>> a very good morning. we are counting down to asia's major market open. >> our top story this hour, asian stocks are set open mostly higher after a muted session on wall street. the dollar dropped along with treasury yields. jerome powell says the u.s. economy is making real progress.

inflation remains at the forefront of the investment debate. calls for narendra modi to made it a lot down. -- mandate a lockdown. we are joined by the world health organization. breaking news out of south korea. we are getting the latest cpi numbers for the month of april and we are seeing year on year gains of 2.3% accelerating much more than expected. this would be the biggest gain is an since august of 2017. remember last year's pandemic induced dip. we still have higher global commodity prices adding to inflation numbers being accelerated. especially when it comes to month on month numbers. the expectation was for no increase on cpi. month-to-month it 0.2%, beating estimates.

take away and other factors and the core consumer price rising 1.4% year on year beating expectations. the be ok -- bok likely to look at a pickup is an inflation. >> let's see how markets are setting up across asia. let's turn to sophie kamaruddin. >> japan, china, and thailand sitting at the session. the aussie dollar heading -- holding steady. aussie-yen trading at 2018 highs. jonathan cavanaugh says the risk reward picture favors commodities currencies over low yield or's like the yen. prices have hit new highs. we saw the dollar weakened on the latest reading from the u.s.

when it comes to factory activity showing a slowdown, which reinforces bets the fed will keep rates near zero. oil jumping amid renewed hopes energy demand rebounding as we saw the eu proposing to ease travel restrictions for people who have been vaccinated. an analyst taking note of the demand rebound we are seeing in developed markets and the normalization of inventories. the e.m. space remains key to this picture. emerging nations like laos and nepal have seen a pickup in infections due to the virus variants. there is need for vaccines to be deployed swiftly. >> jerome powell says the u.s. economic recovery is making progress. lower income workers are finding it difficult to move. almost 20% of workers in the lowest earnings rung are still unemployed compared with

6% when it comes to the highest paid workers. what did we hear from jay powell that was different from his press conference last week? >> may be more emphasis on the k-shaped recovery. that if we look outside our windows in many parts of america, things are going great. we have a housing boom. people are going back to work. stores are opening, restaurants are opening. it is a reminder that his policy is also reflected on the fullest reaches of the labor market. and he's not going to change policies because we are in an upswing. >> he does keep emphasizing the down leg of what he sees as a case shaped recovery, good for some and not others. >> right. and you know, we did have a

framework change at the fed on this a year ago. i think he means it. substantial further progress. they are going to keep buying assets at a pace of $120 billion a month until they see substantial further progress. it is pretty clear they are aiming at labor market process. we have an average of 540 million -- sorry, 540,000 jobs a month in the first quarter. i think people are coming to the conclusion that they need several months of that before they remove those asset purchases. >> the housing market has also been rallying. did the fed say anything about this? >> he was asked in his press conference and he said, you know, there is a housing boom. he said interestingly, i don't

think it is good. he said it is a combination of people working from home for covid, realizing they don't have to go into the office, and just moving. supply is limited, he said. he did not offer much promise this could cool off anytime soon. he said he could continue it is going to be tough. with prices up 12% year-over-year, that makes it all the much harder for people to get in. it is one of the distributional things of monetary policy that is happening. it is real. he does not sound like he thinks it is fortunate. it is creating jobs but it is also locking people out of the housing market. >> the biden administration supporting pfizer's move to

start exporting u.s.-made vaccines to boost supply in other nations. let's get more from jodi schneider. what is pfizer's plan for exporting doses of the vaccine? >> pfizer is looking at sending vaccine directly from its u.s. manufacturing to canada and mexico, something we have not seen yet. the white house had really not been supporting these kind of moves, but now says it is. we heard today from the covid response coordinator for president biden. he basically said he thought it was a good thing to do, it made sense, they were glad to see it. this reflects the pressure on the biden administration with millions of doses of the vaccines that have been authorized in the u.s. being available and we are starting to see vaccination rates by toes and the u.s.. there is pressure on them to export this to places that really needed.

canada and mexico are well behind the u.s. in vaccination rates. >> what are we finding out when it comes to the situation in india? prime minister narendra modi still resisting lockdowns even though we have seen the latest wave of deaths. >> we are really seeing a fair amount of pressure being applied to the government and directly to the prime minister to have some kinds of lockdowns. sunday saw a record 3700 almost deaths. 350,000 new cases a day. the virus is just exploding there. we are seeing that mutations increase. it is getting the attention of world leaders who want something to be done. the vaccination rate is extremely low there. we are seeing pressure coming

from governments, from members of the prime minister's own party, business leaders, foreign governments, to have some kinds of lockdowns. and mr. modi has resisted this because the earlier lockdowns had been politically -- he had been criticized politically for them a year ago. a national lockdown morning, you saw people leaving the city's for rural areas, literally walking, getting crazy amounts of distances. that was something the world saw and that he wanted to avoid. at the same time, there is not a lot of solutions with the cases exploding, hospitals overrun, and the vaccine really not yet widely available to most residents of india. >> senior editor jodi schneider with the latest. more ahead with the who newly

appointed science councilmember. we will be assessing the economic ramifications as well. the former are b.i. governor will be with us. with you to vonnie quinn in new york with headlines. >> top diplomats from the u.s. and u.k. have pushed back against what they call chinese and russian violations of the global order. those include a crackdown and the poisoning of alexei navalny. u.s. secretary of state antony blinken and u.k. foreign secretary dominic raab pledged to unite democracies against autocracies. >> what we are trying to do is uphold the international rules based order that our countries have invested so much in. the challenge for us is to demonstrate in very concrete

ways that we can deliver for our citizens. >> joe biden has announced he is raising the cap on refugees who can enter the united states to 62 and a half thousand. the move comes after biden faced bipartisan blowback in his delay lifting president trump's limit. biden says the u.s. will not reach the cap this year. a question that has intrigued berkshire hathaway investors for years. warren buffett has answered the succession question publicly. buffett told cnbc greg abell would take over if buffett were to step down. abell now runs noninsurance businesses. buffett himself is 90 years old. global news, 24 hours a day, on air and at quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries.

i'm vonnie quinn. this is bloomberg. >> coming up, currency volatility and the impact on corporate earnings. ♪

