♪ >> the truth is, we are in a dark winter with this pandemic. it is going to get worse before it gets better. it is going to take many months to get where we need to be. >> joe biden labels his covid strategy a wartime undertaking, warning the virus could claim

another 100,000 lives over the next month. eu leaders say stricter lockdowns could be necessary. after christine lagarde pointed to a double-dip downturn for the euro zone. and the hang seng falls as report say lock -- hong kong will lock down residence for the first time. i am matt miller. this is bloomberg daybreak. we are in a locked down continue until february 15 if it is not extended. let's take a look at some of the market indicators. the hong kong hang seng index. down 1.4%. it is down from an all-time high after news of a lockdown. i feel like my friends in hong kong have been locked down for months but maybe it was not official. the euro stock futures down 0.4%

as well. the dollar gaining in a risk off sign this morning. bitcoin rising at 31,788. looking weak compared to the 42,000 we hit a couple of weeks ago. it has only been another week or two more than that that we were shocked it was going up through 20,000 again. this volatile currency continues to move. back in the usa, in his first full day in office, joe biden ramped up the u.s. response to the covid pandemic, warning 100,000 more americans are likely to die from covid in the next month. president biden aiming to overhaul the federal response with a series of executive actions including stabilizing the supply train. biden needs congress to turn his

plan into action and opposition continues to grow. executive orders may be biden's best chance in enacting his policies. >> he must continue to sign executive orders if the recalcitrance continues in the senate. there's a new senate now. the majority has shifted. matt: joining us now is derek wallbank. walk us through biden's plan to fight this pandemic. >> biden right now is doing i would say two-pronged approach. one is in style, one is in substance. in the style, you are looking at a different example being set. there are rules about masks that have to be on, there is stricter testing, greater distancing.

all these sort of things as well as starting out with a rule you have to wear masks in federal buildings and federal property. all of that is the quick signal there is a new sheriff in town. punctuated most notably by anthony fauci saying he felt sort of liberated and glowing about the approach that was taken. that is the low hanging fruit. the heart is the production and supply and distribution of vaccines. you have seen an effort out of the white house yesterday to try to ramp up production of vaccines. they are going to be overhauling the distribution strategy. it is important to note for asian and european audiences, the u.s. vaccine distribution strategy is going to be necessarily different than in a lot of places. you are talking about

distribution throughout government owned or affiliated stuff. in the u.s., you are talking about a matrix of distribution that might go through private pharma scenes -- pharmacies and things like that. there is a nation that is going to be required from the president. not to mention, this is going to be a midstream adjustment. there is stuff already going out. you are talking about 10 million, nearing 20 million doses. this is changing horses midstream and that metaphor is not something you usually use. matt: no. it is something that also has to get paid for. reconciliation, is it the only way he can deal with that if mcconnell and the republicans do not play ball? >> i love that we are sitting

here talking about senate procedure. yes. joe biden put over a one point $9 trillion plan that includes a lot of democratic priorities, and economic stimulus. also, money to get this stuff out the door and it has gone over a bit like a wet noodle in congress read republicans are not rushing to join this. i have not seen any republicans who say i am on board. that becomes a problem because under senate rules, you need to get 60 votes which this means 10 republican senators. there is a procedure called budget right conciliation -- reconcilliation, but it is more complicated. biden has said he wants unity. the problem is, and progressives have been warning him about

this, if you do that, you have given republicans a little bit of a veto power and leverage over you and over your plan. if you are not willing to gun it and nuke the filibuster. he says he wants unity that he is not getting any right now. this is going to be a test of whether he can get his big stuff through. matt: we know he thinks -- biden thinks that is the reason the filibuster is a great tradition in the senate. he thinks the nuclear option is an arrogant power grab, as he said in the past. i love the senate parliamentary procedure. we will have it again i am sure because the filibuster is going to become a hot topic. let's get over to dominic, senior strategist at hsbc.

