tom: good morning. happy friday. this is bloomberg daybreak:

europe. these are the stories. the end weekends after the boj holds rates and says it will layout plans for reducing bond buying. we break down the numbers ahead of the press conference. a fourth straight consecutive record. european futures point higher. this is the french bond rout deepens over concerns of a surging far right in upcoming elections. reform u.k. leader nigel faraj declares his party the opposition to labor after a poll shows the brexit architect ahead of rishi sunak's conservatives. political risk in the u.k. and eurozone. stateside, you got that fourth straight record for the s&p powered by gains from broadcom and adobe. it's the technology story again.

questions for the executive going forward in terms of whether that comes through. modest gains. you've seen a divergence between the european and u.s. stock story. s&p futures flat after that fresh record above 5430. nasdaq futures building on the outside of yesterday, pointing higher. let's flip the board and look cross asset. the japanese is in focus. we will break that down for you. throughout the show, in fact. reflect on the auction of the 30 year in the u.s. well absorbed. $22 billion. the 10 year, yields up just two basis points but comfortably around 4.3% levels.

there's the japanese yen. pressure coming through as they kick the can on the bond purchase program. currently down .6% versus the dollar. euro-dollar at 1.07, seeing some volatility on the back of political risk out of france. brent down .4%. let's crossover it asia. standing by, avril hong in singapore, breaking down the asian markets. avril: it's about the yen and boj. the expectation was the central bank would do something to help bridge the yawning yield gap with the u.s. and support the japanese currency, maybe talk about the reduction of bond purchases, signal rate hikes. kicking down -- kicking the can down the road. there will be consulting with banks and other parties.

solesky hawkish than expected from the boj and -- so less hawkish than expected from the boj. we are also seeing, and japanese bonds, we were in quite a good mood because of the treasury value overnight. we are seeing further gains because of the signals coming through from the japanese central bank the yield on the 10 year is about a four basis point move. in the equities space, given this messaging from the boj coming in less hawkish, it is taking risk off the table for equity investors. the nikkei was down about four point -- about .4% earlier. it's managing some gains but this is a benchmark that since march has been struggling to breach the 40,000 level.

what happened to those expectations of inflation creeping back into japan and how corporate shareholder value seemed to be unlocked. that will be key even though chip stocks are expected to continue to do well whether the climb and equities can continue broadening. that's key to watch for japanese equities. let's flip the board because when we look at the yen, it is weak against all its g10 peers, but also its counterparts in the asia-pacific, key among them the korean won. it makes you wonder what these economies will be thinking about in terms of export competitiveness. how long will the likes of the pboc tolerate this? so focus on the boj and yen. tom: i love that regional comparison. avril hong in singapore with the market check. we stay on the boj story.

avril has set down the order. let's get more on this rate decision. brian, not a big surprise. it was expected they would hold but they are kicking the cans in terms of the details on the bond purchase program. one interpretation was this is a relatively dovish announcement or detail. we get the governor around 7:30 u.k. time. what will you be scrutinizing from that press conference. are we talking about the softness once again? will he support the japanese currency. >> this press conference will be of interest to investors and traders in japanese assets. what we expected before this decision was to see some hints about a potential rate hike in july. so we would be looking for comments on the likelihood of

achieving that stable inflation target or the underlying trends of inflation rising. that is not what we expected to hear. now there's other things to think about. the fact that the board voted against cutting bond buying suggests there's a broad consensus to do it but the fact they could not come out with details may point to disagreement in terms of the scale on which they should do it . we will want to hear about any comments made at the meeting regarding the possible scale of the bond buying cutbacks and we will be looking at the yen. two months ago, after it came out with comments that conveyed not much urgency about the yen. it weakened and we saw japanese authorities come in with record interventions, so he will be cognizant of what happened. we will watch if he tries to put

a floor under the yen in his comments today >> on the question of the bond repurchases, they will give the questions after that july meeting. what does history tell us in terms of how far they can go and how comfortable they would be with that quantitive tightening program? >> we have heard estimates that it's currently ¥6 trillion and we have heard economists talk about cutting maybe 500 million yen. when they lay out the details they will be talking about the next one to two years. they may hand also it what's come after that. we have seen the fed embark on this path two years ago and it is starting to slow that so i guess the bank of japan will tell us, maybe start out big and slow it down further out.