>> the real battlegrounds may be in currency. indices raising their all-time highs in february before retreating slightly with em currencies at a crucial level. this might just be the month to pay attention to foreign exchanges. our next guest says the negative currency impact on corporate earnings fell the last quarter.

could this be the calm before the storm? >> i think it was in q4 and we are going to see q1 faced serious hits from corporate earnings. investors need to take that as an indication about what is going on with corporations from a risk management perspective as well as from a liquidity management. you have seen dollar strength. you have seen discussions about how people think the dollar is going to go significant higher. you have others talking about them going significant lower. i don't know how to predict whether it is going to go up and down. all that means over many years of watching this, increased volatility, which is not good for corporate earnings and the productive ability of cash flows -- predictability of cash flows. the number one site is an hundred u.s. corporate's. the third was the chinese

currency, renminbi. those were the most mentioned around the world by corporate ceos and cfos as impacting their revenues and earnings. >> we are expecting the rupee to weaken as we see deaths surge. at what point do you think -- i guess fair value for the rupee or it comes to some level that reflect the situation on the ground? >> difficult to say. the rupee against what? i feel in the united states you have if you have good numbers, they may think about letting interest rates go a little bit. either interest rates stay down or go up. in either case speculators on the dollar will start buying, but it creates serious

volatility. what investors need to know is, look at how corporations are managing financial risk. if we learned anything out of covid, it is that is a reflection of how they are managing global liquidity, the bloodline of these corporates. investors need to look at who is managing this well and who is not. there are those who aren't who are not. >> we see a haven being set up with concerns about the reflation trade more globally. how does it affect the chinese yuan as a prospect for becoming an income currency, more of a dominant player within the em space? >> the biggest part about this is actually the central bank digital currency, which they seem to be ahead of everybody on. that is in my opinion the crucial point of are they going to become the dominant currency

or not? they are talking that down and looking to be collaborative. this is something other nations, certainly the united states, if they don't want to lose the dominance of the dollar, have to take into consideration, and that will shake the currency market >> not just digital yuan, but bitcoin. we were speaking to the ceo of a gaming company yesterday and this is why he said he bought bitcoin for his firm. take a listen. >> we have to take our currencies very seriously. prior to this purchase, we owned u.s. dollar, korean won, japanese yen. we started to notice what was going on in central banks around the world. we said there is a scenario here where the buying power of our cash goes down substantially or and precipitously.

we want to protect against that. >> given where the current monetary environment is, we going to see more firms having to hedge because of what currencies they hold, whether with bitcoin or anything else? >> i think it is trendy right now come a certain companies who are adjacent to that space of, certainly not just bitcoin, but the underlying blockchain technologies. they want to be on the edge of this. end of the day, the hedges again is really for, do you believe central banks will not be able to create a digital currency? in the meantime you have limited supply. if demand continues to blow up, you blow up. it can go to 500,000, but it can also go to zero. i would not long-term --

short-term who knows, but i would not long-term bet against the countries issuing a fiat currency that is digitally enhanced and therefore does take advantage of all the things the bitcoins of the world are trying to do. the interesting thing for corporations and investors are what companies are ready? they are ready to take that on. they probably have a very good digital platform, and understands liquidity, understands currencies, and the impact on their financial statements and therefore are able to communicate that. you have days as we saw last week of a 15% and another 12% down day, those are serious. when you are running corporations, how much cash flow can you say, i don't have 15% of my cash anymore that i invested in bitcoin? i don't think that is typically what investors buy companies for, to speculate in those currencies. when you look at what ceos and

cfos of audited companies actually stated, they do not speculate. now they have to take that out and say, we speculate in the financial markets. >> staying with crypto's, a ceo told bloomberg it is less volatile than stock. >> you learn about bitcoin first. after that you venture out and say there is a blockchain. not just bitcoin. there is a lot more you can do. you can do smart contracts, you can do and entities. people need the other coins to do this type of new transaction.

>> my concern is, a lot of people ripon bitcoin and they don't know what a public key is. you have people investing in your b&b, but they don't know the youth -- the use case. they are jumping in because the price is rising. if you have too many people like that, that is irrational exuberance and it does not provide a solid base for prices. that is why we get even more volatility. how do you look at volatility and people that are serious investors in crypto? >> with people who are in stock markets or markets that are actively trading, there are always guys who do research. some people understand more than i do. and then there are people who just follow the herd. there are always a large number of people following the herd.

that is just how civilization is right now, which is everywhere, it is not unique to crypto. whenever there is negative news, they run away, when there is positive news, they try to rush in. there are the diehard fans who really love the project. there is nothing news in crypto. -- nothing new in crypto. it is less volatile than similar sized assets like apple stock and tesla stock. >> with so -- nexo, they don't have plans to go public and you don't. why not access the public

markets when the momentum is there? >> we have a very good example of a private company that has done really well. it is bloomberg. bloomberg never went public. going public is a good option. it is a good way to raise money, a good way for early investors and funders to exit partially or completely. at least have the option. but for many organizations, they are sufficiently funded, they have sufficiently solid businesses that are profit generating, same with bloomberg. they don't have no need to raise the money. investors may be long-term driven. they are not looking for a public exit anytime soon. there are other ways to exit a business if you really want to.

only a very tiny percentage of businesses, even long-term businesses, go public. public is an option for many. it is not a mandatory thing for every business. >> plenty more to come on "daybreak asia." ♪

>> apple's high-stakes battle with the makers of fortnite has begun in court. anti-competitive behavior tied to apple's app store which takes a commission from developers of up to 30%. lawyers for epic say apple engaged in a bait and switch. the trial is expected to last most of may. bitcoin minor iris energy could

become the first australian company to go public. it is weighing proposals from a number of blank check companies for a u.s. listing. a deal could raise up to half a billion dollars. the company says it is (text chime) (text chime) (text chime) (sighs) (text chime) (chuckles) (text chime) it's the biggest week in television. watchathon week is your chance to finally watch shows you missed for free. now you get to talk about them with your friends, no matter what time it is. say "watchathon" into your voice remote and watch for free

>> this is "daybreak asia." bill gates and melinda gates are divorcing but will continue to work together at the foundation they created. they made the statement on twitter. the two married in 1994 and have worked together to combat climate change. through their foundation, the couple has given away more than $50 billion.

