manus: just the job. asian equities climbed towards one-year highs, lifted by friday's strong nonfarm payrolls number. the dollar strengthens and expectations for a fed rate hike increase. staying sluggish. china's latest export data. meanwhile, deteriorating imports raise concern. and setting stimulus. why bank of japan's review of monetary policy has most analysts expecting more action. ♪

manus: good morning and welcome toc." ." and welcome to "countdown it is risk on, in case you have not noticed. the msci asia-pacific up 1.19%. asian stocks are heading towards a one-year high. the s&p hit a record. the probability of a rate hike 47%. adding for, drillers the sixth week in a row. trades.nds and oil the hedge funds are adding to their short that's at the biggest and most aggressive pace since 2006. so a bounce in oil on the fact that the opec nations are not planning to revive their freeze talks.

the biggest casualty of the jobs , we lost 1.9% on friday. and dollar-real does not start trading until after lunchtime, but getting -- get ready for this. the real is hitting hefty levels. the real closed stronger for a fourth week in a row. if you are looking for yield and are prepared to take a bit of currency risk, and i am being facetious there, you will get 14.25% in terms of brazilian real assets. are you prepared to take that currency risk or would you hedge? let's get the first word news. juliette: good day to you. china's capital outflows appear to have eased off. $3.2 trillion for july.

june, the figure unexpectedly rose by more than $13 billion. these latest numbers are more in line with analyst estimates. the bank of japan review of monetary policy make an increase in stimulus more likely. that is according to 22 of 33 analysts surveyed by bloomberg. 28 expect the central bank to retain negative interest rates despite opposition from commercial investors. is set toperor address the nation in a televised message. it comes weeks after media reports that he expressed a desire to abdicate within a number of years. the 82-year-old has only ever given one televised speech before after the march of 2011 earthquake and tsunami. seriousaid the u.k. fraud office has opened an investigation into allegations of fraud, bribery, and corruption. the playmaker says it is cooperating with the probe into

its aviation unit. iran has confirmed it has executed a nuclear scientist accused of providing intelligence on its nuclear program to the u.s. he returned to iran in 2010, claiming he had been conducted and held against his will in america. reports at the time said he defected to the united states in an operation planned by the cia. u.k. consumer spending eased in recent months as the brexit vote heightened uncertainty. the referendum results do not stop to have -- seem to have stopped britain's from splurging on summer fun. people spend more on day trips .uring july overall, expenditure rose 1.6% in july, though it remains the first quarter average of 2.4%. savaging from critics, "suicide squad" has broken

records in north america. it marked the biggest ever august weekend in theaters. warner bros. is developing a range of movies based on the dc comics for release over the next four years. the opening pushes the studio to more than $1 billion in domestic box office sales this year. news 24 hours a day, powered by more than 2600 journalists and analysts. you can find more stories at top . this is bloomberg. manus: thank you very much. from your headlines straight to market. haidi lun is standing by for a nice bit of risk on. the jobs number is at play. take it away. haidi: happy monday. it is a happy monday session that we are seeing here in asia. u.s. stocks hitting that record high. we took the lead from there and we are seeing strong buying, in particular when it comes to japanese markets. the nikkei is close to session

highs, really being underpinned by the weaker yen. toing some risk back japanese exporters and automakers, some of the electronics names. elsewhere around the region, we are seeing gains coming through from the aussies. a very strong session for financials as well as consumer stocks. low.nearing that one-week questions as to whether that rally has come to an end. in hong kong, chinese companies listed in hong kong looking at a three-month high. a nice way to get the week started. shanghai up by .3%. we had the chinese trade data coming through both in chinese currency as well as dollar, a little bit of disappointment over this domestic demand story that we have been hearing in terms of that rebalancing narrative.

