manus: good morning from our middle east headquarters in dubai. i'm manus cranny alongside dani burger in london hq. brent crude topped $80 a barrel. global energy crunch continues. treasuries spike. two-year yields hit an 18 month high.

fed officials to signal a taper is coming soon. powell and yellen testify later today. kaplan and rosengrant quit, two fed hawks step aside after embarrassing revelations of their stock trading during the pandemic. the dots could shift, but i put it to you that the bond vigilantes have had a lovely healthy -- helping of steak. there will be a greater enduring risk inflation on the upside in the two year yield went bam, bam , bam. the question is what could cap the spike? dani: good morning. i'm doing well. i may be a little bit worried because there are plenty of things out there that could cap the spike. we were talking about it before the show. you have the political issue of the u.s. heading to a debt ceiling deadline. you have a potential government shutdown.

does the fed need to potentially step in? there is a great wall street journal piece saying that the fed has lifted this playbook before. there is a potential thing that could put a ceiling of the deal -- debt spike. manus: powell has used words like loathsome and repugnant, other things they could step into do to help with the debt ceiling. master george. brainerd. with all of this kaplan, rosengrant shuffling, what does it do to powell's position? these four voices are moving the narrative to substantially slow the progress, which puts the taper more aggressively and play. dani: tapering looms. interest rate rises are another concern. we don't know this for certain, but rosengrant is likely one of the dots in 2022. without him, could we get a

shift to a lower bound? it depends on who replaces him. manus: rates are moving. dani: they are moving and it is really what is dictating the markets. it is happening again today. it is a day of superlatives when it comes to the front end of the curve. you have above 1% yet again for the five year yield. that belly of the curve hitting a 2020 hi. get used to saying 150 now. your u.s. 10 year nominal yield at 1.50. a rotation toward more cyclical stocks. manus, i know you have been on top of this move. brent crude above $80 a barrel, first time since 2018. manus: absolutely. can that endure? what impact will that have on inflation? the call spreads are trading. let's talk about that lead story that we mentioned. eric rosengren, robert kaplan

both separately announcing plans to step down. they were sudden announcements that came after the revelations of stock trading during the pandemic. the departures removed two of the central bank's more hawkish officials. let's put some context. let's get bloomberg's economics opinion columnist in. two potential hawks out. does it shift the narrative to potentially the doves? good morning. we seem to have -- dani: we will try to get daniel back on the phone momentarily. we will go over this retirement from kaplan and rosengrant. how does this shift the narrative in the fed? a great to have you. >> thanks.

it doesn't shifted dramatically in the near term, or even the medium-term. what this does do over a broader period of time is it gives the folks at the board of governors in d.c. an opportunity to rein in the disparate fed banks, who they sometimes see is rebellious. when there are dissents, they are almost always by the district banks. september 2005 in the aftermath of hurricane katrina. i will say one thing about rosengren, he has the capacity to dissent on the upside and the downside. he has dissented in favor of a more hawkish, and on the other

side he haen more dovish. when it comes to kaplan, he has like -- less hawkish than his predecessor. dani: right. ok. potentially some change or it might not have too much of an impact. we will have to see you unzipping nominated. thank you so much. let's check back in on how things are faring in these markets and in asia. juliette saly joins us from our singapore studio. is this having any repercussions in the asian session thus far? >> it certainly is as we see these rising yields. we have some upside coming through in the likes of hong kong and china. we had some injection of liquidity. the higher yields weighing on growth stocks. asian stocks are snapping those three days of advances. no surprise, you have the infotech sector under pressure. with a friend at $80, a big spike coming through in energy

stocks. of course, these power shocks in china leading to downgrades. goldman cutting growth forecasts. let's have a look at some of these energy players. goldman now saying you could see zero growth in the third quarter for china, but you have had some soothing words coming through from authorities trying to boost electricity outlook. you are getting rebounds and a lot of these players that were hit hard yesterday. the ever grand concerns still. looking at some of these players, a bit more moment i'm coming through in the hang seng property index after some words from authorities, the central bank vowing a healthy properties market, that has boosted some of these developer stocks amid the ever grand woes. that is not going away and goldman cutting its forecast for the 2021 economic growth for china. manus: that can have brutal global ramifications. thank you very much.

