resilience. they're willing to push this equity market higher. we're so close to the seven-year

highs, risk appetite not being that hard at the moment. interesting news coming from shire of course, a week bet we could see more stimulus there. they call it reluctant easing said to come from china. any further stimulus will help get inflation going once again. they to follow that with the risk of aggravating further. that helps asian stocks go higher because of chinese inflation slowdown. meanwhile we are seeing a pretty much flat turn in equities. how are we looking? >> we are seeing a bit of risk appetite rid -- appetite. only 520 percent interest points, a little bit of risk outside and meanwhile costs are high for germany.

it seems as the market is reluctant to sell off at the moment, willing to stay calm. look what happens to greece in the next few days. that emergency meeting in brussels coming up tomorrow. the euro with a similar story stocks are you much flat. let's look at brent, we are seeing a snap in oil. after a period of growth we are seeing it start to turn lower. the worry is u.s. glut meeting the demand is pushing the oil price lower. ubs is set to fall up to 4%. we will be talking through much of this with the great interview with the chief executive of ubs. they have had better than expected profitability numbers,

the hook sergio has hung his hat on, not doing the heavy lifting and investors want to see right now. michelin up by almost 3.4% this morning and radisson on its hat on the emerging markets in brazil and china. meanwhile, rife eisen bank -- raiffesien bank, it seems as though they will be selling the polish unit and curbing russian business. >> thank you very much, a busy morning. i am going to do something we don't do very often. danish cpi. consumer prices for year on year for the first time since 1954. in aligned with the estimate but plays into the bigger team a

low flation global economy. you have a negative print in denmark as well. switzerland cpi in 12 minutes time. we are talking about greece, the big question for the last couple of months or years. what does it mean for the rest of the year, and minister david cameron shared a meeting with the treasury and bank of england officials to discuss the potential impact of a grexit on the united kingdom. we had the pleasure of cactus -- catching up with george osborne. >> it is clear the risks to the world economy and british economy are the standoff between the eurozone and greece is growing each day and i think the risks of a miscalculation might be growing as well. so here at the g-20, we are

urging all parties -- we're stepping up our preparations. we have to make sure the british people are best protected from whatever develops. because i am clear that the greek exit from the euro would be very ethical for the world economy and potentially very damaging. we have to be prepared for that outcome. jonathan: greece who cares? we know it is something george osborne is concerned about but the equity market outside of greece doesn't seem too fussed. check out the stoxx 600 versus the athens stock exchange, does that look like a market that is worried? not really. does ram in the keisha care --

ramen nikissa care? you pointed this out as well should they be concerned? >> we think they should. it seems if you don't reach an agreement in europe, less is a crisis. greeks will face a liquidity program and less they agree to a program. there is no way it can do that. so they have a week negotiating position but it seems as if they think they are on this holy mission to repudiate their debt, at least to negotiate down the level of that debt. jonathan: the interesting part is with seen reactions in greek banks that has sold off, up and down like penny stocks, when do

we see the spill over into the rest of europe? >> we have told our clients they should be cutting european over tactically. we completely by the structural story. europe from a macro perspective is with weak oil prices and good lending. there the banking situation less bad loans. that suggest there will be a good pick up. all of our clients agree with that, what is very clear is the huge complacency about greece. and tactically you should be cutting out exposure. >> a thread of euro disintegration and a war of eastern europe. we cannot get away from the fact that it was the best time of the are since 2099, why is now the best time? >> we like european exposure and

we made good money on armed trade but our target is 380, so currently we're 3% below that. we have very little upside as far as we're concerned and the potential for 15% downside if something awful happens in greece. >> you say there is some complacency. looking at the greek bond market going to 21% yesterday. does the administration care? 81% of their debt is in the official sector, a are not borrowing and not issuing three-year debt, why should they care? do they? >> the important thing is that politicians don't matter. what matters is the positives of the banks. think of it from the point of view of the depositor in greece.

if you think your currency will be valued and then you and up with a draw,, what you do -- drachma? you store it under your bed in a suitcase or take it out of the country. if you are in portugal, you do the same thing. there is enter increasing correlation. that worries me hurting others should be worried, too. jonathan: should the bond market be worried? ramin: i think they should and i think they could have global impact and even the u.s. could be impacted. jonathan: what is interesting for me is with gone from aaa seen yields plummet and negative on short dated maturities inter-germany and plenty of other countries where the spillover has gone into the credit market. some junk rated companies doing it right here, should we be looking at the bond market?

