♪ >> the greenback has for its first weekly decline since september and polls tighten ahead of the u.s. election. -- await thethe latest top number. sterling sort, the pound jumped to a four-week high. vote beforet hold a delivering brexit theresa may says she will stick to her timetable. bmw report this hour and political tensions rise ahead of next year's election there. we speak with the bundesbank member.

welcome to bloomberg daybreak, i am anna edwards in london. companies to report. i have the numbers for commerzbank. commerzbank out of germany, reporting an operating profit that has increased. rose, thetio nine-month net profit has come in at 96 million up. this is what we were waiting for. the third-quarter pretax loss at 255 million. we have been expecting a loss in the third quarter. waiting for the bottom line loss number in the third quarter. loss, 230 8 million.

swinging to a loss in the third quarter was expected. business lenders been unveiling its big overhaul since the financial crisis. they have a plan, spending the dividend, shrinking risky assets. a plan to merge investment bank and its corporate finance unit, that was one of the first that they are party taken. this is one of the stocks that has been punished by investors today. down 30% -- 37%. a bit of a headache for the whole sector, definitely the german banking sector where there is talk of m&a as of late. provisions for losses in the third quarter of 275 million and they do expect a net positive results for the 2016.ear, some of the headlines coming through from commerce bank. >> we've also got results from the swiss luxury goods.

first-half sales growth coming in at a constant 12%. also the first half sales at 5.0 9 billion euros. for 5.05s the estimate billion. a beat on the sales front, a beat on the operating profit front. .argins coming in at 16% estimate was 15.3%. the ceo saying he is intimidated -- intimated intention to retire and bearing in mind that all eyes were on october trading and whether the improved trading conditions in china indicated would help some of the mixed results we saw in europe and the u.s.. 13.1%, year town date. now it is down 7%. anna: cement sector, more than a

year than -- since these two companies were put together. operatingter adjusted , has come in at 1.68 5 billion. the estimate was for 1.6 5 billion swiss francs. they also say they are on track to achieve there for your target and 2018 objective confirming. see a 2016 savings of at least 550 million, the target for 2016 unchanged except for the c -- savings. investor pressure around this. the company talked about 450eting an incremental of million swiss francs this year. 60% of that goal was met in the first half. we will focus on what they can deliver, tying up these two businesses. >> now, let's get the bloomberg first word news. shery ahn.

five days from the u.s. presidential election, you polls show the race narrowing with hillary clinton holding on to a slim lead over donald trump. in new york time cbs poll showed clinton ahead 45% to 42% among likely voters. much tighter than her nine point lead in the same poll. tracking poll found clinton ahead within the margin of , having lost 45% ground to trump since last week. south korea's president says she is willing to be questioned by prosecutors about her role in the scandal. againlogy to the nation in a televised address, she will take responsibility for -- if any wrongdoing was found by investigators. yesterday, her close friend was arrested under allegations she metal in state affairs. hasturkish president

extended his crackdown on the opposition following coup attempts with police, curtis -- kurdish lawmakers in midnight raids. euro has taken record lows. the pound is near a full week five, after a panel of senior judges said the u.k. parliament must hold a vote before spring brexit. the government plans to appeal the decision and says it won't move forward to invoke article 50 by the end of march. charges in the u.s. justice department two year antitrust probe into pharmaceuticals could be made by the end of year. they say the investigation now spans more than one dozen

companies and concerns about two dozen drugs. industry giants are among the drugmakers who have received subpoenas. all of the companies have said at sete operating quotas. baseball,nal out could stretch as much $3 million if it is ever sold. that is according to the founder of golden options in use jersey. the ball was pocketed by anthony riso and his team won its 108 year championship drought. global news 24 hours a day, powered by more than 2600 journalists and analysts in more , you can findries more stories on the bloomberg. i am shery ahn, this is bloomberg. >> let's check on the markets. in asia, we are standing by. pressure coming from the anxiety we are seeing around the u.s. election.