let me start with the dollar and how traders -- how much does biden's first couple of days in office move the greenback? >> the louvre thing that matters right now is what is happening in the equity market. you can see that today, in terms of the story in hong kong. overwhelming anything else in terms of fx. setting the kind of tone for the day. that is all we seem to care about. a correlation between currency and equities. between domestic factors, interest rate differentials, and until we get a bit more clarity, until we start seeing that, it is hard to see how we will get through this risk in risk off phase. m we are --

matt: we are hearing more and more and we are going to be reporting about extended lockdown expectations. the u.k. is preparing people to be on lockdown for the third time into the summer. what does that mean for the dollar? the consensus is for the dollar to continue to decline. will that continue to be the case if people get defensive? >> it depends how quickly that gets priced in. for the time being, the overall trend remains the positivity associated with that bounceback, even if it is pushed back a little bit, will overwhelm the short-term downside. the overall sort of balance news

is relatively optimistic. you will get days when the dollar comes back. whether it is stories around lockdowns, the vaccine maybe not going as planned, there are all these risks out there. the overall trend should still be for good global growth outlook through the rest of the year. matt: what are your expectations on inflation and the possibility of a tapering debate at the fed? >> i think it is still too early. we have had that discussion already. it was a bit of a shock to the market. as we saw u.s. rates pop a little higher at the start of the year. i don't think we are going to see much action from the fed anytime soon. they have been clear in terms of wanting to see inflation -- i

think it is still too early. i think there is a lot of spare capacity. we will see a few supply-side constraints. we are talking about economies providing less output than in 2019. the idea we are up against capacity constraints is a bit odd. i think there is plenty of room for us to grow without seeing any strong medium-term inflation pressures. good of -- the discussion about tapering may happen but we are not going to get anything from the fed any soon. matt: a lot more to talk about with him. right now, we want to get back to the first word news's. >> the u.k. saying it is to

early to think about easing the nation's third lockdown. boris johnson says to be prepared for a tough few weeks ahead. the government is enhancing enforcement rules of the virus. the top u.s. infectious disease expert anthony fauci says he feels liberated working for president biden. the new administration chief medical advisor said it felt uncomfortable to have to contradict the previous president over medical advice, saying he took no pleasure in it. pay at the biggest banks and wall street is rising. goldman sachs generated an extra 15%. revenue up 22% per person. pay only up 1%. the firm kept jamie dimon's

compensation steady at $31.5 million. this is bloomberg. matt: thank you very much. laura wright with your first word news. the ecb held its first policy meeting of 2021 as the bloc so you're a small business, or a big one. you were thriving, but then... oh. ah. okay. plan, pivot. how do you bounce back? you don't, you bounce forward, with serious and reliable internet. powered by the largest gig speed network in america. but is it secure? sure it's secure. and even if the power goes down, your connection doesn't. so how do i do this? you don't do this. we do this, together. bounce forward, with comcast business.

>> it would be totally incorrect to infer we have all the time and the world to deal with this. we have to deal with this now. matt: angela merkel with an urgent message in tackling the

pandemic. eu leaders have painted a bleak picture of the health care emergency across the continent, warning new variants of the virus will prolong lockdowns and demanding drug companies ramp up production. boris johnson warned the lockdown could last until summer. a reporter and brussels joins us to discuss how concerned these european leaders are. they met via videoconference yesterday, and it was pretty disconcerting, wasn't it? >> yes, and they met in a midi -- dio conference. the picture that came out of this conference was very grim. they sounded very downbeat. they agreed the situation going forward is very serious. they were concerned about virus

mutations. the virus mutations, that is really the biggest threat going into q2. they signaled there could be more restrictions. this is all happening a few hours after the european health and us is center said mayor -- center said more restrictions may be needed. these idea of lockdowns is still in the game. adding up to this tone, which was very bleak, they said q1, you can forget about it. the question is whether you can save q2. the outlook for the economy in europe looks challenging. matt: maria. thanks very much. talking about the downbeat mood

that has spread across european leaders. christine lagarde has signaled the year -- eurozone economy headed for a double-dip recession. but insisted the level of monetary stimulus is enough for now. >> the risks remain tilted to the downside but less pronounced. matt: senior fx strategist is still with us. dominic, what did you think of lagarde, the ecb. can they do more? >> i nearly fell asleep. there really wasn't much news in there. i don't think the ecb have got a lot they can do. they clearly have a concern about inflation or disinflation.

they kind of fired everything they have got at it. they haven't done anything in the currency. they don't want it being higher. i think the ecb is kind of going to struggle. we are going to have to help for bounceback in q2. i don't they have a lot left in the lockup. matt: we talk about u.s. fiscal issues all the time. the new biden plan, etc.. we don't hear much about european fiscal measures. do you think individual countries are doing enough? >> i think there is an argument and you have seen this, the imf

and so forth, there is still fiscal room. i think there is an argument there is still room to do more heavy lifting. with borrowing rates so low, the economy going through significant strains. this is not a short-term issue. this has been going on for 10 years, at least. there is an argument there is definitely room for more fiscal spending. the move toward consolidation of debt would allow for some of those countries to do a bit more than you might have thought before. i think there is deathly room, fiscal policy, they could do more. matt: we are looking at euro 122, ok, 121.64.