>> there is a massive captive audience for that bond market. the insurance company has to buy that bond market. of course with nestle and shell people are still buying it. with the ecb filing interest into sovereign debt there is a reason to follow that trade. >> what is the risk here? we will talk more about this and the u.k. election. what about brexit? we head there after the break. before the break, let's check in on our top story. ubs at swiss bank doubled. that is one stock on the move this morning. management margins are little bit of a concern. hsbc faking a probe by the

british government over allegation that has clients avoiding taxes around the globe. then hugo boss in focus. that is what the market thinks of that. hugo boss down 5%.

>> welcome to on the move.

i am jonathan ferro live in the city of london. the battle for the business is in full focus. the british chambers of commerce in the annual conference, and edwards is there, george osborne has highlighted the risks, what is likely to be the reaction from business in the u.k.? anna: thank you, good morning to you. greece is clearly a topic at the forefront of george osborne's mind. no doubt it will be on the mind of some of the delegates here. the prime minister was worried enough about this to meet members of the treasury yesterday. also on the agenda, we have pay

the relationship between businesses and pay. david cameron is expected here today around noon to call for businesses to pay people more. we heard from mark carney that he thinks the bank of england is that -- david cameron will add his voice to the call. the best way to show that is to give the u.k. population a pay rise. linking to what you would say about greg set, the -- grexit and the possibility of brexit. that we could see the u.k. leaving the union. that subject will be very much at the center when ed balls speaks later today. he will be flexing his european credentials. saying ok the relationship needs reform. but he will say that would be a

disaster for the u.k. economy. analysts are saying that promise is the biggest adverse risk facing the country. >> a busy morning in store for you. i want to bring back in ramik issa -- ramin nakissa, i am looking at the year on year drop of 0.5% for the month of january. denmark thomas switzerland and the eurozone facing a similar problem. the u.k. host these business conferences, and we also face low-inflation here as well, how are we going to deal with that? ramin: the numbers have started to pick up in the u.k. and the pmi's look really good. we think if there is a fallout in greece, the u.k. might be one

of the places to get exposure to equity. i think this whole story is a global one because china is exporting deflation globally with sluggish demand and less commodity tested growth. i think it is one which will continue for months to come. >> we will show you how london does u.k. politics. the potential negative impact of a grexit, what about a brexit? how concerned are you and if we should be concerned about europe denominated assets, what about sterling? ramin: i think sterling would be seen as a safe haven. the possibility of a brexit would be a big negative for the u.k. if we were to consider it especially because it contains uncertainty.

i think it will be better to have more integration from europe than less. either way, they will end up with a labor government which will be anti-utility talking about caps on utility prices they could think about -- jonathan: in the short-term, we get the u.k. election, from the picture your painting it seems like it doesn't matter who wins. you have the uncertainty and the outcome. >> you have to balance the fairly good numbers get on growth. rubber for the u.k. equity market am a it is not the u.k. you are buying. they are not cyclical, they are defensive. that is why we like the u.k. at the moment.

as we approach the election date, -- >>jonathan: i want to talk about china after the break. lowflation, a problem for china and japan. the hunt for price growth's getting tougher. we will talk about that after the break.

