beijing's foreign policy chief says construction on reefs in the south china sea is good for the whole region. yang jiechi says differences beween neighbors should solved through friendly consultation and negotiation. interview.exclusive and volkswagen is now said to be criminalct of a investigation in the u.s., after revealing it rigged its cars to cheat on air pollution tests. 18% in frankged frankfurt. you can let us know what you think of today's top stories by twitter. me on >> indonesia is getting under way. here's david with a look at the market. >> thanks. so what we're seeing right now is a rebound. we haven't erased the chart we saw on monday. but we're still feeling the music and the beat from wall

overnight. only malaysia sitting this out at the moment. shanghai has turned positive at this point in time. of course, the a.d.b. coming out with a series of forecasts here. that int you more on just a moment. just for the philippines, their could quicken to 3% by next year. let me just recap data out of australia. prices up 9.8%, a gain from the year before. you compare the end of the second quarter last year and of course where we are at the also seeing ae bigger -- in fact, double than forecasted. 2.3% was the estimate. the increase in home prices in australia. okay. quickly.ery a lot of that has to do with the cheaperollar, making it for foreigners to get in. that's really a hotly contested topic. dollar up slightly against the

currency. where is the dollar index here? very interesting here. 1% on the dollar index. a little lower right now. fed funda look at what futures are pointing to as far as probabilities are concerned hike.e rate we're basically at 48.8%. yep. if you have a terminal, that's the function right there. have a -- said, you whenase is fairly strong all of these -- you get financial in the market starts to die down. so we're at the end of that year. thatt them to jump and get rate hike out of the door. fairly clear guidance coming fed officials here. very quickly, before i go, we're dollar.about the u.s. that's really pushing up as well. dollar. kong 12-month chart, intervening the

monetary authority. and that's what we have for the moment. back to you. >> thanks, david. the a.d.b. has again cut its asia. outlook for sherry broke those lines for us half hour ago. >> for the second time in just months, the a.d.b. has cut china's growth forecast. of course, this is having an impact on the rest of the region. the bank now says growth in asia 5.8% this year and 6% in 2016. below its march forecast of 6.3% for both years. top of these growth prospects and india. first in china, a.d.b. sees growth at 6.8% this year. 7.2% projected earlier. of course, that's lower than

of about 7%,arget already the slowest pace in a quarter century. so growth in industrial 1.9%mies i is also easing to in 2015, down from the 2.2% march.t in this is because of consumption and investment, not to mention and japan had a tough time in the first half. report,aways from the capital outflows from developing asian markets remain a key for the bank. the bank now says asia could be the u.s. inllow raising rates to contain capital flow reversals. the bank warns a strengthening u.s. dollar poses companies withan large foreign currency exposure, vietnam, sri lanka and indonesia. they also had a special chapter women.state of >> the region, saying that although asia's economic boom

them, theted participant in the workforce has declined in the past decade. to you. >> we'll take a more detailed look at that story later on in show. we want your opinion, of course. so please tweet us your thoughts. include the hashtag trending business. chinese president xi jinping leaves beijing for perhaps his most important state today. he's off to the united states, where he will first stop off in seattle for meetings with business leaders. then he will head to washington for more formal proceedings. we are joined for a closer look at xi's trip. first?ttle >> well, the view is that he'll get a warmer, more informal business-friendly seattle than the highly politicized atmosphere, of the nation's capital. there's precedence as well. presidentst chinese visited seattle as president.

