joumanna: good morning, this is "bloomberg daybreak europe," i'm juma never said she in dubai. asian stocks gained, kicking off a week dominated by data including the fed's preferred inflation indicator. israel is pressing ahead with operations in the southern gaza city of rafah, despite a u.n. court ruling. g7 finance chiefs blast china's trade practices and written to protections for their economies. we will bring our exclusive interview with the french finance minister. >> we have an issue with the economic model in which china is producing more and more cheaper industrial devices. it could be a threat not only for the eu, not only for the

u.s., but the global world economy. joumanna: good morning, again, this is joumanna bercetche in dubai standing in for tom mackenzie, it is a u.k. bank holiday. we will take a look at how key equity futures are trading. as you can see, all of the futures are opening slightly in the red this morning. moderate losses on these boards, after a better wall street friday, we saw the essence end up 0.7% higher, nasdaq up 1%, investors cheered on by slightly lower-than-expected inflation numbers and the university of michigan sentiment indicators. asian market boards this morning. we are keeping a close eye on japan. some interesting commentary coming through from the bank of japan governor ueda. asia-pacific actually up 0.5%, coming off a week of losses last

week, chinese indices up 0.3%. let's get to that bank of japan commentary. it had been driving some of the sentiment overnight with the bank of japan governor suggesting cautiousness was needed in order to cement inflation expectations at 2%. >> we have made progress in moving away from zero and lifting inflation expectations. but we must now rancor them at the 2% inflation target. we will proceed cautiously as to other central banks with our inflation targeting frameworks. joumanna: we will proceed cautiously. it is giving a boost to the nikkei and dollar-yen this morning. the euro area trading sideways today, 1.0 850, but it is up

over the last month, the pound similar movement, 1.2740 where we're at this morning, gold is up 0.4%. we did see the currency dip towards the end of last week, but the same themes apply, we we continue to see reserve buying giving support to the bullying. the vix index continues to drop despite the headline risks coming the next few months. chinese trade practices have been sized by g7 finance chiefs, who are threatening escalation. in a joint communique after their meeting in italy, the accused china of hurting the economies of trade partners. let's get more with oliver crook. china was a big part of the discussion at the g7. what came away from the summit? it featured heavily in the communique. oliver: the context of the

timing was interesting because a couple of weeks before, he saw the biden administration throw up tariffs on ev's and a few other goods. let's not forget we're expecting the same from the eu in a couple of weeks time. we will have to be precise to talk about this question of overcapacity. which yellen kicked off in the press conference with the g7 meeting. for the g7, it was a venue for them to say they are speaking with a unified voice on this question of china. the language itself was somewhat hedged, as you will hear from the communique, china was only mentioned twice, and trade and overcapacity only ones afraid listen to jeremy hunt, the chancellor of the exchequer commend what he had to say about rising protectionism. >> it is really important that the world is not unintentionally creep back into protectionism. our starting point is that we really think hard before imposing tariffs or trade

remedies. oliver: of the people i spoke to , jeremy hunt was the last defender of the open market. cautioning even his allies against some of that protectionism. you think about that overcapacity argument and the u.s. throwing up barriers, the eus well, that leaves the u.k. vulnerable to extra overcapacity but the chancellor is not concerned he wants to preserve open lines of trade throughout the world. joumanna: it is the u.s. that is the key protagonist looking to pressure china. i also noticed the ukrainian finance minister was in attendance. i know that ukraine was one of the big topix discussed. namely because there have been conversations about what to do with those frozen russian assets. did anything come out of this summit? oliver: there was a lot of positive talk and a lot of talk

about the will and initiative, and everybody in broad strokes, in agreement. but in terms of kneeling down backer texture -- nailing down the architecture of russian assets, that was not fully dealt with. i was a bit surprised how difficult the technical issues seem to have been. the g7 ministers seem to have coalesced around the american plan, which is to say the future earnings of russian assets could be disbursed today, to the tune of about $50 billion, but there are all these technical elements that are missing. here is jeremy hunt. >> the g7 was absolutely united in its support of ukraine. it always has been. but i felt that it was stronger than i've seen it before. i think that sends a very big signal to putin that we will not

