nicola sturgeon vows to keep pushing for a second independence reference and -- referendum. >> i don't think the position of the prime minister is a -- one.ble and -- the doj shows improvement for japan. encouraging, inflation in the year ahead. authorities and visit three offices for alleged tax evasion. the bank repeats zero-tolerance

approach in newspaper as. what does this mean for the turnaround plan? ♪ anna: a very warm welcome to debate -- bloomberg daybreak: europe -- "bloomberg daybreak" going to india and cfos are up there of the u.k.. most optimistic in 18 months. is it getting harder to hold onto the short dish? data, slightly likes but you can see short vision was after the flash crash. we are less short on the british and thatn we were,

positioning is getting more and more difficult to hold onto. 1.21 by the beginning of this year. it depends which research you've read. every time you see a little bit of a nuance, you see a squeeze wethe purpose house anna: were talking a lot about how short the market was. bit ofk radar, a little a picture of where we are on various assets as you go to the asian session. dollar pretty weak. new york president weighing in on where the fun because next. no huge rush to raise rates more quickly. we are focused on geopolitics arrest north korea. manus: a nice flow of money into european -- the euro.

you take the dick black of inflation, what does that do to the european? yourlow of money into assets can drive the euro dollar higher. the asian equity session: up a quarter of 1% on the pacific. the estimate was as 14. the questions, to extend to the japanese corporate bailout and send that question mark we will talk more about that. can it hold onto the gains is made last week? opec over the weekend talking about how things are moving more into the balance. bloomberg first word news. in the u.s. donald trump has said america can

totally address north korea's nuclear threat unilaterally if china does not cooperate to put pressure on the state. ahead of a summit between the u.s. president and his chinese counterpart. he said he will discuss north thursday and friday. donald trump's son-in-law jared iraq, his in expanding foreign policy role. kushner, a senior advisor to the president in the husband of people the trump traveling with .oseph dunford, south korea's from speaker is considering a request to recall lawmakers to debate on opposition sponsored motion of no-confidence in president jacob zuma after he made cabinet

--nges that party changes party leaders said was that without his consultation. he would have to resign if they no-confidence motion. hasserving prime minister claimed a landslide victory in the presidential election. giving russia a chance to keep the influence in the balkans. keep cutting servia on his past .he european union union lena dunham for the country's businesses brexit. and saudi arabia, gensler philip hammond and mark carney are going to india. the heels of the u.k. formally triggering two years of exit talks with the european union. michael phelan has says the british territory of gibraltar

will be protected all the way as the country negotiates an exit from the eu. on the chart sovereignty -- global news 24 hours a day powered by more than 2600 journalists and analysts in more , you can findries more stories on the bloomberg at top . manus: the list on market, china is on holiday. back of that the survey. .1% -- .05%.up by and hong kong.

a switch up on the close in australia. their clocks have changed. 58.61.flat at the meeting between the president and trump later in the week. the stocks are watching in the region, shiva may miss the earnings that line once again as soon as we thought toshiba had got its act together but the shareholder approver -- approval including westinghouse filing for bankruptcy. 42%, china is planning to set up a new area, a lot of construction players very strong. ceo.h scope has a new the cash expected to rate but if you look at the

you can see the balloon --blue line -- tomorrow really expected to show dealing as to how it is with the aussie dollar versus it's very hot property market on the east coast with property of the percent over a year. expected. an update from hong kong. a and nicola sturgeon says second scottish independence referendum is the right one. a resistance will delay from the u.k. government untenable. >> scotland should have a choice over our future when the time is right. when the terms of the u.k. exit from the eu are known.