back in 1979. i in fact remember the visit, as arrived in seattle with a nasty cold. thelike him, xi will visit boeing plant in everett, washington. that is in fact where xi will in the wee hours of tomorrow morning, asia time. aircraft orders could be announced later in the week. tuesday night he's going to give what's being described as a an eventicy speech, at hosted by paulson. kissinger will be in attendance. wednesday will be an even bigger day. tours the boeing plant, heads to a local high school, then attends an internet industry forum with the likes of warren names,and many other big including china's internet czar gates.ner with bill thursday, he heads to the other

washington. d.c., of course. a 21-gun salute and perhaps more discussions than likehe'll face in seattle, america's wide trade deficit, change. human rights is always on the agenda. and perhaps the most prickly and cyber--ng hacking and cybersecurity allegations. yang jiechi, in an exclusive interview, says cyberspace cooperation with the u.s. is possible. >> china believes that china and the united states and other countries should really try to work out the, thes for cybersecurity in mutualof equality, benefits and mutual respect. up hispresident xi wraps u.s. visit in new york over the weekend where he will address

nations.d yvonne? >> thanks, steve. we'll take a look at some of the other stories we're watching for you. here's doug with a roundup. been scrambling to fix an embarrassing security have exposed may hundreds of millions of customers to a malicious malware.known as the malware secretly embedded itself into counterfeit copies kit.ple's developer tool a total of 39 apps using apple's software, including wechat hailing service were affected. this according to palo alto networks. wechat's parent company, theent, said it has fixed security flaw and has released a new version of the app. anys unclear whether personal information of apple's customers has been stolen.

well, volkswagen may be facing new legal troubles. the u.s. justice department is said to be investigating the german car giant over its onission that it cheated federal pollution tests. the company shares lost nearly a at one of their value point on monday. the u.s. probe is the latest complication facing the world's biggest automaker. it has faced stinging criticism in the three days since it admitted that it had rigged to passehicles emissions tests in the lab. the environmental protection agency alleges volkswagen admitted as much as 40 times the legal limit of pollutants when they were on the road. german financial regulators are at whether vw violated the rules in its home country. over.neymoon phase is alibaba's lockup period ended saturday. means the biggest shareholders can sell stock, has planned founder

not to do so. the shares fell 2% at the monday close. leaves the stock down 32% from last september. closelys are now watching yahoo, which has yet to decide what to do with its 15% stake. the chinese market turmoil has not helped sentiment with the trading restrictions. a flood of new alibaba shares are available for purchase. biggest investor that hasn't pledged to hang on holding. it's valued at a cool $25 billion. we're following is clinton's tweet on the rug prices. sent biotech stocks down in the u.s. bloomberg.com. make sure to check it out. coming up later on, high society. media and downtown the way transforming luxury shoppers spend. asiaok at the outlook for

out of the asian development bank. they cut their growth forecast for the region. ♪

>> the asian development bank has downgraded its growth forecast for china for the many as -- on as declining appetite for energy commodities. down to growth+

forecast across asia. i think this reflects the ongoing extent of the slowdown china and they're bearing the prunt of -- brunt of this forecast adjustment. when we look at the gra forecas, balances --ount current account balances are expected to be broadly unchanged. regional inflation is expected to be 1% below the long-term average. is stilla.d.b. recommending that central banks in asia may need to follow the fed higher.

it's one of the overriding influences on this document. in the midstlearly of a trade recession. with thenomy in asia, exception of vietnam, is in year onarge falls year growth in exports, thertsment and i think a.d.b. revised forecast reflects the reality of that extremely trading environment. >> we have seen in terms of china, there's just this bashing bandwagon going on. a mix rather of than disasterous picture and the global sentiment seems to be a little bit too bearish on china. what do you think about that argument? >> well, look, the chinese economy is definitely transitioning. if we summarize it as the old exportersch commodity are so used to, that component of the economy which is probably summarized by growth has

slowed and slowed quite significantly. tertiary sector and the services sector are showing if not stability. now, not even in an economy like can these type of transitions occur quickly or instantaneously. another feature of the a.d.b. report is these lags or breaks handovers. so the transition from chinese led growth to chinese tertiary led growth, a more occurringconomy is slowly. at the same time, the transition from a china slowdown to a and developed economy growth, particularly growth led household. in the sector, is occurring more slowly. there's a series of drops in the economic backdrop, which i think clouding theof visibility on the outlook.

