guy: talking to on the move. over in berlin,. i am guy johnson. here is what we are watching. the chinese credit. gdp hits the target but should investors worry. the debt continues to climb good brazil's biggest weekend is too close to call ahead of sunday's impeachment called -- sunday's impeachment meeting. the new revenue growth. as jpmorgan and bank of america's stocks surge.

good morning. half an hour away from european open. let me tell you how things are starting to shape up now. a lot going on. the g-20 meeting. what is happening with the imf meeting. all very much and focus. let me show you where the future story is going. very flat call this morning. not going to do much. we watched plenty of other assets. let me show you what is happening with dollar yen. there is an interesting report out of one of the japanese spikes. suggesting desk japanese banks suggesting -- japanese banks suggesting the earthquake may be the cause of not having to use the failed attack site -- failed tax hike next year. we are watching the dollar yen carefully. brent crude, we are watching what is happening this weekend oha.elhomme -- in del

you've got the spat between schaeuble and the greeks. the imf in the mix. aussie dollar trading higher, unsurprising given the chinese data. here's juliette saly. saidtte: goldman sachs is to be embarking on its biggest cost-cutting push in years as a tries to whether a slump in trading and deal making. according to two people of knowledge, ceo is falling for the push which includes firing and curbs on travel and entertainment expenses. china's high-yield bonds on the mix today. the worst two-year selloff since the end of 2014. they have yet to fully price and -- with the economy slows. speaking in washington, the governor of the pboc says the

debt burden is heavy. federal reserve bank of atlanta's president dennis lockhart says he will no longer push for a rate increase this with weakening growth and low inflation. speaking to bloomberg's kathleen hays, he says they are still opportunities ahead to make a move. if you look of the calendar, there are enough meetings remaining this year that if the data were to suggest it is the appropriate policy to have three moves. i don't know, to moves, three moves, they are both possible. it is going to depend on how the economy evolves. juliette: global news, 24 hours a day, powered by 2400 journalists in more than 150 news bureaus around the world. you can find more stories on the bloomberg at top . guide. -- guy. guy: juliette saly joining us.

she was mentioning china's economy stabilized in the first quarter. gdp rose 7%. that's rose 27%. picked up lastut month beating analyst forecasts. tom orlik joins us now from beijing did tom, is this -- from beijing. tom, is this stimulus in action? tom: yes. china's government put a huge amount of stimulus into the economy in the second half of 2015. multiple cuts in interest rates. beginning in 2016, we are starting to see the impact. that is passing through the property sector. stronger activity in infrastructure. that is what we are seeing in the gdp numbers. guy: how does it play out for the rest of the year given all of that? ?s this a front loading

does it fade toward the back end of the year? tom: it is front loading on lending, huge growth in new finance going into the economy from the banks in the first quarter. it is front loading on the fiscal system. chang calling on accelerated disbursement on investment funds in the first half of the year. our view is china's government has policy space and determination. that gives us confidence about , 2016,erm growth outlook 2017. the government growth, 1.5% growth. -- the government wants 1.5% growth. the growth model built on credit and investment. good --at points points. tom orlik joining us. take you very much indeed.

bondable wager joins us. us --u but wager joins that line moving up. this is a credit fueled story. there frontloaded the stimulus. remember in china, the dissension between monetary and fiscal stimulus is fairly global. the difference between this and 1997 is that this is entirely mystically financed. you don't have a massive deficit on the other side. that means that that you get a get out of jail free card. is for anteresting little while they were worried the market make it too hot and they were restricting market stimulus and moving the seamless to him for structure. things like water conservation, environment protection it now in the last four months, it is

right back to the same old model where the new building construction is boosting up again. china property sales are extreme the hot. it is classic stimulus. property stimulus is what has the highest import multiplier. if i am in brazil or south africa, i don't care as much about china's gdp is a care about the fixed asset investment and in particular property investment. that is the one that is doing externally well. -- doing extremely well right now. prices are rising at a pace. see copy prices going up. construction going up. i and or being supported -- iron ore being supported. rio tinto ceo saying we'll