colombia's finance minister has quit after days of bloody street protests pushed the company -- plan to raise taxes. the plan was to address a surge in poverty. he has been replaced by the current trade minister. at least 17 people have died in the violence. the world's largest vaccine maker is promising to deliver 220 million jobs to india over the next few months. in a statement, the central government will receive 110 million doses of covid shield. state governments and hospitals will get the rest. india has been struggling to curb its crisis. a biden official tells bloomberg the white house will support pfizer's move to start exporting u.s.-made doses to nations in need of them.

the official says the company is ahead of schedule in its commitment to supply the u.s.. demand for shots in the u.s. has been falling to 2.4 million a day for the past week. confirmed coronavirus cases in the u.s. rose for the slowest since the start of the pandemic. data show a 1.07% gain for the week that just ended, below the previous pandemic low back in march. the number of new infections increased by 344,000 last week. european commission is supporting easing restrictions on business and leisure travel for countries with low infection rates as well as those who have been fully vaccinated. the commissions president ursula von der leyen said it is time to revive the tourism industry. the proposal requires approval from a majority of the

bloc countries. global news, 24 hours a day, on air and at quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. >> back to the news about bill and melinda gates, divorcing after 28 years of marriage. do we know what the impact will be on the foundation and the family? >> what we know so far is that this is not going to impact the foundation. they are seeing their going to keep their roles at the foundation and nothing is going to change. in terms of the fortune and the money they hold together, that is less clear. they are in washington which is a community property state. whatever was acquired during the marriage belongs to both of them under law.

it does not mean it is going to shake out that melinda gets 50% and bill gets 50% of their enormous fortune. that is what could be. >> what are the components we are talking about here? >> obviously the fortune is rooted in microsoft, he cofounded microsoft. now it is split up into other things, including an investment company they have that started with proceeds from microsoft cascade investment. they have various other investments. stuff in public services, a bunch of -- it is a hodgepodge of investments. when you look at the pie chart of what their wealth is made up of, there are a lot of different segments.

>> we can't not compare this to the big tech billionaire split with jeff's and mckenzie scott in 2019. -- jeff bezos and mckenzie scott in 2019. is there a precedent? >> there are similarities. they are both couples in washington, both tech billionaires. the difference is the gates couple is a bit older, more established. they have the foundation together. it is unclear what is ultimately going to happen to the money they have held together all these years with mckenzie and jeff, when they split up, mckenzie became very active. bill and melinda have already been active. in terms of a timeline, it could be a that are of months. -- a matter of months.

mckenzie got 25% of the amazon stock and jeff got 75%. there is no guarantee it will be 50-50, but that is what we saw with jeff and mckenzie. >> the markets, a quiet trading session we are setting up for. u.s. stocks rising, but nearing session lows. 0.1% when it comes to trading in new zealand. australian futures up 0.25% on rbi decision day. kospi futures up, the best performing market out of the developed and emerging indices. we are looking ahead to s&p futures, down about 0.1%.

with to have japanese and china markets closed for holidays. ♪

>> commodity prices are jumping to new highs again.

the commodity spot index which tracks 23 raw materials had its best day since 2016 amid a surge in everything from copper to oil to timber. the benchmark at levels not seen in nearly a decade. bloomberg any after that the transition will require more base metals like copper, zinc, and led, materials that are more carbon intensive to produce. let's bring in bloomberg's head of mining and metals. why does the carbon intensity of nickel and copper matter? >> copper and nickel are going to be quintessential in clean energy technologies. particularly solar panels and wind turbines and batteries that go into electric vehicles. while the use of copper and nickel in technologies did not

read a huge portion of the metals market currently, about 10% of copper demand currently goes into clean energy technologies, and a little less than that of nickel goes into batteries, they are the key drivers of growth for the demand of these metals in the next decade or so. we expect clean energy technology demand for copper to more than double over the next 10 years. for gold, the demand for nickel and batteries will grow from now until 2030 and represent about 40% of total nickel demand. it is a huge issue in that you need these materials to power greener technologies, but can these materials be made sustainably as well? >> a terrible irony, isn't it? why are certain metals more carbon intensive to produce? >> for some like copper and

nickel, the key issue is they are smaller scale in production than larger bulk metals like steel and aluminum. they also have complicated production processes. they come from various kinds of resource. sometimes the type of ores from which they are mind, the quality is decreasing over time, which means it requires more resource intensive processing, refining, and smelting to get them to a quality level that would be sufficient for technology use. in particular, areas where a lot of the new supply growth is coming for let's say nickel are also in energy markets where they are more dependent on coal as an energy source. some of the fastest growing supply of nickel in the future is coming from southeast asia, historically the indonesian energy market has been dominated

by coal generation. there is this question off a combination of how do we make the production more efficient over time and also perhaps improve the energy flows they use to produce these materials. >> how do we have greener metals for green tech? >> in the near term, the one most people would talk about is recycling. the carbon intensity and energy intensity of recycled nickel and copper and other base metals are significantly lower, in some situations 10 times lower, then the carbon intensity of primary production. the biggest constraint on the global ability to recycle nickel and other crucial base metals is the sheer stock of supply of scrap that is available to be

recycled. unlike steel and aluminum which have been used in many different applications for years, there is a larger scrap market and therefore higher levels of recycling of aluminum because there is more material to be recycled. nickel and copper and other base metals, there is not enough out there that is ready to be recycled. at least the next decade or so, most of the growth in demand for materials has to come from primary production, basically producing from raw materials, from mining. >> let's come back to the vaccine effort. moderna has agreed to provide as many as half a billion doses of its shot to the program known as covax in a boost to the global vaccination effort. at the same time, new virus waves are surging in developing countries, most notably in

india. let's get more from sophie who has a significant guest. >> good morning. we are joined by an infectious disease expert and the president of the international aid society who has recently been appointed to the who science council. thank you for joining us on bloomberg tv. the world health science council just held its first meeting on april 27. we are seeing a pickup in infections when it comes to developing countries. what is your assessment on the emergence of these variants? >> good morning. certainly the variants are of great concern, particularly because, like what we have seen with the u.k. variant, the

concern is that a variant increases the likelihood of spread. we saw happening in the u.k.. secondly, what variants can do is increase the severity of the disease. thirdly, and this is the one together with increased transmissibility, is whether the variants will escape the way the vaccines work. there is intense research in all of these areas. will there still be a risk of being infected with this new variant? these are the reasons why we are concerned about increasing mutations and increasing types