let him succeed. oliver: a lot of positive talk, sort of lacking on the details. they need to hammer this architecture out and buy two and a half weeks time when the g7 leaders meeting takes place in southern italy, that will be the holy grail for them to get ukrainian financing on stable footing not just for this year, but years to come. joumanna: and possibly with a change in u.s. president, which also may throw a spanner in the works. amazing coverage over the weekend. in middle east news. the hamas run health ministries has at least 35 palestinians have been killed in an israeli airstrike at a camp for displaced people in wrapup. it came two days after the icj ordered israel to halt its operations in order to spare civilians. let's get more from onur ant. there has been intensification in a tax on both sides over the

weekend with rockets fired into tel aviv. the response from israel over the weekend with missiles directed at camps in rough. what else do we know about these strikes? >> sundays 76 inflation -- sudden escalation in violence came after hamas launched rockets in tel aviv. all of those rockets were intercepted by israeli air defenses, following which, israel carried out the strike in a part of rafah that was overly crowded and resulted in the death of dozens of people. that area in rafah that was hit on sunday was not one of those where israeli authorities were urging residents to move elsewhere, which is what they have been doing the last few weeks in expectation of the rafah invasion which should not materialize. that meant basically the area that was hit eliminated a even

about resulted -- illuminated a key member of hamas resulted in the death of suva. there is disagreement over what the icj court ruling meant. joumanna: the backdrop to all of this is we found out towards the end of the week last week after that video was released to the public about the abducted israeli female soldiers, that israel due to public pressure, are now looking to reengage in talks with thomas once more via mediators. what is the latest on those talks given their has been intensification of violence over the weekend. >> the violence puts in danger the possible resumption of talks. the qatari foreign minister, who has been one of the key mediators in the talks for

months now, met with intelligence chiefs of the u.s. and israel last week in paris, and this week, we expected talks to resume again. if anything, sundays attack puts on display the significant difference between the two sides. for months, the interest had tried to bridge the gap between israel on the one side and hamas on the other, israel sees a possible cessation of hostilities as an opportunity to get the israeli hostages held by hamas in gaza to be released, whereas for hamas, the language in any deal should be constructed in a way, so that the ceasefire can be equivalent to a permanent, long-lasting if not peace, at least cessation of hostilities. that is the key difference between the two sides. if anything, sundays attack puts in danger the resumption of talks we expected you to place this week.

joumanna: the latest out of the region. bond traders who are stuck in a waiting game over fed policy may soon get some welcome support. for the first time since the early 2000's, the u.s. treasury is preparing to launch a series of 56. you heard it here first. while the central bank tapers the pace of its balance sheet runoff. this ahead of inflation indicators had to be released later this week. for more, mliv strategist ven ram. the details are important because it could be construed as a buyback, but not with the aim of pursuing monetary policy, it's important to note these are liquidity operations. the fed is introducing them because they want to help include or inject liquidity in treasuries but what impact will that have on bond markets? >> it will have marginal impact. some kind of impact, but marginal, because the overarching policy factors that

will weigh on the market is inflation and monetary policy. at the margin, this reduction of the buyback will improve liquidity, because these treasuries go off the run, and it is very hard to trade them, variably, and it helps to bring back the securities. the more important measure will be the runoff in qt. that will reduce from 60 billion to 25 billion, that will help treasuries a lot more than liquidity measures, but overall there is no getting away from what themes nation numbers mean for the fed's policy. we will get pce this weekend if it is 2.8%, it will be hard to argue that the fed will cut rates by a whole lot. joumanna: ultimately, inflation expectations, the analysis of where r-star will be will determine where those rates will end up. i want to ask about the ecb because our colleague oliver crook was interviewing the

