>> you're watching daybreak: asia coming to you live from new york city and hong kong. annabelle: we are counting down to the opens in tokyo and seoul. haidi: the top stories, a mixed picture for asian trading. investors are reading for clues. also ahead, the s.e.c. giving the green light to spot bitcoin etf's more than a decade after the first proposal. plus, stress in china's credit market showing signs of ebbing after companies unveil payment plans for maturing debt. annabelle: we have the open at the start of the day fairly flat. it is a staggered start so if you minutes to be fully online, but futures have been indicating some gains. tracking moves on the wall street session and it is the countdown to the u.s. inflation

print due thursday. out of the sectors we are going to be tracking, pretty muted overall, one of the key ones will be in the materials space because it has been that five days slump we have seen in iron ore that has been interesting. around a 7% drop. we have seen all miners falling off the back. bhp seeing we care for another session. that is the state of play for aussie stocks as we come online again, fairly range bound at this point. what has not been range bound, let's take a look at this terminal chart. the sheer outperformance of japanese stocks over the course of 2023 is continuing into 2024. this chart, the topix and white, versus the gains for s&p 500 in blue, and mx ei asia-pacific index the bottom one in yellow. really underscores how much investors have logged japanese

equities over the last year. still seeing that coming through into the coming months. we are not expecting any sort of boj policy action. we are expecting a weaker yen helping the exporters. japan is standing out as a bit of a favorite. vonnie: there was a lot for u.s. investors to digest and that is before the main macro event even happens. the cpi data thursday morning u.s. time. it looks like u.s. futures are unchanged or mixed. investors no doubt still digesting the bitcoin announcement. after john williams spoke and reiterated the fed is done although it looks like there might be some time before the fed reduces rates.

we may get some evidence tomorrow although economists are looking for the cpi data to show inflation moved up a little from the previous month. in terms of bonds we are above 4% on the 10 year after williams spoke. will we are awash in oil and there is plenty of demand. bulls and bears are fighting each other right now. the main event today was after the closing bell in the united states when we had approval from the s.e.c. for those 11 bitcoin etf's to go ahead. we will start seeing some of those trading tomorrow. after a slow hour -- after hours start bitcoin is trading very close to $47,000 a coin. haidi: of course one of the main events, certainly a key event in the trading session today, was the bank of korea decision pointing to stay pat on policy and push back against

expectations it might join the fed in signaling rate cuts. for more we are joined -- the governor has been cautious in signaling against this idea of premature relaxing of policy. in light of some of the data we have gotten as recently as yesterday, what do you think about the possibility of a change at least in tone and communication? >> in my opinion is sickly the bank of korea will have a hawkish tone. even if we saw progress on the inflation front headline inflation is over 3%. much higher than the 2% target. and while we expect inflation to ease further throughout this year, it is true that there is high uncertainty around the inflation outlook. stressing difficulty in the last mile in the inflation fight.

separately come of the bank of korea is concerned about debt leverage of the private sector. having said that, as we expect the b.o.k. to peak in the third quarter. some transition into a lash -- less hawkish stance today. there is adjustment of the need to base -- raise base rates further. another possibility will be a change in the number of board members who are open to further rate hikes. vonnie: recently a construction company filed for a debt workout program and it raised concern about a risk in the property project financing area. how do you think that will affect military policy for the boj -- b.o.k.?

hyosung: they will take a two track approach or we can say the separation between monetary policy tools and financial stability tools while keeping the policy rate steady at 3.5%, the bank of korea might use other tools to provide equity to address concerns in the property sector. for example, the bank of korea could use market operations to provide 2% more rp's, or use its lending program such as foreign -- financial support program. in that way, the bank of korea will address potential stress in the market. while not cutting rates too early. haidi: we have also seen the

government announcing measures to address the slump and the property sector, difficulties in property financing to increase home supplies. what are the risks in this approach? hyosung: well, the government announced yesterday was quite comprehensive. i think it will definitely give some support to the real estate sector and property product -- finance. but there are many property development projects initiated with expectations of low interest rates and rising property prices with high leverage. but here we are. the interest rate is much higher. and the property prices declining.

and construction costs are also elevated. in general, the property development project is less developed -- profitable now. it will lead to more defaults in the property project, especially with higher leverage. so in my opinion, restructuring in the real estate sector is necessary or inevitable. so the question is whether the restructuring proceeds in an orderly manner or not. we will need to see how government policy will work out in that area. vonnie: hyosung kwon, thank you so much for joining us. hyosung kwon of bloomberg economics. for the first time u.s.

regulators approved exchange traded funds that invest directly in bitcoin. the s.e.c. authorized 11 funds to begin trading thursday. >> i am delighted that we are at the end of this saga. i know there are still pieces of it to go but this is a big milestone. vonnie: rebecca saying joins us now. talk us through the significance of this decision. we saw some trading in bitcoin after the decision and we are up to about $47,000 again. rebecca: this is a historic day but you may recall that this race started more than 10 years ago. the first filing for bitcoin etf happened by winklevoss brother more than 10 years ago. it is finally coming to an end. and today, 11 spot bitcoin etf will begin trading. this will be the first ever u.s.

spot coin etf. but we have never had 11 etf's filed and launched on the same day in the u.s. he will be very historic because we will have all of these etf issuers trading the exact same product and we expect a lot of flows and trading volumes to come in. haidi: we are seeing a fee war this week with all of these funds. who do you think might come out on top? rebecca: normally fee wars don't begin until the etf starts trading. what has been interesting is the fee wars started before any of the etf's traded. just yesterday blackrock was the latest drop fees. they initially launched at 30 basis points and then went down to 20 basis points and yesterday they dropped to 12. so it is interesting because we have a lot of people, and there are six etf's are being offered for zero basis points for the initial three to 12 month period. so this is significant because

we have never had fee wars drop so quickly, let alone to zero. there are six etf issuers including bitwise, wisdom tree, valkyrie, that are offering their etf for free for a certain time period, or until they get certain assets. this now makes it interesting, where a lot of people who have traditionally been in the virtual asset space they consider trading etf's because it is free now. a lot of the concern was wide when you to buying etf when i can just buy bitcoin directly. but this gives access to investors where fee is not a concern. ultimately the advantage is now you can get access into a listed exchange traded fund that is regulated. you can trade it on the new york stock exchange or cboe. so we expect this fee war to continue. it is not uncommon for an etf to lower their fee after the reach a certain level or competition gets more fears. we are starting with 11 etf's

