haidi: president trump turns up the heat on canada, slamming what he calls years of trade abuse and is warning congress to keep out. ramy: the president is skipping important summits in asia this year. that raises questions about u.s. commitment to the region. isdi: the administration accusing others of currency manipulation. we hear from the bank of finland. ramy: sydney's margin -- mortgage pain says the rba will stay on hold to the next decade.

what impacts rate hike will be followed by others. a.m. it is best 8:00 this is daybreak australia. we are ours from the first major markets open. ramy: fast 6:00 on new york -- sunday in new york, we are looking at the action how the past week will play into the asia-pacific trading day. right now we are in a time of uncertainty with the u.s. and canada because of what happened friday with donald trump saying canada maybe won't be included. take a look at the s&p 500. we were up and down, and we basically closed flat. real estate consumer discretionary and simmer technology were in the red. the dow is down by 1/10. the nasdaq with the biggest gainer, up .25%. we are in a new month, hop into the bloomberg terminal.

i want to show you how we fared in august. let me turn on the little illustrator. i will show you here for the 3%th of august we were up relative to the past several months. take a look. this is the best performance for the s&p since 2014, where we ended that one, 3.77% up. look at the green that has been happening from april into august because we have been talking about trade tensions, trade drama, not just north america but with china. the fact we are seeing the s&p rise is something quite indicative of i guess what you have been calling the haven play for the united states on the back of corporate earnings and what has been happening with corporate tax cuts. everyoneetty much bearing the brunt of this.

look at what is setting up in asia. we are seeing trading in new zealand getting underway, downside, white 3% lower, kiwi dollar at 66.20. the aussie dollar falling 1%. this was the very forefront with trade tensions, the trade story and deterioration in optimism we saw last week and the new nafta deal getting uncertainty attached to the outlook. futures with the equity sessions looking like indicators of .6% when we get going. the other stories we are watching, not just trade, though it is connected to that outlook with the selloff. that selloff with the lira and the peso, the argentinian peso did abate somewhat. this week is key for argentina. we are watching for meetings with the imf. they are very much supporting

argentina's efforts to shore up domestic finances. that takes place. we are watching turkey, inflation numbers looking to jump close to 20%. creating aprices nightmare scenario for the central bank as they meet in september. looking at the emerging-market index, some rebound, but watching asian currencies like the rupiah and the rupee, they hit lows last week. let's go to first word news now. china welcomes african leaders to beijing later monday amid criticisms its development plans on the continent risk settling countries with debt. xi jinping is facing growing criticism with some chinese academics raising doubts at home. his speech gave him a chance to develop the belt and wrote initiative and he is expected to stress the importance of

cooperation and consultation. japanese prime ministers shinzo abe said relations to china are back in normal and he hopes president xi will visit soon. speaking to a newspaper, he said two-way ties improved after a premier came to japan in may. prince -- prime minister will go to china soon. he will visit russia and hopes to settle the dispute of the islands & an official world war ii peace treaty. china purpose regulations for the stop late with london. they talked about capital control. companies will need to meet a threshold including a minimum value. there will be limits on how many securities can be issued and how they will be traded. they lifted firms from each nation, positive in each country. italy's outlook has been cut by

the populist government fiscal plan. from stablelowered to negative but maintained the long-term triple b rating and said it is proof of credibility of their spending plans. the government campaigned on tax cuts to infrastructure plans which could breach european union rules. india's economy expanded the fastest in nine quarters. the robust manufacturing upset and he worries about trade war. gdp grew 8.2% in three months from june, faster than the 7.6% estimate in the survey. the government expects growth of 7.5% in the fiscal year to march 2019. global news 24 hours a day, on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i am haslinda amin. this is bloomberg.

