♪ haidi: more turmoil in dumpedton, the u.s. has and coming dialogue from china. betty: a new head of the pboc will succeed the 15 year veteran. boss, will make the new same as the old boss. wins and a landslide and is russia's longest serving leader since stalin. betty: the g20 with trade tension at the top of the agenda. live in windows are is. -- when osiris --

haidi: i am haidi lun, this is daybreak australia. betty: another start to the week, just after six ago p.m. in new york. i have betty liu. we will be looking at how all the action played into the asia-pacific trading day and wall street action friday. not too bad. we saw a rally, consumer sentiment numbers on friday help lifted shares right before the weekend. you can see the s&p higher by 0.2%. the dow adding 70 points, the nasdaq slight bid under the index but pretty much unchanged. we will be watching those tech shares, but more important we will be watching the fomc meeting and its decision with powell of the head of the fed. haidi: we have futures pricing in. their chances are well over 90%.

we are watching for the press conference, the town, any sense of extra hawkishness will be taken to mean a change in the dot plot, but looking at how we are setting up in asia, we have the fomc event clearly fun and -- front and center. the bank of it asia, new zealand central bank, the philippines, indonesia setting policy this week, largely expected to stay unchanged. new zealand has been trading to the upside. we have the u.s. dollar gaining alongside u.s. stocks for the first time. over theme optimism reckitt -- recent economic numbers. sydney futures look good going into the open. the aussie dollar trading 77.15. there is weakness with iron ore trading, so looking up for the likes of the hp and fortescue into that open. gold futures up a little bit and new york crude as well.

trading at $62 a barrel. we see some sustained weakness across the industrial commodities space there. president trump made his most direct attack against robert mueller into the russian election-meddling.. this is the lightest test latest sign a showdown may be brewing over the road. 13 hardened democrats, supposedly did hillary supporters -- does anyone think this is fair? the president reading -- tweeting that. be getting closer, as we say, to some kind of showdown? ros: very interesting as you say over the weekend. president trump used the word witchhunt about two dozen times to talk about robert lawler's probe, but never used the word mueller. . he did today and yesterday. it is like a loyalty test by the

president and trying to push the envelope as far as he can to see how far he can push and what the response will be from professional -- from congressional publicans and others in his party. he had a success you could say on friday when attorney general jeff sessions fired andrew mccabe of the fbi. that was a loyalty test area this is another loyalty test. ,ow republicans responded senior republicans like lindsey graham, john mccain, jeff flake, who is a vocal trump critic, saying he can't fire him. this is a redline that he cannot cross. maybe there is some back-and-forth. maybe trump thinks he can't go ahead with this. this -- weaying into had a poll showing almost a majority of americans want democrats to take over congress, so to some extent trump and his

team feel the clock is ticking, and that could behind their latest comments on the fbi probe. betty: we ever democrats like there will be a constitutional crisis if moeller is indeed fired. i want to switch to another topic over the weekend, which is continuing talks, talks around this meeting with president trump and the north korean leader. we had the top diplomat from south korea saying it was quite a surprise to see the president here in the u.s. jumping at that chance. we had this woman who has been in the united states a few days she met with ivanka trump and has been holding meetings with u.s. officials. she said she thinks kim, kim jong-un, like everyone else was by how quickly

president trump agreed to that meeting. she has been saying again and again she is compass me -- she is cautiously optimistic. now she explains or by how quicy president trump suggest that kim has actually responded to president trump, saying he is taking star. she did have kind of a cautionary message that, given the trump administration's new tariffs they tried to put on aluminum and steel imports, that is a cloud over this whole korea peninsula situation. so it remains to be seen how trump gets wound up into the whole north korea talks or not. betty: all right, certainly going to continue to watch that and the aftereffects. ros krasny, our bloomberg editor. let's get to first word news with ramy inocencio. ramy: "first up russian president vladimir putin has won a record first term, and i keep till 2024e kremlin on

and makes him russia's longest-serving leader ever since josh hingst -- since stalin. condemnation for allegedly meddling in the u.s. election as well as the nerve agent attack on a former spy in the u.k. speaking of which, the u.k. has evidence russia spent years building up its nerve agent capability that culminated in the attack on the former spy and his daughter. boris johnson told the bbc that the u.k. has shown moscow has perfected assassination by merck -- by nerve agent. they say british laboratories may have been involved, russia. the rise of digital currencies .ay make a threat to the system ahead of the g20 meeting, cryptocurrencies could undermine confidence if not regulated properly. carney said the combined global market value is less than 1% of