tomorrow, or tonight i should say. but we could see more coming. it would not surprise me if we have other people come in later. we could see as many as 15 or even 20 spot bitcoin etf's in the u.s. as we get more products, fee will have to come down. so i could see these etf issuers maintaining the fee at zero. it will be interesting to track, because there is definitely a lot of hype in it. with the hack that has occurred, even more people are looking into this. with a lot of the virtual assets in crypto trading there has been a lot of fraudulent activity and hacking. now we finally have it in a registered form, so it will give people an opportunity to trade this in a registered, secure and safe way. haidi: bloomberg intelligence etf analyst rebecca sin there. coming up, our interview with bitwise asset management. before that, we will be speaking

with asset wealth management on why they believe the fed can spit -- can make the soft landing. this is bloomberg. ♪

vonnie: china's efforts to lower risk on government debt --

national deleveraging campaign is expected to curb spending on investment projects. john liu joins us now from beijing. what is going to happen this year? we have noticed the last few days that several companies are trying to proactively restructure. john: i think what we have seen is the government is taking lots of steps to make sure there is proof -- is plenty of liquidity in the system. we have the central bank pumping in money via medium-term loans. everybody is waiting for a reserve requirement cut again. and we have the mlf monday and there is growing consensus that will be a cut when we have that monday morning. the governor is making sure there is plenty of liquidity. we saw that from -- when they told investors they would repay their debts. part of how is they will get an

additional loan. they said part of the reason it will be able to pay some syndicated loans coming due this year is because it will be able to sell a bond with government backing. you are starting to see these efforts by beijing paying off at some point. vonnie: we are also see the new sources of funding. special treasury funding sources. is that going to be enough to make up any kind of shortfall? in the bigger question is how will they be used? we are seeing again a convergence of the corruption efforts again putting focus on local government debt and how it is being spent. john: oh, we had this story yesterday about one government official spending 21 billion dollars u.s. on what the government described as vanity projects. that is an ongoing concern. first and foremost beijing wants to make sure there is not a

systemic problem. we don't have a wave of defaults by developers. that would cause chaos in the financial system. that is something beijing definitely wants to avoid on top of that when it comes to corruption, that fight continues. the risk is it will cause some kind of policy paralysis. government officials worry whatever they do will come under greater scrutiny and may not decide to do anything. but first and foremost beijing is going to try and make sure there is not anything worst that happens in terms of debts. haidi: our next guest is favoring emerging markets including china. we have not been hearing that very often. let's discuss where the opportunities are with brian jacobson. we do love a contrarian call and we love any kind of semblance of hope we can attach when it comes

to the outlook for china. what are you constructive on and what perhaps makes you more positive than some of your peers? brian: part of it is over the last couple of years we first hear china is uninvestable and then you look at sell side research and a talk about how they want to underweight china and you should be thinking about emerging markets ex-china. granted there are a lot of macro concerns but they are growing at a decent clip. but these macro worries can give rise to micro-opportunities. that is what we are beginning to see. we allocated to the emerging markets oftentimes through active managers. gq g is an example of one of them we have used and continue to use. they were on bloomberg earlier. to identify some micro-opportunities. but it seems like everybody has thrown in the towel on china thinking it is dead money. but maybe that represents a good

opportunity. haidi: i like that. macro worries to micro-opportunities. so where are the micro-opportunities? which segments of the market, given how broadly cheap it is for evaluations, continues to sit right now? brian: where it is not likely is in the real estate area. but more likely in communication services and with consumer discretionary. we know that as far as, let's say, it's an election year in the u.s. and i am pretty sure candidate trump will be turning his ire on china, maybe mexico, who knows who else, so that could create volatility, especially for more of the manufacturing and export- oriented parts of the economy. but the consumer seems to still be doing ok. we did not see a massive consumer rebound coming out of the covid reopening. but it does seem to be getting some traction. not a lot of deterioration.

perhaps in the consumer discretionary area is where there are more opportunities. haidi: i am keen to get your views on japan. it was obviously a banner year, a lot of uncertainty ahead in terms of where the boj goes next, and whether a lot of the exuberance over a policy change and government changes materialized. at least on the technical side we are looking like maybe a little bit of a risk of a pullback for japan equities. because we are starting to see that sell signal for the topix. that is the line in blue nearing the 70 level, signaling overbought territory. we hit that in september and saw a fall of 25%, which is what you see in the yellow line. are you still finding compelling opportunities in this market? brian: not as compelling. and i love that shirt because one of the things we look at is trying to understand the fundamentals, the valuations,

but also the trading opportunities as far as what is the market telling us about is it the right time to allocate or not. and you do see some signals about perhaps being overbought. let's say you have the etf in the u.s., the ew j for japan, that is up 19% over the last year. if you look at it from its inception which was a late 1990's it has gone about nowhere. and so there are lots of pockets of resistance to more upside movement here. maybe the boj could be a catalyst that we could see a move to the upside. but if they are moving towards tightening i don't see how that could be a catalyst towards further upside. if anything, it would serve as a headwind if they try and eventually normalize monetary policy. haidi: obviously u.s. cpi is a

big one for this week it in december you alluded to the fact that you thought the market was getting too exuberant. has you are thinking changed in terms of a soft landing, whether the data supports expectations of fed easing? brian: i think that we might get a little bit of a surprise to the upside with the inflation numbers tomorrow. looking at the bloomberg information as far as distribution of forecasts, .2% is the median. but with some of the housing numbers, insurance numbers, maybe it could push it closer to .3%. it is not a huge miss, but it could be enough to make people re-question whether or not the fed is going to hike even the 3% the fed has projected. the market has moved from pricing in six rate cuts in 2024, to now around 4.5% to 5%. there will be what that -- that bow between the fed projections and what the fed is expecting.

it could create more near-term volatility but i would view that as a 5% to 7% pullback as being a good opportunity to allocate for a longer term. the fed is likelylast time theyd did some fine tuning. 1996, adn even 2019, it looked like it would be as soft landing. 2019 probably would have been except for the whole covid thing. haidi: that whole covid thing. brian jacobson, always great to chat with you, chief economist at annex wealth management. we have much more to come. this is bloomberg. ♪

vonnie: you are watching daybreak asia. the white house is backing legislation that would --

in order to help pay for the reconstruction of ukraine. president biden's support for the move comes with republicans in congress blocking more than $60 billion in funding for ukraine. they are concerned the u.s. is carrying too much of the financial burden as kyiv's counteroffensive stalls. the u.s. once ukraine to sharpen its plan for fighting russia's invasion as the war heads into its third year. u.s. national security advisor jake sullivan is expected to raise the issue with president zelenskyy in davos next week. washington's effort is the latest sign of friction between ukraine and its most important ally. plenty more to come right