see this rising iron ore or a price being sustainable. he is right basically. he is right to say that actually what we are seeing in china is not something that is what the last even throughout this year. cities account for only 5% of construction in construction 4.5% in china. debts that is where he had inventory problem. -- that is where you have inventory problem. this kind of that, you'll see it rising it we are delaying -- rising. we are delaying but that does not mean the market from a strong just from a short-term --spective

guy: does it feed into big industrial -- you wonder what the ripple affect is? are we going to be see context being placed? is that the kind of stuff we can expect to see? that is big stuff. does it actually work that way? bhanu: that is an interesting point. if you look at it details of the pmi -- look at the details of the pmi data, what china is showing to do as you would if you're trying to stimulate your economy is try and limit the import multiplier. when used to let your economy, don't want to help germany australia, you want to help your own economy during -- economy.

given the property markets, you will see some commodity markets. i don't think you'll see an impact. the near-term impact is going to be quite modest. i don't think they will stimulate that sector right now. the manufacturing sector -- a big pickup in infrastructure which is more services these days. --e pickup and property pickup in property. guy: stay with us. we are going to carry on the china conversation. what does it mean for europe's biggest economy? we get the news from germany next. ♪

guy: 42 minutes past the hour. let's get to bloomberg business flash with juliette saly in hong kong. juliette: thank you. goldman sachs is embarking on its biggest cost-cutting push in years as it tries to whether a slump in trading and deal making. pushs calling for the which includes firing and curbs on travel and entertainment expenses. valeant pharmaceuticals is working with investment banks to review options after receiving interest in a number of its businesses according to a reuters report. -- itug maker has said

seeks to pay down some of its $32 billion in debt and the company is working to return a stable -- after a disastrous eight-month run which is seen its stock lose 90% of its value. -- taking -- checking customers e-mails without ever having let them know. apple is said to continue its fight to keep the government out of another iphone. this one from a drug dealer in a brooklyn case. it comes weeks after the fbi appled its case to force to help break into an iphone of a terrorist. european first quarter market share has reached a five-year low in the wake of the emissions cheating scandal. the company's brand including audi has accounted for 23% of new registrations in the three months up to march.

that is your bloomberg business flash. guy: juliette, thank you very much indeed. discussing china's economy has been stabilizing. gdp growth came in. how does it affect one of its biggest trading partners? germany. china has a big export relationship. good morning to you. you watched what happened in china very carefully from berlin. you watched what is going to be happening going forward from here. do you see anything good and what is coming out of china me german perspective? we are seeing housing picking up. can i read across from one to the other? germany, we are looking closely at what is happening in china and asia more

generally. at the moment, there is no real hope that there will be a big pickup and exports from germany and the euro area to china. this is not a china issue specifically. it is a slowdown in global trade. yes, the consummation of exports to the euro area growth, we project to be basically nil. it is a big worry. we don't see an upside. guy: where d.c. the global economy going from here? we had the imf warning about what it sees. during the clearly financial crisis. are we back there again? we are seeing them pour ins back on that. they are back in crisis mode. marcel: the german economy is doing relatively well.

we have a stable labor market. ,he growth leaders for germany 1.5% growth this year. 1.6% next year. german economy, quite decent. overshadowed by the fact that industry is doing poorly but striving growth in germany. it is government consumption. remains credibly -- incredibly week in germany. private investment has been declining over the last 20 years as the share of gdp. that is the main worry for the german economy. bhanu: if i could slip in a question. social --ina's total we haven't seen german factory orders pickup. how much of that impulse you are

seeing across europe from the improvement in china data? recently we have seen a euro coinion in the survey. europe is losing some momentum. what is your outlook for the next three to six months for europe's economy? do you think with yellen getting sensitive on the dollar, the ecb will get sensitive on the euro given that the cyclical outlook may be deteriorating? marcel: the cyclical outlook is improving slightly, not massively. exports will not be very strong. domestically demand is picking up their consumption -- picking up. .he numbers are much too weak we're talking 1.5% growth for the euro area.