global economic output and they are not yet substitutes for traditional currencies. ahead of the g20 meeting, there is confusion about america's economic hotline with china. the royal court said washington had dumped a long-standing dialogue created by then paulson.treasury hank the senior treasury official said washington was disappointed at beijing's expanded role in the economy but said -- global news 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries. i am ramy inocencio. this is bloomberg. ♪ haidi: thank you for that. the next should bring as confirmation of who is taking the helm at the people's bank of china. some say the deputy governor has been selected to succeed. let's get to beijing. tom mackenzie there with us in the last days of the national people's congress.

this guy is in fact the one. does that suggest continuity when it comes to the pboc strategy? because he has been in the pboc since 1997 and more importantly, he has been under the watch of the leader for almost a decade. he has been the current governor's number two for over 10 years and that is a time when he steered the pboc end of monetary policy through the financial crisis and through the moves to have the yuan taken up as a basket currency. adding additional tools to the pboc as well. if he does take over, he will take over a more powerful pboc. he could rewrite regulations around the financial sector. it is a more powerful plank, but the challenges are significant. not just controlling the debt and ensuring there is not a

crash in the economy but further moves to liberalize the yuan and try to calibrate with what the fed is doing. no easy task if he does take over this position, which if reports are correct will happen and be finalized today at the conference. betty: president xi jinping in china has won a second term as president, not surprised. the vote, 2970 20, but it is significant nonetheless, right? tom: in fact that number is significant because that is the first time the npc has voted unanimously for a decision of this kind for a quarter of a century. it does have rubberstamped decisions put to it, but that was surprising. the people's daily,: xi jinping the great helmsman, -- daily, calling xi jinping the great helmsman. reminding us if we needed it, president xi is the most

powerful leader china has had for two decades. the other noticeable nomination was the vice presidency, a key ally of president xi. he will take over the task of u.s.-china relations. he has ties to many policymakers in the u.s., and a lot of financial and economic experience as well. that will be a challenging prospect for him. that will be a key part of his portfolio going forward. betty: thank you so much, tom mackenzie in beijing, the china correspondent. we will stay with this story and bring the chief economist, jason shanker. the much sought-after voice on .ll things global economics his most accurate forecasts are across 24 categories. let's talk about china first and whether you think the risks have increased, stayed the same, or decreased after watching

politically what is happening at the national people's congress. jason: the risks to china as we see it from a growth standpoint or economy standpoint are unchanged year. that is not where i am concerned . i am still more concerned about what we might see from trade repercussions following u.s. tariff proclamations on steel and aluminum imports. it has a much bigger risk than what we have seen at the npc. betty: how about the change at the top near the pboc? there is assurance that if it is this guy elevated to the top suggests continuity. jason: that is right. that is part of why there is not much risk. we are seeing stability here, so i would expect monetary policy. we will see that same sort of neutral sort of stances we have seen for a number of quarters. we see that remain in place, so

we see continuity and also politically we would expect things to remain relatively the same. betty: given that, then, what about the chinese currency, right, which continues on its way to liberalization? the wildcard for the chinese yuan has been the u.s. dollar. jason: that is right. the u.s. dollar has been a big wildcard in the last year or so, although we were expecting a dollar would weaken significantly over the past year because other central banks, other economies are improving and other central banks are looking to tighten their monetary policy. i think for the chinese renminbi going forward, the big issue is going to beat what is the global economy looking like? if the global economy is in good shape and we see growth, the renminbi is likely to strengthen because global manufacturing will be strong, and is unavoidable with the chinese

currency not to strengthen. but on the other hand, we see some prospects are global growth diminish as we see monetary policy in the u.s., europe, tighten as we see the risk of terrorist repercussions -- tariff repercussions. that could dampen the outlook for 2019, which means something that could limit the upside potential for strength to the renminbi. retaliatorywould actions from beijing potentially look like? is it more likely to take place through the treasury holdings or trade tariffs? jason: i think it would be more likely for trade tariffs, sort of the first gambit i would expect. i would not think, doing things with treasuries would be a bit more extreme, but as we see tariffs potentially increase, who knows how far that could be

