

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Speaker 1: high profile soft power wind for the island as well,

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Speaker 1: been battling for increased international visibility amidst the of course

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Speaker 1: ongoing campaign by China to isolate it diplomatically. So all

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Speaker 1: sorts of consequences from this event stunt, what do you

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Speaker 1: want to call it?

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Speaker 2: Consequences for me? Vertigo inducing TV. I mean I could

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Speaker 2: barely watch Free Solo, which was the first time that

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Speaker 2: the world really understood the powers of Alex Honald and

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Speaker 2: his skills to kind of climb without assistance, without ropes.

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Speaker 2: Don't know whether you ever watched the movie in twenty eighteen.

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Speaker 2: A lot of it was about his now wife Samny McCandless,

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Speaker 2: you know, and the fact that they traveled around in

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Speaker 2: this tiny van to get anyway. It's I don't know,

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Speaker 2: climbing is yes, I say, it's my heart's palpitated just

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Speaker 2: thinking about it or.

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Speaker 1: Something that you can read more about on Bloomberg dot

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Speaker 1: com as well. Let's bring you more there on on

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Speaker 1: our top story, the Trump Administration's immigration crackdown, fueling growing

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Speaker 1: outrage in the US after a border patrol agent shot

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Speaker 1: and killed the thirty seven year old nurse Alec Presting

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Speaker 1: in Minneapolis on Saturday. Joining US Now with more details

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Speaker 1: is Bloomberg's Tia Out of Bio Tia, Good morning, Quada

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Speaker 1: has been the impact then of this shooting.

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Speaker 7: So far, this is the second time this month that

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Speaker 7: ICE agents in Minnesota have been involved in a fatal shooting.

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Speaker 7: It comes just weeks after the shooting of US citizen

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Speaker 7: Rene Good in Minneapolis. So just a recap of what

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Speaker 7: happened over the weekend in terms of what ICE is

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Speaker 7: saying took place. Gregory Bovino, who is the Border Control

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Speaker 7: Commander at large, said that a man approached border patrol

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Speaker 7: officers with a semi automatic handgun and then, he says,

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Speaker 7: violently resisted attempts to disarm him. He also says that

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Speaker 7: the agent then fired defensive shots. That's according to a

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Speaker 7: statement that he's made. We've had President Trump, who took

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Speaker 7: to truth social quickly afterwards as well, defending the federal

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Speaker 7: officials involved. But this version of events has of course

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Speaker 7: been widely disputed by others, including Minnesota's Governor Tim Waltz,

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Speaker 7: so the mayor of Minneapolis, Jacob Frey, who have emphasized

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Speaker 7: that a number of videos of the event that are

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Speaker 7: circulating widely on social media, and Tim Waltz has called

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Speaker 7: IS's statement nonsense and lies. We've also heard in a

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Speaker 7: statement from the parents of Alex Pretty who have refuted

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Speaker 7: Trump's claims. But just in terms of the political impact,

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Speaker 7: this is raising a lot of difficult questions in Minnesota

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Speaker 7: and also for the US at large. We're now seeing

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Speaker 7: this sort of stand off situation between authorities in the

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Speaker 7: States and the federal government. President Trump has accused Tim

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Speaker 7: Waltz and Jacob Frey of inciting insurrection with their rhetoric,

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Speaker 7: and he's also suggesting now that the two have instructed

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Speaker 7: local police not to protect or aid ICE agents. There

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Speaker 7: are other politicians that we've heard from as well in

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Speaker 7: the Trump administration, Department of Homeland Security Secretary Christy nem

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Speaker 7: who's called Alex Pretty a domestic terrorist and argued that

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Speaker 7: he was actually impeding the work of the border control

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Speaker 7: But there's also this question of the Second Amendment right

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Speaker 7: to bear arms. We've even had from the National Rifle Association,

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Speaker 7: who are traditionally a Republican leading organization, and they've called

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Speaker 7: for a full investigation into the shooting and described the

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Speaker 7: suggestion of a federal prosecutor that people who carry guns

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Speaker 7: have the risk of being lawfully shot by officers as

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Speaker 7: dangerous and wrong. So this incident is really bringing out