>> my base case is that the

current restrictive stance of monetary policy will continue to restore balance and bring inflation back to our 2% goal. i will expect we need to maintain a restrictive stance of policy for some time to fully achieve our goals, and it will only be appropriate to dial back the degree of policy restraint when we are confident that inflation is moving towards 2% on a sustained basis. that was the new york fed president john williams on the u.s. central bank's monetary policy. a bank that has not been restricted is the bank of japan, and the dovishness we continue to see from policymakers that look -- is one of the reasons we have seen japanese equities rising so significantly. this chart looks at the rsi for the topix. and you can see we are nearing the 70 level, the line in blue. the last time we saw that in september we saw a significant correction for japanese equities.

so the question is whether this is a sell signal looming on the horizon, even though we see nikkei futures just opening, still pointing to further gains. that is one of the key areas we are going to be tracking today. take a look at this terminal chart because another key one we are going to be watching, as soon as the next hour, is the bank of korea. its rate decision is due, it will be the first bank decision in asia for 2024. the expectation is the b.o.k. is going to be standing pat at 3.5 %. this here would indicate it will be a full year since the bank of korea started to hold rates, if that decision comes through. the b.o.k. saying it does not want to relax its fight against inflation yet. really pushing back on that speculation. let's change on because the third thing we are tracking

today is what is happening with the prices of iron ore. just had that contract coming online in singapore. a little more weakness coming through. the sixth straight day of a slide come around 7% lost in iron ore. getting close to that 130 mark. you can see the pressure it is continuing to put on the aussie miners. declining 30 minutes into the session. haidi: i think that was the third thing. the fourth thing, maybe the top thing, are these price moves when it comes to crypto. the question as to whether this did turn out to be, if not a sell on the news kind of situation, but certainly not a trade exuberantly on the news that had been priced in. bitcoin accelerating some earlier gains, 1.7% higher although still shy of the $47,000 mark we were almost at. also a jump of 12% since the start of the year, more than a 21 to month high. but there is concern that given

some of the volatility in the gains seen into the run-up of this decision that perhaps it will be selling pressure. 150% gain in 2023. the fcc commissioner says regulators will scrutinize the bdf -- the bitcoin etf market and they must be transparent on their probe. she spoke with bloomberg's kailey leinz and joe mathieu. >> a fiduciary is supposed to look out for the interest of the investors that she is look -- working with. and that means taking into account the specific circumstances of that investor, the risk tolerance of other elements of that investor's portfolio. it is not a cookie-cutter. answer fiduciaries are paid to make good decisions that are appropriate for that particular investor. >> there were a few moments

yesterday when we thought this would be approved earlier. everything worked out with the twitter account at the s.e.c.? hester: it is. i think there was a statement that came out saying that we are going to be looking into this and working with law enforcement authorities to figure out how this happened, how yesterday's event happened. and i hope we get to the bottom of it and i hope we are as transparent when we explained what happened, as we expect the companies that we regulate to be when they experience a similar event. >> that certainly has gotten the attention of many on capitol hill. there have been many congressional republicans who have made their opinions known about the s.e.c. under this chair for some time who have called a lot of attention to yesterday's events. i would also point to a statement we got out after this. they maintain that while

legislation provides clarity remains necessary the steps today are a significant improvement over what they called sec's track record of regulation by enforcement. until that legislation exists, even with these approvals aside, should we expect regulation by enforcement to continue? hester: well, i have not seen much progress on also as a regulator setting out clear rules of the road when it comes to crypto products and services. that's been a complaint that i have had and others have had. we could, just as we changed our tune here, we could change our tune on that. so i remain hopeful that we will. that said, congress has expressed an interest in legislating in this area and i look forward to seeing their work in this area. they have a clear interest in figuring out which regulator should have authority in this area and i look forward to

seeing what comes of that. vonnie: fcc commissioner hester peirce. one of the firms to have received approval from the s.e.c. for their spot bitcoin is bitwise. joining us now is katherine dowling. congratulations. i imagine there are a few champagne bottles getting de-corked. but what is next? katherine: thank you so much for having me. it has been a whirlwind. it's an historic moment. we have been after this for many years. i could listen to her all day. but you are right. right now is when all of the issuers, everyone these to make sure they will not be the one who has the bone in the door plug. everyone has been making sure everything works and we are feeling really good, feeling really confident. we are also trying to take time to enjoy the historical moment

here for spot bitcoin etf. vonnie: 11 start trading tomorrow were in the next day or so. i am curious what your target will be for inflows. what will you need in order to survive? i will point out you are the lowest fee at the moment, 20 basis points after the first six months. katherine: and we are very happy to be in that lowest position. we do believe that although the estimates are all over the place to be sure, we do believe that there is a number of -- a lot of investor interest out there. we base that on historic fact based on another -- a number of etf issuances in the past. we are led by matt hougan and he has been talking to advisors for years now. we feel that we have a really good pulse on the interest out there, can we feel we are in a great space and excited to get this launched tomorrow. vonnie: one of the things about

etf's is money can trade extremely fast. and there is a bar. of the 11 that may start trading it is not for sure they will all exist in a year. what would you need in order to keep existing? katherine: you do want to be out there in the field and talking to advisors. we have relationships with thousands of advisors. we will be out there, our sales team will be telling them about our product, about the fact we are crypto specialists, we have been in this for many years. we will be having that dialogue now that we have effective registration statement. we can be out there explaining how we are different, and then we will see what happens with the entire field. when you are right, there are a number of us out there, but that is really good for investors. you don't need to have only one. you get better price point and differentiation. then it is up to the investor to choose and look and see the market and decide what is right

for them and what will be the best choice for them to add some bitcoin exposure to their portfolio. because many have been waiting for this. vonnie: bitcoin itself traded above $47,000, it is back at $ 46,000-plus. coinbase up more than 6%. if you were somebody at home, or an institution, how would you value a bitcoin right now? what is fair value? katherine: obviously the price right now has a lot baked in, and it has been fluctuating around the margins. some of the fake news has caused ups and downs around it. but i think we are pretty fair in the market right now. can we will see as we go forward interest with the etf and i think that will move it forward. i think we will see a big year for bitcoin in 2024. vonnie: i am sure you do, but sometime etf movements have absolutely nothing to do with bitcoin movement.