let's get the latest now from germany. olaf scholz claimed a narrow victory after sunday's election. let's get the very latest from maria tadeo. has she had any sleep? what color is her rainbow this morning? give me the latest. [laughter] >> i did have a great sleep at last yesterday. it has been 24 hours and we are now starting to get clarity in terms of where things are going to go from here. olaf scholz is carrying a lot of momentum. he made it clear he wants to see a government in place led by the spd before christmas. the bad results are really beginning to trickle down for the cdu. also facing a lot of criticism

from a newspaper that shapes public opinion in germany. yesterday, it was brutal. it kept repeating he needs to wake up to reality, the cdu is not in a position to form a government. then we headed public opinion survey that came out, 56% of germans would prefer olaf scholz to be the next chancellor. you can see where the narrative is. it will be very difficult. i would really say it is the traffic lights coalition that is really gaining traction right now in germany. very briefly, we know that christian lennar will be having bilateral talks with the greens. they say they need to agree to a common agenda between the two of them before they can speak to olaf scholz. dani: great catching up with you. that is maria tadeo staying on top of the german election. get to the first word news with juliette saly. >> a pivotal trade meeting

between the u.s. and the eu this week will be narrower in scope than originally planned. the contents of a joint statement outlining the results are still up in the air. the u.k. has officially put the military on standby to help deliver supplies to petrol stations in an effort to stem the widening crisis. it is the latest emergency measure after supply chain disruptions that have blamed -- drained petrol plants and emptied some supermarket shelves. panic buying has seen sites run dry around the country. south korea's sk innovation says it will spend $11 billion constructing battery factors -- factories with ford. the two sites will be the biggest investments in the automaker's history and will employ nearly 11,000 workers.

the tennessee plant will occupy six square miles, making it three times the size of the historic complex that henry ford built in michigan a century ago. global news 24 hours a day, powered by more than 2700 journalists and analysts, this is bloomberg. manus. manus: thank you very much. let's set up the events for the day. the key event is going to be the congressional testimony from fed chair jay powell and treasury secretary janet yellen. i think where he reset and recast the die yesterday was about inflation. it will be greater and enduring and an upside risk. dani: the disappearance of the transitory word. will we see selling pressure resume? we also have the ecb forum that will kick off today. we will hear from christine lagarde. the key policy panel to watch for is tomorrow afternoon, christine lagarde, powell, bailey, and kuroda.

coming up, we will stick with the central bank theme. we will discuss more about the resignation of these two fed chiefs. we had the stock trading scandal. we have questions around health as well. what does this all mean for u.s. monetary policy? we will discuss that next. this is bloomberg. ♪

>> employment is still a bit short of the mark on what i consider to be substantial further progress, but progress continues and i hope it may soon meet that mark. >> i think it is clear that we made potential further progress in achieving our inflation goal and there has been good progress with maximum employment. assuming the economy continues to improve, the moderation in pace and asset purchases will be warranted. manus: some of the fed officials

with a hawkish message on the taper plans. comments sent yields spiking a little bit higher. levels we have not seen since 2020. but still the chair, jerome powell, will tell lawmakers the progress and jobs remains short of the central bank's goals later today. dani: there is also the changing of the guard at the fed, which is important. robert kaplan and eric rosengren quitting within hours of each other. this follows an embarrassing disclosure about their trading activities. kaplan sat down -- set to step down in october 8. rosengren, who cited health concerns, leaves at the end of this month. let's get more into these markets. thank you so much for joining us this morning. let's start with this changing of officials at the fed. do you foresee this really

changing the shape and the pace of tightening to come from the central bank? >> absolutely, it is interesting, the context of who votes next year on the fomc. we had some concerns that they were leaning in a more hawkish direction next year. the resignation of these two officials could alleviate some of those concerns in terms of the growing hawkish nest of the voting members. that said, the fed officials yesterday and even in the recent meeting, they pretty much made it clear that the bar to commence tapering is all but met when you look at inflation, when you look at employment. so we are pretty sure to get that beginning soon, perhaps at the end of the year. i don't think that changes very much.

the question is with regard to lift off. will the conditions for a lift off the in-place next year, or do we have to wait for the impact of tapering to settle down a bit and for fed officials to get comfortable with that before we go into rate hikes? that is the question that will be on our minds. manus: all of this spiking in the yields, the only spoiler in this -- not the only spoiler, that is ridiculous of me to say that -- but one of the spoilers in the spike of yields could be the debt ceiling. could that be something which you think becomes more material a risk markets than it currently is? >> yes, absolutely. the further you go into october, the higher risk that if this is not taken care of, that you