>> that is right. we are seeing a lot of anxiety, volatility in today's markets. the regional index on track for its lowest close in seven weeks. the nikkei doing a lot of the damage, closing down of 1.3%. today, have a weaker yen but remember the equity markets were closed thursday so a lot of the selling you are seeing today is catch up to what we would have across asia yesterday. also weakness coming through in hong kong and shanghai. both have been positive territory -- in and out a positive territory through the day. the weaker oil price playing into those. energy players also playing into the energy sector in australia closing down at almost 1% and new zealand off by another 1%. some upside in the philippines,

that was the market which out -- under performed yesterday. we have seen buying there, but generally not a good day at all for asian equities. a little bit of earnings, there have been some upside there. stocks that did well. in the casinos, china a small gain there. las vegas came through with pretty good numbers in the close of the u.s.. singapore also doing well. singapore gaming company. a few upsides, but generally not a great end to the trading week in asia. eustis: let's get you up to speed with additional lines. down inset to step march.

the cso set to step down in 2017. inh will be stepping down 2017. changing its senior management there. johann rupert is to remain as executive chairman, so there is some continuity in that position. of changes in terms management at rich more as we have seen some of the sales figure considerably weaker in this period. the jobs report due out later from the united states because todays payroll number will be closely watched as a sign that the u.s. economy is strong enough to withstand a rise in cost. can the number bounceback? >> plus 175,000 jobs, that is

what the bloomberg median forecast projects friday when the bureau of labour's statistics reports. we shall pass the highest number in july. if it is right, that would be higher than september's number of 167,000 jobs and a third month of higher gains in a row. bloomberg intelligence predicts a higher number than that of 190,000. a rebound in health care jobs is expected. this will have huge bearing on the fed december meeting. two more monthly job reports until then. if it shows more growth, it would be more reason to hike. the minimum number is 100,000 jobs to hit. which sees achievable barring a black swan event.

in other data points to look out for from october, average hourly earning may have picked up one third of the percent against the 2/10 of a percent rise in september and a rise of 2.6% for the year. just shy of the postrecession high of 2.7%. that ishe work week, projected to stay the same at 34.4 hours. the level it has been at since the second quarter and the unemployment rate is forecast to toallen just a bit to 4.9% 5%. he has been sticking at 5% of few months. that could mean the economy is close to full employment. october jobs report comes out friday, 830 -- 8:30 a.m. wall street time. eustis: paul krugman has told bloomberg the fed should not raise rates this year or next. he thinks the u.s. central bank --determined to act as tough

as though things are normal. ramifications the of the presidential election and had this to say about donald trump's economic strategy. >> i don't think there is any mics.eno it is all about who is in charge in the you -- chinese are taking advantage of it, there is no coherent policy. let's slash taxes on rich people and believe wonderful things will happen. anna: jeremy, great to see you in the studio. busy days ahead. to talk about.cs let's talk first about what we are going to hear from payroll later on. officialeems to be forecast on bloomberg. tot does that have to be

move the diet -- dial on december? ike -- jeremy: i think somewhere below 190. i think the hide side -- highside, there is a fair amount of leeway. 180,r would be expected at 170. the fed has been happy to say, that's ok. we are still looking for further signs of improvement. around 125, that gives them part. what is your take on the wider health of the u.s. labor market? a chart on the bloomberg shows u.s. productivity rising in the third quarter.

this after the longest slump. and you will recall, that was a particular concern that productivity wasn't as low as it was. jeremy: i think we should be watching productivity more than these pedro -- headline payroll numbers. those are the key things, the ongoing health of the u.s. through 2017. hopefully we see the fed start talking more about that in a minute. at the meeting in december. about, as we move haveds the election, we had ulcerative views expressed about what trump policy means. we don't know what it looks like really, so in that sense, it makes it difficult to come up with firm conclusions about the scenario, but give us your

thoughts. aremy: i'm thinking we going to see a dollar strength on a trump when. maybe a knee-jerk dollar weak reaction on the ninth. a lot of policies trump has talked about could strengthen the greenback in the first couple of weeks, certainly the first hundred days of his presidency. bringing -- lowering praxis -- -- it isinging back going to be a volatile time for the u.s.. eustis: could a strength in the u.s. dollar extends beyond the first hundred days in a trump scenario? from the rhetoric, you are hearing tighter monetary policy and looser fiscal policy. jeremy: absolutely. if he does win, he is going to be a strongman president. strongman presidents like strong currencies.

he is going to gear his economics towards something that promotes a stronger usd. if he is bringing more jobs back from taiwan, asia, wherever they have been offshore, that will kick up labor costs in the u.s. it will have to be controlled. it all points to a stronger greenback. anna: what does the continuity candidate look like for the dollar? what does 2017 look like if hillary clinton wins? --emy: the monticello monetary policy will not change that much. keeping yellen in the fed, which trump hasn't signaled that he wants to do. keeps that argument as it is. she is also in favor of more fiscal spending as well. that will hopefully boost inflation through the u.s. economy, lead to stronger usd. on the night, we see little bit think, a movie i

to emerging-market assets as a result. but for clock a.m. in the u.k., mexico is going to be going wild, the canadian dollar will do well, the you one will be doing well. anna: jeremy, thank you very much. eustis: still plenty to come. sticking to script. u.k. high court ruling on article 50, theresa may said the plan remains by the end of march. we delve into the brexit debate. is bmw set to lose its title as the number one luxury? plus delegates gather in munich today but the german chancellor won't be there. amidst growing tensions of the two party. we have all the details. stated. this is bloomberg. ♪