not unless it is a reflection of the actual value of bitcoin. i mean, how does the value of the buying and selling of your etf, how will that be reflected in what bitcoin itself does? katherine: basically what we are going to see is, we think this will create even more interest in bitcoin. and we think the price will rise from there based on interest. that is what we see happening. vonnie: there may have been red flags that gary gensler is scared of. we know he is against exchanges at least. he said that today, that basically this happened because of the grayscale court case, that that was the only reason because of that court case and its findings, that is why the 11 had to get the go-ahead. what are some of the red flags that gary gensler does not like? katherine: what we have seen from gensler, from the chairman, is that he has some concerns around the exchanges, the

bitcoin exchanges, feeling there is not enough separation between the different business units. that is something he has been saying for a long time. he's definitely behind the scenes having conversations with them and trying to have a dialogue about how to make that move in a direction where the s.e.c. will have more comfort will how -- with how they work operationally. vonnie: all right, looking forward to seeing you again soon. it is off to the races, or get the games commence, or whatever you want to say. katherine dowling, cco at bitwise asset management. coming up, one of the biggest players in taiwan's life insurance industry is optimistic ahead of a looming presidential election. our exclusive would nan shan life insurance chairman chung yin, next. this is bloomberg. ♪

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when you automate sales tax with avalara, you don't have to worry about things like changing tax rates or filing returns. avalarahhh ahhh electricity and gas restrictors. sources say the review of their 58% stake is at an early stage. a transaction is sent to value at around $2.2 billion u.s.

morgan stanley has a limited 155 employees to managing director, a smaller number of promotions for the firm's top rank than las t year. women account for 30% of promotions, and increases the overall share of female mds at the bank to 26%. huawei has ended its in-house operations in washington after spending tens of millions of dollars trying to win over u.s. policymakers. bloomberg news has found that while way's two -- that huawei's last two -- they failed to reverse a ban on selling its products in the u.s. vonnie: taiwanese voters head to the polls saturday to pick the next president. one of the largest players in the life insurance industry is optimistic about business. chung yin spoke with us

exclusively about the prospects he sees in the sector. chung: we can now offer a full range of products and that will be very helpful. by offering that range of products it will help with our market share. stephen: it has been a tough couple of years particularly for taiwan insurers. what is your outlook for 2024? chung: i think i have a very positive outlook. we believe the fed will have to cut rates. and that would certainly help insurance sales. because a higher interest rate environment is more difficult to sell insurance products because the comparative. stephen: what kind of premium increases can you expect in

addition to the improved interest rate environment? chung: we don't actually have an exact number but we are looking at a good increase. stephen: do you think the worst is over for this interest rate risk? i was seeing a note earlier this month essentially saying this will still be the biggest risk to the taiwan insurance industry. chung: i wish it was over. it is difficult to pin down whether the situation is over and whether we can completely get over this high interest rate environment. stephen: there has been talk in the past, whether it was back in 2009, but you also applied for an ipo in 2019, which were in ann koh -- which financial regulators rejected. you did not meet the requirement of 5.5%. are you revisiting the opportunity to potentially have an ipo? chung: capital injection is certainly an issue we have closely looked at.

our goal is to go ipo. it is on our agenda. but at the moment we don't have an exact timetable for that. stephen: is the market looking better? we have seen since the end of 2022, the taiex is up 24%, and the economy seems to have a bit of a tailwind. is that your assessment right now? chung: yep. i think if you look at last year, especially the fourth quarter, taiwan's export economy is doing really well. and the y on y growth exceeded everyone's expectation. so i look at this year also with a positive outlook. i think taiwan's economy will do good. stephen: we are not talking politics today, but right now politics is at the fore with the presidential election coming up. i will not ask you about that, but the offshoot is, what kind of support from any government,

whichever is going to take office, what would you like to see to help the insurance industry here? chung: the elephant in the room is the new capital regime especially. the whole industry has really specific history special to taiwan. financial regulators are working really hard with us and they want to make sure there is a smooth transition to a new regime. and the chairman has made it very clear that the whole regime is for everyone. and that is not to disrupt anyone's operation. i think that was a very good and important promise that we have and we believe the financial

regulator will really help us to transition into a new regime and make it a more viable operation. haidi: chung yin speaking exclusively with stephen engle in taipei. we will have our continued special coverage from taiwan all week into the lead up to the vote on january 13. those full results and analysis from monday. watch us live and see past interviews on our interactive tv function tv . dive into any of the securities that we talk about and join in on the conversation as well and sent us instant messages during our shows. this is for bloomberg's subscribers only. check it out. it is at tv . this is bloomberg. ♪ hey, doc, quick question. okay? if you had to choose, would you give yourself a root canal or run payroll? run payroll, no question.

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haidi: partner sk expects ev sales to be sluggish this year but they remain bullish when it comes to the long-term. the chief commercial officer spoke with shery ahn at ces in las vegas about navigating market fluctuations. >> this year going forward for

2024, we think it is going to stay around for a while. but long run as you know our goal through the end of the year, or the end of the decade, it remains strong and remains our plan. shery: in order to get to the end of the decade would you consider adjusting production levels given demand levels? >> that is a given in the automotive industry. battery was not so much automotive yet but then it is becoming more of an integral part of our business. we just need to be flexible relative to the market situation for the time being. but long run it is no doubt we will reach the goal. shery: it includes production cuts? >> not cuts. we manage our production schedule relative to the motors. shery: some geopolitical challenges we have seen as well, china restricting some critical

minerals that need to be put into ev batteries. what are your expectations for how that will affect your business? >> it is obviously a challenge. but we always manage different policies and regulations around the world. so it is nothing new. we just need to find the better ways to qualify products to each respective regulations. when it comes to ira, we have obviously started our plans before covid and we ramped it up right before covid. now we are running at full capacity. and then ira is definitely helpful for our business. obviously a new regulation is a challenge but we will definitely manage it through as well. vonnie: other stories on elected vehicles today, volkswagen's

finance chief says europe's biggest automaker remains flexible on how it spends money between electric and combustion engine cars. the cfo says the company is seeing some reluctance on ev's in europe and perhaps the u.s. they highlighted the complexity of the electric transition. >> it is not an easy shift. about one third still goes into projects like keeping our combustion engine cars competitive. essentially the last generation. so we will have a range of very competitive and great electric cars, and we will also have a range of still very competitive combustion engine cars. it's up to the customer to decide. this is flexibility. the strategy is a little more costly, but it gives us the flexibility in the years to come. haidi: these are some stocks we

are watching when trade opens in korea and japan shortly. crypto related shares are in focus. the s.e.c. approving the exchange of funds that invest directly in bitcoin. suzuki will build a second car plant in india. also watching rocco tan expecting to report a loss of $109 million for the fiscal year that ended in december. some big names releasing earnings today. the market opens our next. this is bloomberg. ♪