pushed. i don't think china is going to take this sitting down. i don't think most economies are going to take the u.s. increase in tariffs sitting down. there is likely to be some level of punch back. that is most likely to come with terrorist -- tariffs. haidi: is the biggest risk from u.s. or china? jason: two of the global economy the u.s. is a bit more risk ,ecause labor costs are rising productivity was flat in the fourth quarter, interest rates are rising, housing and autos have slowed. and yet you have inflation with the fed likely to be raising rates. so we see that impact negatively corporate profit margins, u.s. growth were to slow and equity markets take a shift, there is a ripple effect through the global economy. that is the risk now. the chinese economy is more dependent on the downstream economies of the u.s. and the

eurozone, because the u.s. and the eurozone are not strong, they are not buying or consuming , then they are not buying or consuming goods made in china. that would be negative to the chinese economy. very competitive now. what happens with the u.s., it key inflection point for a number of data points affect policy as well. haidi: we will be getting more on fed policy. stay with us. he will be back to talk with us as we look ahead to jaipal is -- jay powell's meeting. more from the fed and the boe and other central banks meeting this week, betty. betty: i will be live in buenos aires. the trade minister meeting. top of the agenda, trade tension. this is bloomberg. ♪

♪ sydney. am haidi lun in mark: i am betty liu in new york.

it is a big week for the fed, new chairman takes his first meeting. jay powell is in the spotlight with investors wanting to know if they will see three or four rate hikes. is it three or four? our policy editor kathleen hays. we are always asking for the answers. we get clues, not answers. kathleen: we will get answers because this is an important meeting first of all because jay .owell is reciting -- presiding and also the first time he holds the so important post meeting press conference, an hour of all kinds of questions from every reporter trying to get every thing out of him on the rates and economy and more. we will not talk more about if there is a rate hike because it is considered a done deal at this time. if you look here on the wirp, chances are about 100% they will hike the rate. they will put out their new summary of economic projections.

what is growth going to be, gdp, inflation, unemployment. people put dots on what the rate hikes will be. what is driving the debate? let's go to this side. gdp is solid. unemployment is low, and they are concerned with officials on this side. on the other side you have spending softening in the first quarter, inflation below target, and we don't want to see the shortage to judicial selloff while the long end of it and you have a flatter yield curve. in terms of the comments from economists on wall street, definitely looking for four rate hikes. we would get that announcement at the meeting when it wraps up wednesday. morgan stanley going to stick with three. looks like a compromise could be, let's wait until june. if we need to go to four, we will raise the consensus forecast. we will price as much as we think we need to.

that is the drama at the time. haidi: data dependent. stay with us in this conversation. we will get back to jason shanker. thank you for staying with us. we were talking about this during the break. fed policy doesn't exist in a vacuum. we have had lots of analysts staying -- saying the risks posed by trade policy, fiscal policy to the economic outlook are overblown. you think the fed would be concerned at this point? jason: i think the fed has to be concerned. it does exist in a vacuum and we have not seen what repercussions might yet come from the u.s. tariffs on steel and aluminum. so hunchback's, there have been warnings issued immediately after these were discussed. this could lower the total growth outlook. this could hurt the u.s. economy . if this were to escalate, that

presents down said risk. when you are already seeing downside risk in financial -- taken a hint on higher inflation resulting in needing, resuscitating higher interest rates but also higher labor costs. and now higher materials costs because of inputs from the terrace -- tariffs. the global economy is doing well. all of these things erode corporate profit margins, so the fed has to weigh all of these things. i think more fed hikes and fewer later. we have been predicting since october cointreau this year but none next year. -- four this year but none next year. kathleen: in terms of the trade, they see minimal impact on the economy from tariffs, so let's put that on the table but i want to ask you about wages. in the first block of the show you said you see signs of rising

wages, and i want to show you a chart, #btv -- sorry, i took it off my screen. let's move on. the wagesyou look at for production workers are pretty flat. the average earnings over here, they pull back again. where'd you see the wages rising? jason: there is a couple things. we do a quarterly benchmark, which is predominantly corporate for our clients. in january the biggest risk was more than a dozen risks every quarter. the biggest risk on a weighted basis since q1 of 2016, out of any of the risks we have asked about every single quarter right now is labor cost. that is the biggest risk since the risk of a prolonged chinese slowdown assessed by our clients in q1 16 when the pmi was below 50 and did convey a manufacturing recession ongoing.