pockets of resilience if not strength in the chinese economy. unfortunately, the economies in aren't really leveraged to that at this time. >> glen, we're also expecting coming out of china tomorrow. most people are expecting a contraction. view? the house >> look, i think it's going to negative territory but it's not going to be as bads it was. when we look at some of the sort of proxies that we can use for toan trade, it's interesting note that in that container shipments, they're starting to strongly.d pick up so either we've seen inventories run down in asia or production up.oing to start to pick so i think, you know, for the the low may be in. but definitely that's a key leading indicator to be

watching. >> the a.d.b. report does talk about the strengthening u.s. threat to asian companies. i mean, this on the backdrop, and the voj -- i mean, they've got a lot of pressure to actually do some move.f a what do you think draghi is thinking about right now, post-fed? >> well, that's the interesting dynamic. fed has now that the sort of passed on a liftoff, you have that relative differential in monetary policy between the g3 widening. but certainly we still are in a situation where the level of unemployment and the risk that is presenting for wages and inflation in 2016 do suggest that the fed will be raising at some time over the next three to six months so that will u.s.pportive of the dollar. but to bring that back to the point the a.d.b. was

over this period of generous liquidity, there has been an increase in corporate foreign exchange leverage, what low interesty rates. so it's not so much the speed at the global structure rate moves higher. it's the speed at which the u.s. moves higher, that poses a risk for corporate asia. and that could be a possible transmission mechanism, from what we describe as a trade moresion, into a generalized income recession domestically. >> all right. we're going to have to leave it there. thanks so much for joining us. asia pacific economist. >> the stories making headlin the u.n.e world, islear agency has iro iran moving closer to having sanctions lifted. officialsing with the in tehran, the director general says significant progress has

been made. he says iran's cooperation has helped the agency investigate activity that may have had a military dimension. he'll deliver a full report by year.d of the hungary has given its army to controler migrants at its border, of nonlethal use weapons. orban says his country is being overrun by asylum seekers, who he accuses of breaking down the europe. hungarian authorities have been trains,migrants on to taking them straight to austria. leaders hold an emergency summit the crisis tomorrow. the huge group of republican presidential contenders has smaller with the withdrawal of wisconsin governor scott walker. theays he wants to thin field so the party can find an alternative to the current front-runner. he didn't mention donald trump by name, he urged others the same reason.

walker had promised to stay in 1% race but had less than support in a recent poll. >> coming up next, a new set of slowdown mayna's not be as bad as first thought. we'll see just how much faith put in those numbers when we return. stay with us. ♪

>> this is trending business. welcome back. china's slowdown may be causing investors to exit the stock market. but some data shows things may not be as bad as they seem. talk about this very interesting set of data coming alibaba and union pay. could be good news for the chinese economy. the does it say about health of the economy? >> increasing signs of this --ion, albeit at stabilization, albeit at this slower growth rate. there's a bum bunch of indicators that are showing rebounds. so effectively china's google, about six billion searches per day it handles. it looked at clicks on to small med-sized -- medium sized enterprises and that was up in september. the alibaba shopping carts, the

prices in those carts are ricing, about 7 -- rising, about 7.4%. and then union pay, which handles most of the banking transactions at the card level, it's showing rebounds in some areas, especially in all-important property transactions. >> seems like you're looking at china is looking at now as well. why is it such a big difference the official government data and what these companies are releasing? theo a large extent, official data just isn't keeping pace with the changes in china's economy. the economist talking about this transition in growth. data just isn't capturing the activity as well to.t is used it's used to industrial economy, easier to measure. services, consumption, they're a little bit harder to capture, so there could be a bit of a gap there. the pmi is a good illustration

of this difference. pmi gets all the headlines and it's been very weak. three-year low last month. yet the services pmi is looking okay. a bigger part of the economy. doesn't quite get the attention level.factory >> that's numbers come out tomorrow. good to look at other figures as well. much for joining us. coming up next, imax seeks to cash in on providing the big screen experience to china. details on the company's hong when trending business continues. ♪ . sure, tv has evolved over the years.