♪ eustis: welcome back. you are looking at victoria harbour, a live shot there. slightly trading to the downside . it is 2:22 there in the afternoon in hong kong. anna: let's talk about the u.k.. theresa may has plans to stick to her brexit timetable despite the call that she needs parliaments negotiation -- cooperation. the bankeanwhile, at of england, mark carney warned of more volatility ahead. >> i'm not qualified to comment on the prospects here, but it is this uncertainty that will characterize this process. the previous

question, the negotiations themselves have not yet begun. be uncertainty, volatility, negotiations as they proceed. i would just view this as one of the symptoms -- one example of that uncertainty. jeremy cook, still with us. so much to talk about with regards to the u.k. and break the conversation. so few answers out there, i fear. i have a chart that shows we have seen speculators waiting bets on a weaker pound. just a little bit of a turnaround in that in yesterday's session because of two factors. the high court ruling. jeremy: i think the bank of england, moving forward, will be forecasting.- as a there is not much they can do in the short term. it is the political atmosphere in central banking in the u.k. at the moment. gedy have almost been defan

by the chatter around mark carney's future. , maybeis down .025% adverse reaction to the qb and bond buying. a couple must be on weeks time. eustis: what are you able to take away from what mark carney was talking about? jeremy: a lot of it is plain vanilla. the short version of mark carney was speaking to politicians, the u.k. electorate saying, you want high prices are fewer jobs? do you want inflation in the short-term or for us to raise interest rates and start to strangle an economy we are worried is going to be strangled anyway, moving forward. dependency. they will sit on hold and wait to see how this plays out. they have to revise their forecast, both the gdp and

inflation and they will sit there and -- >> we have a chart that shows blue,itish pound in the inflation expectation in the white. is that something that is a word we have to stop about -- talk about in the u.k.? jeremy: the inflation numbers are are really starting to pick up and u.k. but i don't think it starts to -- i think february will be an interesting month for the inflation dynamics in the u.k.. they can't put it up before christmas, it is suicide. anna: the high court said what it said yesterday and whether that changes the politics. jeremy: i think we still leave the eu. it is a case of, is it now postponed and does it give handle of more of a

the quality of the brexit? whether it is hard or soft or whatever it may be, that parliamentary oversight softens it a little bit. eustis: what happens to sterling from here? we saw lift, now a four-week high, is that sustainable? are -- wethink we have some doubt for 2016. we may have put the low in for 2016, there are obvious risks around the election in the u.s. and the statement from phil and -- philip hammond's. yearse 50, you have two to do everything you need to do and try and gain a unanimous whichsus to extend it, would have to happen. it is simple enough going to happen and they will take the pound lower. anna: is it going to be about investment in infrastructure, not short-term stimulus? jeremy: it is going to be about infrastructure, fixing potholes.

anna: jeremy cook stays with us. up next, bmw has been pumping money into its electric car. more about their earnings. this is bloomberg. ♪

♪ anna: welcome back to daybreak europe. there is tokyo where we see the dollar against the yen. on the move at 103.23. 3:30 in the afternoon if you are in tokyo. we are going to tell you what is coming up in today's edition of daybreak. focus on the job story coming through today. front cover of daybreak for you. a lovely, well organized and well dressed line of people waiting for jobs in the united states. all about payrolls. markets looking for a jump of payrolls, the last

report before the election and second last before december's meeting. the fed will be watching for further evidence that a rate hike is warranted. how week with this number need to be to throw that expectation of a rate hike in december off its course? >> definitely keeping me on edge. political unrest in turkey. police begin rounding up kurdish lawmakers in the post midnight raids and extending crackdown on opposition following the coup. a record low -- anna: focusing in on the brexit ruling. yesterday, the idea that britain must hold a vote sometime in parliament before formally starting process of leaving the eu. that sets the stage for a supreme court in september. may get the courts final say on the matter. breaking news. >> bmw third-quarter revenue