bundesbank president joachim nagel over the weekend, one of the more hawkish members of the ecb, i thought it interesting he doesn't think jun should be a live meeting, he is happy to wait until september. of course, markets are centered around june being the timing of this first rate cut, would it be a big surprise if they don't overturn at this point? >> i would be surprised if they didn't go. nagel is a really outline hawkish member, so it's not a surprise he would say that, but the bulk of the governing council has come around to the view that june is when they will go first, and i think we will get that reduction. what is interesting is what will happen beyond june. are we going to get cuts at every meeting? at alternate meetings, and how make cumulative cuts will we get by the end of the year? the markets have been factoring in three rate cuts by the end of the year, that's a bit of a tall order, especially in a situation

where the fed will not cut too much, so two cuts is what the market should perhaps expect. joumanna: we spend so much time talking about the timing of the first rate cut, but not enough talking about how frequently these cuts will occur subsequently. thank you for joining us around the set today. that was mliv strategist ven ram. quick look at what else we have on our radar. in terms of key events this week, we have the eu foreign affairs council. that starts today but it is a two day meeting so we will get communiques from that tomorrow. wednesday is the deadline for bhp-anglo american talks. bhp have now made three offers to purchase anglo american. this time around, they are giving them a couple days to come back with a renegotiated offer, we will see whether there is further information about potential divestments. friday, the big event for u.s. investors will be that pce

indicator, the fed's preferred inflation gauge. it is expected show moderation to the lowest level this year. also coming up, south africa's president urges people to turn out in the country's general election. we are live in cape town ahead of wednesday's poll. this is bloomberg. ♪

joumanna: welcome back to "bloomberg daybreak europe." president cyril ramaphosa is urging citizens to turn out in wednesday's election, as south africa's ruling anc party risks losing his parliamentary majority for the first time since the end of apartheid in 1994. the minister says the party will come out on top.

>> they and see still rub -- the anc represents the best interests of all south africans. that it will climb the wave, so to speak, of optimism and come out with 15%, and once again be given an opportunity to continue to build democracy in this country. to build our economy and to ensure that the inequality and divisions in our society are intended to in the anc way. joumanna: key elections coming up this weekend. let's bring in my coanchor jennifer zabasajja who is in cape town with a guest. >> good morning, i have melanie verwoerd, former anc political

analyst, and former bloomberg contributor, thank you for being here, you are partly primed to talk about this. we showed the prime minister expecting the ruling anc to get to 15%. melanie: it is a bit of optimism and spending by the and see at this stage. it looks unlikely there will get over 50%. most probably 45 and upward seems likely at this stage. >> where did they lose out on that percentage on the majority? melanie: they lose it everywhere across the country. they have lost their base support which is mostly african support, black south africans. they have lost a lot of votes because of jacob zuma and the mk party. that is the second-biggest province in terms of running numbers. they have lost support around

johannesburg, the biggest province in south africa, and that hurts them. >> you bring up former president jacob zuma. you wrote a bloomberg opinion column that said he may not make the difference a lot of people were expecting. >> he is not in parliament. the constitutional court ruled he cannot stand is a presidential candidate. all that the party has two offer voters at the moment is jacob zuma. there is not real -- pick up zuma is getting elderly. i am sure they will get something like 10% or around that number, but very much a flash in the pan, one cannot see them in five years from now unless things change dramatically within that party. >> does it still have an impact on south africa and the democracy moving forward,

especially because of the policy they have been pushing for? melanie: not really, because what ultimately happens is cabinet decides the way the country will go forward, and decides on policy. mk will almost 100% i can say they will not be in cabinet, first of all, so all they can do is make noise in parliament, at 10%, they are about 40%, so they will make a lot of noise and may be disruptive parliament, but they would have impact on any of the policies. the anc will still be such a dominant factor that they won't be able to make that much of a difference. in the end come with all the noise, it won't make a big difference. >> let's talk about coalitions because a lot of people expect a coalition. cannot work on a national level? some provinces, it does not work, but you have experienced coalitions to a certain extent. melanie: we have seen at local

government -- actually, the majority of local governments, it has worked, but they have been the smaller, local authorities. the big disasters have been in the bigger municipalities. and that's the concern. could you have coalitions that collapsed the country? if the anc gets about 45%, it will be stable, it will be coalitions with smaller parties or independence and that will be fairly stable. our current president is in a heavy space to include people. we had a history in the beginning of national unity with all the political parties represented. the anc has been in a partnership through all these years with what is called the tripartite alliance with the trade unions, and they have also brought in little parties, and at some stage they had the freedom front plus. we have done that on a national level. the only real risk what would