it's gotten squarer. brighter. bigger. it's gotten thinner. even curvier. but what's next? for all binge watchers. movie geeks. sports freaks. x1 from xfinity will change the way you experience tv.

yvonne: top stories. aftershares are dragging officials added to speculation. presidentf atlanta said although he voted against that the september rate hike due to market volatility, it was a close call. the fourth policymaker to speak out in favor of the rise happening sooner rather than later. the state of the chinese economy but data from an alternative that of indicators suggest

things may not be that bad after all. enginet used search suggest the world's second-largest economy is stabilizing. the findings tied in with the conclusion of the beige book. and the u.s. justice department is said to be conducting a criminal investigation into volkswagen after they admitted to cheating air pollution test, according to officials. vw shares plunged in frankfurt. the german regulator looking into possible trading violations. over to david with what is moving the markets. david: yes, it is. these movers. markets after the opened. more in a moment. let me start things in south korea. one of the bigger stories has been vw, volkswagen, coming out

and admitting they cheated on emissions tests in the u.s. -- a lot of the south korean carmakers on and expectations as they may benefit for what could be a backlash coming from consumers. that basicallyng they made that affected because of the ongoing investigation over in the u.s. lg display down about 5%. a note from investments, they are seeing no improvement when it comes to demand for lcd. you have stats and potential of getting together or i would like anday merger or purchase the operations of sharp. when it's a come together -- when it comes together, the competitiveness. ist means touchscreen, this

lcd i believe. g pg out with earnings guidance for 2015, 4 year that is good. marking at 33%. if you look at that at an ets basis, up. shares were up four or five straight days and selling all the news of no guidance. gold-mining stock, down report -- down 3.3%. newcrest is down almost 3% for the can we get a gold price up? $250 millionecure in finances. gold price, what are we doing? 1133. on what is really driving markets. taking a look at oil and gas.

oil was up for 5%. -- 4% or 5%. the greenest of the agreement. back to you. you.e: thank our top story, asian development bank said at the slow down in china will be felt across the region. sherry and joins me. a pretty grim report. shery: very cautious about the growth in asia. it is extending on the idea of what would happen if china's of slowdown deepens? the bank has slashed prospects for the second time in two months. as they are expecting growth at 6.8%. below chinese target of 7% which is the slowest pace in a quarter century. that will hit commodity explorers in mongolia and indonesia. not to mention on top of this, you have india's reform, and through at the slower pace.

that is affecting growth prospects. you also see industrial at a slowercovery pace. all of this affecting growth prospects for the asian region where the adb expects growth at yearthis year and 6% next which is below the forecast of 6.3%. yvonne: what of the key risks? shery: nothing surprising. we have seen this capital $125ows from asia area billion fleeing asia in the first quarter. this is a key concern for the adb. asia may bethings forced to raise rates following the u.s. in order to contain the destabilizing outflows also. strengthening u.s. dollar posing a threat to asian companies that hold large amounts of four currency debt.

foreign an currency -- currency debt. a specialey dedicated chapter in this report for you tell a is more. shery: it was interesting. a special theme. the boom in asia help the women. literacy rates and mortality rates. int is happening with women the workforce in asia is in the rate has fallen from figures is percent in 1992 -- 56% in a 1990 to 40%. moreuld be because housework. unfair load of housework, cultural biases and illegal options. yvonne: thank you for that. emerging economies are bracing for any future hike by the said. there was relief and it could be