could go into a technical default. certainly, we are concerned about the fact that you have incredible amounts of polarization within the congress. that could raise the risk of a technical default. that is absolutely an event that is in our minds when we look at potentially risk aversion in the markets. in treasury yields, it's interesting that in the u.s., it's really driven by more the real yield component and if you look across europe and the u.k., it is really the inflation breakevens that are moving higher along with real yields. if you look at that composition of that move higher, it is a little bit different depending on when you look at the u.s. or europe and the u.k.. dani: given the drivers of that

bike higher and yields, given that it's being driven by a spike in real yield, does that change how you wrote the equity market in relation to this move higher yields? are you more interested in cyclicals given the move we've seen? >> we've had a pretty balanced allocation between sectors. whether that be cyclical value or growth or more defensive areas of the market. we certainly think there is an argument for an allocation toward financials, with the expectation that yield curve's will continue to steepen a bit. we do have allocations across the market that will benefit from higher yields, but we are more balanced. we think that there is a risk that growing concerns on the inflation front could stymie confidence and [indiscernible] to the reopening. you could get yields higher

before they turn around on a little bit of weakening. we have seen that in the u.k., europe as well, and that could potentially be the case elsewhere. china, for instance. concerns about energy intensive businesses. all of those mean that at some point you could get a growing risk for the economic picture. manus: ok, we are going to pick up on that theme in just a moment. the debate on real yields. coming up, we added to the inflation mix that natural gas soars. brent above $80 a barrel. amid the warnings that there is a global energy crunch. it is sitting growth. the potential to discuss the great power debate. that is next. this is bloomberg. ♪

manus: a little bit of m&a breaking news coming across the tape and are part of the world in saudi arabia. saudi industrial offering to buy national petroleum in a share deal. it is a nonbinding agreement with national petroleum chemical company. as we get a little bit more detail on that. it looks like the national petroleum shareholders, 1.2 shares in a share swap. it is all paper rather than cash. we've got these commodity markets, more specifically the power markets, they are quite literally charging ahead on gas, aren't they? dani: it is really remarkable. we saw natural gas prices surge to a fresh seven-year high on the u.s. that added momentum to a rally

that has been fueled by escalating concerns about those tight winter supplies. manus: indeed and it comes as brent tops $80 a barrel. demand may be running ahead of supply, depleting the inventories amid a global energy crunch. we are joined by our guest. we are writing about it, i'm reading stories about $100 oil calls being traded. do you think we make it through $100? how dangerous is a ramp and prices like this to the global economy? >> yes, with regard to oil prices, yes the tightness in supply, opec has not been able to lift production to the extent they envisaged. demand has been strong. inventories are really tight. that is really reflected in this move higher in oil prices. still, i think i made this point

before on china, on the regulatory pressure with regard to production in energy intensive areas and industries in the economy. that will start to have an impact on their demand for oil import. we have to watch that. ultimately, we are seeing all of this inflation. whether it is commodity prices, but ultimately how does that get resolved? a way it could get resolved is through demand destruction. we have to watch to what extent it really dampens growth. dani: to what extent do we need to see these prices move or perhaps we are already there that it starts to change the corporate outlook that it hits margin pressures enough to change how we approach companies this earnings season? >> absolutely. coming up to earnings season, expectations are still high. it is below 50% year on year.

-- 15% year on year. we have headquarters where earnings have beaten expectations by a large margin, much higher than has been historically thanks to some basic facts. -- base effects. whether it is common -- commentary coming through, we are seeing the impact of some of the later shortages and also various other supply chain distortions starting to impact earnings. pricing power, the extent to which companies can count on these higher prices to companies will be a bigger differentiator going forward. it will be an idiosyncratic driver. manus: it is whether you can make your price rises stick. i've yet to live through a world where the price lived up and collapsed back down. i live in a different universe. goldman sachs, zero, nada, down to zero in china in terms of

growth. i would be worried. are you? >> yes, we expect our own forecast suggest that we get close to zero in the third quarter because we've got quite high growth in the think part of the reason are those production cuts. part of the reason to crackdown on real estate, even outside of evergrande, there has been a shift in mood with regard to access in the sector and restraining that sector in many ways. indirect and direct effects on property and the consumption sector. that will have ripple effects through to the global economy. we would be concerned about that. i would agree with goldman sachs on that one. i would be concerned about the impact on the global economy. dani: i'm afraid we are going to have to leave it there on a very

somber note. manus, just want to mention, hong kong asking banks to report exposure to troubled evergrande. giving banks 24 hours to report their exposure. this is bloomb (announcer) if you've struggled to lose weight, you might think you were born with a slow metabolism, but what you may have is insulin resistance. fat becomes trapped inside your body and it becomes very difficult to lose weight. now there's golo. golo works to reverse the effects of insulin resistance, increase metabolic efficiency,