coming in at 23.4 billion euros. the estimate was for 3.2 billion. a beat on the revenue front. ,hird-quarter profit coming in 2.3 billion, estimate was 3.2 7 billion. a beat as well on the profit front. before bmw. jpmorgan said there might be impact from weaker pricing. it was down the corner of 1% before the earnings, it has full -- falling 4.7 so far this month. 16 analysts had a buy on this stock. 14 hold and 14 cell. -- election angst left right and

center. the s&p 500 and its longest losing streak since 2008 and the worst week for global stocks since the run-up to brexit. the global selloff extending into the asian trade. we are seeing the pacific index poised for its worst close in seven weeks. outave financials -performing, but material down 1.2 percent. stock prices down, volatility has been moving higher. the vix in blue, you can see it has been picking up the volatility in recent days. not quite at the levels we had during brexit. write about that here. we see the risk aversion moving away money from stocks. we see money move into the havens. the bloomberg dollar index, a little changed today. it is set for a weekly loss.

election concerns outweighing the prospects of a fed rate rise next month. we will see how the u.s. jobs data affects the dollar a little bit later. talking about the havens, money moving into the yen as well as swiss franc. it is slightly weaker today, but this weekly performance, you can see dollar index and white. 2.3%,ng, on track for a best performance in eight months. sterling trading near its highest in four weeks. finally, gold and oil. gold heading for its longest weekly gains and spreads it. three weeks of gains. a trumpeter he makes for a rally of 1400 and our, still below 1300 at the moment.

crude heading for its biggest loss in nine months. >> a few more lines coming in on the -- bmw. third-quarter automotive margin, 8.5%. 8.9%.recast of that the company is achieving success in its electrification strategy. anna: you never know, big fan of electric charge. -- cars. high with the coalition partner democratic union. less than year to go until german federal elections. two parties are clashing over merkel's refugee policy. she won't speak at the convention. by thejoined from berlin senior policy fellow at the european council on foreign relations. great to have you on the program today.

for those of us outside germany, tell us the significance of the risk that we see between the cdu and the csu right now. >> good morning to you. on the face of it, it is a dispute over a certain policy element. wantavarian conservatives the chancellor to impose a ceiling on refugees at 200,000. the chancellor refuses because if she would accept it, it means she would have to admit that her policy was wrong. the bavarians want to force her to say that she was wrong and she resists. rift over whos a is more conservative. who is covering the right side of the political spectrum better? is bavarians believe merkel too soft. she has moved too much to the middle and allowed french parties to arise with this. that merkel is not attending

is overshadowing any discourse that will take place over there. talk us through what risk there is that there could be a real breakaway that ultimately .eakens the position >> both parties know, the german voter hates nothing more than parties quarreling within each other. a have been avoiding a showdown on the issue, which would have been unavoidable if merkel had attended. if she had been there, the csu leadership would have been forced to restate it position and she would've been forced to restate hers. by her not coming, not being invited, they simply avoid that situation while the underlying dispute is still there. some of theakes tension out of the situation, the fact that merkel will not attend. does that mean that union lives to fight another day? from what you say, you think so.

are there alternatives to merkel or is she the only candidate in town from the right of politics? >> in her own party, she is the only candidate. she is the chancellor. -- best chance in her own party to lead her party to another victory. and the bavarian democrats know that, but they are looking at their own elections in 2018, where the bavarian conservatives believe they always need an absolute majority of the vote in their own states in order to have that leverage on the national and even european level that they now enjoy. talk us through the timeline. what happens after this article print's. -- party conference? the christian democratic union, the sister party, the major conservative party in germany would have its own party convention in december.

it is still not clear whether it will be announced at that party congress in december that she will run again. she may want to postpone this until the spring of next year when the campaign really gets going. but because that will force all insider -- inside her own party and the sister party in bavaria, to close ranks behind her. if she announces early, that is an open invitation to everyone who wants to criticize that decision to come out and raise question marks about would it not be wiser to have another candidate. she will try to avoid that debate in order to control the critics in her own party. anna: do you think when we finally get to the german about howm a speaking german politics and the brexit conversation linkup, do you think the u.k. x assumes -- assumes that merkel will hook

up. will it be consistent with the german policy in the future we have developed for brexit? nothing unexpected happens, which could happen. there are a lot of risks in the air over europe. crisis, the eurozone the turkey eu refugee deal, that is a temporary thing. think of the ukraine war. there could be things the , andng politics in europe germany in particular. if no disruption happens, she looks like a pretty certain winner. it also looks like the present coalition, the social democratic, christian democratic, left right coalition will continue to govern. thebrexit terms, that means misunderstanding of the german position in london will continue. in london, people still believe germany is the best ally a u.k. can find on getting a great deal on brexit.