short lived for let's bring in sharon chin. good to see you. let's look at the malaysian where it has fallen the most. is growth most active risk for a said hike -- fed hike? sharon: according to hsbc research, a fed hike could accelerate declines such as malaysia and this would raise spending costs for consumers and constraining demand. ins particularly dangerous malaysia where a lot of investment and consumption has been driven by deptford malaysian -- driven by debt. share of gdp rose last year in the first quarter of this year compared to 150% in 2009. this is after china. the government has taken steps

to ease policy and reinforce capital controls. yvonne: what other risks are there to malaysia right now? well, we know malaysia has been hurt by the commodities slumped. and the prime minister battles corruption charges. and also malaysia has a sizable share of corporate debt in foreign currency and one of the highest proportion of offshore ownership in sovereign debt markets. all of these factors coupled with the fed hike, not looking great. yvonne: are there any bright spots? you could antipate the ring get might have boost for exports and tourism and a central said yesterday she will improveingett in line with the fundamentals

and stabilize an issue surrounding. she also said she things in the ringike will help the evene though the window has closedtt. . it remains to be seen how it will play out. malaysia will be hit by the fed hike. chen joining us. skies solar holdings arose to one-month high in new york after the hong kong-based company signed projects up to $100 million. skies solar works with clean energy to fund ventures in asia and latin america and expand in the u.s. up 50% on the news and gained more than 40% since hitting a record low last a month. u.k. chancellor george osborne is hoping to calm away from a trip in china with the deals for

new nuclear power plants. he announced the u.k. will guarantee $3 billion in funding to build the first nuclear station and a decade sprint osborne is hoping this will attract investment from china. dov charney -- the financial times said that china companies may help. uber is played to set up an end and asian entity. -- planning to set up and indonesian entity. drivers were question said the app does not have the right permits. over them said they are open -- uber said they are obeying the law and asking customers to use twitter to tell the authorities why they need uber. access china is looking to raise almost 280 million dollars in the hong kong ipo. will it be up to make a big splash? bloomberg news asia deals editor

joins us now for more analysis. ben, how will investors respond? the ipo market has been weak? be a bit of a tough sell. most of the ipl's that hit in the market that ipo market has fallen from prices more than 20%. it will be a bit of a tough they'll. yvonne: what is their position? ben scent: it is doing well. the next income -- is the adjusted net income doubled. the market position is interesting. different from the u.s. where there traditionally known for the space museum. the dinosaur movies for kids. and china, as they have been known for sharon commercial films. they are showing a hollywood blockbusters. yvonne: oh, yeah.

why are they focus on china? ben scent: the main reason is an economyis such for film. it will eventually be the biggest of box office receipts in the world. most of the cinema are built. imax, u.s., if you want you have to do a lot of upgrades. they can get the latest, greatest technology from the beginning. yvonne: bring on the popcorn. joiningt, see what for us. come up next, president xi jinping had to the u.s. and we hear from his top four official. -- foreign official. ♪

david: headlines around the world pretty israel and russian said they have worked out a way

to -- around the world. -- israel and russia said if they have worked out a way to avoid clashes. israel said they may stop arms shipments from iran. israel's benjamin netanyahu said he written agreement with russia vladimir putin. alexis tsipras has taken the oath of office as greek prime minister following his victory in sunday's election. the coalition between his party and the independent greeks will have 155 seats. greek government bonds has fallen on the result with the international bail out seen as more secure. in contrast, the january vote prompted a selloff in security. u.s. extradition proceedings person a former fifa jeff warner is wanted on charges of fraud and racketeering, qs of taking millions in bribes.