it's gotten so chooses to opt for a different path. the prime minister is clear that the time she is working to his two conclude agreements by the autumn of next year through spring 2019. that seems to me the appropriate moment for scotland to have a choice over our own future and speak to pursue concessions -- discussions and eight constructive way. not having a future direction, choosing the future direction so welcomingn remain the country that is not just in line with bellies as a nation but important to be future of prosperity of the economy. she suggested another date? >> that is for the prime minister answer. i do not speak for her. which got parliament represents the people scotland has voted and voted to endorse

the timetable set out. i don't think the position of the prime minister which appears to be the will of the scottish stable one.nd is a parliament scottish has to be and must be respected. anna: scottish first minister. more from that interview throughout the day here on bloomberg. isus: the next big date april 5. when they instill their votes on the resolution of the principal at once on how president talks and how the resolution is in finding. the most detailed documents we have seen so far. economist simon french. great interview with nicholas sturgeon. you pay abouten

trying to bang the drum, you have theresa may going to jordan. he timing of the potential referendum seems as if it will be later in 2019. when we know the brexit details. have you look the brexit situation? >> less than a week on triggering article 50, three little headlines have overtaken any of the economic questions around the relationship with the eu. the border with northern ireland, scottish and defendant, -- independence, gibraltar. it is quite striking how that a lotnaged to supersede of principles you mentioned in your intro. in terms ofnt

divorce, we need to also get through before we start talking about a new trade deal. anna: this. important relationship as how the relationship goes. tension over gibraltar and the rhetoric less than a week after triggering article 50. there's also the spanish foreign minister getting interviewed, he talks about how they might not be -- a scottish application they can't -- join the eu. the dynamic between the u.k. and spain, explained that there were going to have a friendly voice fighting in their corner within the eu, a different question. >> i will make the case to the defense, not immune to separatist questions of their own.

think that it spain and a contradictory position. think there's a lot of fostering. turing. markets, anrms of interesting dynamic with the pounds. pound hasning of the reached such aggressive levels that we seem to be pairing that fact. the hardest of french people in regards to the pound, i would have to admit that this looks as if there's a slight squeeze, as

if hard brexit may well have positioned in the 20th and 25 area. since november 2015, more than 23%. that takes you into the territory of lehman's, e.r.a. m, mid-1970's. there are a lot of forecasts in the market following brexit around the euro-sterling. that would have taken you to the order of 35%. is economically this a more damaging episode than these parties moves? it simply isn't. the fact that you are getting data, thering on the think it is key for the whole trajectory. >> an interesting development through. you mentioned this. u.k. cfosm among

climbing to an 18 month high, they still of knowledge that frexit is their top concern. it seems they think the brexit headwinds have eased. this is the ftse 350, that criticize. size.ind of >> in an attempt to get momentum. rattled through its. 20% depreciation and sterling. the bank of england restarting the qfii. helps a lot of the corporate sectors here in the u.k.. it is a sugar rush. it will not last. policymakers, it does quite well. to squeeze oneng more in but i have to get in.

it is built on sand. we are sending our bottoms up on critics -- credit cards. saving rates lowest on record. when that runs out, pop goes the weasel. >> i would not disagree. spend today, almost putting the finger in their years. ears and jumping real wages start to return. very little prospect for the rest of the decade. simon french stays with us here. program. on the manus: optimism among japan's latest manufacturers. this is bloomberg.

♪ anna: welcome back to "bloomberg daybreak" let's gets to hong kong and joined debra. ebra: china has seen the most corporate bonds ever in the first quarter. on ninevities failing it bonds this year. 29 for the whole of last year according to data compiled by bloomberg. the start heavy industry and construction. the situation shows how policymakers attendance to reduce the pretty is causing casualties. oiletary-general says reserves begin to fall. was optimistic that the market is starting to rebalance. on crisis in several producers are calling for the restriction to be extended rather than end in june as and tax evasion

and money laundering investigation, spanning five countries that would involve thousands of counselors. the term is less than two years old. its offices in london, paris, amsterdam were contacted by authorities. that is your bloomberg business flash. thank you very much. manus: let's talk about the confidence of japan's largest manufacturer and how profits rise. of 12,ising to a score up from 10 at three months ago but short of the forecast of 14. joining us from tokyo, great to have you on the program. good to have you here. why haven't we seen expected wage gains for japan's market tightening? some of thet

conversations taking place, the early signs are that gains have been modest. >> that is right. the resources are increasing here across the corporate landscape. not into wage rises. the first that the japanese labor unions were really week. they do not push for increased pay. since the last 10 or 15 years, the they were unions have been content to negotiate a wage increase for job security. they don't get restructured, but they don't get an increase in pay. the labor unions are pushing for a small number of companies are going to give you rising wages out of the goodness of their hearts. therehat first phone is are not pushes for better wages.