so the fact our clients are assessing this as a risk is a big deal from the business roundtable. there were similar surveys of the national level. the upside labor costs is a big risk. most of the markets and clients we talked to, they cannot find the people they need, and they are at risk of busting their salary tables by paying someone more than they would normally be paid to bring them in or risk losing people. at 24 2017 where productivity was flat, what happens now that productivity begins to fall? what you begin to see his corporations looking at, starting to cut payrolls. betty: jason, i'm trying to get a better sense then, looking out into the future. despite what we are seeing with short-term deals rising, if you look at -- let's bring up that chart. if you look at what bloomberg has crunched with their indicators showing a 100% chance

of recession within three years, what are your numbers, jason? >> i say what we have normally seen in a selloff that happened in february. it has been between 11 and 13 months from that kind of drop to when you see things began. october amorecast is a four rate hikes this year, none next year. big businesso the investment last year and what we expect in the first part of this year, you don't necessarily get that bump on a basis normally. we have seen three months of negative retail sales. that shows there is risk further out. right now the fed has got to raise rates, but later on they will be more. four thisyou said year and none next year. that is a call, a vivid outlier

because a lot site 2, 3. the extremists, maybe even for next year as well. jason: back to october, most were expecting two this year and several next year. october expecting cointreau this year, none -- four this year, none next year. haidi: always a pleasure, the presidential economics, james -- jason schenker joining us from austin. it is fed week of course, the first policy decision under jay powell. let's get you a quick update on business flash headlines. saudi arabia has reported willingness to delay the aramco ipo, due to a lack of interest in the u.s. saudi officials pitched the listening to some of the regional hedge funds. we told investors that the soul -- the fellow this, the dividends aramco is prepared to pay and the impact of u.s. shale on global oil prices. betty: the crown prince of saudi

arabia is planning to meet apple and google during his trip to the ever -- to the united states and have started to donald trump and senior administration officials. mohammad bin salman will have meetings in san francisco and l.a. saudi arabia was the first foreign country president trump visited after taking office. is paying $1.5 twoion in stakes in offshore oil facilities in abu dhabi. it will help develop the production of crude and natural gas. they have been working in this .nergy sector since 1939 it generates electricity at a solar plant and produces and sells gas. a roundup of the stories you need to know to get your day and week going. bloomberg subscribers can go to dayb on their terminals. no surprise who has been winning a fourth term, fujian. it is also available in the bloomberg anywhere app.

you can just get news on the industries and assets you care about to get your trading day and this writing -- brand new day started. this is bloomberg. ♪

♪ haidi: it is 9:30 in sydney, the markets are open for a brand-new trading week. this is how it is turning out ahead of the citi open. up -- the sydney open. watching declining price of iron , weighing on the energy and materials majors into the start of trading. haidi lun in sydney. betty: i am betty liu in new york where it is 6:30 p.m. let's get the first word news with ramy inocencio. ramy: the wall street journal is reporting china will name a new successor at the pboc. he joined in 1997 and for the past decade has served as deputy or the national people's

congress is certain to approve him. president trump has launched his most direct attack so far on the justice department investigation into alleged russian meddling in the 2016 election. he used mueller's name for the first time and said this probe should never have been started, and uses capital letters to call the investigation a witchhunt. the president attacked former fbi director john mccain who was fired on friday. the south korean foreign -- the unitedthey states surprised north korea by agreeing to a talk. they believe the north korean leader is considering his position before responding publicly. congress says seoul and washington have made it clear nothing is being offered in return for the talks. asean summit has agreed to get north korea to those -- its

nuclear program immediately. it is a threat to the region and called for complete, verifiable and irreversible denuclearization of the korean peninsula. they agree to two free open markets, vowing against protectionism. global news 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries. i am ramy inocencio. this is bloomberg. ♪ haid. haidi: more turmoil in washington with the treasuries undersecretary for the fed saying he misspoke when he said economic dialogues with china are over. >> the administration was disappointed with the results, and because there wasn't a path orientation.it i have discontinued the comprehensive economic dialogue. , they areever backtracking.