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>> we are counting you down to asia's major market opens and it looks like it might be a causative day -- positive day in asia. a lot to get through before we even get to the u.s. cpi data. a lot of other central bank news as well. haidi: absolutely including the bank of korea of course later on this hour and that is the first decision of an asian central bank in 2020. just focusing on the guidance and cohn from the b.o.k.. they have been cautious about the idea the bank would be in any rush to follow the likes of the fed. annabelle: that's right. we are counting down to the open for japan and the start of trading in korea. at the start of the day it is a focus on where japanese stocks are heading because they have indexes hitting 34 year highs. we are going back to levels before the economic about burst

in the early 1990's. you can see the nikkei coming online 1.2% to the upside. outperformance over the course of 2023. a lot of investors are saying you cannot expect it to continue for a variety of reasons and one of those is the boj likely to stay dovish. the yen holding about the 145 mark. cash treasuries holding above 4%. adding to the fed speak this week is fed williams saying it is high enough for the 2% goal. as you said we have the b.o.k. decision that could be due this hour. we also had trade coming data for the first 10 days of january. the big watch on exports and we saw that rising 11.2% falling fractionally and continuing to watch samsung shares a little under pressure. a big block trade crossing yesterday. haidi: economists we have

surveyed believe the bank of korea is poised to stand pat on policy and push back against expectations and might join the fed in signaling rate cuts. we have heard caution come from government read against premature loosening and signaling of these expectations changing. hyosung: so, in my opinion basically the bank of korea will keep its hawkish tone to this meeting. because as you mentioned, the governor stressed difficulties in inflation fighting because there is a high uncertainty about the pace of inflation due to the middle east and the rises in food and energy prices.

but in general there are growing risks of difficulty in the property sector. this means the next move will be cut anyway and the question is only when. there will be a transition into a less hawkish tone of the b.o.k. today. one possibility is there is adjustment in the stated expression of the need to raise the base rate farther. another possibility is a change in the board members who are open to further rate hikes. vonnie: what will be more important for the b.o.k.? we got fresh data for the first days in january. imports fell 8.3%. will domestic data be more

important than what the federal reserve does and when the fed starts to cut? hyosung: the federal reserve cut will be a very important factor of the bank of korea. but that is just one factor. as they stressed several times, the bank of korea monetary policy will be determined by domestic factors. and currently, inflation is in retreat. there is a higher certainty around pace of disinflation. in addition the bank of korea has concerns of excessive leverage of the private sector. even if the fed cut rates in march as the market expects, in

my opinion the bank of korea will wait to see further progress in inflation and risks in financial stability so it will start cutting in the third quarter, in my opinion. vonnie: all right. thank you so much for joining us. investors gearing up for the u.s. cpi print coming later thursday. let's get to the market action with mark cranfield. we will get through the b.o.k. and most likely they will stand pat but then we get to the u.s. cpi data. will we get a surprise and see inflation rose more than we even thought it might? mark: that is not the consensus. consensus is for a slight softening in the core number, which is the most important thing. the fed is much more interested in what court inflation is doing.

even these cpi numbers are not the big story for this week. the big story this week is debt issuance. there is a mountain of debt being sold around the world. the u.s. and europe as well. the u.s. of the biggest week ever with over 100 billion euros of bonds being sold this week. it is just as well that the comments were slightly dovish. they need all the help they can get to get through this period, where they are absorbing a lot of government bond sales. the cpi numbers in a way are a little bit of a sideshow. people just need to digest this enormous amount of bond sales. a much bigger story in terms of inflation is the data which comes in two weeks. it was those core pc numbers which got the fed excited back in december. if we get another print on an annualized basis printing below

2% as it did in the last one, then people will get very excited about the march potential for a rate cut from the federal reserve. this week is all about getting through the supply, making sure the cpi numbers are not too far out of line. no one expects big drama from them. looking ahead to these core pce numbers they justify the first red -- fed rate cut. haidi: what sort of an impact could we potentially see on the yen? mark: in terms of the yen it is really being driven by this conflict between the pace of the potential fed easing and the fact the bank of japan seems to be very slow in wanting to tighten policy. at the beginning of the year there was a little bit of excitement there could be an early bank of japan decision. that seems to be pushed back already. july looks a little more the consensus now among estimates.

so that has really pushed the yen into the back picture here. the aggressive buying of the yen that we saw in december is starting to unwind. we probably see a bit of range trading between dollar-yen for a while as people weigh the difference within the fed and the wake of japan. neither are set to move this month. but within 24 hours we have a bank of japan meeting and a fed meeting. you are likely to see a lot of option positions around those two days and people will be thinking there is a slight chance you get a fed move then which will benefit the yen. more likely it will be further down the road. this indecisive trading in the end will probably extend for a while. haidi: mark cranfield there. coming up we will be getting this year's tech outlook with nasdaq ceo adena friedman from the sidelines of ces in las vegas.

that is next. this is bloomberg. ♪ thanks to avalara, we can calculate sales tax automatically. avalarahhhhhh what if tax rates change? ahhhhhh filing sales tax returns? ahhhhhh business license guidance? ahhhhhh -cross-border sales? -ahhhhhh -item classification? -ahhhhhh does it connect with acc...? ahhhhhh ahhhhhh ahhhhhh

>> i am ed ludlow live in las

vegas at ces. i just stepped off stage at a keynote with the nasdaq ceo and president adena friedman and i am delighted to say she has followed me to the studio to keep the conversation going. what a ces it has been. let's start with the news. the s.e.c. approving bitcoin spot etf. the nasdaq will be one of several exchanges that lists these products. your reaction to the news, but what it means for your business as well? adena: we are proud to partner with blackrock and have their etf's listed on nasdaq. what really tells you is that from a regulatory point of view there has been maturing of the bitcoin market the point where the s.e.c. has now simply approve these new vehicles and allow retail investors to access bitcoin. they don't have to buy underlying bitcoin but they can

have an opinion about the trends in bitcoin and express themselves in a regulated market, which of course is nasdaq. these instruments are highly liquid and they have ready access to an investable vehicle in the space. we are excited to be there partner. ed: there are cerebral debates about bitcoin, about whether it is a risk asset, and asset class , if it is not come if it is a store value. is the nasdaq approach that this development moves towards a deeper focus on crypto as an asset class? adena: i have to look at it differently. we have etf's that reflect a lot of different instruments and asset classes whether it is commodities come equities, bonds , other instruments. as long as they are liquid and have a solid underlying price mechanism which now the s.e.c. is saying underlying market for