companies are not confident about what is happening with japan's economy. most japanese companies are more confident overseas to they're not investing domestically. does all of this put more pressure on the pboc? eight,not the previous the bank of japan to think about raising the target? >> he said repeatedly that he would want cost inflation, demand inflation, not all prices but people paying to rise, that to increase. that to push of inflation. toon't think that is going change the yield curve control at the moment. he said he's basically satisfied

with where he is at the moment. if he sees more inflation to the second half of the year there will be more pressure to change that. rises, their policy there. anna: thank you for your time. macroeconomy editor in tokyo. here,ssing ingredient many economies and asked this question, wages. one of the missing ingredients for inflation. >> 2.8% is the unemployment rate. 23 year low. you would expect tight conditions, wages up. japan is not alone. whereare many geographies labor bargaining power has just been gradually eroded over the last 25-30 years. investors are reaping the rewards. that is not sustainable

economically. anna: the regions where they are updating profits most is japan. manus: inextricably linked with what happens with dollar-yen. there's an injured straight differential, the bassist swap of a -94 basis swaps. --s stops and cap saps out.ed andc capped if there is an unwinding. reporter: changing guidance from the boj. i think the flow is in and out of yen. driving boj behavior regarding your current guidance.

what international investors see any hell a success, not just japan but its reference point to the u.s., will push the yield curve in the direct and of changing guidance toward the second half of this year. i don't think it is sustainable given where other bond markets are moving. global trade looking better. we will talk more about u.s. and chinese in our next conversation. in japan, always material. reporter: extra could be linked to -- it is a virtuous circle. the circle gets three quarters of the way around and that does not get through to japanese workers. is the boj responsibility, the government responsibility, the -- we have to look at the transmission from policy to workers. it is broken. they give much. simon french stays with us.

manus: talking oil and opec. painting a cautiously optimistic picture for oil. if the market finally rebalancing? that is the question this monday morning. this is bloomberg. ♪

>> welcome back. here.daybreak against the yen a lot ofy flat against currencies. and you is available can look at the stories that made it in today. we will see if he got a handshake.

what is the benchmark for success? the chinese president needs the u.s. president. washington will be prepared to act alone against north korea, if they do not get more help from beijing. china in the view that gates in -- engages in abuses that lead to consistent deficits. there will be a menu of options presented. the opec secretary believes that this is a sign that supply cuts are restoring balance. the compliance with oil surged.

today is a little weaker on prices. story.s look at this there was a two-page advertisement taken out that focuses on the bank having a zero-tolerance policy on tax evasion. surprised by the investigation, with a number of items being confiscated. let's move on to south africa. of nocould be a motion confidence, according to the theiamentary speaker, after finance minister and other had goneinisters

without consultation. >> a columnist for bloomberg news joins us now. motion ofns if the no-confidence's six seats? event thats in the there is a possibility of success here. said, it would not be the first motion of no-confidence debated on in parliament. we have seen various members coming out and criticizing the president extensively. secretary and the

treasury general. they come up and they criticize the cabinet shuffle. what we know is that there will have to be a two thirds majority voting for the motion and we will have to see if any of the members vote to get him out. if there is, the cabinet will have to resign. >> the markets believe that a lot is at stake. >> definitely. is the crediting rating. we have heard the agency coming and they said that this is something they do not want to see and we have seen this in the past couple of days and weeks.

