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

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Speaker 2: This is the.

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Speaker 3: Bloomberg Day BAQT podcast, available every morning on Apple, Spotify

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Speaker 3: or wherever you listen. It's Friday, the twenty fourth of

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Speaker 3: January in London. I'm Caroline Hepkin and.

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Speaker 1: I'm Stephen Carroll. Coming up today. Donald Trump says he

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Speaker 1: would rather not impose tariffs on China, but that he

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Speaker 1: will demand lower rates from the Federal Reserve.

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Speaker 3: The Bank of Japan raises interest rates to the highest

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Speaker 3: level since two thousand and eight.

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Speaker 1: Plus a non dom reprieve Rachel Reeves relaxes plans to

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Speaker 1: tax wealthy foreigners as consumer confidence sinks.

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Speaker 3: Let's start with a roundup of our top stories.

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Speaker 1: Donald Trump says he would prefer not to impose tariffs

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Speaker 1: on China, a softening compared to his pre election threat

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Speaker 1: to impose levies of sixty percent. Here's what the US

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Speaker 1: president told Fox News Channels Hannity.

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Speaker 4: We have one very big power over China, and that's tariffs,

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Speaker 4: and they don't want them, and I'd rather not have

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Speaker 4: to use it. But it's a tremendous power over China.

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Speaker 1: President Trump had floated the idea of ten percent tariffs

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Speaker 1: on the country from next month, but as so far

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Speaker 1: stopped short of imposing the levies on Beijing in his

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Speaker 1: first days in office, but Trump did press China to

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Speaker 1: pressure Russia's Vladimir Putin to end the war in Ukraine,

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Speaker 1: telling an audience at the World Economic Forum in Davos

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Speaker 1: that China have a great deal of power over that situation.

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Speaker 3: On interest rates, President Trump says that he will pressure

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Speaker 3: Federal Reserve change your own power to lower boring costs,

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Speaker 3: which he blamed for America's ballooning deficit, and Trump expects

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Speaker 3: the Central Bank to listen to his demands. Here's the

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Speaker 3: exchange with reporters in the Oval office.

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Speaker 5: Are you worried that there's too much going on at once?

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Speaker 2: If you're trying to bring your interest reached down.

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Speaker 6: At economy back just works that way, and it's just

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Speaker 6: economically works that way. When the oil comes down, it'll

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Speaker 6: bring down prices, then you won't to have inflation, and

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Speaker 6: then the interest rates will come down. A man that

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Speaker 6: the interest rates come down, do you expect statement?

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Speaker 5: Do you expect the side to listen to you?

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Speaker 1: Yeah?

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Speaker 6: Are you going to talk to Powell about this?

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Speaker 5: And he's bringing the resale at.

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Speaker 6: The right time.

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Speaker 3: The back and forth came after Trump's remote address to

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Speaker 3: finance and business leaders at the World Economic Forum in Davos.

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Speaker 3: The US President said that he would ask major crude

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Speaker 3: producers to lower oil prices.

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Speaker 4: I'm also going to ask Saudi Arabia and OPEK to

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Speaker 4: bring down the cost of oil. You got to bring

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Speaker 4: it down, which, frankly, I'm surprised they didn't do before

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Speaker 4: the election. That didn't show a lot of love by

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Speaker 4: them not doing it. I was a little surprised by that.

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Speaker 4: If the price came down, the Russia Ukraine war would

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Speaker 4: end immediately.

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Speaker 3: President Trump's cool for more oil production comes as fresh

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Speaker 3: sanctions on Russian supplies in the last days of the

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Speaker 3: Biden administration have begun to take effect. Trump did also

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Speaker 3: make efforts to pressure of Lasmir Putin in his Fox interview,

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Speaker 3: being quote massive tariffs and big news sanctions if he

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Speaker 3: doesn't settle the war with Ukraine.

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Speaker 1: Donald Trump assigned executive actions relating to cryptocurrency and AI

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Speaker 1: in his latest round of sweeping changes. The Crypto Order

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Speaker 1: will create a working group to advise his administration on

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Speaker 1: digital asset policies and submit a report to the President

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Speaker 1: within six months, but the plans were met with a

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Speaker 1: mixed reaction in the crypto community, with some expressing disappointment

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Speaker 1: that it didn't specify bitcoin as the center of a

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Speaker 1: national reserve.