let's get the latest from the international editor who is in buenos aires at the head of the g20 talks. the financial bankers, let's talk about what is going on. >> no question, the u.s. is on the spot, the trump administration's steel and aluminum tariffs are not popular area treasury secretary steve mnuchin arriving to a chilly reception. we have a draft of his final communique where it says a country turning inward is the biggest threat to global growth and in it exclusive interview, the treasury undersecretary told me the u.s. is just responding to provocation from china. points in his recent history has moved toward markets. they have joined international institutions. and they were allowing market pricing within their own economy. but in recent years, that has stalled or even reversed. that is a concern for the world because it says the world cannot

grow as fast as it should. >> one of the jobs will be trying to get up support for the u.s. and international action against the chinese. the administration is about to impose sanctions on china for electoral property theft, and they would like support from the allies, but that is difficult given their view of the steel and aluminum tariffs and that trump could be starting a global trade war. haidi: what are we expecting to happen today? on monday the ministers will begin talking about the global economic outlook with a bit of a twist. we have this secret just strong growth, they don't really want to get into individual forecasts . each will talk about what they think the biggest risk to the global economy is and the u.s. may be on that list. ok, will there be a battle over the final

communique? mike: there was last year. secretary mnuchin was new on the job and refused to sign on to committing to free trade while -- trade. while they are drafting the final language, people think they have finessed it. they will talk about the importance of free trade to the rest of the world. we will see how it develops when secretary mnuchin gets in the room with other ministers. betty: thank you so much, certainly always a lot of debate when you get to -- them together. week onok ahead to the wall street. as we have mentioned we have the fed big deal news and a new round of earnings and economic numbers likely to dominate trading. i want to bring in su keenan for a closer look. let's look at the deal news. be berkshire set to chock-full of deals, given some over the weekend reports over a potential david and goliath

fight in the defense sector. this company with their $3.88 million market cap up against dynamics, a diverse .ompany with 17 times its size both are after an infotech company csra which is a analytics company. according to the wall street journal which cannot with this report, fighting -- citing an unnamed source, the offer of $44 csra share noth only dominates the all caps off are that csra and general dynamics agreed to last month, it appears they are designed to settle the deal. that is something that will likely be very big news on monday. neither of the three companies responded to a bloomberg conference. if successful this would halt the biggest acquisition by general dynamics which makes tanks and nuclear machines.

very high-profile deal. warner'ss is at&t time $82 billion combination begins trial later this week. the u.s. justice department kind of block the deal. some analysts think at&t has the chance of pulling it off, but instead of the biggest antitrust case in modern times, it you could -- it could determine how we pay for and get streaming tv movies. at&t is saying it needs to combine with time warner to fend off a petition from amazon on netflix and many analysts are saying, what will happen to time warner if they are left alone? haidi: we have also got dollar drama, some fresh icahn numbers and numbers paying out for investors to focus on. what are the highlights? su: dollar direction may be key. go to the bloomberg and look at

#2147. the whole drama in washington, the political shakeups, the departures, trump is said to go after this special counsel, the subpoena resulted in a drop in the dollar. if that story moves forward, the story on how it impacts the dollar will be in the headlines and in focus. we are also getting another round of earnings, big names, nike, which has been under competitive pressure, fedex, which is sort of an indicator of the transport and commerce. it always gives us an underlying idea of the economy, and tencent, one of the key online retailers, the giants up against alibaba, very much in focus as well. in terms of the eco-data, it is continued to be the expectation is that we will continue to get positive results. we have housing data which is expected to be up in february, jobless claims will be a big focus as you know.

we continue near a 48 year low for joblessness which is showing the underlying strength in the sector and durable goods rebounding. haidi: lots on the docket this week. thank you so much for that, su keenan with a look ahead. let's look at the markets that are trading. new zealand of course, we are ahead of the asean freight decision we are watching policy rba andce between the the fed. the kiwi dollar looking at these lows, 72.20, approaching that .oving day moving average the aussie dollar hitting a three-month low. we have not seen these since christmas time last year. the general risk off sentiment and concerns over how metals and commodities prices are going to fair under potential trade protectionism.