that is much too weak to pour the euro area just to pull the euro area out of crisis here it -- to pull the euro area out of crisis. the central bank is doing its best to ease. we saw massive easing in march. the euro has been holding up so well. it is relatively strong. it is not a weak currency. that point, what side of the fence do you said on? draghi side? t short list -- or short schaeuble's side? -- marcel coal the ecb -- inflation is around

the euro. ecb targeted below 2% to the ecb has to act to protect its credibility. i would not be surprised if in the next half year we see more easing steps by the ecb. benu: how worried should we that inflation expectations are coming down in europe? ecb or reaction from the will it be same old same old? marcel: inflation expectation is the most important indicator for the ecb to look at. it shows us something about market expectation, the trust that markets have in the ecb to the fill their mandate. at the moment, it is deteriorating. we don't see the euro area coming out of the crisis for the next two or three years. therefore the ecb has to keep acting. will also clear the ecb

not be able to do it alone. we have a massive problems with the banking system. in particular in italy. it created more than $2 billion in nonperforming loans. we have that in your. .hat is a big -- in europe that is a big impediment to growth. we have economic growth -- economic slumps all over the euro area. guy: we are going to leave it on that note. thank you very much. joining us from the d iw from berlin. we are eight minutes away from the market open. we are going to take a look at the corporate movers. ♪

guy: 7:54 let's find out what is happening in some of the stocks you need to watch. caroline hyde is here to tell us. caroline: keep an eye on steelmakers. is and eye on -- this what does this is what is in the white line. compared with the volatility. the other rivals -- in the purple. i put up the rivals. they could be eying a merger. this is what is being reported.

understandingly, they could be sending out options with a possible merger of one of its three main rivals. keep an eye out. up 2% on the open. we are in the initial stages says the german press. is it the way to start the upset? i want to -- i want you to keep -- we are now trading at 25.15. will they bounce by 2% on the open because sales did better than expected? growth -- 10% sales could we saw china declined by 8%. they are managing to do well in southern europe. carrefour is france's biggest retailer. guy: we are going to be watching some of the stocks. the market open. we are four minutes away from that market open. how will friday fair?

we will find out next. ♪

guy: good morning, you are watching "on the move." theymoments away nothing start of european trading. given the chinese credit. gets, but should investors worry that debt continues to climb? too close to call ahead of brazil's impeachment vote? the new revenue growth cost. it will embark on an expenses cut. still tumultuous out there, there was a lot going on. european equity markets look reasonably calm according to the

futures. plenty of stocks we will be paying attention to. caroline: we are on track for the best record for european stocks since february. it is the highest since the beginning of the year. asia was a bit lackluster today. perhaps some profit taking off. it came in line with expectations in terms of gdp. saw industrial production pickup, factory output and retail. is that all credit-fueled? we saw some declines across the board. the mckay was also off. let's get back -- the nikkei was also off. looking at the futures market, we're seeing the open a little higher. dax clearly a lower performer.

bank also feeling the pain. let's get out of equities. a bit of profit taking on this side in terms of the region. remember, the best week since february. money slightly going into oil this morning. dohayes on what happens in on saturday. to be get an output freeze? glut coming that down. we could see a balance that helps to push oil higher. so close to 2013. it has been weakening after the tragic events in japan. the earthquake, and the worst week for the japanese yen since they started to unleash negative rates back in january. let's have a look at some of the

stocks to watch. sales did better than expected, outperforming even though we see china fall. merica pulls it out of the bag. justrench retailer creeping up. we couldn't see mergers between competitors. they are prepared. there currently of letting this. 2.4% the biggest public iterator hedge fund the group is put in $500 million in the first quarter since the computer driven out fund trackers. those are some of the stocks you need to watch. there is not a lot happening. we have had quite a week in terms of the upside for stocks. let's go to the breakdown, it is

a fairly mixed to one. the financials are getting back a little bit. it is down as well because of what is happening. of rotation bit this morning. given the low volumes and that theappening vis-a-vis actual market climb, i don't think we need to read too much and what you are seeing. a lot is happening. eting, butis doha me also the impeachment possibly on sunday of the brazilian leader. overturned court has the government emotion and is allowing voting on the impeachment to continue as scheduled. the potential near climax of a two-year corruption scandal surrounding the country's president. brazil has deteriorated into the what -- one of the world's worst performing economies during that's time.