which is not the case. will continue to be the symbol of this. also, the misreading of german politics will continue to shake things in london, as well. anna: thank you very much for joining us. it has been a volatile week for emerging market currencies. the egyptian pound slumps against the u.s. dollar. a different story for the south african rand, gained against the greens back -- greenback. how the president could of been influenced by the family. mix -- mexican peso gained some ground. the chief us, is economy at world first u.k..

think the mexican peso movements we have seen, it is up and down with every seeming poll coming from abc or the wall street journal. that will likely, down once we have some certainty next wednesday morning. but the news out of south it pourshen it rains in south africa as far as news around the south african rand. the fact we are not seeing prosecutions in south africa for the finance minister, as we thought a couple of weeks ago, has strengthened some of the currency and continues. anna: it has been a volatile .eek for merging markets we have been following the rand, we have a full-screen graphic that shows you how much of a plunge we saw in the currency others.y, compared to

when we have seen other currencies float and leave their pegs, go off into the great unknown, even by those standards us was a big fall for the egyptian pound, wasn't it? some lessons to be learned in how they handle this. jeremy: some traders hit the wrong price and tried selling -- to stop selling at the same time. 45% over therly course of the day? it shows just how long it has been badly paid within the country and obviously, sucking in that they need a foreign currency. eustis: is this going to unlock appetite for foreign investors? is that something that you can play now? jeremy: you would have to see egypt is something people are going to start talking about increasingly. there are huge amount of in

country situations that you don't with, but the fact that it is 45% cheaper is going to lead people to try and pick up some bargains. anna: interesting story about lessons we learned from losing the peg over in egypt. the advice seemed to be, don't do what nigeria did. don't fiddle around with it. markettly, the black it can beooms and costly to defend your currencies, the russians have found. as painful as it is, just leave it alone. is that your experience? jeremy: it is what we want in this kind of policy, a clear, decisive action and if egyptian authorities have been bravery to say in the grand seamer -- scheme of things, this is where we wanted it to be. that will engender some

credibility for further policy decisions they are likely to make. eustis: always a pleasure to have you on the program. program, wee on the speak of bund as they board member. satan, this is bloomberg. ♪ -- stay tuned, this is bloomberg.

♪ anna: welcome back. this is bloomberg daybreak europe. nervousness abounds in the asian equities. the selling, the nervousness around the u.s. election. it looks we could be drawn in the sand around that anxiety story. at least until we get the payroll numbers out of the u.s.. let's get the business flash. here is juliet. said theidgemont has ceo and cso will retire next

year as the reported decline in profits. johann rupert will remain executive chairman. that comes as the luxury goods maker reported operating profits at $798 million, a 43% fall from a year earlier. quarter, thehis net loss of 288 million euros compared to the profit of 235 million euros a year earlier. that is after the ceo unveiled the german lender's biggest overhaul since the global financial crisis. tokyo,the shares fell in having been suspended earlier wasr the nikkei said -- preparing to file for bankruptcy protection. no new developments since last month, to reports it was considering bankruptcy. it began seeking buyers in may after regulators in the and japan ordered expansions of rate

halts that were already the biggest in the auto industry history. dolly and wonder has bought dick clark productions. the producer of televised events like the global -- golden globes and miss america, mark's entry into the tv industry. the latest addition to his growing entertainment enter -- empire, which includes the cinema chain amc. that is your bloomberg news class. gopro shares, plunged after hours as the company lowered its for your sales forecast and missed earnings expectations. bloomberg news has more from new york. >> this is an incredibly troubling quarter for gopro, especially coming off the heels of fitbit. a lot of problems were blamed on the production issues.

a new line of cameras as well as the drone cameras were caused problems, which meant they couldn't reach demand for the fourth quarter. fitbit had a similar problem. they said production led to poor earnings. both of these young companies are using that as a crutch to cover up the bigger problem. that investors are all asking, is there enough demand for these novelty items? is there really a huge total, addressable market here? with wearable devices. it seems a lot of customers are not renewing and upgrading them. it is hard to get new people to join the family. similarly, a lot of people don't feel the need to have an additional camera on top of their smart phone. investors are questioning the entire business model. however, gopro is still hopeful they can reach profitability in 2017.