japanese yen was one of the early gainers against the u.s. dollar out of that g10 space. nikkei.weighing on the when they get trading, sterling, 149.14. we are pretty steady when it comes to the yield into the fed meeting. gaining, thes are volume is weak going into this chopping block week. the first gain always for u.s. equities. a lot to watch as trading gets underway in asia. ae global editor is here with look at that and focusing on the yield curve. abigail: -- adam: no one is really wanting to put on big bets prior to testimony. that takes us back to looking at the yield curve again and that narrow spread between short and long-term data.

if we dive into the bloomberg, 9423, it shows us how this has been playing out against the s&p 500. we have inverted the spot -- this spread on the bond curve. that is the earnings estimate, that ratio, the forward ratio. the point being made by the folks at ever core, this does bode well for equity valuations and the risk rally, if we have a further narrowing of flattening of that curve. it is a place where you would expect more rest assets -- risk assets to perform well but the next few days will be tricky. no one wanting to make any big shifts and portfolio allocation. there -- in portfolio allocation. there are questions if the. plot does get moved -- the dot plot does get moved. we could stay with that benign inflation from last week. economic data has been shy the

last few weeks after the big push at the start of february. betty: some breaking news now, that story the two keenan had offering of a caci, $50 a share in cash, fixed ratio 0.18. shares for csra. this is a bid to scuff or the deal already being put in place , this information technology company, with general dynamics. there were reports about this earlier, but it looks like we have confirmation here. cash.ng $15 per share in the proposal is to buy csra for $44 a share, so that was the overall value of more than $7 billion. their full year ep yes at 1126, 1150. that is above what they had seen before at 1095 to 1119.

that is confirmation news on caci, raising their fiscal year guidance and also making that bid for csra. we will follow that story, but in the meantime, back to you. last week was a mega week for equity flows. record $43 million into stock funds. what has driven that, and well that be the same this week? in a sense what is driving this is the valuation reset after the big pullback in february. valuation has come down significantly and there was a certain appetite to get back into the risk markets, and people use that as an equity play, especially north american equities. much of the fund flows we saw last week, $34 billion or so were driven into u.s. equity funds. private story of what happens wednesday, but if the state is a growing state and powell doesn't do too much too upset, certainly

an argument to be made for further gains in risk assets and equities looking to perform very well. looking at this environment. the inflation last week was not very worrying for people. there is no reason why we could not grind little higher, but rather or not we will see a repeat, i doubt that very much. betty: thank you so much. adam haigh, bloomberg global markets editor. president vladimir putin winning a landslide and is russia's longest serving leader since stalin. the outlook for the russian economy. this is bloomberg. ♪

haidi: that is the newest addition to the daybreak family in the middle east, starting at 3:00 p.m. sydney time, midnight in new york. betty: always like the show music, different show music they pick for the rest of the world. our exclusive interview with kingdom holdings chairman -- you want to stay tuned for that interview to kick things off. russia, the russian election turned out to be totally predictable with president vladimir putin winning by a landslide. he is the longest serving leader since stalin and will be in power for at least until 2024. the economy is struggling. relations with the west are at their worst since the cold war.

ramy inocencio is at the wall with the things we need to know. run us through the numbers. ramy: in this case it is the drama that is in the details here. we knew it was a foregone conclusion mr. putin would win the election, but taking a look at the size of the wind, 75.1% is how much he has won so far with 50% of the ballot being counted. we can see how the communist candidate has gone about 11% based on what we are seeing and the little democrat candidate, coming in 7%. the other i sliced, 7%, this is for five other candidates which speaks to the entr -- the whole entire win. let's flip through the report because i want to show how this compares to the context of the last three elections. you can see it is that a high, 74%, 75%.