jonathan: good morning and

welcome back. it is all about lowflation day. chinese inflation coming below estimates, as price growth is very essential to bankers from washington dc to frankfurt to beijing. check out this chart. this is china's job surplus. job vacancies per applicant. so long as the labor market stay strong political -- will the authorities really blank with inflation heading south? hard to get a decent read on the chinese labor market. it doesn't look like a are at the cliff edge for now. >> the general trend we are seeing is less young people. a shift toward a service economy

rather than manufacturing. the thing to bear in mind is if you have less people entering the market and more of the service economy, that is much more intensive in terms of the number of people that it employs. overall you can see why there would be more job openings and why there would be this kind of trend you are pointing out. >> a long as people are on them -- employed they won't be on the streets protesting. >> that is exactly the key concern. putting the growth down to something manageable, a 7% handle then i've -- five, we are converging to the global growth rate at 3%. we see this as a global trend. slower growth, aging demographics, this will be deflation. when you are entering all got

the, you will not buy or stuff -- mroe stufmore stuff. i have a car, i have a tv. it is the young people who are buying a new house and everything areas i can see inflation -- everything. i can see inflation going lower. jonathan: do we have to start looking at the pmi manufacturing numbers? when it was still in contraction territory, it was better on the previous month this month, what are the proxies you're looking at when you look at china? ramin: funnily enough we look at the iron ore price. jonathan: that tells you a lot. ramin: that has been collapsing. the copper price has also been very weak. less commodities and more of the consumer led that is the big

shift we are going to see. that can affect the whole global economy. >> you see chinese stocks go higher people start talking about stimulus. last week's action from the people's bank of china and in november when they cut the benchmark rates, when i look at the reserve rate requirement and a 50 basis point cut, that is not an aggressive cut, that is the tweak on the fringes. what is your view? have they really blinked yet? ramin: i think the story here is passive tightening. i think your re-rate rises. what they have to do is cut rates to compensate for the inflation falling. if you look at the market markets didn't read too much into it.

i think that was a fairly small change in policy. jonathan: bullish china for the rest of the year? ramin: we like china and india. jonathan: more than europe? ramin: yes for the moment. jonathan: up next, we do what we have done for the last couple of weeks. the stocks closed down almost 5%. we will give you enter opening price in just a couple of minutes time. you have yields coming a little bit lower after going through 21% on the three-year. we will look at ubs after the break and we will be live from zurich where manus cranny has been speaking to the ceo. ♪

jonathan: welcome back i am jonathan ferro at the bloomberg headquarters in london. this happened to shake up this tuesday morning. the ftse 100 is a little bit lower. the dax stays lower this morning as well i-30 points. for now, let's get stock specific with caroline hyde. caroline: i am going to kick off with a bank that is huge exposure to russia and ukraine. the first loss on the back of that turmoil last year but now

people are seeing the optimism. the second rig bank in eastern europe and they are saying we will curb our russian business. there seems to be a silver lining surrounding that dark cloud. so rife eisen -- raiffeisen turning up. this is a company that is really backing the emerging markets. the problem is, those markets are starting to cool down. they are also feeling the vulnerability to foreign exchange issues at the moment. when they got the euro starting to weaken the got volatility elsewhere. even though you have lower material cost going down, that

is not enough to make sure that profits are picking up. another big fall are today is hugo boss. he issued calling, this is the private equity comity that took up a majority stake in 2007. the last couple years they have been unwinding that majority stake and once again they sell down there holdings. they are selling stock into the market and more supplies means price goes down. jonathan: thank you very much, greek stocks just opening. the athens stock exchange opens a little bit higher. a sizable selloff yesterday, down almost 5% on the back of concerns that reese and of the eurozone would not reach a cop -- that greece and the eurozone

would not reach a compromise. the problem is, the rest and germany want to collect their debt. more stories as it continues, let's get our i on one of the top stories ubs crushing estimates due to strong earnings. some concerned about margins as a wealth management unit, manus cranny joins us from zurich. talk us are the numbers because on the headlines, it all seems pretty solid. manus: the banner headline is the net income up one billion. as you says -- said it was listed by a tax credit. it has delivered a return of over 20%. what the market is focused on is wealth management.

the numbers myth and also the margins, the amount of money you are earning, that has get as well and actually not having that as a target would be a key performance indicator. the money also dropping considerably for the third quarter. those are the negatives being focused on. when you consider the actions and the impact, we'll have a different story. >> we saw during the first days, a huge round of swiss clients buying euros. being on their account or drawing cash and buying euros for shopping and holidays and really a massive increase of demand for euro. i would call it temporary demand, not structural. manus: the story has yet to run.