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Speaker 3: In a widely anticipated move, the Bank of Japan has

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Speaker 3: raised interest rates by a quarter point two half of

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Speaker 3: one percent that is the highest since two thousand and eight.

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Speaker 3: New predictions for growth and inflation were also released, with

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Speaker 3: officials maintaining GDPA expectations but forecasting a big increase in

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Speaker 3: consumer prices in Japan in twenty twenty five. The yen

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Speaker 3: fluctuated after the decision and the forecast emerged, before strengthening,

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Speaker 3: largely on the back of US dollar weakness amid the

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Speaker 3: commentary from President Donald Trump on tariffs.

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Speaker 1: Just in breaking news this era, the Italian bank Monte

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Speaker 1: da Pasca to Sienna has offered to buy Arrival Media

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Speaker 1: Banco and an all shared deal. Montepaski is offering twenty

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Speaker 1: three new shares for ten Media Banco shares. According to

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Speaker 1: a statement, the offer is a five point zero three

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Speaker 1: percent premium in respect of Media Banker's shares closing price yesterday.

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Speaker 3: Now to the UK, consumer confidence dropped this month to

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Speaker 3: the lowest in more than a year. GfK's sentiment index

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Speaker 3: slipped five points to minus twenty two in January. Bloomberg's

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Speaker 3: James Walcock reports.

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Speaker 2: Now it's yet more data showing the stark shift to

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Speaker 2: pessimism since Labour's landslide election victory. The government can see

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Speaker 2: the numbers. Two ministers have been talking up the economy

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Speaker 2: in recent days, and the Chancellor has tabled the speech

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Speaker 2: outlining you growth plans for next week. Bloomberg has learned

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Speaker 2: Rees also plans to amend her tax changes to non

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Speaker 2: domicol UK citizens, but one offshore wealth manage is said

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Speaker 2: it may be too little, too late. In London. James

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Speaker 2: Wilcock Bloomberg Radio.

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Speaker 1: Millions of people are being told to stay home in

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Speaker 1: the north of the UK due to a life threatening storm.

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Speaker 1: The UK's Weather Service has issued its most severe Red

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Speaker 1: warning in northern Ireland and parts of Scotland, with the

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Speaker 1: rest of the country under either Amber or Yellow alerts.

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Speaker 1: Meteorolitist Joe Robinson explains what we can expect.

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Speaker 3: We're going to see you flying debris, trees down, dangerous

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Speaker 3: driving conditions, damage to buildings that will be disruption.

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Speaker 5: This is a damaging storm.

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Speaker 1: Robinson was joined by other experts and advising people not

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Speaker 1: to drive if they can avoid it if they live

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Speaker 1: in an area with a red weather warning. Stormy Owen

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Speaker 1: is expected to hit Ireland as well, with the authorities

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Speaker 1: there warning that it has the potential to be the

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Speaker 1: storm of the century.

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Speaker 3: Okay, so those are a few of our top stories

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Speaker 3: for you this hour. Let's think about the markets this morning.

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Speaker 3: So on the back of Trump's comments about preferring not

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Speaker 3: to impose tariffs on China, the CSI three hundred this

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Speaker 3: morning is up eight tenths of one percent. The hangsing

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Speaker 3: is also up by two point two percent, and the

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Speaker 3: yuan has strengthened zero point six percent against the US dollar.

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Speaker 3: You did see a major rally a yesterday again on

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Speaker 3: the S and P five hundred, up by half of

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Speaker 3: one percent. The call for lower oil prices, the call

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Speaker 3: for lower interest rates from Donald Trump. Just looking at

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Speaker 3: all prices this morning, they are trading at seventy eight

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Speaker 3: dollars twenty six the boal for Brankfreud futures, So it

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Speaker 3: does seem to have had an impact on markets. The

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Speaker 3: yen is strengthening, the Bloomberg Dollar spot indexes down two

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Speaker 3: tenths of one percent. Looking at stock futures for Europe,

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Speaker 3: they are actually positive, up four tenths of one percent,

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Speaker 3: and tenny US treasury heels are currently trading down two

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Speaker 3: basis points at four point sixty two percent.