the market is lacking in consensus in terms of how far they should go and maybe that explains why the bank of japan was reluctant to come out with specific details today. tom: bryan fowler, excellent breakdown. what's a look for in terms of that press conference. the japanese yen at 1.5797 down against the dollar. we will go now to oliver crook. let's give you a sense of what else is lined up for today. 7:00 a.m. u.k. time, tesco's sale and revenue. the grocer in the u.k. that will be a picture of the health of the u.k. consumer. the u.k. consumer as we start to adjust expectations around the bank of when the boe can go. they expect them to be able to go in august.

a gauge of the consumer coming through. we do get that press conference for the bank of japan governor. there will be scrutiny on what he has to say about that bond purchase program and whether he guides in terms of teacher hikes for the boj. bloomberg exponent -- bloomberg economics two further rate hikes expected. christine lagarde will be speaking also interesting given the uncertainty around the next steps for the european central bank so tune into that. you can get a round out of the stories you need to know in today's edition of daybreak. subscribers to the terminal can go to day gp. nigel farage versus nietzsche -- versus rishi sunak. what he calls his party the

opposition to labor. that is next. this is bloomberg. ♪

tom: welcome back to bloomberg daybreak: europe. happy friday. to the geopolitics. g7 leaders meeting in italy. they have reached an agreement to unlock a loan for ukraine by using the profits from frozen russian assets. they have been wrangling over this.

the details are yet to be ironed out but fresh cash is expected to reach kyiv by the end of the year. leaders say is a strong signal to vladimir putin that he cannot out wait the bloc in the conflict. >> we have agreed to have a 50 billion euro support in addition for ukraine. this 50 billion euros will be fed by windfall profits, from mobilized assets in europe, russian assets in europe. >> we have the agreement today. we are hopeful. it will be the task of the team in the days to come and weeks to come to put it -- to put it in concrete steps. all the leaders, we want the agreement to be implement. tom: let's go to oliver crook in italy.

talk to us about the significance of this g7 agreement in terms of using the frozen russian assets, the prophets, the gains to aid ukraine. when does the money come through? how significant is it in terms of the impact on the ground for ukraine? oliver: if it does come through, and they hope to get it before the end of the year into the ukraine wallet, $50 billion based off russian assets. this is something we have been talking about for weeks. what we have is an architecture for what this would look like, bilateral loans contributed to by the g7 members as a proportion of their gdp. they want to get that ukraine before the end of the year. conspicuously because we have a big election in the u.s. that they want to trump-proof and get the financial footing for the warren ukraine on solid ground for the future. the problem is is that there is still the devil in the details.

not support cold water on this but we keep talking about the technical details that need to be worked out. there's a lot of questions surrounding this. in the eu, this whole system, this whole approach, is based on the eu continuing every six months to renew the freeze on those russian assets. by the way, to do that, you need full unanimity among the eu members. could hungary throw a spanner in the works and prevent that? these details need to be worked out. and the eu needs to look at it and find ways to perhaps circumvent that. overall, tom, this was the big the ripple herbal -- the big deliverable. there was this spectacular show yesterday were these parachutists jumped out of helicopters with the leaders below, each with a national flag. they broke out into press conferences. i went to the macron press conference. there's a skydive he took politically himself and that was the focus. a journalist asked about that and it speaks to the weakened