there are assessments on the sovereign credit rating in the next couple of weeks. >> thank you for the very latest. this is technically -- bigs talk about the other onue for investors coming wednesday with the payroll data. they rebounded from the lowest and we saw ith tightening a couple more times this year. >> this does seem reasonable. the economy is a little stronger and it could do a little bit less. >> meanwhile, trump says that

the united states could act alone with addressing the north korean nuclear threat. a chief economist is still with us. there is a lot to talk about with the united states and china relationship. this conversation was an introduction into the united states. where do you stand now? pushing forhe fed more? is this a misreading? that we will have and payrollssday towards the end of the week. whether the core inflation picks 1.8% and theound

data thing is that all the has been very weak. it is the very bottom of the -- e and things will be the lowest. . love this title mission accomplished. aggressive the fed is. this is the shape with a xi jinping and down from, which could ship the moves for the market. markets expecting difficult conversations. it is likely that this

conversation will be on a difficult and of the spectrum. will we hear more? what we have heard is a recalibration of trade arrangements and i don't think they can stay silent on the issue. >> as an economist, you would the at this inflating and most extreme scenario. what else will you look at? will you be looking at the u.s. the economy? some ofill want to see the geopolitical.

well we talk about north korea and the tensions in the south china sea? policy that hawkish could spook investors. tradere is potential of a gdp and ing exports. maybe we are not allocating the concern correctly. there is concern about germany and italy and the blockbuster global threat is the china and u.s. trade relations. flipvestors will have to on this. there is a series of global how do you never

will -- navigate that? >> let me give you the number on the consideration. would reduce chinese exports by 60% and 70%. that is gargantuan and it is a us.ificant risk to all of >> i think that it is not conceivable in this backdrop. they are restored competitiveness and that would put the chinese back in a current manipulation place, where they should not be. about steadyd

monetary policy and following the fed. interesting that you mentioned it. we have been talking about what was at stake. has faltered.ct these economies are in the spotlight. meanwhile, the economics carries. this threat doesn't materialize. ability to have a more aggressive approach. which do you think will be more important? expectations and

getting to the moderate center. you expect this on a sustainable basis and i don't think so. he is among the key voters. >> we will talk about that. we are turning to the subject of oil. decline is starting to in production cuts are rebalancing the market. man.t's get to the magic it is our middle east anchor joining us. this won't last. it is a figment of imagination. >> and a lot of this depends on what it can hold and the other thing we are watching is what

the secretary is cautiously optimistic about. let me show you what has caught the eyes of a lot of analysts. and russia at that is coming and delivering on promises and was always going to be a little bit of a wildcard. it still is. to countries we have heard from. morgan stanley said that you should be looking at crude storagees and floating around the world. comments thing is the from the oil minister who says that they are 98% compliant, after reviewing production data

-- having him bishops ambitious targets. the question remains if they will be on for the cuts. >> thank you. a reminder that you can watch to show using the function get all of the added benefits. there are charts and you can reach out to the show producers. up, but around of elections is a few weeks away. . surge from the left this is the next to discussion. this is bloomberg.

here in theack morning. you see the empire state fording in bright colors the awareness day. bloombergto the business flash. >> thank you. confidence among manufacturers has improved. comes as a week yen helps to boost profits. to last year and the data compiled by bloomberg. most is heavy industry and it

shows how this is causing casualties. evasion in an tax investigation that could involve several holders. the bank has said that the offices were contacted by the authorities and that they are cooperating. estimatese analyst with the maker of the electric 25,000d just more than vehicles. the ceo prepares to build the model three in july. the four remaining executive directors have quit and they cannot locate the missing head of treasury. said that theso

manager of treasury and cash operations was in hong kong. bloomberg's newsflash. >> the left-wing candidate is gaining ground in the polls. >> they are fighting for the and we are getting more on the political story. this andlook at battling it out, are either of them getting into the second round? it looks to be remote, but this

story talks about adding to and -- isks >> you are right to say that they do not really stand a chance. what happens to the voters when they get into that second round? there is a left of center there may beda and a shift in a second round. markets are underpricing her reallocating in the second. oppositesa number of have votesountries for president, even though there

was brexit. in a normal democracy, it takes a long time. it is hard to fix without breaking it. they either want to rip it up or -- thatam not convinced either in the center ground is really having an honest conversation with the electorate. about is talking redistribution from rich countries to the poor countries. they don't want to do it, but it is essential to do that.