we can see the first election here is 53%, growing ever since then. turnout, that is one thing. analysts say he would need a mandate from heaven to push his legitimacy to make sure the people would not attack him for saying, people did not come out to support you. the numbers are around 60% turnout, which is higher than the last election, so people are seeing this could be the ability for mr. putin to say he actually has a legitimate support for the next six years. haidi: and while he have got another six years, it could be all downhill, particularly this one to punch of u.s. sanctions, lower oil prices and the russian economy. whatever looking at? there are a lot of missed target he promised and then did not fulfill. walk with me this way as we look at mr. putin voting for himself,

we presume in the u.s. election. in terms of the target cities, he had a salary target that had been missed, a capital investment target that has been missed, and in terms of per capita income, which he said he wanted to beat portugal on, strange little thing. 9369, the gdp per capita for portugal somehow he is trying to compete with. he said in 15 years he wanted to beat it. portugal's income gdp ratio is in white. the russian is in red. it never really quite made it, so another failure there. looking ahead here. the weight on the ruble, we can see year to date because of what has been company -- happening with geopolitical tensions, flat against the u.s. dollar and we are seeing a week dollar environment. we don't see much of a change, so we are thinking the ruble could continue to weaken as

well. and finally we have got to talk about oil women talk about russia. 2928. as the fortunes of oil, brent crude is down 6%. we see the rise and fall of gdp growth. looking ahead as we expect russia to output and saudi arabian output to be towards to buy u.s. shale on the order of 11 -- to be towards by u.s. shale on the order of 11 million barrels. demand growth is now not going to meet supply growth. a lot of weights here that mr. putin has to face, not just this year but as we know for the next six. haidi: we will stay with the oil issue and how it weighs on russia with the country saying it is committed to working with opec to clear the global glut even if it means restrictions into 2019.

alexander novak speaking to our reporter. moscow is determined to see the pact through to completion. these are our assessments as well. we believe that at a certain point, the market will reach its balancing point, and there are different assessments as to the timing of that, so we believe as soon as the ultimate goal is achieved, the balancing of the market, we will start considering gradual withdrawal or exit from the deal. most importantly is that all the parties to this agreement are committed to achieving the ultimate goal of market rebalancing and only after that for the actions -- for the -- further actions will be taken. --when do you see the martin market rebalancing? >> we monitor the situation and think it will happen in the third or fourth quarter. this hard to predict anything right now. we need to watch closely the situation, particularly in spring or summer when the demand will grow.

>> when you raise the issue with counterparts at opec to it exit the cut? >> we have all the opportunities to discuss various scenarios. as we meet at the ministerial meetings and meetings of the monetary committee, we discuss the current situation all the time and matters related. in order to send a message to the market, one thing to stress, we are committed to obtain the ultimate goal which we put forth in the framework. >> russian companies seem eager to exit these cuts, second half of this year. are you under any pressure to get out of opec? >> actually we act in coordination with our companies. we are in constant dialogue. since it is their decision and a joint effort, and of course we have listened to their point of view. once again everything we do is a consolidated approach aimed at obtaining the ultimate goal. betty: that was russian energy minister alexander novak speaking exclusively to our reporter.

don't forget you can always find in-depth analysis on the newsmakers. tune into daybreak asia from 7:00 a.m. hong kong time. you can download the app, bloomberg radio plus or access it by bloombergradio.com. this is bloomberg. ♪

♪ that is just about it for daybreak australia, but david ingles and betty are up next to talk about what is coming up this week on daybreak asia. taking a look at what david is looking at, he is the one, apparently. [laughter] david: good morning. good morning. a lot of things to talk about. it doesn't feel like a monday morning. we are getting a lot of news on the trade front, and we have the president of china pace -- he is basically saying, the guys

will be there whether or not. we will have a new person to report to and he will report to xi jinping. he will not have much leeway to determine policy. lot to talk about with him as well. and that will install continuity at the very least for investors, but on the other hand it seems like the gloves are coming off again in washington with the firing of andrew mccabe , and it seems like a continuing revolving door. jacob kierkegaard is joining us, international senior fellow, who will weigh in on all of this. it is interesting to see these poll numbers coming out president trump's approval ratings are going up despite the turmoil on the personnel front. and we will talk about how all of this plays out when it comes to the markets. are we looking at investors demanding greater risk premiums

given the raising risks to do is trade and the economic futures going to be affected. guest there to talk about the week's agenda. this is bloomberg. ♪ retail.

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hong kong, and we are live from bloomberg's headquarters. our top stories this monday morning. more turmoil in washington. reports that the u.s. has dumped the economic dialogue with china are now being denied. we are expecting a new head of the pboc that yi gang will succeed his predecessor. betty: it is just after 7:00 p.m. on this sunday evening, wrapping up the weekend. meet the new boss, same as the old boss. putin wins by a long flat -- by a landslide.