concern markets is if they are forced to go in coalition with the eff, which we have seen a local government, has been very unstable, and could be very disruptive. otherwise, it will work, especially if the anc is about 45%. >> does that mean cyril ramaphosa, is staying in the presidential position? melanie: the question is long-term, that would be his choice ultimately. whenever he decides to leave, it will not be a messy transition, it will be a peaceful handover. >> melanie verwoerd joining us in cape town where the sun is slightly coming up. back to you. joumanna: beautiful shot over cape town this morning. that was horizon's and africa anchor jennifer zabasajja. plenty more in coverage of south africa's elections. we speak to the cape town mayor at 730 u.k. time, and the leader

of the good party at 9:30 u.k. time. this is bloomberg. ♪ and to have a better life, then you don't stop. we have been able to reach over 100 million people impacted and affected, and at risk of hiv. the rocket fund takes all of the work that we're doing, all over the world, and looks at the most effective ways, to get resources to them, to get services to them. the idea that we have saved five million people's lives, it's overwhelming. it's everything.

joumanna: welcome back to "bloomberg daybreak europe." now some other stories making use. a qatar airways flight hit severe turbulence over turkey injuring 12 people. the boeing 787 landed as scheduled in dublin and qatar airways says it is investigating the incident. last week a singapore airlines flight made an emergency landing in bangkok after severe turbulence killed one passenger and injured dozens of others. nvidia vos jensen huang and a bipartisan delegation of u.s. lawmakers arrive separately in taiwan. builders leaders will meet with the president. it comes after china wrapped up

its largest military drills around the island in a year. the u.s. has accused beijing of military provocations for a later on the show, we will talk about the buddhist bank president who tells us the ecb should wait until september to make another move, after a generate country the market is pricing in 21 base points of the probability of a rate cut for june, less so, for september. more from that interview on the sidelines of the g7 in just a few moments. this is bloomberg. ♪

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>> good morning. this is "bloomberg daybreak: europe." these are the stories that cite your agenda. asian stocks gained kicking off a week set to be dominated by data including the fed's preferred inflation indicator. u.s. and u.k. markets are closed for holidays. israel is pressing ahead with operations in the southern gaza city of rafah despite a u.n. court ruling that ordered it to stop. g7 finance chiefs blast china's trade practices and threaten tougher protections for their economies and critical industries. we will bring you our exclusive interview with >> the french finance, bruno le maire. we have -- with bruno le maire. >> china is producing more and more cheaper industrial devices. it could be a threat not only for the e.u., not only for the u.s., but for the global world economy. >> shots fired from some of

these european finance ministers to china on the back of that g7. a big story for today. i am sitting in for tom mackenzie. it is a u.k. bank holiday. you can see all of the major equity futures are seeing openings slightly in the red so the euro stoxx 50 future seeing about 10 basis points lower, ftse 100, about .3% weaker as we head into what could be quite a crucial week for market direction. friday, the big event with that pce number coming through from the u.s. as for asian markets, it is a slightly different type of sentiment this morning. we are seeing the msci is trade in the green after a week of losses last week, about .2% higher in trading today. the chinese indices brushing off some of the commentary coming out of the meeting, trading in the green this morning as well and the nikkei up 5%, this on the back of comments from the bank of

japan governor suggesting that they can proceed cautiously with rate hikes. as for other assets that we are following this morning as well, let's take a look at some of those currency pairings. here are trading sideways. the pound trading at -- both of them are up 1% in the last month. gold also seeing a bit of love this morning, of 14 percent after dipping towards the end of the last week. still coming off a record high in the bullying towards the big fashion bully on -- the bullion towards the beginning of the week. ecb executive board member says the time of right for a hike. speaking at the economy faster, he said any move towards afterwords will be "data dependent." he said there are conditions for a change in monetary policy at the june 6 meeting.