position some of these g7 leaders have to discuss and hash out global issues when they have large issues to mystically. tom: indeed. we see pictures of rishi sunak facing those election risks in the u.k. july 4, macron facing that threat from the efd. the skydive is dramatic. there is some symbolism that maybe they would not want to draw. when it comes to unity, that we focus on the technicalities of this russia asset deal and how they implement that and potentially road from hungary, when it comes to agreements or disagreements on the china question, particular when it comes to tariffs on chinese electric vehicles, there has been some back-and-forth. germany has a position opposed to that of brussels. walk us through what's happening on that front. oliver: for the united states, obviously, probably above all, it's important for them to get

common language on china, particular on the trade issue, but they are trying to pitch a much longer -- much larger tenant. they have invited the leaders of turkey, argentina, brazil, kenya. they are cognizant of the fact that the g10 has waning influence and they need to make this pitch more broadly across the world. i spoke to charles michel yesterday about the china issue. here's what he had to say about what they hope to get out of it at this meeting. >> we want to rebalance the relationships, diversify our supply chains. it's important. it will work for the benefit across the eu. it's why we courtney. oliver: i think these china questions are particularly interesting because they tie into other questions about

developing nations and immigration. often at these g7 meetings we have these conversations about helping developing nations, but they don't go much further than conversation. when you think about the role china has played in many of these nations -- let's say kenya, for example -- there's a huge amount of infrastructure their bill by china. often the west and the u.s. and the leaders here are cognizant of the fact that they are not really doing enough on the ground there. as a sort of response to that, there's been an announcement of a fund that will be back by blackrock and other investors to help the development, but of course we need to take this in the geopolitical context of his fragmenting world order. tom: on the fragmented world order question, you got into this in your previous answer, or at least your comment around trump-proving some of this. to what extent is a potential --

extent does a potential president trump in november elected lou large in this -- elected loom large in this? oliver: it does loom large. obviously defense is a sort of major issue here. we are also talking about orban -proofing this aid. we are talking about a lot of proofing at the g7 with leaders who don't necessarily have a mandate as strong as previously. so that's a large part of this, ensuring there legacy gets through and they are able to push these things through when not necessarily they will be empowered to the same degree, so this is a large conversation here, and i think in terms of where biden is, dealing with these issues, the trump presidency would loom extremely large over these discussions. tom: ok. oliver crook, fantastic work live for us in italy for the annual g7 summit. to some other stories making

news this friday. left-leaning political parties in france have sealed an agreement, an alliance for the upcoming legislative election. they will feel only one candidate for each district for the first round of voting on june 30. polls suggest the bloc could become the second biggest in parliament behind le pen's national rally, dealing a potential further blow to president macron. in south africa, continuing talks on forming a new government hours before president cyril ramaphosa is scheduled to seek reelection of headed -- reelection as head of state. according to the u.n. secretary-general, three parties have opted to join a proposed government of national unity. the agency was forced to seek an alliance after lost its parliamentary majority last month. sources say donald trump has told u.s. ceos he will cut corporate tax -- cut the

corporate tax rate if he wins the november presidential election. the likely republican nominee met in washington with around 100 ceos, including j.p. morgan's jeannie -- jp morgan's jamie dimon and apple's tim cook. he is said to say 20% is a nice round number. coming up, the trade war. how eu tariffs on chinese cvs will impact efforts to reach net zero on the road. that is next. this is bloomberg. ♪

i can't believe you corporate types are still calling each other rock stars. you're a rock star. we're all rock stars. oooo look look at my data driven insights, i'm a rock star. great job putting finance and hr on one platform with workday. thank you! guys, can you keep it down. i'm working. you people are (guitar noises). hand over the air guitar. i've got another one.

tom: welcome back. bloomberg has learned the german

government is working to prevent or soften the eu's new tariffs on chinese ev's. officials in berlin are reportedly optimistic the bloc can find a solution in direct talks with china. officials say they see wiggle room with some eu allies but need both the bloc and beijing to move forward on a potential agreement. the new tariffs take effect july 4. the eu has waded into the green trade war, announcing it will increase tariffs. that's part of the story on electric vehicles imported from china. we will see to what extent the germans control is back. this comes after the biden administration lifted duties to 100% last month, so tariffs have been raised on these chinese ev's. what does this mean for the markets? joining us is bloomberg's head of advanced transport and energy storage. how are they impacting the ev

market? >> what you are already starting to see is more localization of. it will slow down ev adoption. a lot of country -- countries have been missing these models. you have heard negative headlines saying ev sales are falling. in absolute terms they are still growing.