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Speaker 1: In a moment, we'll bring you the latest on Trump's

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Speaker 1: apparent reversal on China tariffs, plus what the crowd at

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Speaker 1: Davas made of his speech. Yes, but just no words

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Speaker 1: on another story that caught her eye this morning. The

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Speaker 1: rich are on the move. According to the latest Sotheby's

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Speaker 1: report on international realty. This is looking particularly at the

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Speaker 1: ultra luxury segment. Apparently one hundred and thirty five thousand

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Speaker 1: high net worth individuals are expected to migrate to new

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Speaker 1: countries this year. The top destination the United Arab Emirates,

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Speaker 1: the US A second yees.

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Speaker 3: I thought that's really interesting. Also, Southeby's has some great detail.

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Speaker 3: Millennial buyers are now apparently in the luxury market in

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Speaker 3: a really big way and actually shifting things significantly because

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Speaker 3: younger buyers are using a lot of social media.

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Speaker 1: But it's the thank you for a frank millennials as

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Speaker 1: being younger, caroly I feel very flattered.

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Speaker 3: Well, but no, apparently they are having a hit huge

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Speaker 3: impact because actually some agents are now getting ninety percent

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Speaker 3: of their sales done on Instagram. Of course I had

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Speaker 3: to have a little look on Instagram the Sotheby's one

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Speaker 3: amazing home fifty five million dollars in the US with

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Speaker 3: like five hundred feet of waterfront views absolutely sun. Yeah,

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Speaker 3: and the way that they design the Instagram feed to

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Speaker 3: kind of show off the home is really fascinating. Kind

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Speaker 3: of lots of flash flow.

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Speaker 1: Is the ridery equivalent of property programs that are on

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Speaker 1: there in the middle of the day in case you're

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Speaker 1: wandering break they've gone.

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Speaker 3: Also, there's a massive agender change as well. Apparently in

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Speaker 3: twenty twenty four, twenty percent of buyers were women. That's

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Speaker 3: double the percentage back in the nineteen eighties. But yes,

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Speaker 3: I think a great piece that's on the Blueberg terminal

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Speaker 3: that the wealthier on the move moving home.

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Speaker 1: I'll dream with us.

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Speaker 3: Yeah.

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Speaker 1: Well, let's go back to our top story this morning

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Speaker 1: in Donald Trump's threat of China tariffs a period softer

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Speaker 1: in his comments yesterday than they had been during the

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Speaker 1: election campaign. Markets are taking that positively as well. Let's

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Speaker 1: bring in Jenny Marsh, who leads our coverage of the

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Speaker 1: economy and government in China. Jenny, great to have you on.

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Speaker 1: So Donald Trump is holding tariffs over at China like

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Speaker 1: a sort of damocles. What would a deal with China

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Speaker 1: look like?

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Speaker 7: I mean, the most sort of obvious deal.

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Speaker 8: I think he's going back to that Phase one trade

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Speaker 8: deal from the first Trade War where in the end

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Speaker 8: off was sort of so much wrangling, Beijing committed to

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Speaker 8: buying two hundred billion worth of goods.

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Speaker 7: From the US extra goods.

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Speaker 8: But of course, you know then as soon as that

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Speaker 8: was InCD virtually the pandemic happened and China only ever

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Speaker 8: really brought about sixty percent of that. So in the

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Speaker 8: executive order that Trump passed on Monday, that was one

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Speaker 8: of the things.

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Speaker 7: You know, they're looking at the sort of.