it is not just the doves we have been speaking to. have been speaking exclusively to the eunice bank president. he says they should wait until september for any subsequent rate cuts. >> my expectation is that there is a flattening of the wage data that is occurring over the next month so i believe that some relief coming was from the data set but nevertheless, which data are still strong so we have to keep our vigilance when it comes to the next rate decision. >> it sounds like it's not concerning you that much. we are expecting inflation to come up in germany, spain, france, the euro zone, to slow its descent. does that not concern you? >> has a central banker, you are always concerned but i see the trend is the more important issue. over the last couple months, inflation rates came down so

what i expect for the next month that inflation is coming down further. the headline will come down and came down here already so what i see is the probability is increasing. in 30 days, we will see the first rate cut in the euro zone. >> do you think we can rule out back-to-back cuts given the uncertainty on the outlook for inflation? >> i believe it is a very important point. it is a kind of autopilot that when there is may be the first rate cut that there is a consequence, let me say, more rate cuts coming. i believe this is not helpful discussion. we really followed the meeting here. that should still be the case. if there is a rate cut in june, we have to wait and i believe we have to wait until september,

july. it's too early to speculate. >> --under the circumstances particularly? >> i believe the forward guidance was helpful maybe in an environment where there are blue skies, the sun is shining, but now, we are in a world that is more difficult. it is a very uncertain world. a lot of geopolitical risks so the data that is incoming is the most important indicator that we have to follow. >> very insightful commentary from the bundesbank president, pouring cold water, the suggestion of subsequent rate cuts even if the ecb do go for that rate cut in june. obviously, notable given that he's one of the hawks on the ecb committee. olaf scholz said the creation of a european capital markets union will be a priority during meetings with french president emmanuel macron. president macron is in germany

on a state visit where he will attend celebrations marking the 75th anniversary of the german constitution and hold a joint cabinet meeting on tuesday with german counterparts so let's get more on the story with bloomberg's christophe rolled -- christophe. very interesting to see them talking about that once more. this has been a perennial topic as well as new leaders were concerned but what were the main talking points in berlin so far? christophe: good morning. you mentioned the comments about the capital market union were made by olaf scholz just before emmanuel macron landed in berlin . when he arrived, there was work by the german president and they focus very much on the importance of the franco german relationship in order to push through some people -- some reforms across europe to allow closer cooperation basically related to a wide range of

different initiatives. defense spending, political cooperation and as you already mentioned, the capital markets so there are indeed quite a lot of talking points that go through germany. today and tomorrow. >> let me just ask you more specific questions about what is going to be the focus of today's meetings. obviously, he is there for the 75 year commemoration of the constitution. what is going to happen today specifically? >> he is going to go to the city where he's going to hold a pretty eagerly awaited speech basically stressing the highlights the importance of stronger and deeper ties between france and germany which in the past have been one of the key drivers to allow cooperation across europe. we and others have reported the

ties in the relationship between emmanuel macron and olaf scholz, the german chancellor, have probably been a bit more difficult than compared to the relationship between emmanuel macron and his previous successor, angela merkel, so i think it's going to be important to see how much concrete progress that can really make to really cooperate more deeply and more closely than france and germany have probably done over the last two to three years. >> as often is the case with these types of meetings, i'm sure many analysts will be watching out for the personal chemistry between these two leaders given what you just said about sort of the tensions that have existed between the two of them over the last couple of years. thank you so much for joining us today on the show. friend finance minister bruno le maire says the g7 is united in its concern over the threat to the global economy from china's industrial overcapacity. speaking to us exclusively from the groups meetings in italy, he

also confirmed its commitment to funding support for ukraine. >> we are on the right track to get final approval by the g7 leaders summit. we want to ensure long-standing funding for ukraine. and make no mistake, the g7 countries are fully committed to provide long-standing political and financial support for ukraine so there are many options on the table. we will work on those options to find the best one. we need to have the most solid option from both. i want to leave no uncertainty. we will find an agreement and we will provide to ukraine the necessary funding. >> in terms of china, where would you say you agree with the united states and disagree? where in your approach do you think that there is total synchronicity and where do you