♪ ramy: president trump has turned up the heat on canada, slamming what he calls decades of abuse over trade. he wrote there is no political necessity to keep canada in the new nafta. if we don't make a fair deal for the u.s. after decades of abuse, canada will be out. he warned congress not to interfere, or he would terminate nafta entirely. this.asny is watching has the president really and simply pulled the rug on talks? ros: it sort of looks like that from his tweets, and we know the president loves a good cliffhanger, so he could be putting this out as a negotiating tactic and hoping canada will make concessions when negotiators come back into town as they do wednesday. freeman from candidate will be back in washington for more

talks -- canada will be back in washington for more talks. we don't know how far he is going. we don't know what the administration has privately said to lawmakers on the hill, but it is possible he or his cabinet have spoken to lawmakers in the same way he has spoken publicly. strand of advisors in the united states for pointing to the u.s., don't get too hung up on the dairy issue with canada he likes to talk about. billion in$630 bilateral trade between the u.s. and canada and have sanity going into this. we don't really know, and we have not had much lawmakers pushing back against trump. like to bengress seen as an equal branch of government, and to be told as

they were, don't interfere or i will call nafta off, you would think there would be pushed back, but we have not heard too much. haidi: the president planned to skip two major summits in china. how are the optics of that? ,os: i think the allies australia, singapore and others, are putting the best face forward. they say we welcome the vice president mike pence who will go in trump's stead to the aipac and asean meetings, but there is no question that any vice president doesn't have the gravitas of the leader of the free world, so this is a disappointment. analysts who look closely at u.s. political relations, they think it is a mistake, and really it is opening the door

pretty wide for china, which will be out in force at both of these meetings, promoting the belt and wrote initiative and emphasizing its role -- road initiative and emphasizing its role as one who cares about the asia-pacific region. i would say a big win for china. haidi: thank you so much. ros krasny. let's talk about the role of beijing. it is a big week with the escalating trade war between these two countries. on thursday there is a proposed additional tariff of $200 billion of chinese imports. trump did order that new round of duties implemented as soon as the public input is met. david ingle is following the latest devoutness. what is likely to happen? time are two months

the midterm elections, so you will hear and amped up rhetoric from the white house as he wins political points for being tough on china. this threat of another round of tariffs on $200 billion worth of chinese imports place to that narrative among the -- plays to that narrative among the hawks. if you think of the likes of the ustr's robert lighthizer and peter navarro versus moderates like steve mnuchin, the treasury development -- department and larry kudlow, it seems as though the light heiser-navarro team are winning out. announcingadying, positions of $200 billion. when the consultation ends this thursday, that could be friday morning asia time, china has said it could respond with duties of its own on $60 billion

of u.s. imports. it will be a very pivotal week whether this amps up into more of a trade war given the fact there are no negotiations planned at all. ford is the hearing latest falling victim of these tariffs. what is the detail? david: you could call it that but ford was planning starting next year to build this new focus active crossover suv, a small suv into china and exporting, but the new levies on it notit basically makes very economically viable. the ford president of north america saying resources could be better deployed. they were only protecting -- projecting to sell 50,000 in the u.s.. they sell 2.5 million in the

u.s. domestically, so it is a symbolic victim if you will of the escalating trade conflict. ramy: looking ahead, i know that you are also looking to president xi jinping's speech promoting the belt and road initiative. can he change the narrative back to china's initiatives rather than president trump's? i think he will try. i agree with ros. he will not go to asean or aipac, he is leaving an opening for xi jinping to continue to talk about and lay the fears -- allay the fears and china's rising influence to the negative side with belt and road. he has a chance to seize the narrative again especially after china was rebuked and saying we don't necessarily need this new

era of colonialism. he backed that up by canceling the $20 billion chinese rail project. ramy: stephen engle, thank you very much. escalating trade war to come. we will speak to an economics professor who said trump's tariffs will not to her america's deficit. -- cure america's deficit. haidi: emerging markets unlikely to have risks going away. this is bloomberg. ♪

stroud-wattsaidi in sydney. ramy: i'm ramy inocencio. you are watching daybreak australia. let's see how markets fair this week. we are joined by the pepper stone head of research. good to have you. as we look ahead, uncertainty is the best way to cash this