this is what we're looking at in terms of the currency theme. dollar-yen looking like this. the weakness lending positive sacrament -- sentiment to the equities market. the aussie with a little weakness. it is well off session lows after the trade data out of china. new zealand dollar, the biggest loser today. new zealand suggesting we will see not just this week rate cut, but two more before the end of the year is out. that is spurring some of the sentiment we are seeing here in asia. we be in lifeould if there was not a central bank in life to backstop every asset class that you have ever thought of trading. let's talk about china. exports remained sluggish last month. 44% in dollar terms. we have our chief asia and economics correspondent enda curran. what worries you more, the

import number or the stabilization? is that a fair number in terms of the exports? enda: it is an interesting one. and you look at exports in the long-term, they are holding up ok. volumes are doing all right. the problem is with the pricing. that is what gives the negative headlines. when you look at the import side of it, you have got to question whether or not this is a new sign of weakness in the consumer base in china and that we are starting to see waning demand now. whenever we look at it, we take it all together and it is still a pretty soft trade number. we have not really turned the corner yet and have not had that circuit breaker to get things going in china. it very much goes to the case that we need the services and consumption side of things to drive the economy.

we are not going to be getting a major dividend from the export side of his anytime soon. global growth is under pressure and that is what comes through in these numbers. ,n terms of the import number the import number is a little more disconcerting. that says there is a drop-down in terms of domestic, internal demand. enda: that is the big worry. are we starting to see a leg lower in consumption and demand in china for the kind of growth that they want to import? there is a qualifier these days and a lot of it is skewed by the pricing. commodity prices are down a long way. australian,at the they were down. the concern remains that demand is coming off for for the mental

reasons and maybe consumers are going a bit slower than anticipated. it is probably too early to call it just yet. we're seeing other signs of demand and consumption in china. it is certainly a cause for concern. i want to see if it becomes the trend over the coming months. manus: thank you very much. enda curran with the latest. let's bring in our guest for the next hour. he is the head of global equities strategy at unicredit. as he said, it is about the import numbers. concernwhere the real is. how slow is the real world? >> i fully agree with you in that this is probably the most concerning number. it shows that this rebalancing of the economy in china is

taking much longer. me, theaid that, for is thatortant message the downside surprises are not really that the -- that big to the extent that they will start spooking the market and we will ,et china falling off a cliff which will imply a significant drought to emerging markets. on the whole, we are going along with what is to be expected with probably some downside bias. manus: we have an article. been seven years short. i have got to give him this -- saying of extensively -- of obstensibly, it

is over the -- it is over. is the yuan overvalued? , a whole host is will not be working because of peg of many years. i think there is an element of truth to there will be some weakening going forward. i don't really expect that we are going to see any big move going forward. i think you can get that sense by looking at the numbers. this change in policy seems to be maturing right now. things seem to be calming down or at least finding a normal pace. manus: we will talk more about

the fed in a moment. a steple card could be if the fed goes into a more aggressive move -- mode. we are up some 30%. card could get thrown into disarray. >> that is correct. right now, this is the major risk factor. the fed is the wildcard. what is it going to do? overall, you have had to payroll numbers. very strong labor market indications. will this force the hand of the fed? i don't think the story about the dollar is whether it will move to our three months earlier or later. for the dollar to get ,ustainably stronger from here that will shift the entire curve.

i'm not convinced that we are going to get that. in other words, you need an aggressive repricing of the rate hike expectations. i think it is largely going to be irrelevant for the dollar. manus: we will spend more time on the fed. signaled, and it is amazing, the use of language, "more innovative monetary policy tools." they are concerned about the reserve requirement. ?hat do you think the equivalent of funding for lending? more liquidity for the banking system? >> i do not think this is going to be the central scenario. if things start getting worse, i think something along the lines of funding for lending. some credit easing could be in

the making. let's not forget, these guys have plenty of tools to play with. they have the interest rate, the rrr. they have quite a lot of scope to boost the economy if they need to. manus: where is the top end on dollar yuan at the moment? you are not convinced on the fed. where does that put the cap on dollar yuan? factorink the fed risk is one, but it is not the most prevalent one, the most important one, at least when you compare it with other emerging market currencies. our forecast is that we will above seven in china.