of variants. what is happening in india, the question is is it because of the emergence of the -- but i think that is not enough scientific evidence to say it is or it is not due to the variant. we are seeing devastating rates of infection in india. >> how much more important is it to quicken the pace of rollouts in countries like india? >> it is critical. countries that have rolled out the vaccines more successfully than others, namely the u.k., the u.s., and israel, it has dramatically reduced rates of

infections, hospitalization, and death. what we see in india is the system cannot cope with the numbers. we must to everything we can to reduce the number of infections, particularly severe infections. many of these vaccines have shown to be highly successful at doing that. >> vaccine deployment has been hampered by limited access to vaccines. there is inequity when it comes to distribution. what can be done to improve that deployment? >> as we know, of the vaccines that have been given since vaccines came into human use,

unfortunately have mostly gone to wealthy nations. the african continent has 2% of the vaccines. unfortunately now as we see increasing infections coming over to asia, and there are concerns that southeast asia will bear the next wave, we must do everything we can to rollout the vaccine more equitably. i happy to hear that moderna has just announced they are giving vaccines to covax, but more needs to be done. there is the ip issue. the world must learn from the hiv experience.

they waited far too long to ensure the antiretroviral rollout could benefit countries. we must not repeat that mistake in the case of covid-19. the urgency is greater because the disease is much more acute in terms of causing death than hiv was. the parallels are similar. >> we have seen vaccine nationalism of course complicating the rollout to developing countries. we have pfizer's factories in the u.s. looking to export those doses to countries that need them the most. what other efforts should be made by developed countries to speed up this process?

>> there have been developed countries that have more vaccine than they need. i believe the u.s. is considering donating vaccine. this must be done and must be done quickly because, you know, to use the cliche, no one is safe until everyone is safe. >> we had the who identifying a funding shortfall. do we need to ramp up funding towards the effort? >> absolutely. vaccine is only one half of the equation, isn't it?

and in terms of the accelerated programs, there are medications for low income countries, there is ppe, there is the whole gamut in addition to vaccines that we need to cater for to really bring an end to this pandemic as soon as we can. >> you have been drawing parallels to the covid pandemic and the hiv epidemic. what is the outlook for the future of health as well as the framework when you look at what has been going on? >> if you look back in 40 years of the hiv pandemic, nations that have successfully controlled the pandemic have pae

attention to the human rights issues, to equity, to a whole of society approach, to greater community involvement. the framework and the principles are there. the scientific evidence is there that if you employ those principles when you rollout programs, when you strategize, you are going to be more successful. we have those lessons over the last three decades, four decades of response. we know what to do. we just have to implement it.

the basic principles are the same. >> thank you so much for joining us this morning from kuala lumpur. >> don't miss another big interview ahead. the post-covid economic outlook with the former rbi governor. ♪

>> a quick check of business flash headlines, fidelity investments cut estimates by half following a chinese regulatory crackdown. the money manager lowered the implied valuation down from $295 billion in august. adapting business, it will be supervised by the bank bowing to demands from beijing. horizon getting rid of its ownership in bands like aol and yahoo!. while the carrier -- the wireless carrier has agreed to sell to other firms. the price tag is $5 billion. verizon will keep 10% stake in the business is adding a deal is expected in the second half of

the year. jp morgan the first to trade higher on the short-term bank yield index has wall street has new benchmarks to replace libor, which will be replaced next year. the banks -- bsby is administered by a subsidiary of bloomberg lp. we are counting down to the start of trade. the bank of korea releases minutes for its april rate decision meeting this afternoon. that is when they left the rate steady as 0.5%. on the corporate side we have earnings reports from big names. and the kospi on watch after slipping on monday. we will see if the listing of the shortselling band continue to put pressure on the markets. we are seeing new zealand stocks

up 0.2%. sidney futures pointing upwards. kospi futures under pressure again. ♪

♪ >> welcome to daybreak asia. i'm shery ahn. haidi: i'm haidi stroud-watts. seoul just open for trade. asian stocks set to open higher after a mixed session on wall street. india's prime minister continuing to resist calls for a lockdown even as virus cases surge. we are joined by the former rbi

governor. the rba set to release its latest decision in a refrain of any hawkish tilt towards policy. shery: japan still away on holidays, but south korea coming online. let's go to sophie kamaruddin in hong kong. sophie: kicking off the open in sydney. we are seeing stocks again .2%. keep an eye on westpac which has hired morgan stanley for the sale of its wealth management operations. miners on watch with citi saying we could hit $200 a ton on iron ore prices. crypto also, as etherium passing. ahead of the rba decision, the aussie dollar holding steady this morning. while bonds are nudging higher. switching on the board for the focus on south korea.

we are waiting on the april meeting minutes. we have inflation data that the fastest pickup in consumer prices since 2017. the korean yuan trading at about 11.20. the tech heavy is under pressure this morning. the kospi bouncing back a little bit after being led lower by health care stocks on monday as the shortselling ban was lifted. biopharma and battery makers are vulnerable to downside pressure. switching the board for what's happening across assets early tuesday this asia session. the u.s. s&p lower after we saw stocks higher on wall street. commodities very much in focus. we are seeing some renewed energy demand optimism after the eu proposed easing some travel curbs for people who are vaccinated. that will help lift oil prices. crude above $64.

we have precious metals on the radar. silver futures continuing to gain ground. we have dollar weakness in the wake of the u.s. pmi numbers, showing it could be slow in the u.s., haidi. haidi: emerging investors head into the first week of may with as many reasons to be gloomy. all the support from the u.s. stimulus plan, dovish central banks globally, and rising commodity prices, worries over covid-19 cases in asia and china's debt saga may give buyers pause. joining us -- you add to that the high valuations we continue to see across risk assets. how much reason is there to take a cautious approach right now? >> i think times like this, we have to be mindful of the past recessions, when we come out of the recession.