we are projected them to grow 20% this year that we are projecting them to grow 20% this year -- we are projecting them to grow 20% this year and that is holding up. you will still see about 17 million sold this year. that's about one in five cars, so that's one in five cars sold in the world this year will have a plug, a remarkable milestone. tom: important context. projecting forward, what is the outlook from you and the team for u.n. -- for ev's? >> it is still bright because the technology continues to improve. we are seeing battery prices under $50 per kilowatt hour at the cell level in china. that will start to trickle into other international markets in the years ahead. that's what will drive adoption more. cheaper ev's that consumers can buy at every different price

point and consumer segment. the adoption outlook is still bright. we are nowhere near the end of how good the batteries can get in that will continue to drive adoption. tom: smart analysis. colin mack russia with the details -- colin with the details. coming up, tesla shareholders approving elon musk's $56 billion pay packet and his plans for a move to texas. will bring you the details next on that story. this is bloomberg. ♪ ♪ ow! whoa! watch where you're going. yeah mom, pay attention. what if it's a concussion? hang on, i'll look it up. uh... i'm probably fine... probably? we noticed something wasn't right and got her to a doctor. i thought i was okay, but i had a concussion.

sometimes, it's hard to tell on your own. don't mess with your melon. people couldn't if yousee my potential.hecked. so i had to show them. i've run this place for 20 years, but i still need to prove that i'm more than what you see on paper. today i'm the ceo of my own company. it's the way my mind works. i have a very mechanical brain. why are we not rethinking this? i am more... i'm more than who i am on paper.

how am i going to find a doctor when i'm hallucinating? what about zocdoc? so many options. yeah, and dr. xichun even takes your sketchy insurance. xi-chun, xi-chun, xi-chun! you've got more options than you know. book now. tom: good morning. this is bloomberg daybreak: europe. i am tom mackenzie in europe.

the yen weakens. we break down the numbers ahead of the boj governor's press conference. the s&p notch a fourth straight consecutive record. european futures higher. the french bond rout deepens over concerns of a surgeon far right in upcoming elections. reform u.k. leader nigel farage declares his party the opposition to labour after a new poll shows the brexit architect's party ahead of prime minister rishi sunak or conservatives -- rishi sunak's conservatives. let's check the markets. it was tech boosting the highs of the s&p. adobe and broadcom and tesla lifting the s&p. european futures pointing to up .3% but there's been a diverging

picture. ftse 100 futures showing gains of .3%. the s&p looking to gain modestly. nasdaq futures higher but .2% that higher by .2% -- higher by .2%. you have further evidence that inflation is starting to cool in the u.s. that is playing into expectations that the fed can go at least once this year with a cut, with producer prices following the most in seven months. the u.s. 10-year at 4.26%, below 4.30%. the japanese yen under pressure, down .6% on less than hawkish comments coming from the boj. brent trading lower in the

session. let's cross over to asia. avril hong standing by in singapore. april? avril: yeah. the focus is on the japanese currency as we wait to hear what the governor has to say. after april, in his presser, his comments managed to send the japanese yen levels that prompted intervention. it was an expensive exercise. $50 billion from the finance ministry of japan to support the yen. this is at stake as we look into what we will hear from the boj governor. these are the peers the yen is losing ground against. we knew coming into the decision today there was a chance that the bank of japan would be classic in terms of not giving the markets what they expect in the normalization of policy/. that's what we got.