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Speaker 7: wider constitutional questions which affect all Americans, but just quickly

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Speaker 7: on the business impact as well, there's been a significant

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Speaker 7: impact in that respect. We've heard from more than sixty

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Speaker 7: CEOs of companies based in the state in an open

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Speaker 7: letter they're calling for immediate de escalation of tensions. Those

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Speaker 7: companies include names like Target and Cargol. But it does

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Speaker 7: seem like normal life has almost sort of ground to

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Speaker 7: a halt in Minnesota. Even an NBA game scheduled for

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Speaker 7: the weekend had to be postponed reports of federal agents

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Speaker 7: using tear gas and other violent crowd control techniques. So

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Speaker 7: it seems the situation are definitely far from calm in Minnesota.

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Speaker 2: No, absolutely, an absolute FURII really in terms of what

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Speaker 2: this means for a US government shut down, I mean

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Speaker 2: the political consequences. They also kind of throw the finances

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Speaker 2: now of the government into question, don't they.

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Speaker 7: Yeah, So we've been brought to this situation which some

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Speaker 7: may have called unimaginable perhaps at the start of the year,

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Speaker 7: the prospect of another government shut down, And that's because

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Speaker 7: this shooting has happened in the wake of some unpopular

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Speaker 7: actions by the Trump administration, including aggression towards Venezuela over Greenland,

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Speaker 7: and now these incidents in Minnesota have sort of raised

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Speaker 7: tensions in Congress to new heights. We've seen Senate Democrats

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Speaker 7: sort of digging in against this bill which regards funding

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Speaker 7: for the Department of Homeland Security, that was expected to

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Speaker 7: pass this week as a final part of a package

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Speaker 7: for this fiscal year. But now Senate Democrats are saying

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Speaker 7: that they don't want to fund this building to vote

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Speaker 7: for it, and that means the fate of the larger

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Speaker 7: package is now uncertain as well. So Democrats are calling

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Speaker 7: for new restrictions on ice and a full investigation into

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Speaker 7: the shooting. And they're also calling for the Department of

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Speaker 7: Homeland Security bill to be separated from the rest of

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Speaker 7: the package, but of course doing so would cause new delay,

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Speaker 7: so that situation is also very uncertain.

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Speaker 1: Okay to you, Ada Bio, Thank you very much for

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Speaker 1: joining us with the latest Stay with us. More from

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Speaker 1: Bloomberg Daybreak Europe coming up after this.

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Speaker 2: Now, last week's tensions between the US and Europe over

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Speaker 2: Greenland have again highlighted the security challenges that the continent

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Speaker 2: faces and its reliance on the United States. The new

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Speaker 2: US National Defense strategy published on Friday, restates American priorities

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Speaker 2: for Europe to take on more responsibility for its own defenses.

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Speaker 2: Our Bussels Bureau chief Suzanne Lynch joins US for more now.

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Speaker 2: Has the ramping up of threats against Greenland from the

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Speaker 2: US changed the conversation in Europe about defense in terms

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Speaker 2: of both spending and also autonomy from the United States?

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Speaker 2: I mean, how much has it ratcheted up that change?

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Speaker 8: I think it has. I think the events of last

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Speaker 8: week have really shaken the European scene and decision makers

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Speaker 8: in Brussels and across the continent. As you said there,

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Speaker 8: I mean, this conversation about Europe's need to ramp up

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Speaker 8: defense has been happening for a few years, for almost

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Speaker 8: four years now as we approach that anniversary of the

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Speaker 8: full scale invasion of Ukraine in twenty twenty two, and

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Speaker 8: there has been a lot of change, and we've seen

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Speaker 8: a huge shift in attitudes towards spending. For example, from Germany,

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Speaker 8: which is really culturally as well as defense wise, very

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Speaker 8: very significant given that it's the biggest power. Because of

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Speaker 8: historic reasons there there was always there a look by

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Speaker 8: Germany to lead on this. We also saw the NATO

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Speaker 8: summit last year in the summer in the Hague, which

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Speaker 8: saw member states and members of NATO commit it's a

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Speaker 8: greater spending on defense.

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Speaker 2: So it's been looking.