usually there is a period where valuations are still relatively high. in fact, the market pricing with an earnings recovery in the pipeline. we would argue we are still in the same type of situation. of course, the markets have rallied quite strongly since last year. but, we still think given the growth numbers we are expecting for key economies around the world and the scope for the rest of the world to catch up with the u.s. eventually over the course of the year, there are still pockets of opportunities for investments. we would think european equities would be one area. also, many different markets. for instance, north asian markets would still offer some interesting opportunities for global investors. the valuations, in a way, is a reflection of an incredibly strong earnings growth numbers we have seen in months to come.

haidi: you talk about north asian opportunities. let's take a look at korean markets given that they are the best performer over the period since march 2020 out of any developed, or if you want to categorize it as an emerging market. how much more upside is there given we are seeing the lifting of the shortselling ban and how much of that optimism is already priced into the prices we are seeing? homin: well, relatively speaking, i think emerging markets -- significantly fast vaccine rollout and the prospect of a pretty aggressive fiscal policy support. that story in the first quarter, that might be more or less in the price. what might not be in the price is the beneficial impact we will have in the markets around the world outside the u.s.

if you look at north asian markets, there is a perfect situation for this environment. they are more sensitive to strong demand overseas. they do have a fairly good control of the virus so far, even without the very fast vaccine rollout. the vaccine rollout is something that is coming to the region. we expect the vaccination numbers in places like south korea potentially accelerating. the fundamental story is still there. for that reason, we would argue very strong global recovery environment in these markets still offer pretty good upside. regarding south korea's short sale ban being lifted, in the previous two cases, that actually led to increased inflows for investors. that had a minimal impact on the overall market direction. this time, at least in the very

near term, some sectors that thrived without these short sales could see some pressure and volatility. for the country's cyclical sector, we think they are well-positioned. to navigate this environment well and provide upside for investors. shery: what about pressure from retail investors? we have seen in south korea the like of the korean stockholder alliance grouping together. is there a chance we could see something similar to the reddit-fueled moves we saw in the u.s.? homin: that is an interesting question. without a doubt, the retail army story -- it has been a global phenomenon. south korea is no exception to this. obviously, there is significant political pressure on the ruling

party. obviously, it has been implement it already. in terms of the ability of the retail investors to get together and create this type of space, we are a bit more skeptical because, obviously, we are just coming off a ban here. but also, the positioning on some of these stocks is not as extreme as some of the positions in stocks we saw in some parts of the u.s. market. an interesting prospect there, but we don't think a similar event could occur. shery: before we let you go, you mentioned you like europe. this chart on the bloomberg showing how economic data is finally starting to recover. what do you like? homin: oh, we like the entire market. the market obviously has all

types of valuations compared to the u.s. and part of it is cyclical sectors. a bit more prevalent in the market compared to the u.s., but that is the reason why would like the market. . currently offerit -- it currently offers sector exposure. the background, europe is beginning to improve its vaccination numbers. we look at the growth side and the remainder of the year. we really like the entire market, but we are focusing more on value and large-cap style. in the market. and we think relatively speaking, the market will continue to perform pretty well versus the u.s. equity market for the remainder of the year. shery: homin lee, great to have your insights. asian market strategist at lombard. let's get to vonnie quinn for the first word headlines. vonnie: president joe biden is open to various ways forward for his vision for a better america.

sources say that includes breaking his proposals into multiple bills. republicans are not onboard with the biden american family plan, calling for tax increases on the wealthy. there is support for some parts of his jobs plan, according to sources. biden says he sees bipartisan support but corporations need to do their part. pres. biden: it is about time they start paying their fair share. it is about making a choice. we had out there this year, you have 50 corporations making $40 billion and didn't pay a single penny in taxes. not a single penny. i don't want to punish anybody, but everybody should chip in here. vonnie: top diplomats from the u.s. and the u.k. have pushed back against what they call chinese and russian violations of the global order. those included crackdown on uighurs and the poisoning of russian opposition figure

alexander navalny. the u.k. foreign secretary pledged to unite democracies against autocracies. that theme is excited to feature prominently during g7 meetings. the world's largest vaccine maker is promising to deliver 220 million doses of vaccine to vaccine starved india over the next few months. that is enough to cover a percent of the country's population. in a statement, the modi led central government will receive 110 million doses of covid shiled, while governments will get the rest. the statement did not specify a delivery date. india has been struggling to curb its covid crisis. global news 24 hours a day on air and on bloomberg quicktake powered by more than 2700 journalists and analysts. i'm vonnie quinn. this is bloomberg. haidi: still ahead, we will be discussing india's economic policy and outlook and risks

into the global economic recovery with the giver city of chicago school of finance professor and former rbi governor joining us. coming up next, it is not just india grappling with the pandemic. calls for medical supplies as other developing nations are also seeing new waves of covid cases. this is bloomberg. ♪

shery: developing nations are putting up renewed calls for medical supplies and aid as the battle fear of new wave of covid infections. let's get more. globally, what are the cases surging the most? >> so, we are seeing cases surging the most in the developing world. nations ranging from laos,

thailand and southeast asia. we also have some pacific island nations that are reporting the first wave of their covid because they largely escaped the pandemic last year. it is looking quite worrying that a lot of places that are less equipped to actually cope with the virus and they are lacking the resources. many of them are facing variants that are more transmissible. this is a situation that is not just india. it could happen to any country if we don't take good care of it. haidi: of course, we have seen the stories about people having to walk for hours looking for oxygen tanks. days to look for available hospital beds. what are we seeing when it comes to the sheer pressure on health care, medical systems? >> in laos, for example, the health minister sought medical equipment and supplies, including asking vietnam.