the bond futures and japan are also climbing against that backdrop. interesting also to highlight what we are seeing on the yen versus the renminbi as we talked about how the weakness might be affecting export competitiveness. keep in mind the pboc came in with the highest rate since january. makes you wonder how chinese authorities are thinking of the japanese yen especially with the decision due on monday. the base case is for things to be kept unchanged but bloomberg economics expects a bit of reduction. let's take a look at the stocks in focus and japan. those automakers tend to benefit from a cheaper japanese currency. we are seeing them paring earlier losses but not by much. maybe the caution around what ueda has to say. among the japanese lenders, an increase would be good for their profitability and theory, but given how the odds seem to be reduced now, we might not see

the bank of japan at the next meeting. there are talks about the reduction of bond purchases and rate hikes at the same time. those might have to wait and so do the japanese lenders. quickly taking you through what we are seeing in major gauges. that's green on japan. a bit of a mixed picture in chinese equities. tom? tom: avril hong on the reaction to what we have been hearing from the bank japan. thank you with a deep dive. two u.k. politics now. nigel farage has declared his party "the opposition to labour" after an opinion poll showed him overtaking the conservatives, evidence suggesting the prime minister is heading for a heavy election defeat. joining us now for more is u.k. correspondent lizzy burden. how significant is this really? >> let's run through the numbers. the poll last night put reform

at 90%, the conservatives at 18% -- at 19%, the conservatives at 18%, and labour at 30%. it's a significant crossover for reform. it could foreshadow a 1993 canada moment for the conservatives. and interestingly to me, if you add together the reform share with the conservative share, you get the labour share of the poll. perhaps this is an equation that will haunt the conservatives after the election went thinking about the leadership -- election when thinking about the leadership. farage has said in response that a vote for the conservatives is now a vote for labour, turning the conservative allegation on its head. this was in a televised debate with a conservative cabinet minister. in fact, the truth is, in

britain's first past the post system, this is not quite the reality at. nigel farage would like some electoral reform but we are not there yet. tom: if there was proportional representation it would be a different political landscape given the polling. we will see if this data is repeated but it taps into that fear with the members of the conservative party. talk to us. you touched on the polling around labour. 37%. we have got the manifesto. what details stood out to you from this document? lizzy: the theme is caution. 133 pages of it. no new policies. we have been hearing that economic growth is the priority for the labour party. keir starmer, the opposition labour leader, was in manchester announcing this manifesto. take a listen to what he said. >> in terms of -- the leader in real-world ai. this is a big deal.

tesla is ahead of google, meta, openai, anyone on real-world software. taking video and making decisions based on video. tom: that of course was elon musk. we would love to hear from elon musk talking about a. he's not the best person to talk about u.k. politics i would argue. lizzy: not sure we are getting prime minister elon in the u.k. keir starmer is saying he will not raise any of the three main taxes in the u.k., vat, national insurance or income tax. to state the obvious, this is a manifesto pledge, so if they raise those taxes and government, it would be a serious promise -- taxes in government, it would be a serious promise broken, but this does hem in labour fiscally. a 28 billion pound black hole the public finances.

the rest of it will have to be covered by public spending cuts. the institute for fiscal study says this manifesto does not detail how to finance a plan that would affect real change -- what effect will change. the institution for government says they are in for a nasty shock because it will not give enough growth fast enough or significantly. my take away from this is they do not want to trade their poll lead for a mandate to do more but this is the post truss economic consensus, pursue growth, don't upset the bond market. tom: to your point, interesting to hear from the former shadow chancellor in the labour party saying they have hemmed themselves in with this pledge. lizzy burden with the significance around the polling and the boost for reform u.k. and the challenge for the tory party. two europe, where leaders are still dealing with the fallout

of last week's european elections and discussions about ukraine, defense for the eu. the european council president spoke to crook at the g7 and delete. >> the most important thing will be the agenda. this is a program that will be agreed upon in the weeks to come by the leaders about what should be the priorities for the next five years. >> what changes as a result? >> you have the european parliament holding elections across e.u. we are doing our job. two important priorities, more prosperity, better regulation, smarter regulation, more competitiveness.