it will be a gradual grind higher. manus: the head of global fx strategy at unicredit stays with us. the u.s. presidential nominee donald trump is trying to get his campaign back on track with a speech on economic policy. that is later today. tomorrow, the turkish president visits his russian counterpart, vladimir putin. investors will be looking for clues on the fed rate path. coming up, payrolls push the dollar higher. we discussed the u.s. jobs and what a strong report means to the fed. that is up next. and finally, economic powerhouse will get a check from germany's industrial sector. this is bloomberg. ♪

manus: welcome back. it has just gone 1:19. onehang seng trades up point 12% -- 1.12%. airbus says the u.k. serious fraud office has opened an investigation relating to some of its third-party consultants. the plane maker says it is cooperating with the probe into aviation business. profit at singapore's biggest bank fell 6% in the second quarter. net income dropped below predictions made before they revealed losses related to troubled energy service firms. last week, moody's revealed that the amount of money that banks have set aside to cover exposed energy companies is not enough. walmart aims to close a deal

with an e-commerce start up today. founder tots jet's head the online division as part of the deal. the move would help them challenge amazon by tapping into proprietary technology and customer data. itfinex finish a review of the $70 million hack and said clients will lose 36% of their deposit. in compensation, they will receive tokens that maybe the redeemed for shares in its parent company. last tuesday, it halted bitcoin'sns, sending value down by more than 20%. you very much. asian stocks are near a one-year high. on s&p 500 hitting a record friday. that after the july nonfarm 255,000,jumped to

beating the estimate of 180,000. ratesf the fed raising rose to 47% on that beat. >> today's numbers are strong all-around. >> it is a very solid report. >> solid number. >> the report i would have hoped for when i was working at the white house. >> some good gains in wages and jobs. >> we saw the number would be around expectations. >> we are surprised at how solid it was. >> this is a sign that the labor market recovery continues. the weakness that we saw looks like it was a blip. is treatingy market good news as good news and the rest of the markets are behaving as you would expect. >> janet yellen in september? i don't think so. i think she is focused on global conditions. >> that is what is holding them back.

>> she is worried about the strong dollar relative to emerging markets. >> these numbers show a higher probability that the fed might raise rates this year. >> even with his number, the odds of them going in september are pretty low. >> i think it is still too low. i would put it at 40%. >> maybe if this continues, but not for now. manus: they have all had their opinions. let's get the head of global fx strategy at unicredit back with me. talking about a 40%-40 5% risk next month. how do you look at it now? market isor definitely stronger than people ght have expected following the numbers in may. from that perspective, it is a welcome surprise with things going better in the u.s.

having said that, i think the stance of the fed is cautious. and also maintaining a strong monitoring on global conditions. from that person -- from that two consecutive strong payroll numbers increase the odds that the fed will move this year, i think it does. but let's keep in perspective the currency markets. if we are talking about a 25 basis point hike, a lot of that is priced because the dollar is coming out of an extremely strong rally the second half of 2014 and 2015. in terms of september, is it on the table? it is fair to say is always on the table. otherwise, what is the point of having a meeting? manus: the of session of 25 basis points is a bit like the

obsession with cable. let's talk bonds this morning. questionr, you would the equity yield for yield strategies over g7 in this period. the prospect is that yield sayerential -- you would you are missing a little bit of a beat in this story. >> ultimately, what really inters is what is happening real yields and real yields differential. you try to reproduce the chart in real rate terms, you will find that there has been a trend decline in the rate differential against the u.s. the reason is that inflation has picked up more in the u.s. compared to the rest of the developed market. that has been one of the pillars that the dollar