withs indicted in may former a current officials. warner denies the charges and is fighting the extradition. yvonne: china's top foreign official has defended beijing's actions and the south china sea and causing -- and was said to infringe on the sovereignty of neighbors. our correspondent asked the why china has been reclaiming land. >> there is no reclaiming. land in the south china sea. islands soeen some grounds. solid, legal historical facts to back up our position. reporter: the american say 2000 acres have been added. yang jiechi: china has completed

on some ofation these station islands which are part of chinese territory. of somevery purpose construction on of these islands is mainly to serve public interests, international interests. given the fact that some of our territory is surrounded by installments know, of other countries. thereis -- there is reasonable ground on these islands. betty liu: there was a military airport being built, right? yang jiechi: let me say, lots of is for civilian

purposes mainly. people me say that should take a reasonable stand on it. about the disputes between china individual countries in south east asia, we believe that part is directly concerned solve handle and try to these differences. and through friendly consultation and negotiation, exactly as stipulated in the declaration of conduct two parties and the south china sea. is my understanding the philippines filed their opposition to what is happening in the us out china's the and that china have refused to engage in the complaint. refusedhe chinese have

to engage in the complaint. yang jiechi: china made it very clear that such disputes or similar disputes should be s concernedhe partie and we would not participate in any kind of adjudication, as you mentioned. china made its of you very clear not that this year or last year ,ut actually about 10 years ago china made its position very clear. i believe it would be good for everybody to keep its word and to do what they have promised. see that evencan bank you can say that interview -- yvonne: you can see the interview as "china: behind the wall." coming up next, now you see it, now you don't. burberry uses snapchat for a

preview of its latest collection. was it a good tragedy -- strategy? we will discuss it. ♪

yvonne: a closer look at the burberry falling more than 1% after the eeo downplayed prospects of an imminent rebounds. christopher bailey was speaking at the london fashion week show the sales of the designer wear hats fallen to a two-year low following china's crackdown on extravagance. burberry will report second-quarter earnings next month. my next guest is an expert on china's changing luxury. thank you for joining us here

this morning in the studio. you talk about brands like burberry. they are saying it has been a struggle and china. you say the brand is self resonates when it comes to being a very made in u.k., made in britain brent is still have quite a bit of like. guest: absolutely, we talk about changing chinese consumers. burberry, what is the change of pace? you can look at chinese customers and not just buying buying by status but heritage. is heritage that burberry can use to sell. my research has shown the chinese consumers when you talk british,berry, or first they remember the queen and second burberry. clearly, it is very important

factors which make people wanted to buy luxury. and a second changing pace in chinese consumers is they want to experience it. they want to springs luxury and not just have a hand back in there -- handbag in their hand. yvonne: it is not just i need the hermes in my hand, but to the experience? qing wang: is not about exclusive -- exclusivity but the experience. that is why it is booming in the u k, for example. although burberry may have declined in sales in china. but actually the sales in the u k are still doing really well. markets have a european . if you look at european markets, not european customers so much. exactly. what they should worry more

about this how to make retailing outlets in china more attractive to the chinese consumers so they do not have to go abroad. at the moment, they have this thaty street in london combines technology with luxury, with heritage. that is a third changing pace of chinese consumers. they are very much pro-technology. more so than perhaps most of the world in terms of looks record consumer's free yvonne: at what the total by this initiative from burberry to party with snapchat and they were showing their new spring-fall collections 24 hours on the app before they debuted on the runway. do you think it was a great way to tap into social media? : absolutely. social media at now is an important channel for luxury brands. that debate is already gone. people know social media is so important for burberry.

it is later the way and social media if you think about the runway show where they used technologies to combine real experience with imaginary experience. that is very catchy. as experiences we are talking about of luxury. even bank use -- even bank -- yvonne: you said k use technology but technology -- you technology can use but not the other way around. why is that? and wang: we look at apple hermes. apple sells iwatch is in hermes store. that is not going to change the fact that technology is technology and it is now luxury. the very essence of luxuries

timelessness. yvonne: we have to leave it there. thank you for your insight on the chinese luxury. qing wang joining us. more to come. stay with us. ♪

john: with all due respect to scott walker, that hold back down thing? not so much. scott walker of wisconsin, the antiunion crusader is dropping out of the presidential race. >> today i believe i'm being called to lead by helping to clear the field in this race so that a positive, conservative message can rise to the top of the field.