we are determined to do more in the field of defense and security. >> could there be a decision on jobs by monday? it seems like these are firming up. >> the leaders will have to make a decision. it's my tasks to unite the leaders to hold them to a decision and this is my focus. >> there are a number of leaders in that cohort that have been weakened by the european elections. we know what's going on in france and germany. how will that reflect in conversations at that level? >> i'm confident because the european commission is a unique body. we have the legitimacy to make decisions for the future. this is what we are doing. >> are you concerned about the outcomes of the french election? do you think a weaker france make the task of the eu harder? >> i'm confident the european council in the leaders within it already to play a role and make

decisions for the benefit of the eu. >> do you think giorgia meloni has come out stronger and could emerge as a european leader? >> my goal and responsibility is to unite the european union. this is what we managed to do, including on difficult topics, covid-19, climate change, bore against ukraine that change, the war against ukraine -- climate change, the war against ukraine, china. all done in a spirit of unity. tom: the self appointed of european stability, european council president charles michel speaking to all or cook. part of the conversation was around ev's and tariffs and china. tesla ceo investing in a pay

package -- tesla investing in ceo elon musk's pay package following a drop your to date in their stock price. muska spoke after it was announced when he also touted tesla's ai capabilities. >> tesla is also the leader in real-world ai. so this is a big deal. tesla is ahead of google, openai, anyone on real-world software. taking in video and making decisions based on video. no one is even close. and it's getting better. tom: let's bring in bloomberg's daniel. he's been waiting patiently for us on this story. talk to us about the significance of this announcement in terms of the pay package and the move to texas.

daniel: i think at the very top, we talk about the references to elon talking about ai, for investors, this means tesla, elon musk, they will not be splitting apart here, the idea that elon musk could take his ideas away from tesla and undermine evaluation, which depends on musk himself and ai. as you said at the top, this idea that this vote, the revelation -- the resolution on musk's pay package and the move from delaware to texas felt like a referendum on the company, but this result and after this agm that happened hours ago now, this just means there's strong confidence in elon musk and his leadership. this comes across the backdrop of lagging sales and share price, which has slipped as well in recent times, but elon musk

had fans on x, tesla trying to get this boat over the line. we got a hint of that yesterday from elon musk that this vote would succeed and happen later on with backing from key institutional investors. tom: ok. daniel lee, thank you very much indeed with important insights about what we have been hearing from agm and elon musk, that vote of confidence coming through from shareholders. plenty more coming up. we will do more analysis and assessment in terms of what we have been hearing from the boj. that's coming up. this is bloomberg. ♪

tom: welcome back. the yen weakening after the boj's decision to hold rates. the central bank said it would reduce debt purchases but

delayed providing details until the next policy meeting. the yen trading close to 1.58 versus the u.s. dollar, down. let's bring in the cohead of asian fx and rate strategy at bank of america. thanks for joining us. what was your assessment as we lead up to the press conference? adarsh: good morning. if you look at the market reaction, the yen is weaker so it was dovish. we did think there was a reasonable risk they would delay the decision or details on the purchase reductions to july. the nikkei article yesterday suggested they were discussing this at were likely to announce at this meeting, but in that context, where the market was expecting not just a reduction to be announced but a

reduction to ¥5 trillion, we did not get the details and that was a disappointment. tom: as you say, you and the team called it. if you have been reading those notes he would have gotten a good steer on this in terms of the bond purchase decision and kicking that down the road. what are you in the team thinking about in terms of how far they would go on quantitative tightening post july? adarsh: yeah. ironically, even though today's decision was viewed as dovish, what we have heard is basically they will consult with market participants and they will present one to two year -- present a one to two year roadmap of reductions at the july meeting. that is at the end of july so it's going to take some time, but i do think when we get the announcement, there's actually a chance that the reductions could be a bit larger than what the market has been thinking. the fact that they will consult with market participants and present a long-term roadmap