we are talking about the european union talk about ringing more payments into the currency. the famous figure is they pay 80%, europe pays 80% of its energy bill in dollars and only imports 2% from the u.s.. do you think there is a point where they have to be concerned, and what is that in terms of euro-dollar? >> in terms of the level, it is more the pace of the currency moves they worry about. i don't think euro, from an economic fundamental perspective, should be a lot higher. it is based on the idea the dollar weakens. interesting to your point around the usage of the euro and how it is considered effectively in terms of global payments, you go back three months or four months, there was a lot of

climber on the street, the dollar had lost its status. it was not the reserve currency. it was dead. we think that is not the case. the dollar is still dominant across financial markets in so many ways. the euro zone, the european union, they might want their currency to be more utilized in some transactions. until you get that strong demand, very hard. we are taking that broader structural position for a very long time to come. matt: thank you very much for joining us. senior fx strategist on the issues surrounding the ecb. the 46th president of the united states. coming up, the hang seng index falls as reports say hong kong

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matt: this is "lumber daybreak europe -- bloomberg daybreak: europe." stocks in hong kong under pressure after a report the government will lockdown thousands of residents for the first time. let's get more from juliette saly. how hard will this lockdown be? >> it will be the most severe we have seen hong kong implement. remember, this is a city that has been dealing with restrictions of some kind for a year. but never a hard lockdown like you have seen in some cities.

the core urban area, parts of that will be locked down and you will have government officials patrolling buildings, making sure nobody leaves unless they have a negative covid test. this is an area where you have people crammed into older buildings. in some instances, many people living in tiny cramped apartments. this has affected market sentiment. we did see the hang seng drop by as much as 1% -- 1.7%. currently down by about 1.4%. just over 1.5 hours to go. we will get an up down -- update on hong kong figures. you see the downward momentum, in the casino players. we saw the hong kong index down

by about 1.6%. macau, recording its first case since june. -- it has been following after learning the -- hong kong has been in an absolute terror. most analysts think it will be a short-term correction. this news is just a catalyst for selling and a market which has run hot and it will not affect the market any long run. we saw the hang seng index touch 30,000 points for the first time since may, 2019. you have price targets showing further gains. matt: juliette saly, talking about what is going on in hong kong. coming up, we are going to take a look at president biden's

priorities for the next two weeks and the challenges he faces. this is bloomberg. ♪

>> the honest truth is, we are still in a dark winter of this pandemic. it is going to get worse before it gets better. it is going to take many months to get where it needs to be. matt: joe biden labels his covid strategy: wartime undertaking, warning the virus could claim

another 100 thousand lives. eu leaders say stricter lockdowns could be necessary. after a double-dip -- and the hang seng falls as hong kong says it will lockdown tens of thousands of residence for the first time. these are today's top stories. let's look at the data this morning as the coronavirus concerns spread around the world. i told you the hang seng was off. it has been very hi lately. reports of a possible lockdown pushed it down more than 1%. euro futures off, 0.4%. a european and u.s. futures down across the board.

as investors seek safety, they by the u.s. dollar, pushing the dollar index up a little bit. that coin rises although it has been volatile and is only trading around $32,000. one thing people have been doing more of is drinking alcohol. certainly the case in remy cointreau. revenue was 350 million euros. their organic growth was 25.1%. the estimate was for only 12 point 3%. if you can't go out, a lot of people are just buying a bottle and reeking at home. back in the u.s., joe biden ramped up the response to the coronavirus pandemic. he warned 100,000 more americans are likely to die from covid in

the next month. president biden aiming to overhaul the response with a series of actions including stabilizing the supply chain and boosting virus distribution. republican opposition to the price tag continues to grow with what could be a long fight ahead. >> i think he will continue to sign executive orders if the recalcitrance continue over and the senate. there is a new senate now. the majority has shifted. matt: president biden has already signed more than 20 executive orders and unwound policies donald trump put into place. what exactly is the new u.s.