,or political responsibility that is another critical part no one is talking about that. if we are trying to learn lessons, we would say that the ruling party did not speak about migration and they were hit by the electorate for not having the honest conversation. brexit, itweight of is a different path and they don't tackle the ground the populace stands on. are you suggesting a bold expression of a further unity and a big expression unifying?

certain that the front runner in this campaign has been told by the pollsters to not talk about eurobond. he cannot talk about making this ite secure without making for those who need those. they are lying around the willcations and he electoratehave the .oting for the big problem >> i cannot believe that you lie inay politician and the same sentence. i am french. we will get emails.

is light relief and inflation swapar and it keeps going up. we have tried to hit the inflation target and it will get harder for the bank to maintain momentum. is very material and the core inflation forget the 2%. it is 1%. the ecb may end qe early.

moment there is nothing in and theyof the economy succeed to the point with monetary policy. >> you think it is premature. >> i do. what better way to start your monday morning. >> let's look at the week ahead. the french presidential theidate scores off in televised debate. >> on thursday, the chinese president arrives in the united states for a visit. >> we will round off the week with a gathering of financed ministers. >> we will speak to nicola for ann about her plans independence vote.

investmentsum up and improving me trading relationship. there are questions over comments made by president trump . that is coming up next.

>> a a question about the british future. says she willn keep pushing for an independence referendum, speaking to bloomberg. ofi don't think the position the prime minister to stand in the way of this is good. signs for the year ahead. visiting an office for alleged evasion.

what does this mean for the turnaround plan? welcome to daybreak. i am manus cranny. this monday. early was pretty decent without china. numbersd not hit the the market had anticipated, but located down and you saw the and therendicated up are decent numbers with a big

week for politics and the meeting later in the week. we get minutes and that will give us inflation expectations. we have a little on lloyd's. rights are a continuing story and the u.k. government is getting out. and wecovering assets speaking to trump and there is a great deal of indexwith the u.s. dollar heard was the we president talking about not

having a huge risk to raise rates. reason was the voice of versus the comments from earlier in the week. raise thegers positions to the highest level in almost a decade. momentum and you managers andt reducing the choice. and the doing nicely japanese market gets a bit of a boost. employment is at a 23 year low.

will that be passed on to workers in japan? that is a big question. we have been following this do you have a quick word on the brexit bank? options ong all the the table and they say that this defending and all of the options are on the table. >> there has been some press speculation and they had to review.o a strategic they announced a strategic review of our food business.

markets andan japanese markets. >> they are closed. >> they both closed positively they are up by just a fraction. >> you have the bond market in stoxx are a the little bit better. conversation says that this is to premature to start talking interestering in the rate market. >> let's get the first word. >> thank you. >> in the united states, donald trump says that america can totally address north korea unilaterally. come ahead of a

and hisetween trump shiny's counterpart. jared kushner is visiting iraq, in an example of his expanding form policy rule. he is thesaid that senior advisor to the president and he is traveling with the joint chiefs of staff chairman. they did not share the itinerary of the scheduled meetings. parliamentarycan speaker is considering a request to recall lawmakers to have a debate about no confidence for the president. involving changes that officials say it were done without their approval.

headingp officials are to paying the drum ahead of breakfasts -- brexit. myanmar, the chancellor and bank of england governor is going to india. michael fallon has said that the country will negotiate exit from the european union. said thereident would be a stay on deciding brexit deals. france, marine le pen as described the euro as deadweight.