we have this weekend coming up, this climactic event coming up. it versus -- this is the dollar. the market has come a long way with brazil since the start of the year. now the time to walk away from the trade, do you think? pricingnk the market is and fairly optimistic outcomes in terms of political change in policy change. that is leading to much better economics. i think we have much more would to chop before we reach those outcomes. clearly, the market does front run and will not wait for the better data to arrive. in most cases, i think the balance of probabilities in this case is now beginning to tilt in favor of actually walking away from that particularly in the equiti. if you look across the assets spectrum, i do think there is more juice. credit has come a long way.

interest rates can be cut. brazil has enjoyed a conference of factors. also, it has enjoyed to the federal reserve having a different function. it has enjoyed, of course, china getting much better data. particularly oil prices going up. this improvement in the brazil gives room to the central bank to become more dovish. i think the debt trading can run, equities have become expensive quite quickly. anna: can we price out the idea we could see venezuelan style default? always a bitwas extreme. brazil is much better institutions than venezuela does. i know that has been a lot of corruption scandals out there. but the fact they're going after that tells you the institutions are much better. that the brazilian economic is going break with the other way. but brazil would default imminently, i think that was always wrong. therefore, brazil credit was a

pretty good investment. that is command long way -- has come a long way. local debt i think can continue to do well. central banks could relax and take their foot off the pedal in terms of how hawkish it has to be. wide uppera very cap. the debt i think could run a little further. market can only focus on wanting at a time. it is focused on the politics, maybe it ignored the fed into china. those are both contribute factors. what are we focused on after this? just howestion will be much reform we will get in brazil. the single biggest problem is its public debt. the face of it is rising. their running a massive primary deficit. or 90 percent 80% of public debt. they cannot compare public debt

there with those in developed markets. em tends to blow up at a much lower level of stress. brazil meets to bring down the public debt. how will they reform the system of wages? that of the questions brazil the to answer. these will be tough questions. brazil at this minute is in contraction with the labor market. it is a difficult time to reform. reform, it ise to very difficult post of a dolphin we have heard the last from the president no matter how these proceedings go. i think brazil has to brace itself for some difficult times ahead. fed weat happens to the get to, three hikes? bhanu: it is possible that we do. of the minute, the kind

jump it is enjoying, that precise reason is likely to be temporary. the fed is only going to go twice if they believe the u.s. economy is improving. that will mean some part of it will benefit from that. if i accept north asia will benefit from that. em point is, other parts of have become a countercyclical bet on the u.s. economy because they borrowed more. leverede financially into the financial economy. you have a lot to do with u.s. monetary policy because if rates go up that hurts your bottom line. that is the issue with em. you could has a decent relative value opportunities. might do well, but turkey could come under pressure. south africa could come under pressure. well,s. economy does my you could get some relative value opportunities.

i think it could be slightly on the downside for em. guy: as you look forward and what is going on around the world, what stands out for you? we have brexit coming out, with the greek story back. walking your way through this for me as you set up and talk to clients. as you try to figure out this fed question along with all the others. the first, and most important question, is just how long china is going to continue with this stimulus on steroids. orause china's public debt the total social financing is increasing at the same pace as it did in 2011. that is extremely at a much higher level. will china take a pause? will they say we need to reduce the stimulus? that is one big question.

question number two is how strong the international trade rebound is likely to be. international trade is improving in value terms because the euro dollar is coming through. in volume terms, we're still very poor. that could be a key call for emerging markets. we are likely to see in brazil, china, at this minute the hopes of reform are quite high. prettylity is actually underdeveloped. the markets are hoping. we really have to see if that is followed up by action. guy: we cap you longer that we should have done. it is been a great pleasure. back to his real job enough about the next, stuck in reverse. volkswagen's market share hits a five-year low. we live in berlin with the latest.

back, new news coming out of spain. the industry minister has resigned over the penama leak. -- panama leak. it looks like the story is not going away in a hurry.