that the drone business will be an important line for them, but they face huge competition from the leading distributor in china. gopro is just getting into it. anna: that was an update on gopro. germany's second-biggest lender, commerce bank has a loss in the fourth quarter. the country's top business leaders are meeting in hong kong for the asian pacific german business conference. we're joined by the executive board member at deutsche bank and former ecb board member. thank you, and dress for joining us. we'll start with the story around the banking sector right now. you have expressed confidence in the state of the banking sector in germany. and you have talked about how consolidation in the sector is not taboo.

could i ask you where you see consolidation making sense for german banks? first of all, thank you for having me. what i said today and when i am happy to repeat is that the solvency and liquidity of the german banking sector is actually, in no doubt whatsoever , the german banking system is stable. at the same time, you have to admit that the profitability of the german banking sector is rather low in a european comparison and a international comparison. that is partly due to the fact that the german banking sector is very competitive and is having a large number of banks competing with each other. it is not my job to recommend what the right level of competition should be and what is the right level of -- should be, but clearly, given that we

have more cost to regulation and there is a need for investment in digitizing, that we do have a low interest environment. all of these challenges, all banks are thinking of consolidation. but it is not for me to make recommendations of who should consolidate and when. eustis: you have said a low interest rate environment, we are gearing up for possible changes in policy from the ecb. where do you stand on the front? what is the bank doing right and what to do better? you know, with regard to our monetary policy stance, i have a very clear opinion. europe is at the forefront of our thinking. clearly, the consumer inflation rate is not where we have it in

our mandate. .t has nothing since early 2013 according to projections, it highstay below our stability target for some time. having said that, i mean and believe that the low interest rate environment is appropriate at the time. how the inflation rate actually develops and once we see that, and depending on that, we have to go on. --ht now, in the recent present economic environment with moderate growth, i think the interest rate environment we are in, which has been set by the ecb, is appropriate. anna: is there a case for increasing support from the ecb or the euro zone economy in december? of thet a member governing council of the ecb, so

i'm not part of that decision. we are not in december yet, you have to wait and look at the data. everybody has heard for making that decision. we have seen tremendous volatility in global markets ahead of the u.s. election. they sway, what measures are you taking to mitigate that volatility? it is a good question. i am seeing what you are seeing. i am having is that it is not unusual to have volatility ahead of tight presidential elections. on the other hand, what we have seen in the past and what is probably also true of the future is that the american system of checks and balances in politics -- the president, congress, and senate have worked in the past,

mitigating volatility and i think that will hold true once november it has passed. you are in charge of risk control at the bundesbank, are there measures you will have to to in place around next week make sure volatility doesn't catch you out? think there is some exaggeration in the question the function not of central banks to avoid volatility. only in the case of excess volatility. this volatility, you cannot compare with volatility we had after the brexit. this is something i'm not worried about. eustis: uncertainty back home in your country, germany, where anxiety still a lot of

around what is going to happen with the future of chancellor merkel. some internal rift between parties. if she doesn't run again, would you consider that a risk event? andreas: anxiety that goes far beyond a monetary policy matter of mine, so i would really like to not comment on your question. is a highly hypothetical question, in addition. anna: we will leave the politics there. if we go back to the monetary policy environment, we were talking about what is right for the ecb to do and you say the policy tightness is appropriate right now. if ecb were to move policy forward in december, what is the best course of action if policy were to change it all in december? andreas: first of all, december is december and we are early in november. the most important thing is to

stay calm and to concentrate on the data and not jumps to conclusions ahead of time. there is a reason this is called the december meeting. it is not for me to say what will happen in the governing house in december. anxiety is never good advice. anna: you are speaking to us taking place. they focus on chinese investments at germany. what appetite do you sense from chinese companies to invest in germany. standpoint, wel have seen some pushback in germany of chinese money. is that putting investors off? andreas: i am not sure. all i can say is, from a german germany'se, china is

largest sales market and there is a lot of foreign direct investment in china. we're also quite important from a chinese point of view. in the past, they have always and thed relationships chinese economy is developing fine and growing at a steady rate this year. we do not see any risks of this collapsing anytime soon. a stable environment and i'm expecting a stable environment to continue.