moved into significantly-overvalued territory. that is why, if i want to wrap it up, my overall view on the dollar is that whether the fed is going to hike in october, november, december, it is neither here nor there for the dollar. the bottom line, you are still talking about a strong rally in the dollar of 2015. you said the market is as sated for dollars as it wants to be. positioning isk extreme at the current levels. at least with the exception of sterling. i think the market is short sterling right now. that is the impression we are getting. having said that, i don't get the impression that the market wants to go along dollars. we have a super strong payroll

number. the nikkei is up 2%. the yen is unmoved, really. manus: we will talk more about the yen shortly. ♪

the emperorsot of palace and we are waiting on a statement from the emperor for the second time. expected toold is speak. there is lots of speculation and it could be the start of regency in japan. edition and let's

take a look at some of the top stories. this is our lead story and the .raud office is starting cooperatingd to be and talking but the use of their parties. saying thatncies they have expanded some of the there is aill stop key focus of the foreign exchange reserve. this end, there is less cash in the reserves are off.

stability with the repair of -- with the reserve story. there is export data still remaining dovish and you have the global demand and it is really nervous in this story. down 12.5%. what is going on with the chinese economy. china is the rainmaker, in terms of movement for the asian markets and i'm talking about stocks hitting a high, following a close that was a record. caroline hyde joins us with more. >> good morning. the industry group and

areas andnly slight this is the asian markets with s&p 500 is a record. going seeing the yen currency.a kiss you you see the new zealand dollar is better and, swiftly behind, it helps fuel demand with japanese exporters. is corruption in another

area. andare seeing a weakness exports andn imports. is down for the fourth day. a lovely area involved. casualty and the we see a cold down with the on rateand a focus in hikes. thisses a little bit of luster. >> i know you like little bit of this. texas intermediate race

have been holding above and we have our middle east anchor joining us now. downs withn a indicators saying this could be temporary. these analystsf saying we would see this and take a look at this from they up fornd i will put this you and you can see the increase and it is the sixth week and us they and this tells are comfortable to bring things raises broader

with the first decrease in weeks. wanted.l keep you >> thank you. we now have our middle east anchor and there was a survey increase inect the the majority think they will andk with the negative rate a time frame could ask -- could change. there was a summary of options they?and what were >> this is a summary of opinions and there were opinions with

monetary policy and this notion that it should be avoided and policy highlight was a that is powerful and dramatic details.d have andell us about this review it could be a clear indication of what this involves. >> that is right. watchl make this closely awayhis one is six weeks and a survey that we did showed these createty of

a greater likelihood and they avoid thisnk should time frame to make this inflation target. ande is a lot of attention they ordered this at the last meeting. >> what is behind some of the responses? remarkablese make things, in terms of the ease, quality, quantity, and they think this will be vindicated in a review. >> they think the rates will be in the toolbox and they have

with whatcizing these you have been hearing in the recent months. and is a lot of weakness this farstill saying from the inflation target and there are questions about how to reach the targets. >> thank you for the latest. survey and looking at it, the expectation is more action. should they abandon this will push it? >> it is a tough question. will be a below

this andhave stocked it would raise eyebrows with credibility. easing, they have a qualitative aspect to this along this curve and i do not expect to see something coming from this. simple.t but it is not complicated. and thereed working was the first-round hike initiated and that sent this having aown and we are significant reversal with the

implementation and the announcing of the fiscal package. questionthere is a and i think is that, if they do something, it be abe subtle and it will move. i do not think we should wait for shock at all. >> if you are an investor, this is a big question with the bond markets in the yields. i'm interested in the domestic investors combining the u.s. treasury bonds and there is a 1% return. turnsou are hedging, it this flow of money

, to whatdomestic impactdoes this have an on the story? touched on the issue of i think that we tend to have the bond market be more volatilityse of the and, if you are searching for yield, you do not want to see the bond being trumped by currency and that is likely to

happen. in this respect, i have been flowous with extrapolating in the markets in the implications because these tend net effect and the is small. this mindto make up with a flashpoint, they are bringing it home. you have a little bit of this end --ld you short the the yen at this juncture? i do not think there will be shock and all. there will be more time. >> i think that it will go

higher and it will move by the end of the year. it is a telling market with a almost 2.5%ll and moving. higher. this think there is a gradual realization of moving , from here, itnd will be bumpy. trend will remain. >> that is by the year end. >> yes. we have the forecast.