the etf and they are proving the etf. that is an interesting signal. i would say that our job is to create products. and then to be the listing exchange for the index products that allow investors to invest in all sorts of tradable instruments including bitcoin. ed: final question on this subject. let's go back 24 hours almost. an s.e.c. x account posts, we now know that it was an unauthorized post, a hack. we are looking into it. but twitter, x, have explained what they believe happened. just as the ceo of a leading exchange, explained to me what it was like for you, given our bloomberg audience had a similar experience. adena: the behaviors in the markets really came from looking

at anything related to bitcoin itself. the underlining bitcoin markets and any companies that had that underlying asset class as part of their business. for us it is a matter of making sure we think about more generally what protections we put in place as more technologies are used to to drive trading but as more information is being used to direct people and investors. we look at it from a protection perspective. first of all we want to think about, as ai comes more into the markets, how we regulate that appropriately. we have expressed interest in that. what kind of smart regulation can we put in place, but also if something were to come into the market we have circuit breakers and the ability to cut off any premarket participant that may be acting in an unusual way. we also have to make sure that as ai becomes a bigger part of the ecosystem, how do we make sure we protect investors in the

process. ed: we have technology on the brain all the time, and we are speaking with adena friedman, ceo of nasdaq. nasdaq is a technology company. true or false? adena: true. ed: why? adena: we obviously have a wonderful foundation as a market operator and we are really proud of that. and we leverage very advanced technology. ed: ai principally at the moment. adena: but as we broaden our scope we provide great technology that enhances liquidity, transparency and integrity. we provide market technology to 130 markets around the world including many in asia. we also provide risk management and regulatory technology to banks and brokers around the world. we also provide anti-financial prime technology to banks around the world. as we have been looking at the use of ai we are really focused on how can ai be used to protect markets more effectively, root

out criminal actors and use large language models and a large data set to be more effective and improve the integrity of the system. ed: can you go into detail on the underpinnings of what you are doing? are you building the llm's yourself, or who are you working with if you are not? adena: we are not building them ourselves. we are working with the large language models that exist today. we have certain products we are working on and certain products and capabilities we are working on with microsoft and openai. as we think about using technology on our business. it is one thing to put it on our products. we have tools that will become much more efficient with ai. they also use algorithmic ai to root out criminal behaviors.

we have very specific models that we used to predict potential criminal behavior. generally you cannot have a copilot and other copilot capabilities will be what we focus on. ed: we took a broad look at financial and capital markets on stage. we talked a lot about north america and i wonder about particularly in asia, our markets moving at the same speed globally? are there themes unique to any market this year that are different to others? adena: one common thing we have seen across markets and market operators is they want to have access to the most advanced technology available. we have been focused on moving more of our capabilities into cloud work with a lot of market operators on how they can move their markets to cloud. we just moved our second to aws outpost and we are working with other markets that are deploying

markets in the cloud using our technology. or they are thinking of a similar model. it is definitely a big trend, how to modernize the markets and leverage their data more effectively, how to bring ai into that so it can be more innovative within their own markets. and of course in terms of companies coming to market, it depends on the economy. there are certain vibrant economies that will see a better high-yield environment this year including nasdaq and the u.s. but every economy is different. ed: we just have 30 seconds. summarize 2024 for me? adena: cautiously optimistic. cautious is a complex world. optimistic, a lot of the economic unknowns are more known. we have falling inflation hopefully, falling rates over time. ed: adena friedman, it has been great spending time with you here in las vegas at ces. adena friedman there, president and ceo of nasdaq. back to you.

haidi: plenty more to come here on daybreak asia. this is bloomberg. ♪

vonnie: for the first time, u.s. regulators approved exchange traded funds that invest directly in bitcoin. the s.e.c. authorized 11 funds to begin trading on thursday. >> i am delighted we are at the end of this saga. i know there are still pieces of it to go but i think this is a big milestone. vonnie: rebecca sin joins us now. 11 have been given permission to go ahead. will they all survive?

what will be the minimum bar in terms of funds they will need in order to survive? rebecca: this is an interesting question because the s.e.c. has approved 11 etf's and not all may survive. what is interesting is if we start at the largest, the grayscale: unitrust, this will be converted into an etf and they have the largest assets under management. roughly 29 billion and assets. blackrock has secured $2 billion in assets. this may be one of their largest launches ever. often times it is not uncommon for etf's to secure assets under management or funding. it is called seed capital they get from investors to head of the launch. we have heard that a lot of the other etf issuers like fidelity and bit wise have all secured their own seed capital but we don't know how much. so this could be one of the largest etf launches globally. if we take into account how much grayscale has with that $29

billion plus, we can easily see more than $30 billion in assets under management for etf's on the first day of launch. it will be a historical moment across all 11 etf issuers. what will be interesting to see is how many actually survive. on day one we are starting with 11 but i could see 15 or even 20 etf's coming. often what happens in the etf space is consolidation. you will see etf issuers buy other funds. this could happen because there are so many etf issuers. you could see someone like bit wise being acquired by one of the larger etf issuers. haidi: you have already talked about consolidation. what are some of the broader risks? rebecca: one of the questions we get asked a lot is what is the differentiating factor across the 11 etf's. ultimately it comes down to where they trade on. some are on the u.s. stock exchange and others are on the cboe.

some of them have different authorized artistic pence. the liquidy providers. what will be interesting is to see how much volume goes across all of the etf's. because there are 11 listing they will inevitably get different flows. i would expect that from the grayscale bitcoin trust to etf, we will see a lot of outflows for the etf's. this etf is priced at 1.5% for management fees. grayscale has the largest and most expensive fees. the reason why they have kept it so high is they had the scale. we are starting at the largest, we are starting with $29 billion in assets. they were previously charting 2%, they lowered it to 1.5%, but i don't think that will be enough to keep assets there. you have other etf issuers offering the product for free. so i expect to see a lot of outflows coming out from grayscale. and you may potentially see some

of that outflows going from grayscale to some other etf issuers. what will be interesting to see today is how much trading volume is going through across all 11 etf's. i also expect that some of them will have significantly more flows. for instance blackrock, they have the 2 billion, you will see that go out into the open while some other ones may see a couple hundred million. it will be interesting to track and see what happens. ultimately it is a historic day for the crypto market and etf's because this may be one of the largest launches ever globally across 11 etf issuers with more than $30 billion under management. haidi: it is fascinating. bitcoin itself is up about 1%. we will be watching those launches in the coming hours. that is rebecca sin. vonnie: let's have a look at what is going on in terms of crypto-linked entities. let's get to annabelle in hong