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>> good morning from bloomberg's european headquarters. 6:30 a.m. in the city of london yet i am dani burger. manus cranny alongside me. this is "bloomberg daybreak: europe." here's what you need to know. the global energy crunch continues. two year yields hit an 18 month high and the five-year tops 1% as fed officials signal the tapir taper is coming soon.

towel and yell testify later today. kaplan and rosengrant quit. -- powell and yellen testify later today. kaplan and rosengrant quit. it is all about this move in yields. nominal five year yields up about 1%. 30's above 2%. all of this happening off the back of some said speak. is this just the beginning of a more hawkish central bank that is moving markets in this direction or is this the extent to which we will see yields spike? manus: look, i think what you see here is the bond vigilantes being given a little bit of rum stake at the moment. powell talks about rising inflation. john authers, wonderful piece this morning. it is time to watch the bond markets more closely. 151 on bonds. 2%, they say it irks the equity

market. 1.8 percent by the end of the year. you have hedging. the girls go these rates are rising. i have to do something. i have to switch my hedges. that is my inner emotional bond narrative speaking rather than anything else but it is about hedging. there is a confluence of issues coming to play in a re-price. >> looks, anytime there is a spike in yields, we have to talk about hedging. we have to get wonky but i would just pointed to the fact that this rally or rather this rise in yields is also happening globally so that might manage the attractiveness of u.s. paper as well. manus: i go back to robin brooks 's tweet where she talks about a fast taper. he is in a much smarter camp, i would say and has seen a few

tapirs in his time. equities are not sure what to do. commodity markets are ripping it up. brent up over $80 as we go into the opec world outlook. morgan stanley want to get more defensive on the equity story. do not get caught up in last week's strong rebound. you have five year paper above 1%. 10 year paper at 150. where does that become a problem? these energy markets are perhaps the tailwagging the bond dislocation dog. natural gas up 11% in one trading session yesterday and the army are going to come to the rescue apparently in the fourth quarter. >> i feel like we have to stick with the commodities story. it's not just gas and oil. it is also soft commodities. rivers too low for barges to cross.

fire season getting underway in a bone dry forest, happening days or weeks apart and all in one country. that country, brazil. as one of the most important reducers of agricultural commodities, the disruptions have the potential to cause food inflation and supply bottlenecks across the globe and it is the subject in today's bloomberg big cake. joining us now is our agricultural reporter. painted the picture for us. how bad has it been in brazil? >> you really hit the nail on the head. it has been a grim year for agriculture in brazil. the drought is the worst in the century and you have these devastating wildfires and if that has not been enough, they have episodes of frost which wiped out crops like coffee. at the moment, roughly the size of the farmland hit by the weather maladies is the size of

the whole of peru so it's been a bit of a triple whammy. in terms of coffee crops alone, the output is predicted to be down by 20% or 30%, as much as 1.3 billion pounds. manus: how does this play out? welcome to the show. in terms of the rest of the world? my daily brew? >> it's not good news. i'm sorry to tell you. the cost of beans has soared 30% over a six day stretch. orange juice is up as well and sugar. we are heading into soybean in corn planting as well and these are major commodities that feed into food prices and we have seen a huge spike, a huge surge in international food inflation. this year alone, the year-end

index has jumped 33% over the last year and ultimately, emerging markets do bear the brunt of most of this at a time of worsening financial hardship across the world because of the pandemic so it is not looking good at the consumer and business level. the big companies like starbucks and nestle have rushed to secure supplies but the upheaval is so big that it is likely to roil the market for some years to come. manus: sybilla gross with the big take this morning. let's get to our guests now. judith, you have been to brazil a couple of times this year. the headline of one of our stories, scorched, frozen, and dried out. how tight, how really tight is the supply side and what will it endure? let's start with coffee. good morning. >> good morning. so the situation is as bad as it

seems. the reality is that frost has occurred in brazil in the past. the last was in 1994. you have also had droughts on occasion. the largest drought was in 1985, but now, we have had frost, drought, fires, all within one season so it has just been one calamity after the next for the largest producer in the world and certainly, that has effect prices. it is likely to continue to do so for the foreseeable future. >> good morning to you. i know you are in panama. not to be doom and gloom about it, but you know, climate change is obviously having an impact here. in terms of where things go from here on out, is it just going to be more of the same? >> well, there are other factors

here in terms of climate change. one of the biggest problems has been the reduction in the amazon and as a result, you have increased tendency to have droughts. this is the very first time that you have had not one decent coffee production and by drought but a second one and this produces both the -- both varieties of coffee and this is the first time that you have seen two crops punished to such a degree. ever in the history of brazil. >> judith, i am just looking back at your career and one name that stands out and brings back memories of trading orange juice and the liquidity or the lack there of. i worked at lehmans and i traded all kinds of stocks through them in those days.