because with the u.s. and canada, trade talks uncertain, and looking at the u.s. and china, tensions coming up, tariffs, how are you looking ahead in terms of optimism, pessimism and positioning in the market? chris: it is business as usual. there will probably be an extension this week. equities will continue to find buyers fairly active. you will see companies, the biggest themselves. the s&p, it can maintain 2900 and credit spreads, it will give backbone to the equity markets and continue to appreciate. in the rates market we are getting to a state with the fixed income market where we may's the seasonal backup and yield -- in yields. last week, we will see that continue. you are getting fairly messing -- messy trends, but with the

aussie and qe, you can see currencies. you can see the currency staying above. you: i have a chart to show as well as viewers, 2901 is where we ended friday. looking ahead, analyst targets have been climbing. looking at the next four quarters ahead, they say it could be 3158. last week we were talking about 3000 by the end of this year. are you that optimistic? you think we can get through this tension we have been talking about? chris: chris: yeah. if you look at the options market, the fx and implied volatility, we have a 12 handle on their. with the chance to aggregate trade tensions, political noise coming through, the idea that we need to start preparing ourselves for elections in many

different younger fees, and they say implied volatility and s&p not expected to pick up dramatically. i look at the u.s. treasury, there german bund spread, you can see that narrowed convincingly. that is a good sign the s&p will fullback over time. consumer confidence is strong. that has been good for equity gains. ,eing bold -- buybacks valuations, they are lofty but not extremities. profit margins are still really healthy in the u.s. if we had this conversation another time, i would see the s&p higher from here. haidi: i want to get your views on em. it has been a tart summer for emerging markets, the worst yet to come. developings, the pretty extreme negative correlation between em equities and all em efforts and the u.s. dollar. it is getting worse. in terms of what will get you to

change your view on em's, we could talk about the idiosyncratic stories, but does it really come down to the trade story and the u.s. dollar? chris: i do think absolutely, they are the two, if you look at variability of the market, that is causing a lot of the gains in that situation. so you probably want to see reversal which changes the psyche of trade, which is that we believe the dollar is on joe word trajectory -- is on downward trajectory. the trade situation, if we get clarity that makes us believe we are past the end of this, getting closer to diplomatic resolutions between china and the u.s. and supply chain countries see reversal as well, then perhaps we can have confidence to do our toe in. inhink valuations are cheap

these markets because it is difficult to put a value on them because of the assumptions you have to price into your model changing all the time. my view is to continue trading where the trends are bearish on emerging markets. we need to see a section about the u.s. dollar going lower. we need to see clarity that makes us believe trade tensions are coming to some sort of a close. are there almost as much bearish factors with the aussie changes insomething the trade picture, added to the upside or with the additional tariffs, how does that change your position on the aussie? developments, a , that hasen priced in factors in domestic markets and different claims as a way of being em proxy. positioning has become stretched . we have non-commercials, 44,000

or people short that for the thanks. the site is bearish, but for the moment we could she -- we could see a rally coming through. gdp, it is not changing that dynamic. if we get clarity around the trade tensions, perhaps we see people buying, but that would make us, give us better opportunity to sell australian dollars against the greenback and the yen and a more compelling level. haidi: and the other more compelling trade is pound volatility, given the rolling continuous brexit talks. what are some of the opportunities? a lot of opportunities that are quicker than we are. last week we got excited because achelle said there could be strong attraction between the two nations, and that was

followed up by comments from dominick. we got excited and said, hang on, perhaps it is unwarranted. hedgesreduce these coming through. asset managers are very matched in that. the community has started dipping their head into that. we have seen an article in the guardian suggesting michelle is not happy with theresa may's proposals. different and buffeting headlines causing gyrations, it is my belief that there is good upside in sterling, specifically on the australian dollar. cable, we could see upside if you get out of the long dated cause. i think that the pound is cheaper, the amount of metrics. if you look at perhaps the world is too short on the pound, we could see a position in