you see this european nations coming together talking about this idea they will up the ante when it comes to what is happening with tax evasion. it looks at the pressure is piling on panama. me run you through what we're seeing in the market story this morning. fairly quiet session, to be honest, in terms of for the equity markets are. one area you are seeing a little bit of weakness is in some of subcomponent manufacturers. you're seeing some weakness in that space. that is surrounding the sector. a momentat story just for study in the meantime, i want to show you what is happening with the price of crude. again, reasonably flat. it is at incredibly elevated

levels. they try to make sure don't lose out of we see this freeze coming through. here's the bloomberg first world lose -- word news. iette: goldman sachs is embarking on its biggest cost cutting in years as it tries to whether a slump in trading. the ceo is calling for the push which includes firing and curbs on travel and entertainment expenses. quarterly results on tuesday will be reported. china's high-yield the bonds are the worst -- midst of their worst two-month selloff. in time, investors have yet to fully process the risk of default as the government's lows. the government of the pboc says the corporate debt is heavy. the leverage compared with countries without high debt rate is not very high. new prime minister says the government plans to go

ahead with currency auctions. the hedge fund agrees to produce of it or not, regardless. he was a little room for error as he tries to guide the country to the final steps of removing capital control. >> if we are successful with these conditions we put in place, and we fulfill them, i envisioned by the end of this year we will have removed capital controls on households and corporations. the pension fund will have been let out with more funds than they have been able to do up until this point. we will also have in place the precautionary measures needed to protect the general public and the national interests. global news 24 hours a day powered by more than 2400 100 50 newsin bureaus around the world. you can find more stories on the bloomberg at top . thank you very much.

let's get back to our top corporate stories of the morning. looks like an is lost more ground in the european car market. , what do weberlin find out? is this just a continuation of a theme? the questiono people are looking for -- will they be up to stop the rot? and the answer is no. the market share is falling in europe. it is the lowest since 2011. the market is still growing. commitare not willing to this is still a fallout from the diesel scandal. volkswagen is partly to blame for this.

this recall is not going at the pace that they hoped it would. with the switch out a couple of cars. so far, they've only tackled one particular model. it is not a huge model in europe. it is going at a rather slow pace. happening tody instill some competent in the market. how will this affect the financials? >> that is a number people be looking at crucially this month. it will release full euro earnings. they've had to delay those because the didn't have all the numbers together. the number everyone will looking out for his the dividend. how much will it get cut by? will it get eliminated altogether? an important litmus tests. it will give an indication of

how they see the crisis. of how they want to deal with the result, they still have -- the size of the cut will show how they feel about the crisis right now. guy: it seems strange to be talking about bonuses. that seems to be getting a lot of traction of the moment. given the crisis, can it be said anybody deserves a bonus right now? benedikt: that is the biggest debate. but afair to say this is very awkward conversation inside volkswagen. it is captured the public's imagination as well. the executive for branded yesterday as being greedy. the public can't understand how you can have a company that is aning billionsin fines and unsure future with workers worried about future prospects then top managers thinking about their bonuses. golfing was sparked by the who used to ben

the cfo. he was asking for 10 million payments saying it was much better now that the switch to chairman. he was to claim the money that he is still owed from his old contract. question, not everything looks legal or legitimate. that is a debate that volkswagen is having at the moment. out as athat will play crucial test for the ceo. said he wants to reset the company. he wants to instill a new sort of atmosphere. having these throwbacks to old the debates about bonuses doesn't help his cause. as always, thank you for joining us out of our berlin office looking at what is happening. will be goldman sachs embarking on its deepest cost-cutting push in years. details next. ♪

guy: welcome back, you're watching "on the move." goldman sachs is embarking on its deepest cost-cutting venture in years. the bank tries to whether a slump in trades and dealmaking. michael moore joins us now.

start off with what he wants to do. ofhael: it is really kind across the board. it is headcount, travel, entertainment. they are cutting whatever they can cut. blonde -- beyond that. this is going line by line and cutting wherever they can cut. guy: this is about how long we can tease out what is happening. it feels for a similar to what we saw at j.p. morgan. hasael: he philosophy always been to take the little steps now so that we can avoid having -- feeling pressured to do something major in a year. they can keep their returns in the double digits. oft he doesn't face the type pressure you're seeing at the european bank to really get out of major businesses. that is what he is trying to avoid.