cases have jumped more than 200-fold in the month. hospitals are quickly filling up and running out of oxygen supplies, just like what we have seen in india. thailand has health facilities running under pressure. the government is setting up field facilities. right now, it is really important that developed countries really reach out and share the resources they have with some global initiatives including sharing the vaccines if supplies are over demand. shery: what are the channels? you mentioned global programs. perhaps you are thinking of covax. moderna has been supplying 500 million doses of their shot. what else can the developed world really do? jinshan: covax is one example and there are lots of bilateral help between laos. these developing countries, although their population and

size of outbreak is still very far from india, it's important to also pay attention to them because often times we go to the biggest outbreak. a lot of them, for example, laos, the surge is so much larger than india. it is important to pay attention to what place could be the next outbreak. haidi: jinshan hong with the latest. australia's moved to fine and jail their their new sit. -- for many people that are horrified by this, if you like there's a lot of people who approve -- it feels like there's a lot of people that approve of

the situation here. >> it says that the political situation favors locked down and shut up. -- shut-outs. go back and look at the erecting of forced safe borders within australia. we are talking about many stockades within countries. the state border was once thought of as a bureaucratic holdback from the 19th century. many of these state leaders who respond to slightly different political intentions have found in the past year that this is a path forward to strong reelection. that message has not been lost. shery: can this also be seen as a message of anti-globalization in a way? daniel: the siege mentality, fortress of australia, call it

what you will. no politician in australia -- we are about a year out from a national election -- is going to put themselves out there and say, yeah, let's open up. all the trappings of globalization, let's have them all of the front door right now. that is not happening. even when you look at the policy, the prime minister goes out of his way to say effectively, this won't be set by the concerns of socialists in the eastern suburbs of sydney or leftists in cafes in melbourne. he's talking about the heartland, the rural areas where support for his conservative bloc is strongest. this is running through many strands of government policy. where a year out from -- we are a year out from a national election. that ending down the hatches -- that is all the rage.

haidi: i am thinking if you are an australian stuck overseas and not allowed to come home and you are detained overseas in your government no longer has a diplomatic relationship with a government that is helping, how does that add up to how valuable an australian passport will be moving forward? daniel: it takes a lot for somebody to surrender their passport. really not doing it. when i naturalized as a u.s. citizen in 2016, i was very careful to also retain my australian citizenship. but this does raise very important questions about what is the meaning of where one belongs? how is that defined? we know what our obligations to the state are. what are the state's obligations to us? shery: bloomberg opinion columnist dan moss.

don't miss the big interview ahead. we assess the post-covid economic outlook for india with the former rbi governor. this is bloomberg. ♪

shery: recent moves by european nations indicate a shift to a harder stance towards china could be happening. the eu's executive branch and germany have each formulated legislation that would make it harder for chinese entities to invest, while joining the u.s. and swapping tit-for-tat sanctions with beijing. let's go to bloomberg's asia managing editor, dan. does this mean that investment treaty just a few months back, that was the high point of this relationship? dan: yeah, that took seven years of really tough negotiations and

it was reached just last year at the end of the trump administration. still subject to ratification by the european parliament. but even if that does go through, we are seeing more measures from europe to restrict chinese investments and to protect european technology from getting into the hands of china. this is sort of mere earring the policies -- mirroring the policies we have seen in the u.s. under the trump administration, and then extended under joe biden, to kind of block china from accessing these key technologies that will drive the economy into the future. haidi: dan, what is the ultimate upshot of this? what is the next step and potential retaliation or deterioration of this relationship? dan: one thing on the horizon is

just the emergence of the greens in germany. they have been very outspoken in calling for china to stop human rights abuses. saying that europe should not purchase anything that comes from forced labor. forced labor was a big sticking point in the investment treaty talks. so, to have that more on the agenda since the investment treaty was signed -- we have seen europe joining the u.s. on putting sanctions on officials. we have seen china retaliate with a defective boycott of h&m. all of these things have really hardened the view in europe on these issues and could lead to more -- on china, on issues like forced labor, human rights. the g7 foreign ministers are meeting this week.

that is likely to be a big topic there. yeah, the upshot is that things are getting tougher. china has wanted europe to have a more independent foreign policy to try to take them away from the u.s. but with merkel exiting the scene, we could see the u.s. and europe aligning much more on china than they did under the trump administration. haidi: bloomberg's asian government editor dan ten kate. fidelity investments cut its valuation estimates for and grew by half following a chinese regulatory crackdown. the manager went down to $114 billion at the end of february, down from $295 billion in august. and revamping its business will now be supervised like a bank, bowing to demands from beijing as it rains in the tech giant. apple's high-stakes battle with the maker of fortnite has begun

in a federal court. epic alleges anticompetitive behavior tied to apple's app store which takes commission of developers up to 30%. lawyers of epic say apple engaged in a bait and switch. the tech giant says it faces competition from smartphones that do not use its software. verizon is getting rid of its ownership in dominant brands like aol and yahoo!. the wireless carrier agreed to sell its division ii apollo global management. the price tag is $5 billion. verizon says it will maintain a 10% stake, adding that the deal is a credit to close in the second half of the year. coming up, we will hear from the former rb i governor. he says the pandemic shock could be an opportunity for the developing world to build more resilient as we continue to see covid cases and deaths rise in india.

that is coming up next. this is bloomberg. ♪

♪ vonnie: this is daybreak: asia. president biden has announced his cap on refugees that can enter the u.s. this year. the move comes two weeks after biden face bipartisan blowback for enlisting former president donald trump limit of 15,000. biden says the u.s. will not reach the cap this year, saying only 2000 have been processed as of mid april. bloomberg news has learned from

a biden official that the white house will support pfizer's move to begin exporting u.s.-made doses of its coronavirus vaccine to nations desperately in need. in a statement, officials say the company is ahead of schedule in its commitment to supply the u.s. demand for shots in the u.s. has began to wane, according to the bloomberg vaccine tracker. it is a question that has been intriguing berkshire hathaway investors for years. now warren buffett has entered a publicly. he told cnbc that the vice chairman will take over if buffett were to step down. he runs the noninsurance businesses at the moment and has been seen as the most likely candidate. warren buffett is 90 years old. microsoft cofounder bill gates and melinda gates, his wife of 27 years, say they are divorcing but will continue to work together as the massive philanthropic foundation they created. the made the statement on twitter. they married in 1994 and work

together to improve global health, literacy and combat find climate change. they have given way more than $50 billion. global news 24 hours a day on air and on bloomberg.com. i'm vonnie quinn. this is bloomberg. haidi: let's take a look at markets as we see parts of the region still closed for holiday. sophie, what are you watching? sophie: japan is off-line this tuesday. we are seeing s&p minis move lower and a mixed bag elsewhere in the asia region. few stocks gaining ground while the kospi is fluctuating with health care names among the biggest drag. extending losses after which we saw the short sell bedding lifted. this is as we are seeing oil hold gains. wti above 64, brent above 67. step forwards in reopening in europe and the u.s., potentially