adjustment, and the pound has reasonable upside. the pound has a dangerous game to play with a lot of risk. we are beholden to the headlines. before we let you go, a new month, the fed does decide on policy, do you think there is concern to be had regarding yield curve inversion? that is a great question. there is a battle between regional fed presidents who say we should not be raising rates at a time when we have this blueprint by which history has isd us declining yield curve setting a precedent for recessions, then you have people in the core who are less concerned about that. i think there is an argument this time it is different given the wave of capitalism, and a lot of that going into the backend. i am not concerned at this stage. chris weston, thank you so much. we will leave it there.

bloomberg users can be interacting with the chart showing here using gtv . you can catch up on key analysis and save charts for future reference. this is bloomberg. ♪ ♪

ramy: a check of the business flash headlines now, and china's struggling hna group has managed to shrink its pilot debt for the first time after dozens of assets were sold to stay afloat. borrowing is now $79 billion, down $800 billion -- down $8 billion. jd.com said an investigation has found no evidence of wrongdoing of a business trip. he was detained by minneapolis police on a charge of criminal sexual conduct, then freed. ramy: a chinese food delivery

site is setting terms for a hong kong ipo worth $4 billion. they plan to sell shares between 50 and 60 hong kong apiece. this is bloomberg. ♪ retail.

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show me decorating shows. this is staying connected with xfinity to make moving... simple. easy. awesome. stay connected while you move with the best wifi experience and two-hour appointment windows. click, call or visit a store today. 8:00. it is half past futures looking pretty positive into the open, half a percent higher, looking at an indicated upside into the start of trading, .6%. i am haidi stroud-watts. ramy: i am ramy inocencio in new york. you are watching daybreak australia. with get to first word news with haslinda amin. haslinda: good morning. president trump has slammed what he cause decades of abuse by canada and threatened to cut ottawa out of any new deal. he said there is no political necessity to keep canada in the new accord and warned congress

not to interfere, or he will interview -- he will terminate all discussions. he said other countries have been taking advantage of the united states. the u.k. prime minister theresa may has seen her brexit strategy come under friendly fire from a conservative lawmaker who criticized plans for a split from the e.u. the criticism has come from hardliners who want to distance the u.k. from the single market, but a minister said he cannot support the let -- the plan either because it will humiliate britain and brussels dictates demands of departure. experts have targeted key buyers in asia in the weeks before u.s. sanctions hope they come back in force. 2 million barrels of oil that compensates for a day in august, the lowest and march 2016. the sanctions take place november 4, and iran has

threatened to close the port with oil tankers if its own deliveries are restricted. asians led the north american box office for the third straight weekend, making this one of the strongest. the movie booked more than $22 million in the u.s. and canada with a monster film in second place ahead of mission impossible fallout. they have taken $11 million in total. global news 24 hours a day, on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i am haslinda amin. this is bloomberg. haidi: thank you so much. let's get you a quick update on the markets as we get into the brand-new trading week. trading in new zealand is to the downside so far. half a percent, kiwi dollar to

6.20. the 20 month low on friday. the trade story is one of the bearish factors there for aussie-u.s.. sydney futures looking pretty positive. more broadly, this is what dollar-yen is trading at in the monday session. sterling 129.25. sterling on friday after -- over the weekend as theresa may said there would not be a second referendum on brexit, erasing optimism of a soft brexit deal we had last week. we had also quite the august with the s&p 500, ending up, a pretty tepid note, but the next august for the in -- the best august in several years. let's look at trading. adam haigh is here with us. e.m. taking a battering in august. we are looking at turkish

inflation, the imf meeting with argentina, any possibility of rebound? adam: what you are into is discussion around how far the valuation discounts, especially for equity markets, have gone. if you look at pimco's and blackrock's of the world, they are seeing esoteric valuation opportunities pop up in the em space, but there is no doubt downward pressure is continuing, and sentiment is fragile. what you are looking for especially with this part of the world, places like china, the biggest emerging market is what around your asset allocations and whether you can kind of start to take a bigger position if you think policy can in some way contribute to a stabilization of some of the issues that have been around in emerging markets, but what has been interesting about the latest leg down is it hasn't been corresponding with a