when you look at how the market is reacting so far, he is knocking on the wrong door as well, isn't he? that seems to be rewarding. michael: we know the top line is looking tough right now. you have to find something in the middle. that keeps the bottom line moving. i am assuming is market information is pretty good. michael: a lot of it is because what can you -- what can he do? the market doesn't tend to believe these guys when they talk about revenue because they don't have much control over it. the contest think revenue will come back but a lot of it depends on what the environment is like. if you say we will cut costs, you have control over that. the market tends to give you more credit for that. that is what we are seeing it across the lord.

board. guy: how does that compare to the europeans are doing? it is more cutting around the margin. the europeans are getting out of this whole business. this is gone. this is kind of more around the edges. it also becomes more immediate. when you lay off 1000 people, there is severance cost. you don't see the savings on that and online or 12 months out. these things you see the savings immediately because you just not spending the money. you make sense, we will see later. you can follow citigroup's first-quarter earnings announcement and conference call that will happen on the bloomberg function. i urge you to do it. it is absolutely fantastic. it gives you real taste of what is happening. up next, we talk oil.

the output freeze talks. for a second weekly advance. the major supplier there to meet -- compared to meet this weekend. ♪ you shouldn't have to go far

to get the help you're looking for. that's why at xfinity we're opening up more stores closer to you. where you can use all of our latest products and technology. and find out how to get the most out of your service. so when you get home, all you have to do is enjoy it. we're doing everything we can to give you the best experience possible. because we should fit into your life. not the other way around. shoshow me more like this.e. show me "previously watched." what's recommended for me.

x1 makes it easy to find what you love. call or go online and switch to x1. only with xfinity. guy: welcome back, you are watching "on the move." let's he how things are shaping up. to be honest, quite quietly. as you can see, the movie is not that great. , the tiere automotive one suppliers getting hit a little bit this morning. generally, european markets fairly clm. it is the auto sector. the providers the auto sector that are sinking. the french company down by 4.6%.

it to sales aren't living up to expectations. it seems as though they're pulling in and from in sales as well. barclays didn't like that. currency once for again impacting the sorts of companies. they take activity by 1.5%. your best performer is eating red. toyou ever get of vouchers buy lunch for your employer you be provided by this particular company. it is the leader of the pack today. it is doing well. overall, we see some organic issue volumes. is at 4.2 8 billion euros. it was not living up to expectations despite the new fx hit to latin america.

it seems to be some resilience being shown by brazil. overall, france and europe facing significant beats. 8% or 14% target is volume growth. in man group up. it is one of the best performers. it is raking in net inflows. assets under management felt a little bit because of the volatility in the market. overall, they had more money coming in than leaving. people in $500 million in the first quarter. thank you very much, indeed. market,around equity oil is posed for its second weekly advance. at the same time, the international energy agency sees a global glass as always and -- managing -- vanishing.

and, it doesn't make convincing reading. ryan joins me now to walk us through exactly what this chart tells us and why we should pay attention. ryan: i think it just shows why even if they do do a deal, compliance with such a big issue in doha. it could occupy a big part of the discussion time. the last time opec did a deal with non-opec countries to cut they agreed to cut their production by 500,000 barrels. in late 2001.ppen this is a picture of production those and002 in non-opec countries. ,hat you can see is that russia the affection actually rose by 300,000 barrels.

the end goal and's treated -- cheated a little bit as well. only the norwegians and the mexicans really played ball. thing, the oil minister who expressed his doubts about opec and non-opec countries being able to pull off the norwegians and mexicans aren't even at this meeting. they both declined to attend. guy: this is the story from earlier on this week, they effectively sees the oversupply story almost disappearing towards the back end of this year. as you can see, towards the backend, they see the oversupply story disappearing. that is an amazing turn of events considering how the market was set up. think the oil market

took the report in stride. i think a lot of people think we will see a decline in the glut. their main argument is at the shaleroducers -- producers could produce even less. you can see that if you look at u.s. production. we are down and just beliefs 9 million barrels a day now. they have had some success in causing distress in shale country. on: watching very carefully a daily basis now. let's carry on that conversation with the head of the oil market division at the international energy agency joins us now from paris. victory?declare we aren't talking about it in terms of victory, or defeat. our job is to want the numbers.