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Speaker 8: There's been a lot more. But I think what's happened

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Speaker 8: last week is realization. I mean, I think all leaders

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Speaker 8: meeting in Brussels on Thursday night reunited in the realization

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Speaker 8: that Europe needs to stand on his own when it

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Speaker 8: comes to the economy and when it comes to defense.

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Speaker 8: But of course how to do that is a bit

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Speaker 8: more tricky.

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Speaker 1: And so Xander, have been efforts, as you say, being

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Speaker 1: made across the continent to ramp up investment in defense.

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Speaker 1: Of course the increased commitment to NATO spending as well,

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Speaker 1: but the your opinion, has also been trying to help

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Speaker 1: member states with this effort as well. How effective have

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Speaker 1: those plans been so far?

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Speaker 8: Yes, I mean the EU and URSUA under Lyon has

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Speaker 8: said a lot that she has now focused on defense

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Speaker 8: as an issue. However, look, being honest, Stephen, I mean

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Speaker 8: the EU is limited and what it can do in

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Speaker 8: defense this is more a challenge for nature. I think

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Speaker 8: now the EU has set up some programs, the Safe

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Speaker 8: Loan program for example, where countries and in some cases

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Speaker 8: third party countries can apply for loans if you like.

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Speaker 8: At fun defense that has been that is new, that

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Speaker 8: has been had a huge take up for example. That's

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Speaker 8: positive in terms of the EU trying to kick start

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Speaker 8: defense spending, but ultimately it becomes a decision for budgets

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Speaker 8: and national capitalist national governments who are trying to always

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Speaker 8: compete with different priorities when it comes to spending. But

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Speaker 8: we have seen individual countries increase their spending on this sector.

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Speaker 8: But look, there are a lots about with the European

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Speaker 8: defense sector, particularly it's fragmented nature and its dependence on

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Speaker 8: the US. And look, one of the issues that's emerged

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Speaker 8: from last week is the question can Europe continue to

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Speaker 8: depend on US, not in terms of just a reliable

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Speaker 8: partner in nature, but actually as a producer and provider

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Speaker 8: of defense equipment. You know, a lot of the defense

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Speaker 8: infrastructure and countries are dependent on the US. For example,

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Speaker 8: Alexander stud the Finished president, said last week that his

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Speaker 8: country's fleet of US made fighters needs the United States.

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Speaker 8: They can't fly without the US because they need spare

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Speaker 8: parts and hardware and software updates, and there's conversations going

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Speaker 8: on in the UK now about how interdependent they are

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Speaker 8: for the US and is the US a reliable partner

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Speaker 8: in the same way when it comes to defense. So

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Speaker 8: a lot of challenges at facing the sector.

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Speaker 2: Yeah, there are all of this happening as the diplomatic

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Speaker 2: efforts to try to end the war in Ukraine have accelerated.

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Speaker 2: There have been these trilateral talks which have involved the

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Speaker 2: US over the weekend. But then how much progress has

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Speaker 2: been made?

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Speaker 8: Yeah, I mean Vladimir Zelenski, the Ukrainian President, gave a

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Speaker 8: press conference in Lithuania on Saturday, and he said the

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Speaker 8: progress had been made during the talk, but he said

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Speaker 8: a deal, those still compromise. So he's call you as officials.

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Speaker 8: We're calling these talks and Abujabi constructive and on February

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Speaker 8: first there will be a resumption of discussions in some way.

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Speaker 8: So look, a lot of what he was saying was

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Speaker 8: repeating what he'd said the previous week that really Ukraine

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Speaker 8: and the US have agreed to this kind of a

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Speaker 8: post war structure. This agreement obviously the Russia has not yet.

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Speaker 8: But look, all of this has taken place as Ukraine

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Speaker 8: is under pressure from Russia which has launched thousands now

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Speaker 8: of attack drones on Kiev. The city and other parts

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Speaker 8: of Ukraine have been under pressure as they faced power

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Speaker 8: outages due to these huge Russian airs strikes. So look,

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Speaker 8: I think it's an illustration of how much is at

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Speaker 8: stake here still in this war.

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Speaker 1: This is Bloomberg Daybreak Europe, your morning brief on the

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