administration prioritizing for the next two weeks and how will it deal with senate opposition? let's get to our quick take reporter. what are you expect -- what can we expect from biden in the coming weeks? >> many of the executive orders biden has signed have reversed some of trump's policies. coming up, he is looking to fulfill some of those promises he made on the campaign trail. we have seen him tackle things like discrimination and also education. coming up, we are hearing some of these executive orders will tackle things like equity, health care, economic relief for people. we have heard specifics about the orders which are imminent. one of which is revoking the ban on transgender people serving in the military. also, another rule known as the antiabortion rule.

trump's mexico policy which bans u.s. foreign aid from any abortion related activities. the press secretary has dodged answering this question specifically, but she has said president biden is a devout catholic. the president, there is a limited amount he can do without congressional support. he is looking to meet with a bipartisan group of senators in the next few days is what we are hearing. matt: what are you hearing about his cabinet picks? how quickly is he likely to get them confirmed and in? >> this is really key. what we heard early this morning is congress approved that waiver for biden's pick for defense secretary lloyd austin. when he was announced, people

were wondering whether congress would approve this waiver. now that this has come to fruition, it looks like austin will be the second cabinet pick for biden confirmed by the senate. on thursday, we heard from pete buttigieg who is president biden's pick to lead the department of transportation. it looks like he could receive a swift confirmation. we are seeing senators try to ramp up these confirmation hearings because there could be a pending impeachment trial they are going to have to deal with soon. >> thanks very much for joining us. our bloomberg quicktake reporter in new york. in biden's plans for the first few weeks. first word news out of london, let's go to laura wright. >> european leaders warning

rising virus numbers mean the continent will be in lockdown for longer. they are calling on people to avoid nonessential travel even within the country. the u.k. is saying it is to early to talk about easing the nation's third lockdown. the government is enhancing enforcement of the virus rules and is not ruling out this until the summer. sisi group making progress narrowing its gender pay gap. in the u.s., minorities still make 6% less than nonminorities. the bank is one of the few companies to give detailed statistics on its pay gap. global news, 24 hours a day,

powered by more than 27 hundred journalists and analysts in 120 countries. this is bloomberg. matt: thanks very much. the new york times says joe biden will convene a summit of world leaders in april 22 to discuss climate change. he has made this fight a priority for his administration. we asked some of our guests for their take on his strategy. >> this is america's day. we will repair our alliances and engage with the world once again. not to meet yesterday's challenges but today's and tomorrow's. >> global warming is happening today. >> the biden administration clearly intends to be even more forceful and ambitious. >> the next five years is the

make or break time. >> embracing some of the social consequences of this crisis. >> it is a people problem. you can address pandemic. you can address our economy through investments in clean energy. >> i am going to sign it well you are all here. the commitment i made we are going to rejoin the paris climate accord as of today. >> the paris agreement is crucial. the withdrawal was an attack on international treaties. >> the u.k. and the u.s. can work very closely together. >> to retreat into competing factions, we can do this. >> u.s. president biden had big stimulus plans but what is the outlook for the economy as

things stand? we asked nobel laureate joseph stiglitz for his view. >> unfortunately the united states did not have leadership at the top. we didn't get the kind of program that worked in some of the other countries like new zealand and denmark. the result is we had this enormous spike in unemployment. as the numbers point out, another 900,000 people on unemployment. almost 500,000 under the special program for the self-employed whose income plummeted. those are drastic numbers. you are right, what we are going to -- should be worried about, will there be this long-term

scarring? i am hopeful as the economy picks up again, many of these people will naturally get rehired. we will have to have what we call active labor programs to help retrain workers. one of the things that is going to be happening, there may be some restructuring of our economy. we need that. whenever there is restructuring, you have to give some assistance. allow people to move from sectors of the past like fossil fuel into new sectors like the caring sectors. >> a major priority is getting back to precrisis levels. what is the longer-term trajectory? how does the economy reversed some of the deepening trends of

inequality? long before people were talking about k shaped recoveries and someone? we know that is something in the administration's mind. what would be the key thing the white house should pursue so the post crisis economy does not look like the strain you are seeing precrisis? >> we do not want to go back to where we were in january, 2020. we want to build back better. part of that is to build back with less inequality. last thursday, he outlined two measures that are important. one is increasing the minimum wage. it is really quite remarkable. most americans don't realize adjusted for inflation, the minimum wage is the same level roughly 65 years ago. can you imagine, no pay raise in

65 years. the evidence is it would be good for our economy to have that kind of increase in the minimum wage. it will not cause a loss in jobs, it will stimulate the economy. matt: that was joseph stiglitz speaking with us about the long-term damage to the economy. eu leaders say stricter lockdown could be necessary. the eu lockdown could last until the summer. this is bloomberg. ♪