stay with us. berkshire hathaway is up 20% and there is a breakdown of the numbers. >> berkshire hathaway posted of $5es and had an income billion and a jump in profit. the heart of the prophet was and the recent acquisitions paid off. miss, versus the estimates. , iterms of how it performed

has to do with the portfolio and ites under pressure helped to boost the bottom line with a strong player and a slump unitrnings with a chemical taking hits. ok and theyal did rebounded from a loss a year ago. in terms of the book values, this was a strong point for the company and it rose at the end of june. up, 24 days, since and coup in turkey.

a massive rally. that is coming up next. finally, a push. .e're going to talk more this is bloomberg.

monday.e shot of high on friday. 1:50 here and it is 1:50 in hong kong. >> thank you. a criminal investigation has allegations ofo fraud.

we airplane makers as they are core rating. holdings. firm offer was $64 a share in cash. it creates the -- quarter6% in the second and they revealed warning that it was not enough. closemart aims to acquisition as early as today they wantthey said

the founder to head the division and that's the move would challenge amazon. news.s your bloomberg >> thank you. million attended a rally yesterday. to fightdent vowed whatever powers attempted to undermine him. he said he would continue to the coup.llowing firm.ody's is holding there is a great debate of this termsof the risk and, in

of the scale, what might we see? and itill be fairly high be to out of would the three rating agencies going youw investment grade and will have a lot of outflows coming. decision,the moody's not a surprise and the market was prepared for that. it will look at the hard data and related not really have a chance. ofit is almost double sylvania and romania.

this is a downgrade in the price. seen thek that we have tends tond the market generalized.ed and i do not think that the idiosyncratic nature are fundamentally -- market. is an emerging back to where we doubtful. am a little , only just changes out. you are a little skeptical.

short-termt separate from long-term. it is one thing to be cautious of the effects in the short-term. fundamentally, i do not think that we have serious headwinds. the question will then become how do you pick and choose with the emerging markets? think the dollar will go higher. even if it stays where it is, this would be on the back of a small rally. >> you say that you need to differentiate.

>> i think this is a combination of credibility and balances and imbalances. -- and the turkish lira raises alarm. >> it is something that i would you join in this rally? >> no. i am more risk adverse. >> you want to keep your hair. >> i think the uncertainty is to big.-- tooo next, rumors of

abdication? this is bloomberg.

, lifted by payroll. board data andh imports raise concerns with domestic conditions. bank of japan monetary policy has most analysts expecting more action.

good morning and welcome to countdown. we have breaking news from germany with a tortured set of numbers. rose andl production there was a run-up with brexit and there was a negative number with industrial production that was easily adjusted and there was rising all the way around with the largest economy for a seasonalmentum on a basis. guidance laste bundesbanku had the

saying there was no indication and wed change a pickup anticipation of what the emperor might decide to do. >> to this day, i have deepened the japanese tradition and i saw how they imperial family will make these traditions fit in modern times and be close to the people, delivered to expectations.

>> some years ago, i underwent surgeries. feel physical weakness from my age. emperor starting a televised address. 82-year-old is addressing be nation that he could setting up a regency and we will bring this to you on bloomberg. indicate the stoxx