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Speaker 8: The terms of the Phase one trader and wa Chider

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Speaker 8: did so kind of an indication there that you know,

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Speaker 8: Trump is going to go back to the initial deal

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Speaker 8: with China and hold it to account. But also I

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Speaker 8: think for him, Tara was sort of a bit different

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Speaker 8: this time. You know, he was looking at Davos overnight

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Speaker 8: saying that you know, if you want to make a

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Speaker 8: product in the US, You're welcome might come, get your factory,

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Speaker 8: put it in America, and the tax benefits will be

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Speaker 8: you know, bountiful. But if you don't want to do that,

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Speaker 8: then uould face tariffs. So it suggests that this time

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Speaker 8: it's not just about buying products from the US, it's

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Speaker 8: actually about sort of re orienting your whole manufacturing base,

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Speaker 8: you know, and putting more jobs and manufacturing in America.

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Speaker 8: And so I think that actually could mean the contours

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Speaker 8: of a deal look quite different from the first time around.

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Speaker 3: That's fascinating, isn't it. Of Course, China's vice premiere was

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Speaker 3: at Davos too, What does China want? He was talking

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Speaker 3: about the country wants to import into China more competitive

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Speaker 3: quality products from the US and obviously there have been

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Speaker 3: restrictions on things like chips into China.

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Speaker 7: Yeah, but I think that's what he's referring to.

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Speaker 8: You know, I think really that's what China wants is

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Speaker 8: to is being very careful sort of tam down tensions.

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Speaker 8: They don't want this spiraling out of control. You know,

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Speaker 8: hugenp has a domestic economy right now that's under a

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Speaker 8: lot of strain, and they're trying to rouse the domestic consumer,

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Speaker 8: but it's proving hard, and that means they need exports.

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Speaker 7: They need export markets.

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Speaker 8: So what China wants is to be able to continue

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Speaker 8: access overseas markets and not to get swept up in

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Speaker 8: a US trade ward, which then sort of inspires other

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Speaker 8: countries to term more protectionists too. What it would really

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Speaker 8: want is what Ding is referring to there. It would

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Speaker 8: want friendlier relations with America. Why they don't have to

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Speaker 8: worry all the time about these export controls on things

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Speaker 8: that are really critical to their military advancement. I mean,

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Speaker 8: on the flip side, those controls are inspiring China and

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Speaker 8: they're motivating it to develop much faster than people thought

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Speaker 8: they could on their own chips, but you know, it's

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Speaker 8: still going to take time and they need access to

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Speaker 8: those markets.

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Speaker 1: This sounds like a softening of positions on boat sides,

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Speaker 1: and as if we're coming towards something that could be

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Speaker 1: a positive move in the relationship between the US and China.

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Speaker 1: Is that what we should be thinking about or how

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Speaker 1: we should be conceiving these comments?

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Speaker 8: You know, I think first off is very early days

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Speaker 8: in the beginning of Trump's first term. Also sort of

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Speaker 8: started off much more cordial and friendly, and then you know,

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Speaker 8: quite soon, quite quickly, sort of did turn not sap,

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Speaker 8: more sour.

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Speaker 7: But it does feel like that.

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Speaker 8: And it's kind of interesting that Trump is sort of

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Speaker 8: going into this a little bit more cautiously than he

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Speaker 8: suggested he was going to on the campaign trail. You know,

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Speaker 8: it's not just the fact that he didn't tariff of

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Speaker 8: China on day one, that the tariff level he has

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Speaker 8: just so over fentanyl is much less than it is

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Speaker 8: for Canada and Mexico. That he's given TikTok this reprieve,

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Speaker 8: the tone just seems a bit gentler, and China is

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Speaker 8: definitely being extremely careful not to responding anyway they can

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Speaker 8: escalate things. So, you know, I think at the moment

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Speaker 8: there there's reason to be relatively optimistic. But I think,

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Speaker 8: you know, it is clear that some tariffs are coming.

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Speaker 8: I don't think he's going to change his mind on tariffs,

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Speaker 8: but considering he was talking about sixty percent on the

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Speaker 8: campaign trail, this seems a lot more palatable.

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Speaker 3: Yeah, and then ten percent of the beginning of this week,

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Speaker 3: and yeah, I thinking about refraining from tariffs towards the

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Speaker 3: end of the week. Thank you so much, Jenny for

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Speaker 3: being with us. Jenny Marsh, who leads our Economy and

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Speaker 3: Government coverage in China, for your thoughts.