stronger dollar. you have not seen that kind of usual strength like the greenback and a particular negative impact. that is what people will watch this week as we see whether or not we go into the jobs report friday, the rest of this market leading to the fed hike. we presume at the end of this month, how the dollar performs now i think will be the next kind of way em will perform if we get a little bit of sustained rally in the greenback. ramy: despite the news we have been covering about geopolitics, e.m. to global trade, it is interesting one swiss fund manager says the market stresses are actually diminishing at least for the moment. why is that? adam: it is interesting because as i was highlighting, the number of political tensions in many emerging markets, the

overarching u.s.-china trade discussion that continues to affect people's appetite to take risk, what they are saying is there indicators of things like demand, industrial production, the forward leading indicators they use are enough to give support in the last week or two. that reinforces for them global economic growth is reasonably intact. i think this chart in the gtv library shows there funds have been doing decently over the last year. 3.6%, not as good as global equities, but it is alternative risk, so you would not expect it to be equity like returns. , they are using shorter-term indicators to give the overarching view that you want to be adding to risk at this point in the cycle. ramy: global markets editor adam

haigh. don't forget to check out the gtv library for the church you saw. that is gtv on your own terminal. the bank of finland governor and the ecb governing council member is pushing back cap president trump's accusation that europe is manipulating the currency. speaking to bloomberg, he urged the president to cease trade war rhetoric, saying it could damage the global economy. isthe european central bank not manipulating the euro. our starting point and faces of this is based on the economic outlook of europe both growth employment and achieving our possibility target. we don't usually comment on other central banks, other currencies, but my reading of the security system is that the has beenenminbi

weakened mainly because of the threat of escalation of trade war, not because of any manipulation from the central bank. rather to the contrary. ramy: do you expect trade war to cause risks to the european economic outlook as well? olli: we don't see direct impacts, and they are fortunately so far rather limited. on the other hand we have seen confidence impact. on the other hand it is damaging for growth and employment. on the other hand, the cease-fire between the e.u. and presidentchieved by juncker and president trump in july has somewhat eased these been new but there has see it isand i

unnecessary rhetoric. they would not try to escalate the trade war's because that would damage the whole army. u.s. workers and european workers. ramy: what do you think of the possibility of going the other direction? it was suggested in front of parliament not only could the e.u. do away with tariffs on cars but all tariffs could be brought down to zero if the u.s. would respond in kind. how would that affect the european and global economy? of thise initiative person was very commendable and very important. it shows that the european union is in favor of free and fair trade, and it would give a level for both the u.s. and european manufacturers and let the customers decide then.

they decide, let's believe in the market who produces the best cars, most competitive, best quality cars. they would see this to the benefit of consumers and businesses. haidi: that was the bank of speakingovernor exclusively to max miller. coming up next, expected to bring sweeping new tariffs on china. our next test said there will be no impact with u.s. trade deficit. this is bloomberg. ♪ this is bloomberg. ♪

ramy: i am ramy inocencio in new york. haidi: i am haidi stroud-watts in sydney. the end of the public comments time as the trump administration readies itself to potentially do $200 billion of tariffs on china