want to see some changes? bruno: we have the g7 level that we have an issue with the chinese industry of overcapacity and this is not a question -- to question anything against china. china is an economic partner but we have an issue with the economic model in which china is producing more and more cheaper industrial devices because it could be a threat not only for the e.u., not only for the u.s., but for the global world economy, and we need to address that issue. having so many industrial devices for the green industry at a very cheap price on the global market could jeopardize the whole world economy and the growth in the world so that is why we need to address the issue. we need to engage china, and we need to find solutions. joumanna: that was french finance minister bruno le maire with oliver crook. the yucaipa minister, rishi sunak, has put forward a program

of national service and one of his first -- in one of his first pledges of the election campaign. let's get more from our managing editor, adam. i think many people were surprised to hear about this announcement over the weekend, especially because britain scrapped mandatory national service in the 1960's. also in light of the polling which suggests many younger people are not in favor of mandatory service. so why does the prime minister want to revive it? adam: good morning. the underlying fact here is that we are starting an election campaign. the election was called last week and the conservatives under rishi sunak have come out of the gate with what is their first eye catching campaign promise and the polls being very much set against them at this moment. his party has been trailing the labor opposition by around 25 percentage points for a very long time now in polls and he's

trying to narrow that gap in one of the ways to do that is to appeal to some of the voters who may have drifted away from his conservative party and have been attracted to a smaller, newer party, called reform. the thinking is -- the suspicion is that this policy is really aimed at bringing back some of those voters. older voters who have come out more strongly in favor of a policy like this. but of course, there's been reaction against it especially from young voters. there's been scrutiny of the funding, of how it might be paid for, how it might be put into practice, and the home secretary, james, when asked about this on television yesterday, he said that it is difficult to enforce and have a criminal sanction if you don't do it. it is an early skirmish in an election campaign which has just got underway. it is certainly an eye catching

promise but it is one that has not been -- had a home in the british national psyche for many decades now. joumanna: it was a bit of a surprise fry think many people over the weekend turning to the labour party, they have pledged to review plans for the u.k. government to reduce their stake if they win the upcoming general election. you know, tell us more about that and where this framing is coming from. adam: well, as ever with the labour party at the moment, you know, we are not able to talk about too many specifics. they remain tightlipped about many of their policies. they are cultivating a more pro-business attitude than in years gone by and that is a big part of their pledge rose for the campaign and for how they

say they will govern when they are in office and they are making lots of outreach on those levels. the statement yesterday or bloomberg's reporting last night and into this morning is very neutral and there is no particular sense -- all they say on the record is labor will review the details so that the government's remaining steak was due to be put out for sale i think in june and that is now the middle of the election campaign so the future of what happens with that government of course is still the largest shareholder, some 15 or so years after the financial crisis so labor will review that and you know, i would not want to speculate entirely on what they will do but the government has been generally selling down that take over the years and helping to reduce that. joumanna: a big one for investors as well. they have been doing quite well

this year up until the last few days. , managing editor. coming up, markets are preparing for the dawn of the t plus one rule which begins tomorrow in the u.s. we will break down what this means for you, next. this is bloomberg. ♪

>> welcome back to the show. we are getting some breaking news out from elon musk's ai so the news has just been reported now saying that they have announced a funding round of $6 billion. elon musk following that up with commentary saying that there will be more to announce in the coming weeks. so that is interesting to note. investors include sequoia capital and fidelity and all of

this part and parcel of his big visions for ai. he has been outspoken about its promises as well as its limitations, one of the main people in the space talking about the need for regulation around it. this as he expands his own ai capabilities through x ai. they are going to go through a serious run -- funding round of $6 billion. elsewhere, markets are preparing for the dawn of the t plus one rule which begins tomorrow. it means u.s. trades will now settle in one day rather than in two. for more on this, i'm joined by bloomberg's kriti gupta. in my previous life, i was a bond girl, bond trader, and back then, at treasuries did settle t plus one but equities have been two plus two all this time until today so why the change? kriti: this is a little bit of foam -- fomo but also ptsd.