what you get to take away from this is he said dividends where the critical issue and they deliver that today, they delivered a payout of 50% of their profits, but with a action, would it invoke an immediate change in action? sergio: the strategy won't change. we had concrete plans that we announced and we are executing those plans. the latest developments may put pressure to speed up the execution of those plans. manus: what you have to stay -- say here, this is one of the best in class dividend return players. let's see what happens later on in the week. so dividends he has delivered areas and that compensation get slightly as well. jonathan: the other big question

is, how did they perform on the day the swiss national bank took that cap away? what is with his actions? as we look forward to us was actions, it is the number one question, isn't it? manus: it is paramount. it is still very early. i was very clear and expressed this question. did you make money on the day when they took away the cap? how much did you make? it was an exceptional situation. sergio: as you know we don't comment and this quarter is enter exceptional situation which we feel is important to give some indication. i think a day like january 15 to make money is quite difficult

because what we are focusing on is giving the best execution to clients. a day like that when it was important not to lose money. there were some positive affects beyond the fact that one or the other could abandon the peg was always in our scenarios. therefore, we have been benefiting from that aspect. day-to-day training activities we didn't really make money out of that. it was not a priority. manus: forearmed and sometimes forewarned is a good way to be. when you look at the swiss national bank action, there of avoiding negative rates. what is the impact of the action in foreign exchange and the interest rate market? ermotti: first of all it is a

good point because everybody is focused on the currency movements which is something we need to adapt. but the most impactful consequences are clearly the negative interest rates. what we can do, at this time we are passing the negative interest rates. if it goes further, we cannot rule out that more clients will be affected by this. clearly that is some kind of severe or steady consequence for the economy. manus: clients, what is their reaction so far? what is the movement? ermotti: we saw during the first days a huge round of swiss clients buying euros. being on their account or drawing cash and buying euros

for shopping or holidays. a massive increase intra-demand for euros. i would call it temporary demand. manus: jon, i will leave you with one other thought. there is always a discussion of where are you with investigations or using there were bonds for clients it is too early to get an answer for that, but i thought it was interesting when i asked what size is the foreign exchange business? very clear, this is not a multibillion-dollar business. back to you. jonathan: thank you manus cranny, in a beautiful zurich. those hounds are not getting as many swiss francs this time. as we head to the brink equities in london are little bit lower. the equities market that is not

lower is the athens stock exchange. the asc was down almost 5%. the euro bank up almost 10% after falling as much yesterday. we are in for a volatile week. check out the bond market, a three-year note yield. that jumped higher impressively. now we cut back by 123 basis points. did i mention the word volatility? that is the week you have in store. back in two. ♪

jonathan: welcome back, time for some of the top stories. inflation in china wraps up the slowest pace in five years. prices rose just .8%. factory gate prices are also down more than expected, extending a 35 month stretch. saudi arabia had its credit outlook rating cut. the kingdom relies on oil and gas for 90% of goffman revenue and s&p says the saudi could lose their aaa credit rating in two years should liquid assets lose value or its fiscal position we can. the u.s. federal reserve

governor j powell says he is still awaiting evidence that interest rates are pushing up high enough to justify a way china. >> it is a sign of strength, it is also true that it will way a little bit on exports and certainly in the short-term hold inflation down. it might be a slight headwind but i don't see it stopping. we have an economy that is underway here. a sustainable pace renting numbers that we did not even think about. jonathan: that saudi rating should of said aa-not aaa. joining me now is simon, great to have you here. as i look at fx pro, can you give me insight into what they are doing and how to change the outlook?

>> what we have seen are some great trends. what you see when you have them on the dollar is a six or seven months dollar rise in the dollar index. on the euro, they are pulled back from euro trend. people have been consolidating there. but trying to trade the euro is hard. jonathan: it is and it seems the grand blinking contest is emerging. for you simon, we'll have asked this question so many times but here we are in another week. who blinks first? >> i wrote in my note yesterday i don't know. the trouble is you and i know that the whole european project is political.