>> governing council decided to keep the key ecb interest rates unchanged. we will conduct purchases until

at least march, 2022. a coordinated fiscal stance remains critical. the risk around the euro area growth remain tilted to the downside but less pronounced. we are monitoring very carefully exchange rates. we are very attentive. all instruments can be adjusted and nothing is off the table. until the governing council judges the coronavirus phase is over. it is a balancing act. matt: that was christine lagarde signaling the economy is headed for a double-dip recession. india's foreign secretary says

his country is prepared to discuss a new administration -- it has just begun the world's largest vaccine program including with its own homegrown shot. india has begun shipping vaccines out to other countries. >> last year at the general assembly, the prime minister said india's vaccine production capacity would be made available to help the whole world fight. the first phase involves our neighbors. this is keeping with our neighborhood first policy. it includes countries like bhutan, nepal. we are gifting some 5 million

ghosts is -- doses. we are looking at supplying sri lanka, afghanistan, and brain. -- bahrain. tomorrow, we expect two aircraft to come in and land in mumbai to pick up qualities in brazil and morocco. this will be followed by commercial supplies, and addition to some of our neighbors. >> one of the most important relationships is with the united states. heidi you -- how do you think your relationship is going to involve? >> this is a relationship that has grown in recent years. prime minister modi spoke to

president biden in november last year following the election. they had a warm and friendly conversation. in global challenges the two countries can address together. you mentioned some areas we could focus on. it is one of the most important pillars of our relationship with the u.s. the u.s., as you mentioned, is our largest trading partner. bilateral trade has doubled. investments have grown in both directions. even during the pandemic, we received significant investments from the u.s. to show trust and confidence. the desire to engage more deeply with the u.s. is definitely there. we are keen to look at limited trade deals. that would be followed by a

comprehensive trade agreement. the second area is to see how we can consolidate our partnership. in terms of a shared region. -- reason. countering article is him, fundamentalism. strengthening defense and security ties. >> what about a trade deal with the u.s.? >> a trade deal, as i mentioned, is something we would like to look at but it depends on how the new administration prioritizes its outreach. we are open to discussion on that issue. you are aware we have disengaged

because we felt the agreement would not be in our interest. we are already bearing an unsubstantial trade deficit. >> the indian foreign secretary speaking exclusively to rishaad salamat. shipment delays, brexit red tape, and virus restrictions causing border holdups around great written. this is bloomberg. ♪

matt: this is bloomberg daybreak: europe. let's take a look at some of the stories we are watching out for today. 9:00 a.m., u.k. time, watching out for euro area pmi data.

that is likely to have retreated in january. we could observe a similar pattern and the u.k. pmi. at 10:30 a.m., the u.s. eia publishes its crude oil report. saturday, it will be one year since chinese authorities put the city of wuhan under lockdown. the u.k. warning it is too early to think about easing the nation's third lockdown. boris johnson telling people to be prepared for a tough few weeks ahead. they are not ruling out the lockdown lasting into the summer. brexit red tape and virus restrictions causing border holdups. more than half of businesses moving goods have experienced delays since the first of

january, according to a survey. joining us now with more details is laura wright. what has been leading to these extended delays? >> one word, bureaucracy. the government system in fact contributed to the problem. u.k. funds have struggled to get a hold of transit funds. they now need customs declarations along with rules of origins paperwork. drivers must supply a negative covid test. 5% of trucks are being held up at the border because they cannot supply a negative covid test. matt: we heard so much about potential skyrocketing inflation. are we seeing that come through?

>> it is hard to see an economic cost at this point. the bank of england in november, they forecast any impact of brexit production could knock a percentage point off gdp. the fishing industry say they are losing one million a week. inflation will be affected by this. u.k. inflation might reach 1.5%. they have had to suspend exports because it is too complex at this stage. >> laura wright on the problems we are seeing at the u.k. border post-brexit and trade deal. we have futures pointing lower with a dollar that is rising in

risk off friday as the world continues to be concerned about coronavirus. we will give you more of that in the european open next. this is bloomberg. ♪ ♪

anna: welcome to bloomberg markets the european open. i'm anna edwards alongside matt miller in berlin. matt: good morning. the markets say enough for now. christine lagarde signals that monetary stimulus has hit its peak. the stock rally stalls after indexes hit record highs overnight. the cash trade is in our away. here a