bloomberg at top . i am juliette saly, this is bloomberg. nonfarm payrolls will be closely watched for signs the u.s. economy is strong enough to withstand and intimate nent rise. immi plus 500,000 jobs. that is what the bloomberg projection is when the u.s. bureau of labored statistics reports october payrolls. under sincegone may, the highest is at 200 k which we shot passed in july. correct, thatis

would be slightly higher than september is number of 100 60,000 jobs and the third month of higher gains in a row. bloomberg intelligence predicts a slightly higher number than that. of 190,000. they expect a rebound in government and health care jobs. report will have a huge bearing on the december fed meeting. if there is more growth shown, there will be more reason to hike. is minimum number to hike one of 2000 jobs. that seems achievable barring any black swan event. is its highest since early june. in other data points to look out for from october, average hourly earnings may have picked up about one third of a percent, against a 0.2% rise in september. that is just shy of the postrecession high of 2.7%. as for the work we, that is

projected to stay the same at 34.4 hours. the level it has been at since the second quarter. the unemployment rate is forecast to fall to 4.9%. it has been sticking around 5% in recent months which could mean the economy is close to full employment. the october jobs report comes out friday at 8:30 a.m. wall street time. payrolls, payrolls, payrolls. toldhile, paul krugman has bloomberg the fed should not raise rates this year or next. he thinks the u.s. central bank is determined to act as if but things areal anything but. he has this to say about the economic strategy of donald trump. >> i do not think there is any trumpomics. if you look at the concrete policy proposal, they are

standard republican issue stuff. on rich- slash taxes people. anna: there is a lot of discussion about u.s. politics. simon, great as always to see you. let us deal with the subject of the nonfarm payroll. let us look at this charge. nonfarm payrolls and the twitter whisper. we have a lot of whisper numbers. 175,000 seems to be the official consensus. what number does that have to be? be weak was that have to to throw out the expectation of a fred rate hike in december? simon: i think it would have to be in negative territory. looking at the most recent minutes from the fmoc. they describe some data is what they need to see between now and december.

that acts as an insurance policy for the rogue bit of data described earlier by a black -- as a black swan data. some rogue data. fmoc does not want to be in position of is providing for the market and as a result of one data point, losing control of expectations. they have expectations where they want for a december rate hike. yousef: expectations of side for a minute, paul also said that the fed should not hike this year. or even next year. is that something you subscribe to? right givennk he is where every other central bank is in the world, there is no obligation on the federal reserve to hike. they have put themselves in position to want to hike and at this point, you are looking at

credibility rather than necessity to push the fmoc into moving. what paul krugman is talking about is that we have a global problem here that is not consistent with any central bank moving interest rates higher. until you sell that problem, then why should central banks .ove at all what are your expectations regarding inflation? others are saying that there is inflation on the horizon. and we need to get ahead of that. simon: not in the environment where we are having structurally deflationary global economy. and the whole thing changes.

associatede risks with leading the economy run hot on inflation? very little compared to snuffing it out too quickly and being derailed later by economic events. think the global environment lends itself to being able to be brave with global overshooting. yousef: and we have the political environment. how could the u.s. election weeigh on fed policy? ; let us take the -- simon: let us take the donald trump victory. he does not have an economic track record to fall back on. to see whether he would be true to his word. in a donald trump victory, the dollar declines. i think the dollar will decline putting pressure on inflation a little bit.

clinton is business as usual and you push on towards a december rate type. -- a december rate hike. trump, he has been quite vocal about clipping the wings of the federal reserve and the fmoc. in the unlikely category given all of the other stuff he has spoken about and where his principal attention will be in this immediate priorities to deliver to some of his base if elected. entails understand what the presidency. will he get involved in the technocratic element in terms of changing the relationship between the u.s. government and the federal reserve? i don't think so. anna: we are watching governments reacting to the poll tightening in the u.s., the markets unknown. we have a chart here.

implied probability of a clinton win. that is coming down by various measures. perspective, we ad an interesting chat with representative from the deutsche bank, and he is a bit nervous about a donald trump victory in terms of the checks and balances that keep u.s. policy from swinging in one direction or another. from an economic perspective, do you see to virgins? -- do you see economic divergence? simon: i think he said enough to rattle markets from the perspective of uncertainty on domestic policy but it has much greater implications in terms of the crucial access of the u.s. and asia, particularly china. what some of the rhetoric he has spoken about will do for trade relationships and that will have

a fundamental dampener on economic growth going forward should he be true to some of the words he spoke during the campaign. yousef: simon will stay with us. , playing it cool. theresa may pledges to stick to her brexit plant despite yesterday's article 50 ruling. we will get you the full story. this is bloomberg. ♪

anna: welcome back, this is bloomberg daybreak: europe. it is 7:18 a.m. here in the capital. a bloomberg business flash with juliette saly. bmw's third-quarter profit rose as demand for its sport-utility vehicles propelled sales in europe and china. offsetting a slump in the u.s. it climbed to 2.38 euros.