we present the picture as we see it. surplus that we see in the second half of this year, we have been signaling this for some months now. what is new is that the supply surplus is a bit smaller than we expected just a month or so ago. market iscause the gradually responding to the fact that prices have been lower for longer than most people have expected. most cost producers have had to cut out of the market. ion, which isact what the saudi said at the end of 2014 when they decided not to support prices with production cuts that the market will find the price. the market has found the price, and the reaction is being seen in the supply and demand balance. an: even if the oversupply as you suggest a subsides towards the end of the year, and we lead

.nto a smaller glut you still have to have robust demand, don't you for prices to rise? are you sure we would get that to demand? the demand was extraordinarily strong in 2015 partly as a reaction to the collapsing prices that took place in the second half of 25th through 2015. still expecting it to grow at the 60 by 1.2 million barrels a day. we have been carrying that figure for some months now. we look at it very carefully. we're very careful to ensure that figure is robust. we believe it is a solid figure. of course, the economic outlook came out with a earlier this week does turn out to be accurate, then there is the possibility, and i don't say any

more than a possibility, that we might have to adjust upper demand numbers. verye other hand, you have strong growth in some developing countries, principally india which is one of the unsung stories. we drew attention to that in the overview section of our report this week. what difference would an output freeze make this weekend, if at all? of actual bevels coming into the market, any kind of agreement along the lines we've all been discussing would make little or no difference to the actual fundamentals of the market. very few of the countries who are attending the talks, we not entirely clear who is, could increase their oil production -- couldn't increase their oil production even if they wanted to. production has been increasing so far in 2016 by more than we thought. perhaps that is all part of

trying to get production as high as possible to then declare a freeze. we don't know, on the basis of which amount of time this will be based. is it january, february, march? we just don't know. the impact will be very limited in the first half of 2016. we have to wait and see what it means for later in the year, if indeed a company has a deal is actually agreed to. ryan: if they failed to reach a deal, what with an mean for the oil market? neil: because we didn't expect it's to make that much difference to physical barrels anyway, it should not make much difference. there seems to have been a lot of sentiment attached to these have, which has had to been supporting the prices. a extension, it would be negative factor for prices. them in my to them fall back in little bit.

when people focus on the underlying fundamentals of the market, they will see it is continuing along the lines we suggest. a tighter market is in the prospect. guy: how many fed rate hikes do you price into your models? neil: we have not priced that many into our model because it is so difficult to anticipate will happen. to some extent, there is been a reaction since the hike that we had. it might have been premature, that is purely a personal opinion. at the moment, we are not anticipating fed hikes. we don't think in any event they would be sufficiently large to make any significant difference to u.s. oil demand growth. we are not really factoring that in at the moment. to speakys a pleasure with you.

thank you for taking the time to speak with us. the head of the oil division of the international energy agency. next, a merger with a big auto industry player. it is ahead. ♪

guy: welcome, this is "on the move." here's the bloomberg business

flash. sachs is saidman to be embarking on its biggest cost-cutting push in years as a tries to weather a slump in trading and deal making. this includes firings and the curbs on travel and entertainment expenses. quarterly results will be reported on tuesday. they're working with investment banks to review options after receiving interest in a number of its businesses according to a report. the drugmaker has previously said that it might disclose no payre assets as it seeks to down its debt. the company is working to return to a federal footing after a disastrous run for the stock lost almost 90% of its value. isn'tre's rally sustainable according to one

ceo. he added that prices may fall in the second half as supply improving demand from china. the second-biggest exporter of reporte will first-quarter production results on tuesday. guy: thank you very much, indeed. john elkin has pushed to merge one of the auto industry's big guys. chrysler and ferrari both hold their separate annual shareholder meetings today. agm, it is ferrari's first in amsterdam. the first time to see it that they will meet in the same day outside of italy. what should we expect? these company still feel like there in transition. strange.a bit we are near the amsterdam airport. we are celebrating some italian

icons. became aal consensus spinoff. and we have agm, now it is the turn. one press room, the same for the general meeting. company was worth 5 billion euros in market capital. of 2015, the three companies were with 25 billion euros in market capital. while we are speaking, there was some comments made that shares were up. -- ready toing for take definitive action to expand. these are three companies, two for sure looking for deals.