offsetting concerns around retail in parts of asia, including india. with that, full of the chart on the terminal. while we have seen manufacturing stay relatively robust over much of asia last month, we are seeing signs of slowing activity. india pmi at above 55, thanks to exports. new orders and output grew out the slowest pace and factory jobs declined in india. pulling up the board, bloomberg economics anticipating increasing economic uncertainty in dia will draw -- in india will drive capital outflows further until september, according to their forecasting model. we have seen it move back below 74 after breaching 75. bloomberg economics anticipating weakness. shery: staying in india, prime minister modi is resisting pressure for more lockdowns despite covid cases surging in the country. let's bring in our global economics and policy editor kathleen hays standing by with

our next guest. kathleen: thank you. let's bring in former reserve bank of india governor raghuram rajan. also the chief economist at the international monetary fund. he has been a finance professor at the university of chicago booth school. great to have you back on the show, particularly in light of the fact it has been barely a week since you have returned from your recent trip to india. having been there in the midst of that talking to people, give us a more first-hand view of just how bad it is. what is it like? raghuram: i was in the south which has been spared much of the recent wave. certainly, i went through delhi, talk to people there. and both delhi and mumbai, the big cities in india, are deeply affected. the caseload is very high. the space in hospitals is very scarce.

and you have these horrendous sites -- sights of people queuing up waiting for hospital beds. people dying because of lack of oxygen. this wave has hit much harder than the first wave. in the first wave, we have something like, at its peak, 90,000 to 100,000 cases. this wave has been much more serious, more localized, and devastating in its impact. yes, it is a tragedy of great proportions at this point. kathleen: what are people in india saying about this? what went wrong? raghuram: i think what went wrong was simply, we underestimated the virus and its ability to adapt. i think if you looked at the first wave, for a variety of reasons, it died down. we don't fully understand why. at its worst, deaths were about 1000 per day in india.

it's a large country, 1.4 billion people. that is actually a very small number compared to the deaths, for example, in the united states or europe. so, there was a sense that indians were, for whatever reason, more immune to the virus and we could cope. it was not a matter of statistics not being right. you look at the hospitals, apart from a few situations, the hospitals were able to cope also. in general, there was a sense that we had endured the worst the virus could give us. and, you know, we had come through and it was time to open up. as india opened up, as it became more open to big public meetings, the virus came back in a new variant and was much more devastating.

it implies it is very much faster. kathleen: in terms of these shortages -- oxygen, for example -- supply issues more than availability, etc. all of these things that hit the country so hard all at once, many people are asking what happened, but how did india get into this mess? was a lack of leadership? was it because the pandemic blindsided so many policymakers, so many businesses, countries? raghuram: i think there are two areas where you could say the lack of foresight, lack of leadership. one is certainly anybody paying ntion to what was happening in the rest of the world, in brazil for example, should have recognized the virus does come back and potentially in more variant forms. we saw that in europe with the so-called reddish variant. -- british variant. if you were careful, cautious,

you have to recognize it was not done yet. india have built some facilities during the first wave which were dismantled over the course of the year. of course, they would be very much needed at this point. the second place where one could have paid more attention is the vaccinations. it was clear that india needed a massive volume of vaccines, and unfortunately, we don't seem to have prepared for the volume of vaccines we needed to fully vaccinate our population. some of that may be the sense that we have time. since we had with the virus, we could roll out the vaccinations slowly. india to its credit giveaway the vaccine to a number of countries early on, and those vaccines would have been very useful in many of the urban areas which are now badly hit. kathleen: what does india need to do now to recover, to repair, to take out of this whole and move ahead? raghuram: first, i think there's

a massive effort in india from the private sector, from voluntary organizations, and from india's task force. the good news people are engaged, trying their best in the face of a very vicious pandemic. so, that is good. i think the government is getting attacked together in trying to -- getting its act together in trying to bring together oxygen. an army is being brought in. the air force is being brought into ship things. we are in emergency mode. the good news is we finally realized this is a full-fledged emergency and are bringing all resources to bear. the world is helping india out. going forward, what we have to watch out for is as this spreads to rural areas -- there are areas that have a fraction of the hospital facilities that

delhi and mumbai have. we have to monitor that process and be quick to ship resources there, also pullout patients who are deeply affected and bring them into the areas where there are more resources. the south is relatively little affected. the silver lining is -- the city first affected in a big way. you are seeing the cases starting to come down. it may well be that resources open up in the western part of the country, which can then provide benefits to the other parts. kathleen: central banks around the world have responded to the virus in their economies with, you know, extraordinarily stimulative policy. what is the rule for the reserve bank of india in this process? raghuram: it is doing what it can. it has been as accommodative as possible given the fact that inflation has not really come down and was starting to look

up. so, i think the reserve bank has been as accommodative as possible. it has helped finance the government deficit, much like other central banks across the world. it has also built up a fairly large foreign-exchange reserve position which has come in good stead, as there are some doubts about the indian economy going forward. this will at least be a measure of comfort for foreign investors. kathleen: if i ask you, gee, how does the global recovery look to you? first of all, obviously some countries are truly in recovery. the u.s. on an economic boom on many fronts. others are still in the hole. is the global economy in recovery? and the disparities are so big, how do you think about it? how do you measure it? raghuram: it is going to be a very disparate recovery.

the u.s., norma's amount of money has gone into supporting households and businesses. so much so as you saw on the first quarter, household income has actually gone up even in the midst of a pandemic-induced recessionary condition. it should be recessionary, but we see a fairly strong growth. that suggests the amount of support that industrial countries, especially the united states, have been able to give their economies. that implies based on growth going forward, even stronger growth in the second quarter and excellent job numbers going forward in the u.s. contrast that with mexico, with brazil, with india where you've had a very bad virus which has created a substantial amount of damage, a lot of scarring of businesses. a lot of debt that has been built up by the ones that have survived. and, of course, vaccinations are

going to take longer to rollout. the u.s. is going to be by and large fully vaccinated by early summer. in the rest of the world, it will take a lot more time especially the emerging world. more damage, less support, longer time for vaccinations, which means those economies take much longer to recover. and within those economies, the poorer, small businesses are much more severely affected because of the lack of government support. kathleen: i have to ask you specifically about the current stance of federal reserve policy. let the economy run hot, don't worry about inflation. inflation up to 2% or higher. keep buying bonds. imf warned at the last meeting that if the fed does not carefully telegraph what it's going to do next, tapering bonds could be bad for emerging markets. do you see a risk where the fed

stands and what it means for the rest of the world? raghuram: the fed has to do what it has to do given where the u.s. economy is. i think the fed is a little bit like the dog chasing the car and finally catching up with the car. the fed has been saying we are not the only game in town, we need fiscal support. of course, what's happened is fiscal support in enormous quantities with the democrats winning both the senate and the house. that then makes the fed's policy of staying on hold for the foreseeable future, waiting to see a bove tuber -- above 2% inflation before deciding to act, it seems as if the fed has been somewhat overtaken by events. it will stay accommodative. chairman powell has said again and again, we are not even thinking about thinking about raising rates or tapering.