the company repeated its sales posting an increase. commerzbank swung to a loss in the third quarter greeting analysts estimates. a profit of 235 million euros a year earlier. after the ceo unveiled the german lenders against overhaul since the global financial crisis. cfo will retire next year as it reported a decline in first-half profits. will be say one replaced and one brill remain -- one will remain as executive chairman. it had a 43% fall from earlier. gopro shares plunge in after-hours trading after saying it expects a bleak holiday season. the company making -- the camera

making company. a maker offitbit, wearable gadgets, which lost a third of its value after reducing its holiday forecast late on wednesday. toa: theresa may has pledged stick to her brexit timetable despite a court ruling that she needs lawmaker approval. can she hold an early general election as early as next year? charles lichfield joins us and simon frank is still with us. thank you very much charles for joining us on set. let us get your thoughts on where this leaves the political story. charles, to you first. how much more likely is an election next year? charles: slightly more likely although there is still a supreme court ruling. it depends on that judgment and we do not know how the supreme court will judge this.

11 judges will have to decide in early december. should they decide to uphold yesterday's ruling, i do believe an election is slightly more likely because theresa may needs the legitimacy of another election and the feeling that are behind her running on a coherent brexit strategy. you put that at about a 20% chance? simon, at what chance do you put that? simon: fairly slim. it has grown since yesterday. there iss spoke about, still a series of events to run through. what is more interesting is that election or no election, we will have that debate in parliament which is something that government is desperate to avoid because it does not want to reveal the fact that there are different views even among those supporting brexit.

having that playing out in open in parliament will be difficult. envision a us scenario where a supreme court mandates a role for parliament. what would that look like? textes: it depends on the and the subsequent interpretation on what the vote should be. if it would be a yes, no vote, that would be easy to get through because mps do not want to contradict the vote of the people. there could be a case where you have to go through complex legislation before the approval of article 50. if that happens, it will take quite long and will be difficult for the government to meet its deadlines. timing will be difficult. the content saying, will also be difficult because each mp interested in the relationship with the eu will try to get its -- their own amendments in. a poll conducted by

external academics said that 52% of the population voted for brexit in the popular vote. if you look at a breakdown from constituencies, support for brexit is breaker than that 52%. explaining perhaps that if we saw the vote in parliament, that international investors should not assume that mps who previously wanted to remain continue to do so. after all, there is no evidence that there is a big regret for brexit. i think most people who voted for brexit want to see it happen. and also the brexit camp still has the most enthusiastic campaign and individuals. it isly do not think unlikely that the parliament will turn this down. i think the more interesting

scenario is that if legislation is involved and it ties the governments hands -- the government's hance. ana: you are voting on negotiating position. what a brexit would end up look like is very much up to the other side. as parliamentarians will get their say on what the u.k. is aiming for, that is not the same as voting on the terms of an agreed brexit in the future. article 50n that starts the clock for two years and at the end of two years if you follow the rules set out in the lisbon treaty, you have to leave the european union. what conditions will parliamentarians look to put into the vote in terms of their own scrutiny of what deal they will have at the end of two years. you may say it is immaterial. learned in the last decade of european union politics and eurozone politics

that the rules can change if the circumstances change. i think if you got to a situation where the vast majority of parliamentarians are not happy with the deal coming you may start to see some regret for brexit. yousef: life for the boe has not been easy to start with. how will it navigate all of this? boe heard from the yesterday and the inflation reports. what was striking was how they increased 2017 growth and they expected inflation to hit at the back of next year. what that means for the boe is -- raising interest rates. pressure is off the other side for cutting inflation rates. the boe is sitting tight looking at the economic data. and they are set to be there for some time. described themok

as a forecasting body. on what the simon treasury will be doing. there is not a platform for the stimulus now. that: you're right to say the economic data the bank had projected -- had a come through, there would be more pressure on them to do a big stimulus package for november 23. what they would like to see instead is a smaller set of stimulants and delay the bigger projects to the march budget next year. itsef: we will have to leave there. so controversial, this topic, i enjoy it. charles lichfield and simon french. thank you for joining us this morning. daybreak europe. this is mark -- this is bloomberg.

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guy: welcome to bloomberg markets: the european union. we have your first trade of the day. ,hat are we watching today aretions and the greenbacks looking at their first weekly decline since september and the global stock selloff continues. this is of course as we wait for the last piece of data before the election. the u.s. jobs figures are out later today. will today's