a lack of depth in these commodities markets, it's a misrepresentation of the supply side or am i misreading the situation? >> in the coffee market, it is similar, one of the most traded commodities behind oil. in the orange juice market, unfortunately, you have had a severe decline in global production because of disease and hurricane damage in florida and there has not been the recovery. part of that is because consumers stopped drinking as much orange juice as they did before so you do not have that hedging that is taking place in the marketplace to provide the liquidity and as a result, you do not have the commercial players and you don't have the

speculative players on the others. >> also talk to us about how some of the supply chain woes and bottlenecks are in this as well. is this also an issue for corporate who are already facing these higher costs and lower supplied? >> in the case of the coffee market, it is fairly extreme right now so you have a situation where brazil has already sharply reduced their export volumes compared to prior years. some of that is being blamed on logistical issues and the lack of containers in that country and that is slowing shipments, but at the same time, i don't think the coffee exists. i have been to brazil three times in the past eight months and i'm going back to brazil in two weeks to get boots on the ground to see exactly what is going on but when you look at the cooperatives and the delivery into the cooperatives

this year, you find one truck, two trucks, a traffic jam, usually. last year, there was lineups. it just is not there because of the reduction in the supply and last year following a record crop in brazil, really now going on two seasons ago, you had a situation where the stocks were exported rapidly to take advantage of higher currency rates. the brazilian real at that time paid the price for export very attractive and strong consumer demand in brazil. so brazil is facing a situation where their own domestic stocks have been depleted and in the past, when you have had a product in brazil, they had mountains of coffee available for export.

and now, they do not. so you not only have reduced crop. you have to say where is the stock sitting to cover market demand? >> all right, judith, thank you so much for getting up early for us. good luck and safe travels for your weeks to brazil. that is the chief resident of a consulting company. first word news with juliette saly. juliette: hello. the leader of germany's centerleft social democrats is calling on partners to join him in a new government as soon as possible. he called on them to back a coalition. the candidate for angela merkel's cdu says he is still trying to forge a majority but a key ally says that cannot happen after his second-place finish. u.k. has officially put the military on standby to help deliver supplies to petrol stations in an effort to stem the widening crisis.

it is the latest emergency measure after supply chain disruptions that have drained petrol pumps and emptied some supermarket shelves. panic buying has seen fuel supplies run dry at numerous sites around the country. and easy maker is set to go public through a spac deal, giving it an enterprise valuation of $20 billion. the company plans to spend $1 billion bringing three new models to market within the next three years. volvo announced separately that it will invest up to $600 million more, giving it close to a 50% polling. facebook has halted plans for a special instagram platform for kids under 13 after critics said it would be harmful. the social media giant had said children were currently lying about their age to join instagram. it argued that a designated site with age-appropriate policies and no ads would be safer. facebook says it has not abandoned the idea but it is

taking time to consult with parents and experts. global news, 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg. manus. manus: thank you very much. coming up on the show, the energy crisis in europe may spell trouble for the rest of the planet. francine lacqua discusses the price of power with the ceo of octopus at nine: 30 a.m. london time on bloomberg to ev, twitter, and youtube. -- bloomberg tv, twitter, and youtube. this is bloomberg. ♪

manus: it's "bloomberg daybreak: europe." i am manus cranny in dubai. the boston fed chief and robert

kaplan separately announced their plans to step down. rosengrant is citing concerns -- health concerns and leaves at the end of this month. >> these sudden announcements, after revelations of stock trading during the pandemic. the departures remove two of the more hawkish officials at a time when the fed is babbling a tapering so timing is key here. let's get into it with our bloomberg economics columnist in singapore. thank you so much for joining us this morning. rosengrant and kaplan out. how much, if at all, does this make in terms of a difference for policy over the short to medium? >> over the short to medium-term, i think that taper is more locked in. when people say soon, that is fed speak for the next meeting. both the chair, the vice chair,

all the boards of governors and a majority of the district presidents throw their weight behind it, barring an unforeseen upset that is likely to happen in november. who rotates in and out as a result of the kaplan and rosengrant exits may make a difference in some of the communication issues at the margin but i am inclined to think it is only at the margin. >> so that was where it gets going. you are almost challenging your inner cpi, but will the board of governors use this as a chance to reign in, as you say, the air into district banks? they might disagree with that description. they probably would disagree. they would say they are part of the checks and balances but i think you are right. officials at the board of governors in bc have long viewed some of these strict bank presidents as quite tiresome.