kong. annabelle: we are tracking the investor reaction to the news that came through the s.e.c. approving spot bitcoin etf's for trade in the u.s. huge reaction, more notable in the korea-linked names. korea is very robust. a lot of retail participation as well. we are seeing investors piling into these names linked to that sector. that is the stated play for the stocks here. let's take a look at what else is trading in the session so far. another group of stocks moving to the downside are these names that are samsung and samsung affiliates. what happened was yesterday a block trade, or number of block trades crossed the wire late in the day. and these are samsung, samsung affiliates. the li family is believed to be behind us, raising about $2 billion. shares are being offered at a discount as much as 5% to the wednesday close. so looking perhaps, the lee

family, to raise some capital here. haidi: let's take a look at how futures in europe are opening up the moment. of course we continue to watch the exuberance in it comes to bitcoin and their etf approval. this is the picture of course. we are getting into the point in the week where the intensify focus on the u.s. cpi print as well as they want to watch. a little more optimism going into today. up by about .3%. seeing a little bit of upside when it comes to futures. investors are a in wait and see mode in terms of gauging the next steps for the

>> taking a look at some of

these australian trade numbers that are crossing the bloomberg. a question as to what this -- whether they have truly done. some of the inflation numbers we have been getting. imports falling 7.9% month on month. exports rising 1.7% month on month. the exports number is a big acceleration from the .4% from the previous month. imports also picking up from the trend we saw in the previous month. we have a november trade surplus of about 11.5 billion aussie dollars. we have seen big flows contributing to that overall exports number. the question is how all of this potentially weighs in.

a sharper than expected slowdown in inflation we got this week adding to that. when it comes to the trade front, quite a bit of strength in terms of the export economy. vonnie: yes, exactly. as we can see from those numbers , australia doing pretty well. china's efforts to lower risks are likely to weigh on economic growth. a national deleveraging campaign is going to curb spending. our reporter joins us from hong kong for more. we know the government is likely to do something. what is the outlook for the entire year? is it still bleak? >> for the entire past year, the beijing government has been trying to curb the local

government from borrowing more in order to lower the leverage. the debt has been a big issue and it has been weighing on the economy. we saw financing lowering to a four-year low. that is $208 billion. that will weigh on investments. the priority will be to pay back debt instead of investing in new projects. you would see less infrastructure spending and that will eventually trickle into the economy. vonnie: we also have some different sources of funding. as well as more funding for policy banks. how is this funding likely to be used? it does not fill the gap that will be left. lorretta: there has been a special quota given to these local governments to essentially

swap their so-called hidden debt into official government debt to lower the hidden debt risk across china's regions. that quota since last year has been quite minimal compared to the local debt outstanding. there will be a new quota allocated to the local government. there will be no numbers released in march. that is one indication the market is expecting to see how much effort the government will put into trying to help the local government refinance debt. vonnie: some companies are being preemptive. i talked about restructuring earlier. putting out the terms, being transparent about how they will repay their loans. lorretta: that is right. in a way, it is quite similar to how the whole debt cycle is happening in china.

whether it is local government or corporate reprioritizing paying back debt. we are seeing in the span of 24 hours three major companies, two of them property developments in china, letting out their refinancing plan for 2024. talking about how it will repay around $1.4 billion of debt in the offshore market this year. there is a loan for a private developer in china that has been holding up quite well in the real estate crisis. seeing it will issue more bonds and loans to repay the debt. these companies are in survival mode, trying to convince investors they are trying all they can to refinance, not to default on their debt. vonnie: thank you so much. that is lorretta chen. citadel securities has made a

nonbinding offer for the credit suisse offer in china. it is the only global financial firm to submit a bid. citadel securities, the only global bidder for credit suisse's china unit. many other financial companies have been retreating from china. this is giving an opportunity. the firm put in a bid late last month, according to people familiar with the matter, that ranged between 1.5 billion and 2 billion. that is up to $250 billion. they had been seeking the higher end of that range. we will see how this progresses. as of right now, citadel is the only global bidder for credit suisse's china unit. haidi: to politics now.

taiwanese voters had to the polls this saturday to pick their next president. one of the largest players in the island's $1.1 trillion life insurance industry is optimistic about business. the chairman spoke with us exclusively about the prospects he sees in the sector. >> we can now offer a full range of products. that is very helpful. our customers have the need for investment. i think by offering that range of products, it will certainly help. >> it has been a tough couple years with the interest rates cycle in the u.s. with the hikes , particularly for taiwan insurers. what is your outlook for 2024? >> i think i have a very positive outlook. we believe the fed will have to cut rates. that would help the insurance sales.

in a higher interest rate environment, it is more difficult to sell insurance products because the comparative yield they can get from other products. >> what kind of premium increases can you expect in addition to the improved interest rate environment? >> we do not have an exact number but we are looking at a good increase. >> do you think the worst is over for this? i saw a note from fitch earlier this month saying this will be the biggest risk to the taiwan insurance industry. >> i wish it was over. it is difficult to really pin down whether the situation is over, whether we can completely get over the higher interest rate environment. >> there has been talk in the past, whether it was back in 2009, you also applied for an ipo in 2018, which financial

regulators rejected. some of the ratio to equity did not meet the requirement of 5.5%. are you revisiting the opportunity to potentially have an ipo? >> capital injection is an issue we have to look at. last year we have -- that would help capital. our goal is to go ipo. it is on our agenda. at the moment we do not have an exact timetable for that. >> is the market looking better, though? we have seen since the end of 2022 that it is up 24% and the economy seems to have a tailwind. is that your assessment right now? >> yeah. if you look at last year, especially the fourth quarter of last year, taiwan's export economy is doing really, really well. yoy was exceeding everyone's expectations.