50 or up a third percent. we have seen this in the price of oil and we look at some of the headlines. not discusswill imperial policy. he has been thinking about a symbolic role as emperor. this driven by japanese a low point with this is notg and the fastest expansion. part of this has to do with the and, to bes planning

and icold was a casualty love the riel story. and itt a one-year high is stronger, opening a little rates not likely to be done a time soon. if you are in the land of the brave, you want to keep an eye on this. let's skip the first word news. the capital outflows with the foreign-exchange reserves for month andthe previous

the figure unexpectedly rose. these numbers are more in line with analyst estimates. an increase in stimulus is more likely, up according to analysts who were surveyed by bloomberg. this is despite the opposition from the commercial banks. a criminal investigation has someopened into third-party consultants. iran has confirmed in the their scientist was providing intelligence. he claimed he had been abducted. reports said that he had defected to the united states in

operation planned by the cia. a correction -- the brexit vote harsh and the uncertainty. people's meant that people have -- people have spent more. the futures have risen and they average of 2.4%. broken boxad has office records to take the top spot in theaters with warner bros. developing a series of movies over the next four years. global news, 24 hours a day.

stories.ind more >> thank you very much. has made a of japan televised statement and he is ready to step down, finding it difficult to carry on. a decline.t he felt spoke to the nation in 2011 and he wondered if it was possible to avoid this situation. it is a decline in natural levels. have indicated that they would accept the

involve a and it may change in the law. we will see what comes after. let's check in with the markets. a cracking run on trade. it is a strong leave. when it comes to imports, is

worrying about what it says with domestic demand. it extends the games and this is close to 2.5%. this was enough for exporters. , there was agion recovery and they were with weaknesses canwe expect this to cut it , up according to a number of analysts.

the reason being was the liquidity flush. it had a little bit more they put on one 15%, at this point. this gold miner drags things down little bit. >> they missed estimates. expecting one billion. this story continues to play out. that is the latest on the asian markets.

this was the imports and they and what is the takeaway for you? >> it was a soft number and we and we seeing me demand are seeing this on the import side of things with weakness in the economy. caveats with these numbers and that means the volumes are holding up. and you have the chinese trade surplus with

commodity prices coming off significantly. it is a soft overall number and you see the economy. >> thank you for the latest trade data. this is actually july. the fed raising rates has risen and we're joined now from tokyo.

much.you very on the dollar yen. yen and -- there is a to coupling of there isnge and stronger than expected growth with the payroll report. even if the currency does not move, this is where the rallies coming from. >> there has been a shift in and dith the payroll

think they are in play here? that it willsaid take them to december. i think the economy is strong. seehis is when we should the positive. dollar.stronger

>> let's say the fed goes into this. what do that to? purposes, intents and there was the capital outflows you have investors getting the costome and it is of hedges going up. and the is the investor

and there is the government bonds. the trend is over. >> it is going to be my money cost ofand there is the carrying the hedges to increase dollar yen that will be think it -- vigorous. >> look, you've seen the

and it is with this speculation with the bank of japan. it is clear that the bank of andn is likely to ease september will come back into play. andhat is a stronger dollar you have the aspirations. there is highlights for the week ahead. donald trump would try to get his campaign back on track later today. president visits the

russian counterpart. investors looking for clues when we get they retail sales. a place to find out is bloomberg.

>> 174 is where we are. attention tog our the emperor. message andelevised it is difficult to carry out the duties. .his is weeks after reports

what do you make of this moment in history to consider the abdication? quite's it is a moment in history and it is the longest hereitary we have on earth and the emperor said that he wants to stay close to people and the pragmatic stop times weakchanged and he feels and he has a busy schedule that we do not see, because he is ceremonies with the

and he wants to be pragmatic and putting alllity, options on the table and it is up to the politicians. market. go back to the will this involve more he earned a majority 28 out of 30. what do you expect? form.action in that they double the purchases and

they continue to purchase the government debt. it good job of being as pragmatic as possible and coordinating monetary policy. >> does it concern you? >> it is the market and it is parallel. seeing the government we are seeingd

experiments. we can focus on financial markets. is the growth. the linkage right. now, the focus is going to be on the real economy. >> thank you for joining us. headlinesme breaking with regards to the emperor suggesting that he is ready to says he and shinzo abe is taking these seriously.

that dollar yen change. [ hip hop beat throughout ] [ fans cheering ]

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