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Speaker 7: Thank you.

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Speaker 1: Well, let's go to Davos next and talk more broadly

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Speaker 1: about what President Trump said that he wanted to get

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Speaker 1: from a whole range of counterparts, including lower oil prices

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Speaker 1: from OPAC, lower interest rates in the Federal Reserve, and

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Speaker 1: for banks to be more open to conservative customers. Our

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Speaker 1: White House correspondent Jenny Leonard is in Switzerland this morning. Jenny,

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Speaker 1: let's talk about the commentary that we heard from Donald

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Speaker 1: Trump around the FED. How much pressure can the President

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Speaker 1: put on Jerome Powell and will he bend to it.

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Speaker 9: I think the President is probably going to use every

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Speaker 9: single opportunity he has to pressure Jerome Powell. But if

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Speaker 9: you think back to his first term where he almost

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Speaker 9: fired Powell because he didn't agree with his interest rate policy,

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Speaker 9: obviously that didn't happen, but he is going to try

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Speaker 9: to use every single lever he has at his power

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Speaker 9: to get Powell to bend. I don't think Powell will.

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Speaker 9: We have seen this play out before. I think he's

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Speaker 9: going to serve out his term trying to really show

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Speaker 9: the world that the FED is an independent agency and

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Speaker 9: not bending to the president's will. But I think this

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Speaker 9: you know, push and pull between Powell and Trump, which

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Speaker 9: at this point for Trump is really personal because he

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Speaker 9: really does not like Powell or his policies. I think

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Speaker 9: we'll see that play out over the next four years.

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Speaker 9: It was interesting that, you know, he sounded a little

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Speaker 9: bit more conciliatory if you think back to his interview

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Speaker 9: with our editor in chief only a couple months ago

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Speaker 9: in October, he said he shouldn't have a say, you know,

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Speaker 9: he should weigh in but not make the decision on

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Speaker 9: interest rate policy. And obviously he's now sort of hardened

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Speaker 9: that stance now he thought he's in office, so it

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Speaker 9: took a couple months for us to get here. I

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Speaker 9: feel like he's always kind of had what he's saying

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Speaker 9: now has always been his view. So actually, when he

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Speaker 9: was sounding a little more conciliatory in the interview with

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Speaker 9: John Michaelthwaite, saying, you know, I know they're independent, I

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Speaker 9: think I should weigh in.

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Speaker 5: Obviously I don't have the fact.

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Speaker 8: Yeah.

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Speaker 3: Indeed, so in terms of that sort of independent interest

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Speaker 3: rate policy, that obviously is you know, it's seen as

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Speaker 3: the gold standard in terms of policy around the world

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Speaker 3: and beneficial for economy. So I think it's fascinating with

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Speaker 3: Donald Trump sort of stressing that institutional You're putting pressure

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Speaker 3: on it. Meanwhile, in terms of the China tariffs, we

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Speaker 3: were talking to Jenny marsh about that a little bit

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Speaker 3: earlier to get the kind of perspective from Beijing. But equally,

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Speaker 3: President Trump was giving a start warning to European executives

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Speaker 3: at Davos, where you are about producing goods in the US,

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Speaker 3: what might we expect, you know, in Europe from the

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Speaker 3: White House.

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Speaker 5: His shift and tone on China has been really striking.

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Speaker 9: We've actually reported you know that he even privately said

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Speaker 9: I really don't want to go after China at this

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Speaker 9: heart this time around. Europeans, on the other hand, I

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Speaker 9: think will have a little bit of a harder time

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Speaker 9: dealing with Donald Trump. He obviously yesterday addressed you know,

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Speaker 9: the Davos audience saying the Europeans have been very very

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Speaker 9: bad to us, very unfair. He calls them abusers in

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Speaker 9: some of his comments in the White House over the

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Speaker 9: last couple of days. That's obviously a reference to the

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Speaker 9: large trade deficit. He has that as one of his

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Speaker 9: big grievances that we know from his first term. We

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Speaker 9: actually know this decades going back. The President really does

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Speaker 9: not like that there are no American cars driving on

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Speaker 9: German roads, but America imports a ton of or makes

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Speaker 9: a ton of German branded cars. So the Europeans are

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Speaker 9: going to have a little bit of a difficult time

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Speaker 9: dealing with Trump. And the other thing that is a

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Speaker 9: little bit difficult for them is that they have to

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Speaker 9: come to Brussels to make decisions.