i am looking at this with a positive outlook. >> we are not talking politics today but right now politics is here with the presidential election coming up. i will not ask you about that but the offshoot to that question is what kind of support from any government, whichever will take office, what would you like to see to help the insurance industry here? >> the elephant in the room is the new regime. as an insurance company, the whole industry has a specific history special to taiwan. i think the financial regulators are really working hard with us and they want to make sure anything smooth transition to the new regime. the chairman of the fcc has made it clear the whole regime is for

everyone and it is good and it is not to disrupt anyone's operation. i think that was a very good, important promise that we have. we believe the financial regulator would really help us to transition into a new regime and make it a more viable operation. haidi: that was the life insurance chairman speaking exclusively with bloomberg's asia correspondent in taipei. we have ongoing coverage all week in the lead up to the vote on january 13, with the full results and comprehensive analysis from monday. volkswagen's finance chief says europe's biggest automaker main flexible on how it spends its money between different engine cars. the company is seeing some

reluctance in europe and in the u.s. engine interview with bloomberg, they highlighted the complexity of the electric transition. >> what i said about 1/3 still goes into projects like keeping our combustion engine cars competitive. we will have a range of very competitive electric cars and we will also have a range of still very competitive combustion engine cars. it is up to the customer to decide. the strategy is a little more costly but it will give us the flexibility in the years to come. haidi: vinfast said it is working to qualify cars for u.s. tax credits when this north carolina production starts in 2025. the plant must be up and running

on time. it has proved tough even for automakers that have ed production in the u.s. volvo's second largest shareholder geely has redeemed bondholders with shares over the past months. geely reduced its stake from 8.2% to 6.8%. geely is controlled by a chinese billionaire who said its voting strength remains largely unchanged. let's get to -- we inch ever closer to the bank of korea decision. annabelle: i was just thinking about the host of things we have going on. it did not come to my mind that we are just a few minutes out from the decision. so much has happened in the market this morning. japanese equities this morning,

extending another session. the topics, the nikkei trading at 34-year highs. the investor exuberance around the benchmark or benchmarks over the course of last year appears to be translating so far into 2024. things like the boj remaining dovish. there is also japan that could benefit from the investor outflows from taiwan. every single sector so far trading in the green. the question of course is what brings it unstuck? that could come down to the technical. the topics this morning a half-hour into the session has already moved above the 70 mark that does typically signal and level on an rsi basis. that is a sell signal we saw previously flashed in japan. at that point in september we did not see a big cool down in topic shares overall.

the focus on what is happening in korea. we have the be ok decision that is due possibly in five or six minutes. the expectation is we are likely to see officials there holding for another meeting. vonnie: more breaking news to come right here on daybreak: asia. this is bloomberg. ♪ thanks to avalara, we can calculate sales tax automatically. avalarahhhhhh what if tax rates change? ahhhhhh filing sales tax returns? ahhhhhh business license guidance? ahhhhhh -cross-border sales? -ahhhhhh -item classification? -ahhhhhh does it connect with acc...? ahhhhhh ahhhhhh ahhhhhh

>> by base case is the current policy and it will continue to restore balance and bring inflation back to the 2%. i expect we will need to maintain a restrictive policy for some time to fully achieve our goals and it will only be appropriate to dial back the amount of policy restraint when we are confident inflation is moving toward 2% on a sustained basis. haidi: president john williams. take a look at the markets as we had closer to the bank of korea decision. looking for a shift in tone. the messaging from this decision as the expectations are set clearly in the direction of no major change from the be ok. they have been on the extra cautious side when it comes to pushing back against the idea of

the communicating rate cuts. a broad-based rally. bitcoin is staging a bit of a rally. we are still keeping an eye on japanese equities and whether a sell signal is developing. it does look like it is over level. the last time we had that in september we saw the market falling quite significantly. potential uncertainty for japanese equities. the boj about .2% higher. australian stocks up by about .5%. strong export numbers coming. let's get back to the bank of korea decision. it will be out anytime now. min joo kang is a senior economist at ing. when you look at the numbers yesterday and the whole body of

the data, cannot be ok desk in the bok afford to be patient? min joo: the market expects the bok to deliver a hawkish old at today's meeting. inflation remains above 3%. thanks to the recent recovery of the export. thirdly, the bok is concerned about the fast pace of the private sector. for these reasons, we believe the bok will continue to have tight monetary conditions.

haidi: there are some pockets of stress developing. is there in the shorter term increasing concerns about the state of bankruptcies across real estate? do we see the bank of korea taking that into its considerations? min joo: the rising default risk from the b.o.k. for today's meeting, we do not expect any dissent. a few members could voice up about the rising risk in the property market. if so, the bank of korea will likely respond to it with using their facility lending programs and other microlevel policy measures.

haidi: we are just getting the bank of korea decision now. sorry to interrupt. leaving that rate as expected. economists whisper to -- economists we spoke to forecasted holding the rate at that level. the more interesting thing will be the communications and the town to see if there is any shift from the governor and his colleagues. min joo: correct. that is what i said earlier. we have to listen to how the members stance shifted from more easing. at this moment, the current liquidity issue is still controllable. however, if something goes wrong, probably the government will step in, as well and the b.o.k. will respond. however, we believe the b.o.k.'s

first priority for now is more inflation and stability. they are going to use more microlevel policy tools first. haidi: when do you see the b.o.k. potentially starting to reduce rates? will it be in the third quarter of this year and what are the risks you see potentially moving the timeframe to something we could see sooner? min joo: we believe the inflation path is the most important factor for the b.o.k. to deliver its first rate cut. what you are seeing is because of the base effects, we will see inflation soon come down to the 2% level for january.

there is still a significant amount of uncertainty in the inflation path forward. for example, the middle east and europe. we may see some post push inflation returning stronger-than-expected in the second quarter of this year. various measures. however, our best case scenario is inflation will stay in the 2% range by midyear and then go down to the 1% level by the end of this year. hopefully the b.o.k. will start thinking about the rate cuts in the second quarter. i think it is a matter of time. vonnie: we talk about the lag effects of monetary policy in the united states. the b.o.k. has been on hold for

a year at this point. we are seeing the impact on the labor market. the finance minister saying there could be as few of 1/3 of the job growth we had seen this year. what does that do to consumption? min joo: yesterday's labor number was pretty weak. i think it was partially because the labor participation rate was rising more rapidly than losing jobs. this is also one month bigger. i do not think it will have much impact on the b.o.k.'s decision-making. what we are concerning is there will be no future -- the real estate market. we are seeing rising burdens on

consumption from the house. it will probably dampen the consumption. vonnie: it is not just real assets, right? it is also the market. korea has lagged other markets substantially. in a year where we have seen markets up 20%, 25%, it is not that much. min joo: yes and also that is what we are seeing, a liquidity shortage issue recently. what we believe is if things get worse, we believe the government will step in to stabilize the market. i do not think it is going to trigger any kind of substantial, systemic -- higher costs and ongoing sluggishness.

it will also burden investment, as well. however, we believe at this point it will be boosted by a global semi conductor demand. vonnie: thank you so much, min joo kang. thank you for joining us. the bank of korea remaining at 3.5%. that was min joo kang, senior economist for south korea and japan at ing. you are watching bloomberg daybreak: asia. stay tuned. our market coverage continues as wart the tradinghong kong.

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