meanwhile, there pierced to be 18 of ground. the soviet prime minister has andmed a landslide victory it would give a chance to deepen the influence in the balkans. they say in government will be formed into months. you can find more stories on bloomberg. out along with thing nikkei is boosted proceedingvey at closed andhina is

hong kong will be closed tomorrow. thisg a look at some of and they have turned things thend giving the selling of business. it is looking very solid and the sedation report thatis is a he will be replaced by an act executive. ande looking at this chart you can find this white line is they are balancing the

currency in the economy. it is very interesting to watch this is at a record low. return to scottish independence. there was -- and one >> the will of the scottish from it is a sustainable one, but we need to discuss this in a manner. that was a good interview.

>> we have the oversold and undervalued currency. what it is and the reason is the gloomy outlook. and is the upside. it is the economy in the near

term. you would describe us as heading into stagflation? there is a combination of inflation. you get the stagnation and fish in?ow do you tie this optimism is climbing to an 18 month high. that this fits into a narrative.

uses the only sector of the economy that truly benefited. the fact is that the risk is is evidence and there are investment intentions. there is one thing and it is a different matter with the implication. the fact is that the u.k. is

built for the long prospects. >> the savings rate is the level. and there seen this is only so much consumers could spend. risk is the sharp deterioration. >> we are not shorter than we were in the flash crash. in this risklue reward on sterling? is it more? this proves to be interesting is very aggressive

selling from here and it is obvious we have this later in the recovery has happened from the brexit slump. make of theou strength of the euro this morning? brought-based. >> i think that investors got ahead of themselves in that they will unwind the monetary stimulus. we will have to deal with the there arerisk and things to consider, like risk with the french election and significant down slide. a long right now.

>> three weeks to go. stay with us. the rest will come out. next, taxi even asian and money laundering. this is bloomberg.

>> welcome back. be back.utures will let's get to the bloomberg business flash. >> thank you.

anfidence is improving for second quarter in a row, all according to a survey. the a record and more 25,000 vehicles. is your bloomberg business button. we're looking into dozens of euro and swiss accounts. >> we had to zürich and we are joined by the bloomberg news quarter. who is the subject of the

investigation. this is a major money laundering probe. and is the guys looking in this probe concerns individuals. for now, it is not a major issue for the bank. know, we have been theing into the matter and

and theydone a lot were trying to get rid of the it is tax compliant reported 40 million you see this happen a lot. >> we are going to show our viewers what has already been strictd it was a zero-tolerance policy on tax evasion.

he is very dexterous when it involving the media. there is a debate with capital raising and it could not have come at a worse time. understand tod to put a parameter around this? making all the points. saying we aree compliance and that this is a serious matter. issue, we do not know about this and we know they wealthtructuring with management and this is something investors do not want to see.

a major issue? .on't know yet it is a big fear. it is too early to say. consider the bank and they are a capital race or doing nothing. >> thank you very much. great to have you on this program. thank you for joining us. a snapshot.t >> rebounding from close to the lowest levels of march and he he saw as a couple more

times this year. the voice of reason returns the do you think deadly has called back? it will be very interesting how manyere we are and withikely for this hike the reduction of the balance andt getting mentioned there is still time. there is a risk. debate of theous balance sheet. >> we watched the chinese allegation go to florida. what will be positive and what

will be negative? some peril and it theld continue to support and you -- cyclical story that is a risk of protectionism that could resurface. at the same time, the dollar may not do as well against the safe haven currencies. week to sell the dollar. >> thank you for putting this in context. >> that is it for daybreak.

european open is up next. the endkey events for of the week. support that meeting between -- this is bloomberg.

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whoo! boom baby! rated pg-13. [ screams ] guy: monday morning. welcome to "bloomberg markets," this is the european open. your first cash session coming up shortly. what are we watching? the face-off. the u.s. president, trump, and the chinese president xi are expected to meet this week. war still the biggest risk investors face? the brits on tour theresa may. , philip hammond -- the brits on tour. saudia