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Speaker 5: And for Trump, who's wheeling and dealing.

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Speaker 9: And he wants to have one counterpart to sit across

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Speaker 9: from that's not going to work. He wants to sit

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Speaker 9: across from individual member states or their leaders that he

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Speaker 9: gets along with or wants to negotiate with, and he

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Speaker 9: doesn't want to have this you know, body in Brussels say, well,

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Speaker 9: you know, we'll get back to you. We first the

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Speaker 9: twenty seven member states have to first, you know, negotiate

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Speaker 9: amongst themselves and then we can kind of make an offer.

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Speaker 9: So how he is going to sort of stress the

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Speaker 9: EU internally? What kind of you know split? We see

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Speaker 9: there will Hungary and Italy break with Germany and France.

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Speaker 9: You know, when it comes to responding to tariffs, Trump

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Speaker 9: clearly is going to do something on tariffs.

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Speaker 5: He I think right now it's.

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Speaker 9: Still a little bit unclear if we really will see

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Speaker 9: something on February first, but I think he's responding to

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Speaker 9: his stints witches.

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Speaker 5: I campaigned on.

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Speaker 9: This, as Jenny marsh just said, you know, he's also

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Speaker 9: shifted to I want stuff to be made in the US.

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Speaker 9: He you know, used his first days in office to

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Speaker 9: tout large investments made in this AI infrastructure announcement.

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Speaker 5: I think if European companies came to him and and.

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Speaker 9: You know, placated him with stuff like that, I think

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Speaker 9: that would probably go a long way and staving off tariffs.

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Speaker 9: But Trump is always wielding the tariff threat. We saw

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Speaker 9: this in his tweet, you know about the Russia Ukraine war.

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Speaker 9: He said, you know, President putin, come to the table.

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Speaker 9: If not, the hard way would be I'm going tariffs

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Speaker 9: easier way as you just come to the table. So

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Speaker 9: I think the Europeans watching the europe US relationship this

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Speaker 9: time around will be much more interesting than the China relationship,

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Speaker 9: which I really.

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Speaker 5: Didn't expect coming into this. You followed him on the

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Speaker 5: campaign trail.

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Speaker 1: Yeah, that's certainly going to be very interesting one to watch.

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Speaker 1: Another story we just wanted to touch on you with you,

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Speaker 1: Jenny as well, was this commentary around bank executives Trump

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Speaker 1: petting out the Bank of America CEO and JP Morgan CEO,

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Speaker 1: accusing the lenders of limiting business with conservative clients. This

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Speaker 1: is a story that we've experienced in the UK here

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Speaker 1: around Nigel Farage and the de banking story for him,

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Speaker 1: but US banks deny they've any political litmus test when

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Speaker 1: it comes to clients.

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Speaker 5: Yeah.

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Speaker 9: I think this one is an interesting one that certainly

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Speaker 9: caught the Davos audience a little bit by surprise the

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Speaker 9: back and forth. Even Trump was zooming in, you know,

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Speaker 9: virtually sort of hovering over the executives, including moynihan, who

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Speaker 9: was sitting on stage doing this q and A with

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Speaker 9: him and the audience. I think, according to my colleagues

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Speaker 9: who were in the audience gasp when the President said this,

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Speaker 9: it's really not exactly clear where it comes from. The

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Speaker 9: Nigel Farage sort of nexus is interesting because of course

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Speaker 9: Elon Musk is in the White House hovering over all

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Speaker 9: the things that President Trump does right now.

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Speaker 5: So yes, US banks do deny that.

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Speaker 9: They have obviously set some policies around the guns, so

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Speaker 9: that could be one of the references. But this one

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Speaker 9: was a really interesting one that I think none of

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Speaker 9: the audience was really prepared for.

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