that single currency will not work without a fiscal union but they did it anyway. you know that politics has dominated in this situation. if greece has the money they have no money. that is the reality that we are facing. greece said give us an extra 10 billion and germany says there is nothing to renegotiate. i honestly can look at the situation and i think markets are being complacent. having said that, the bottom line is always the euro should be week because the euro itself is a week thing and flawed. >> talk me or that because most look at the situation and say greece explodes and exit. if greece doesn't, i still stay out of the euro, give me a reason. simon: the reason to buy at this

moment, they are the ones -- in essence greece leaves and you have a slightly stronger euro. but the contagion effect and the fact that the euro which has always sold -- once you are in your in, there is no exit strategy and there is now an exit door. so you could say there is a stronger currency overall. it is a real uphill battle to sell that because of the potential. there is an exit door for anyone. jonathan: the big call with saudi-euro, the other big call was euro-dollar. while everyone is easing, the dollar get stronger, is that likely the story for 11? simon: it will not be as take a story as we have seen since july. the weekly gains were unprecedented.

on a momentum basis i think we will struggle with the exact same event of. what we -- exact same momentum. but we are seen recently is -- we cannot sustain the gains we have seen over the next 11 months. jonathan: what forces the feds to capitulate and what is your conviction trade off the back of that? jonathan: capitulate as in titan -- simon: capitulate as in tighten? jonathan: as in not tighten. simon: i'm convinced the recovery is sustainable. we've seen said -- central banks tighten and then pull back. it is more likely the inflation side that forces them to hold ground. jonathan: the big trade? simon: in the moment it is

euro-yen. easy down to one point 30 and below. jonathan: thank you for joining us. as we head to the break, a quick check in on markets. this is 100 down by 37 points. the dax is a little bit softer as well. the athens stock exchange is bucking that trend. we will talk more about greece after the break and we will get the view of mr. osborne. ♪

jonathan: welcome back to "on the move." finance ministers at g-20 are there for the final days of the summit. we spoke with the man at the top

of the treasury, george osborne about one of the chief issues leading up to the u.k. election. u.k.'s roll intra-europe. -- in europe. we have made it clear that the u.k. wants to stay within a reformed european union. we also need to make sure that the relationship between those not on the euro is a fair one. those are our priorities going forward and we say we will put this to the british people and that referendum will take place by the end of 2017 but as the prime minister said if we could include the negotiations we will be delighted. >> many investors have voiced concern that an early referendum could speed up or cause an exit him a what would you say to that? osborne: there has been a lot of talk in the media that somehow

our european policy might deter investment. the truth is since we set down our policy with continued to receive a huge amount of investment than the rest of europe put together. now it is the goto destination for international investors. we have a skilled workforce and some growth aced to start for the business -- growth basis to start for the business. it is a place where business can grow and jobs can be created. what we want to achieve is britain in a reformed european union that is an economic success story. jonathan: mr. osborne and his view on europe. "the pulse" is coming up guy, i am guessing it will be a big theme? guy: anna edwards, will be

talking to him. we are looking forward to that conversation because there is so much to respond to. before that will be talking to mona. the big thing is -- what is the problem with the labour party's relationship with business? john will worth is very cross he is not showing up because at 12:00, the prime minister david cameron is delivering a speech and taking q&a from the audience. so, we need to get to the bottom of this relationship with business and why it is not working. we will talk about that and try to get a sense of where it is going wrong. that is one part of the show. we are also going to be talking to the ad agency -- that the

last time ran the communication strategy, and getting a sense of why it is not supporting labour this time around. it will be interesting to get a take on why his agency is not supporting them. all that is coming up plus a 200-400 olympic champion. michael johnson later on. jonathan: lighter stuff. guy: a lighter shade. is this, politics and then we talk to michael johnson. jonathan: that sounds like some show. a busy day for guy johnson, a busy week for you. the euro area finance ministers had to brussels tomorrow, all attention on greece, the tension facing angela merkel and alexis. as we had to the break i believe you with the greek equity market

raising some of yesterday's losses. if you want to continue the conversation i on twitter. good luck with the rest of your day. ♪

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guy: i see a very bad outcome. u.k. chancellor george osborne tells us about his fierce over greece. tejadative interest rates could hit profitability. and a business plan for britain. prime minister cameron prepares to address the british chamber s of commerce.