we remember the mean craze we signed the stock market. a lot of global investors were exposed to that kind of volatility in a way they could not handle it when you have the retail crew get in on some of that volume. you mentioned the bond market. the fx market is still eplus two so it's not just the equity market that has this delay but it is specifically for international investors. the idea is to make it a little bit more efficient so make sure despite all of the investors around the world that are exposed to the u.s. market, they are able to get their settlements in faster. right now, it takes up to a week to actually, between pushing the buy button to get to the actual trade and ultimately for the seller to give that trade up as well or give the share of the stock they are looking at as well so four days to five days to make that process go and to make it a little bit more efficient. this will not only entice more investors to invest in the united states but also to make their lives and perhaps some of the banks lives a little bit easier as well. joumanna: it's interesting what

you are saying about how long it takes for both sides of the trade to get on that. the stated purpose is to increase efficiency in this market but could it also increase the number of sales? kriti: it absolutely could and that is one of the scary parts of this. why not make it a t plus zero? why not make an immediate settlement within the united states? by 4:00 on the market closes, it is all settled in down for. the thought process is you need a little bit of time to catch some of those failed trades and that is kind of one of the nightmares in terms of adopting this system. if you look out the industry is saying, there is a spike in the number of failed trades, and they are seeing some banks around the world really accommodate for this. citigroup is just one bank that is actually saying we are going to move some of our staff to kuala lumpur and work on a tuesday to saturday schedule to accommodate some of this long-term shift. eventually, the hope is everyone will be on the same page but

this is also staggered by country. canada, for example, getting onto this in the 28th. you have the likes of the u.k. who may not get onto this until 2027. joumanna: one thing that i am thinking about is that it also may catalyze an increased amount of automation in the space as well to mitigate the amount of human capital that is needed to make that shift. what are markets participants saying about -- market participants saying about the impact it will have? kriti: they are saying this may not be the game changer given automation has been a long trend but the added component to this is also the fx piece as well. this is not just an equity market story. the fact that you have not only the additional step of settling the trades but the fact that you have an additional step for international investors, making sure you have that dollar, it creates a very long kind of pace and if we are talking about automation, this is where it could get efficient in that additional step in other markets

when you look at cross-asset correlations but right now, you and i both know very well that trading is considered on the decline simply because of that threat of automation. this may not necessarily accelerate it though. joumanna: that is a good point. also another good point we need to bring up is that it is a u.s. bank holiday today so i guess all of these traits are going to start trading with two plus one settlement as of tomorrow, something worth bringing to mind. kriti gupta, thank you. plenty more coming up on our show. we will be back in just a few moments, but this is bloomberg. ♪

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it's overwhelming. it's everything. joumanna: -- >> what did we really right over the last two years is that we really followed the meeting to meeting here,

understanding, and i believe that should still be the case so if there is a rate cut in june, we have to wait, and i believe we have to wait until maybe september. i think july. but assess it. it is too early to speculate. joumanna: the bundesbank president there. let's take a look at how ecb rate expectations have evolved over the last couple months and you can see from this terminal chart back at the beginning of the year, the expectations that they would be cutting sooner and faster. now, we are seeing the first cut is pretty much priced in for around june and the second cut happening around september and of course, many of them saying they will have to take a meeting by meeting approach and not necessarily cut at every subsequent meeting so even though the first cut is priced in still for june, subsequent rate cuts are now a big question over them. the other chart we are watching on the back of some commentary we got from chris wallace over the weekend. he was telling market participants that if you want to get an idea of where that mutual

rate for the u.s. is over the long-term, you might as well take a look at where 10 year yields are trading. the long-term rate is something to bear in mind given that commentary but plenty more in our coverage of south africa's elections throughout the programming today. we speak to the cape town mayor at 7:30 u.k. time, and patricia, the tourism minister and leader of the good party at 9:30 u.k. time. later, you don't want to miss our interview with the president of the institute. that is at 9:20 am, u.k. time come on the pulse. up next, markets today. this is bloomberg. ♪

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