, chinese goods. beijing's out it will as in previous instances retaliate. let's bring in an economics professor. he and other researchers have written this could have little or no consequences to the u.s. trade deficit. i want to show it to where we are at in terms of these tariffs. this is the library. about 50 billion dollars. why do you think it will produce the trade deficit of sessions that trade -- trump has and how does beijing retaliate when they run out of runway? >> the reason it will not reduce the trade deficit is twofold. the first thing is when you impose these tariffs on chinese goods, the u.s. firms and consumers will purchase he were chinese goods, but it doesn't mean they go out and purchase u.s. goods. tariffs, onets of of them on chinese televisions,

and so when those increase in price and 25%, it is not like they will rush out and buy u.s. televisions since i don't think the u.s. of makes televisions. they will get japanese and korean television instead. you are shifting the deficit from china back to japan and korea. the other thing is a lot of these tariffs are on good the u.s. firms have to purchase in order to make other goods. there have been tariffs on steel, now on car parts. that makes it more expensive for the u.s. to produce cars, so consumers will purchase more foreign cars, so putting tariffs on steel and car parts leads to buying foreign cars. essentially all of these things will add up to the u.s. not reducing its trade deficit by much at all. haidi: does it also have the consequences -- we talk about trade wars being a lose-lose game, but you say it is

redistribution of opportunities for other markets. does that work given the supply chain environment? game, and iose lose think the u.s. loses from this, china loses from this, and this is before we consider other retaliation. there will be to some extent, it tol shift opportunities other countries, then the u.s. will presumably begin to start raising tariffs on countries. you will -- this could lead to a more fully blown trade war between the u.s. and the rest of the world. because the rest of the world will still have better access to the supply chains, u.s. firms will have worse access to supply chains, worsening the u.s. trade deficit, so they will begin to respond with tariffs on other countries as well. haidi: trumps maverick approach has been to throughout the playbook with local trade, threatened to pull out of the wto, and is there a real kind of

existential crisis over whether multilateral trade agreements work and whether these institutions need improvement? john: these did work very well for the first almost 70 years of their existence. 70 years since the general ,greement on tariffs and trade the forerunner of the wto, was signed. and it may have seen a relatively prosperous era, so they did work quite well. one thing that wasn't expected was people would suddenly decide they wanted to withdraw from them. so in some sense it is possible could be improvement in the architecture to give more certainty that these tariff for the were going to be more -- reductions were going to be more lasting. if you force countries to give more certainty on tariffs, they might be less willing to reduce in the first place. there is a trade-off.

ramy: a lot of folks are wondering what is happening with the u.s. dollar strategy out of the trump white house. as we talk about this, hop into the terminal because i want to show you what is happening most recently here. we can see over the past few weeks, it had been on the downward trend here, now we are starting to see the most recent two weeks, it is rising again. do you think mr. trump's love of a strong dollar is warranted? do you see this in the trade rhetoric? these short-term fluctuations in the dollar could be due to a lot of things other than just trade. i actually don't think the trade policy is a good policy for shoring up the valley of the u.s. dollar in the long -- value of the u.s. dollar in the long term because it seems the u.s. is picking trade fights with most of the world. u.s. firms are going to be

increasingly locked out of international markets. what it means is there is less useful for foreigners to hold u.s. dollars. if the u.s. begin to shut itself out of markets, there is less purpose to hold u.s. dollars, so it is a long-term strategy for strengthening of u.s. dollar, these trade tactics are not a good strategy. ramy: september 6 is the deadline for these tariffs on chinese goods. how optimistic or pessimistic are you that something that will happen? john: something will happen, i am confident. ramy: to the negative? [laughter] john: to the negative, yes. i am confident that a fairly substantial set of tariffs will be applied to chinese goods that will actually lead to a big drop in u.s. purchases of chinese goods with increasing and purchases of other goods, and high-level retaliate, then we

have to see what happens to the cycle after that. something will happen, it will be negative, then we will see how quickly china response and what they respond on. they are not limited to tariff policy. haidi: how inflationary are punitive trade actions? john: they will increase some. prices will get past to consumers. the copulations this morning, my if trump imposed 20% tariffs on $200 billion worth of chinese goods, you are at 0.4% to the cpi because the cost will be passed on to consumers and increases other firms' cost, and consumers take advantage -- competitors raise their own prices area 20% tariffs on $200 billion worth of chinese imports will boost cpi close to .4% in the u.s.