who will rid us of these rebellious promises? neither was instinctive. rosengrant has dissented to the upside and the downside and kaplan is nowhere near as big as his predecessor was. >> all of this is happening and made a spike in treasury yields. you have the tenure at 150 and this perception or narrative starting to develop that the fed has turned more hawkish in the past few days, is that a fair assessment of what is happening? >> i don't think that they have turned more hawkish in the past few days. i see this as consistent with the message emerging from the fomc decision last week, which is that we are, to all intents and purposes, tapering in november with a look to wrap up

the taper by the middle of next year, a quicker taper than 2013, 2014. manus: we had a whole bunch of people tell me that that is not going to make a blind bit of difference. you have been through the odd taper, as have i and i would tend to aggressive -- disagree with that. the fomc press conference, transitory. six times in march, nine times in april, two times in april, six times in july. how many times did they mention transitory in september? >> zero. they might have used another preferred word like temporary. >> as long as it starts with 18. that's all we care about. manus: transitory, temporary, and tantrum. great to have you with us. a very measured perspective on the resignation. coming up, we will discuss the potential for coalitions. the german elections. they have decided, but not

quite. this is bloomberg. ♪

dani: it is "bloomberg daybreak: europe." i am dani burger in london. manus cranny in dubai. olaf scholz of the social democrats has claimed a narrow victory after sunday's election. he is appealing to the greens and the pro free democrats to back a coalition. let's bring in maria tadeo to discuss more. maria, the ftp have been telling us about how they are one of the potential kingmakers here. hopefully, we have a little bit more clarity. do we know which way that they are leaning now? maria: you know, and that is still very much a question in germany and berlin this morning but i would say over the past 24 hours, we have gotten more clarity in

terms of the way things would go from here. olaf scholz made it very clear that he will trigger talks that he feels he is the one who has a mandate. he also cemented that lead over the cdu and says he wants to see the government take shape before christmas so he has already put a date on it. he also heard and this is very interesting, that the liberal democrats in germany are already in talks with the greens to get to a common agenda before they go to olaf scholz. you see this coalition is gaining momentum. yesterday night, a poll came out that showed 56% of germans believe that olaf scholz should be the next chancellor for germany. he does carry a lot of momentum and that is the reason why the social democrats in germany are very keen on getting the ball rolling quickly. they want to run on this momentum and hopefully get this government done before the end of the year. manus: interesting. we had thomas klein from the

german marshall fund and he just may be said 75 percent of the german population voted for neither of these people so if you think of it in that way, who has a mandate? you will get home for christmas given those odds, maria? so do they have a chance? maria: it has been so provable -- brutal for him. he is being attacked from everyone, this idea that he presented on sunday that he also has a mandate and wants to go for it, now really being attacked from all sides. we did have this poll yesterday. only 11% of germans believe he is legitimate to form a government. he is facing a lot of internal criticism. a lot of members of the cdu coming out and saying he should take responsibility for that result. this was the worst showing since the second world war for the union and again, something that

caught my eye is that this is the most read newspaper in germany, usually very close to the cdu, and it has been so ruthless. they keep repeating that he looks like a wounded soldier, walking around without a clear plan and in that decision, he should not leave germany. so again, that momentum is quickly disappearing. manus: once the media start hacking at attacking, you know, it there's no bother shouting. maria, thank you very much. enjoy berlin, following the outcome of the general election. opec will have their world outlook. that is a little bit later on today. the ecb picked kicks off the form on central banks with president christine lagarde giving an introductory speech. jay powell and janet yellen on banking and urban and housing affairs. >> you also have the riksbank

governor speaking on the economic outlook and then later, the u.s. secretary. coming up next, the european open. francine lacqua and tom mackenzie will walk you through it. that is it for us here. this is bloomberg. ♪ baaam. internet that doesn't miss a beat.

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francine: morning, everyone pill welcome to." i am francine -- welcome to "bloomberg markets: european open." i am francine alongside tom mackenzie. embarrassing revelations of their stock trading during the pandemic. treasuries spike. two year yields hit an 18 month high as the five-year tops 1% and fed officials signaled the taper is coming soon.