my sense is the amount of fiscal support that is underway and the strength of the economy will probably force the fed to have to rethink what it has laid out. of course, when that happens and a financial market which has been thinking that the fed is not going to act in the near future is likely to be somewhat surprised at the first signs that will happen. kathleen: so you see some risk there. what about debt, overhang of debt? the u.s. is one of the biggest borrowers now. you have warned of the doom and gloom scenario. you are warned of financial risk embedded. what is the biggest risk and all of that? raghuram: first, i think the old views on debt have to be reconsidered with relatively low interest rates. what happens if interest rates start picking up once again? this is where the majority of government debt, the amount that

has to be rolled over every year starts becoming an issue. and one of the concerns sometimes ms. we don't pay enough attention to how much has to be rolled over. if you look at japan, the imf suggest a significant part of its debt has to be rolled over going forward. that means if interest rate start popping up, which they haven't for a long time in japan, but if they do, it means debt service becomes more costly . the u.s. in the imf's estimation is the number two country here. it has a lot of debt rolled over. some of this is because the fed buys long-term debt and issue short-term paper against it. when you look at the effective maturity of public debt, it is shorter than we think. with that means is cost ramps up quite quickly when interest rates pick up. is the u.s. in any danger of debt default? not in the near future, for sure. for other countries, for smaller

emerging markets, as interest rates start picking up, many of them are at the level reinhardt wrote of in the famous book would say is way beyond what is sustainable in an emerging market. debt levels of 9200% of gdp. even though interest rates are still relatively low as they move up, there will be more signals of debt stress across the world and we will have to deal with that. kathleen: got a lot to deal with. i guess we start with the virus, the pandemic and vaccines. we move onto that when we have to. thank you for joining us. raghuram rajan, finance professor at the university of chicago booth school. haidi? haidi: we do have plenty more to come on daybreak: asia. this is bloomberg. ♪

haidi: turning to commodities. the red-hot rally in everything from corn to copper to lumber continues to set fresh records. let's go to su keenan who has been watching all this. could we say there's a single driver for these gains? su: mainly, it is the anticipation of the boom in demand post pandemic, post

everyone getting vaccines. jump into the bloomberg and he will see everything from props to copper to lumber began 2021 with a bang. the rally, the best since 2016 for commodities. if you look at the way a lot of these commodities closed in the chicago trading, lumber hitting all-time record of 1571. that is more times -- more than four times the price you would see. silver broke out among the metals to move higher on the dollar gyrations. and if we take a closer look at corn, the eight-year rally has a lot to do with the fact there is a drought in brazil creating a shortage and shortages are the other big part of the rally. check out copper. the rally has been unstoppable for more than a year, largely in part to a lot of governments boosting renewable, electric vehicle use. the green revolution is creating huge demand for copper.

shery? shery: could be applying to commodities as well. what are analysts and chart watchers saying about this year? su: typically it does. may is usually a weak month for commodities but the charts are saying the opposite. do not touch to the dial. jp morgan seeing 10% gains in commodities but if you look at lumber, it has been on fire. demand from homebuilders skyhigh and shortages also very much a factor. 10 at risk of a super spike. it will carry prices much higher. it is already up 40% year to date. a lot of the producers out of indonesia and malaysia so there shortages there. the stunning demand for building materials is another big part of the story. people cooped up in small homes or apartments now want big homes and there is not enough materials to build them so that is making prices higher.

shery: that makes sense. we have all suffered through this pandemic. su keenan in new york. this is bloomberg. ♪

shery: let's take a look at cryptocurrencies with ether soaring.

digital tokens will eventually replace paper currency, according to one guest. he told bloomberg how he expects crypto to move. >> prices go up, prices go down. people that are buying these assets really need to think of them as commodities. they are not currencies. cryptocurrency is a misnomer. they are commodities and just like any other commodity, the price can go to zero as we saw with wti. futures contracts in the short end of the pandemic. those ones can go negative. cryptocurrencies can't. the one thing that you will absolutely see, and this is the one prediction i'm confident to make, is trivial. in the future, there will be more software than there is today. and that software will apply to every practice. if you look at actual

currencies, there is no question in my mind that the dollar will continue the digital journey which it has been on for 50 years. and most dollar exist in the central banks and the federal reserve. and the rest, the paper bills that we see, most of which are actually outside of the united states. those paper bills, no question in my mind, are going to eventually disappear and replace the digital token. >> all the stuff you have been talking about have to center around technology. i wonder how you look at the whole sector in terms of antitrust. yes, it is focused on the big guys right now like apple, as is the case in california. but it's also amazon and facebook. how do you look at that? marty: antitrust is not really the way i would think about big tech. i'm thinking about it much more

in terms of what were the rules that were applied to the financial system over time? a huge wave of regulation after the stock market crisis in the 1930's. again, another wave after the great recession. if you look at what the regulators have done in the areas of financial services, here's one thing -- one outcome that is not an accident. during the pandemic, there was so much disruption to so many sectors, the one sector that might have been really worried about that they didn't worry about was the banking sector. banks continued to lend, they continued to make markets. and a lot of that had to do with the huge upgrade in systemic safety instability and risk management. more liquidity, more internal models. all of that can be applied to big tech. i would be talking about and

am talking about some form of carbon tax for polluting the info spear. to do something about showing more -- emotional outrage. haidi: that was marty chavez. ♪

♪ >> good morning. it is 9 a.m. in beijing and shanghai. welcome to the bloomberg markets china open. we are counting down the open of trade in hong kong. let's get to your top stories today. fed chair jay powell says the u.s. economy outlook has clearly brightened amid increased vaccination rates and fiscal