ways, we should expect that we have more deals. maker, that isl what he does. if we are true to form, that is what we will see, aren't we? letter, i mean, the written by the chairman yesterday renewed that they are looking for a make a deal. that to tango you have to be in two, and they didn't find a partner. they said that several times over the last few months. it is not clear the moment who could be the partner. a company there is called volkswagen has a few problems.

i am not speculating. thank you very much joining us out of amsterdam. in?y, do you want to jump sergio, he will ask is here. guy: yeah, we will wait and see. if there's anybody knows what is happening inside that man's head, i think it is you. right, let's get back to our top story. china had some data out overnight. the biggest surprise was the surge in new loans. >> this chart shows aggregate financing. expectationghlight and reality. what we saw in aggregate 2.34 trillionaled yuan in march. this is a credit helped home sales jump a 71% in march from a

year earlier. a real estate development surge was 6.2% in the first quarter to get the property market a boost. on the one hand, this jump in could bet -- credit seen that the stimulus is working. on the other hand, it also raises concerns about the durability of this recovery. how much is financing propping up zombie companies? how much is china relying on data for growth. the imf in its latest report trilliona may have 1.3 dollars of risky loans with potential losses equivalent to 7% of gdp. it is that bad a data that is one of the things at the center of the debate about whether china will continue to drive global growth. thank you very much. up next, a look ahead to a super sunday. two major market moving events

are due to take place. but will happen in doha? ♪

marketscome back, 52 into the market session. one of the stand that we are seeing some selling at some of the u.k. house builders. this may be brexit related.

land,more sort of british maybe they are mentioning some of these house builders that could be affected. arclays was down nearly 5% earlier on. in littlefirmed bit, but there has been some selling. we will explore further and find out. let's see what we have to watch this weekend. will she cling to power? live in house vote coming up on sunday. the oil producers converging on doha, will they freeze efforts? will it make any difference whatsoever? let's talk about what else we need to be watching. bloomberg first word strategist richard jones joins us now. we've seen a series of downgrades this week to

expectations from central banks. of from a whole series of important institutions, let's put it that way. the question is -- now what happens? two others join in? one story to these are just jumping at shadows. richard: we'll have an interesting thing with the ecb statement. seeill be interesting to what the councils take it on this. think taking a fairly cautious tone in terms of global growth this year. it will be interesting to see how much of this feeds into the ecb when they speak next week. have had a markets good couple of weeks. not that performance is at all. the yen coming down a little bit. where are we? there are we in the barometer up up down, risk? richard: obviously, the talks in

doha this weekend. futureointing the wti and this being a notable thing. depending upon what you get on sunday, we might be below that moving average for me open on monday, or might continue to grind higher. that is -- the oil place is one of the things really setting a tone for this. we have had a decent amount higher. let's see what doha brings us. guy: where are we with the fed? i am still trying to understand this. we have had another people -- speaker on our air talking about 2, 3, 4 hikes. could we get a back and of the year filled with said hikes -- fed hikes? richard: the world would look like a much different place.

some of the regional president are more hawkish. it strikes me that chair yellen as the leader of the dovish group is pretty much setting the tone. i don't think the with the market is reacting, there has been no change to what she said despite the fact that we have had some more hawkish voices. guy: thank you very much, indeed. an interesting week and next week that sets up into the meeting. plus, we will talk about what is going to happen with the ecb. banks are front and center once again. i urge you to go to the -- let us talk about we are seeing at some of these key events that we have. citigroup's first quarter warnings -- earnings, pay attention to that. the banking center is front and center. that is been a real driving sector so far. you have seen those jpmorgan, and bank of america.

we have this goldman sachs a story as well. watch out, the banking story will be front and center. plenty more conversations coming around the big story. ♪

francine: building on credit, a debt surge spurs a renowned in china. no intervention yet. the yen henceforth worst week since the bank of japan cut into negative territory. and, goldman cuts. set toestment bank is join j.p. morgan and wells fargo in a cost-cutting push as slums in trading and deal making their toll. spain's industry minister becomes the latest casualty of the scandal for now.