tells you that eventually the reductions could actually be more than expected, so of course that's a story for another day and the markets will not really care about that now, but i think medium syrup we think -- medium-term we think the reductions might be quicker. tom: that's fascinating. that's really fascinating. because as you say we are thinking of the here and now as well. we have the press conference at 7:30 a.m. u.k. time. how fine a line will governor ueda have to walk in this press conference? adarsh: sure. on the purchases i think it's straightforward for him because the statement said everything it had to say, so all he will say is we will speak to market participants and provide details at a later point, so i don't think it will be difficult communicate matt. the trickier part will be the prospect of a further policy rate hike. so the market has reduced the probability of a rate hike at the july meeting. i think it was around 65% before the bank of japan meeting. now it's closer to around 40 to

45%. so kind of finally balanced. that's where governor ueda will have to tread a fine line in terms of will he push back against expectations of a rate hike in july? i think that's unlikely. i also don't think it's that difficult for the boj to hike rates in july and provide details at the same time. so i suspect he will do what they normally do. he will say we are data dependent. it leads on -- it depends on economic conditions leading into that july meeting. but i think that's what the market will be focusing on in terms of his press conference comments. tom: for now, where do you land in terms of the number of hikes they can push through this year? where do rates end the year in japan? adarsh: so we are sticking to a rate hike in july. and then a follow-up rate hike in 2025, taking the terminal rate to 0.75%. so we have not changed that view

and we think a july rate hike still very much on the cards, but as everyone, we will be watching the data and the bank of japan's communication over the next month and a half. tom: briefly, before we let you go, next level for the yen. adarsh: the yen is going to be interesting. people kind of think 1.60 is the line in the sand but i think there's a chance we get above that. part of the reason is we are seeing structural outflows from japan that will continue from both the corporate and household sector, but also volatility. when they intervened, volatility in the dollar-yen was around 10%. now we are nowhere close. we think maybe 8% to 8.5%. if you get a move like that, we probably won't see that immediately. tom: fascinating. adarsh sinha on the yen potentially getting past 1.60. really smart take in terms of what to expect from the boj.

we look at the yen breaking through 1.58, now down .7%. plenty more coming up. this is bloomberg. ♪

>> it's worth recalling the last year -- that last year almost all economists were predicting we would have a recession. that's something we have avoided and we now continue to see solid economic growth. tom: treasury secretary janet yellen speaking with new york fed president john williams at the economic club of new york. worth noting that producer prices, the ppi index out of the u.s., came in softer, softest level in seven months, well below estimates, suggesting the moves lower in terms of cooling inflation in prices continues in the u.s. and that feeds into the

fed's preferred gauge. it's been a big week in terms of auctions by the u.s. treasury in the u.s. and they have been well absorbed by this market. most recent auction 22 billion u.s. dollars of 30 year treasuries. you had a bid to cover ratio of 2.5, well above -- the best they have had year to date in terms of the appetite for 30 year bonds. it suggests markets can absorb this and are trying to login yields. maybe it's a bit yields move lower -- a bet yields move lower. the bond story around the run-up of the deficit in the u.s. is not in play for now. let's see what's happening because european bonds, french bonds, really and focus given the spread in the differential versus doorman -- german bunds. you had a 20 basis point

increase in the spread due to the political risks at a friends, the biggest since 2017 -- risk out of france, the biggest since 2017. there's the pickup we have seen this week. the markets suggest there could be a further rout in french sovereign debt. that's a story we continue to keep an eye on. more coming up, including the outgoing cleveland president sitting down with mike mckee. this is bloomberg. ♪

gotcha. take that. whoa! bruh! i'm fine. that smack looked bad.

not compared to the smack down i'm giving you. you sure you're, ok? you know you're down 200 points, right? lucky, she convinced me to get help. i had a concussion that could've been game over. in actual reality, you've only got one life. don't mess with your melon. if you hit it, get it checked.

>> good morning from london. i'm anna edwards. cash trade one hour away. the bank of japan delays bond buying.