haidi: university of sydney professor of economics here with us. you can get a roundup of what you need to know to get monday going in this edition of daybreak. bloomberg subscribers can go to dayb in the bloomberg anywhere app. you can customize settings to get the news on industries and assets you care about. this is bloomberg. ♪

welcome back. i'm ramy inocencio in new york. haidi: i'm haidi stroud-watts in sydney. westpac decision to raise mortgage will likely delay any further tightening from the rba when it meets on tuesday. rates have been at a record low for two years now. we will discuss all of that. with the decision to raise rates on mortgages, the rest of the

bank lenders are expected to follow weekly. >> they might -- although quickly. >> they might take a while. funding costs are up for australia's banks, and what might be more exposed to others, if we want to take a look, we have a chart to show on the basis swaps. basis swaps are the main cost for australian banks when they borrow abroad and bring the money back into australia, and as you can see, they have surged recently. the australian dollar has dropped. that feeds directly into the bank's costs. westpac, one of the more exposed, but they are all pretty exposed to overseas funding costs, they have responded by posting rates up. we have another chart you on funding costs.

this is the funding cost inside australia. it has remained very elevated, so we can see we are relative to the cash rate and what is more, even as expectations for the rba rate hikes going forward have been lessening, so you would expect cost to come down, they have been staying up. with all of that going on, there has to be more bank pain for mortgage holders. ramy: how does this feed into monetary policy that is seeing the rba hold that cash rate target at the record low 1.5%? >> if you look at markets, they are pricing the rate hold to 2020, and even then one rate hike in 2020. it might get priced out sooner rather than later also. are two things going on. one is directly the rba has traditionally said what the rates are that mortgage holders

are paying, so when it goes up, they are less likely to raise the base rate itself. the other thing is it hurts the economy. there is less money to spend, the economy is sluggish, so that is another reason the rba's stock at the 1.5%. ramy: thank you very much, garfield reynolds with the latest. you can follow more on this story and all the day's trading on the markets live blog. that is the bloomberg at mliv go . you can get a market run down in one click and there is commentary and analysis from bloomberg's expert editors, so you can find out what is affecting your investments this minute. let's do a quick check of business flash headlines now. ford is canceling plans to import a new crossover model built in china. that is after president trump's tariffs undermined the case for taking the car to the u.s. the plan was to import the focus active for 2019 but ford the duties of 25% mean it is not

worth shipping a car that would probably find only 50,000 sales each year. analysts say other companies may also alter sourcing plans. reports from the uk's say ford may cut thousands of jobs and not revive the european business. lost $70 million between april and june. like other companies ford is facing uncertainty of brexit, which could mean new duties on cars and parts traded between the u.k. and european union. that is just about it for daybreak australia, but yvonne and remy are up next for what is coming up in the next several hours. yvonne: trade will be the big topic here for the rest of the week as we count down to thursday of course and potentially the u.s. slapping tariffs on chinese goods. we are speaking to someone about

experiences in the bond market. amanda has 60 years of experience, he says the big concern is this trade war and could potentially derail the fed move to higher rates. he thinks september is a done deal, which could cause investors to flock into 10 year treasuries, so plenty of stuff to ask him. ramy: from bond markets, we will go into chinese equities and the inclusion of chinese shares. we will be speaking to the head of china equities thomas faang and basically over the weekend we did see more inclusion from september 3,to 5% so we will be seeing if inflows are coming in in been more in the rest of this -- even more in the rest of this year. haidi: a big trading day with this new month, stocks ending out on a strong note. the best for august in four

years. can it last? we are talking to a market strategist, getting views on how this next step up in the trade war plays out. that is it. this is bloomberg. ♪

yvonne: we are live from bloomberg headquarters. welcome to "daybreak: asia." president trump turns up the heat on canada. what he calls years of trade abuse. about u.s.stions commitment to the region. in new york it is just past 7:00 p.m. on a sunday. the sterling retreats after the government rejects the next boat. and the fastest-growing major economy.