♪ shery: welcome to "daybreak: asia. haidi: we are counting down to asia's major market opens. wall street has its worst two-day selloff in over a year with volatility spiking as the u.s. confirms one case of the omicron virus strain. jay powell warns of the risks of persistent inflation but says the fed's will adapt. we speak exclusively to the

cleveland president, loretta mester. and china is looking to close a loophole used by tech firms for for foreign ipo's. shery: let's get you straight to south korea. cpi just crossing. we are seeing a faster pace of inflation on the consumer side than expected. 3.7% is that you're on your number, beating expectations and -- 3.7 is that year on year number, beating expectations. a month, poor -- .4% inflation. the core number two point 5%, still higher than expectations. that is the highest since december 20 11. price pressures are really just mounting.

we have seen the bank of korea changing their tone and the way they talk about inflation and tight, and that certainly is not going to change given that we will continue to see these ongoing supply bottlenecks. shery: we will see what happens with the omicron variant. we did get that impact in third-quarter gdp numbers. we are getting final numbers, which came in line with estimates. we are talking quarter on quarter growth of 13%, same as the previous estimate. year on year, 4% growth, same as previous estimates. when we talk about wholesale, retail trade, accommodation, and food services, it was a contraction of .9%. we are hearing that growth will be bound given that restrictions were lifted toward the end of the third quarter, but as we mentioned, what happens with the

omicron variant? already, rumors of governments postponing the second stage of returns to normal life. haidi: and when it comes to markets, omicron is still weighing pretty heavily. this is what we see at the start of trading that is upsetting trading sessions starting here in sydney. we are seeing some downside, as expected. we are also seeing some downward pressure when it comes to new zealand. make a future -- nikkei futures looking a little more positive. the u.s. having a horrible session on the back of the u.s. confirming the omicron variant had arrived there as well. let's take a look at what we are expecting and what is the latest news when it comes to talking about the variant, right? more countries reporting their first cases.

south africa in the meantime seeing its daily number of cases almost double. the u.s. national economic council director says it is still hard to assess how the new variant will change things. take a listen. >> it is too early to know precisely the impact economically. we need to learn more about the transmissibility and severity of this variant. haidi: let's get more from our san francisco bureau chief. we're hearing messed mandates in the u.s. could extended until march and also the restrictions and measures coming through. there really is difficulty in making these measures when there is so much we don't know still. >> exactly. policymakers are trying the best they can to not spread panic and remind everybody it is still early days and we don't know

about and really getting a clear message across that the best way to fight this is to get vaccinated and they are trained to get more people out to do that. shery: what is the message we are getting from different government agencies around the world, not to mention drugmakers, when it comes to the omicron variant? >> it is sort of mixed messages. we had markets fall after the moderna ceo said he expects he will need a new form of vaccine, but the world health organization came out and said they expect the vaccine to have some impact and at least eliminate severe disease, again, urging people not to panic, but it is just very early days. the south african scientist came out today with a note of caution saying this is still primarily in young people, so they might have milder cases then we would

see in older people. shery: all of this factoring into monetary policy. jay powell hammering home that the fed will do what it must keep inflation in chest, and it is time to consider tapering -- the fed will do what it must to keep inflation in check. >> he wants the fed to consider speeding up the taper path, and this is directly tied to inflation, and he is concerned that the fed could let it get out of control if it does not start moving. let's listen to what he said. >> i would say the inflation we are seeing is still connected to pandemic-related factors. i would also add, though, that it has spread more broadly in the economy, and i think the risk of persistent higher

inflation has clearly risen. kathleen: not only that, he did say the fed will use all of its tools to make sure inflation does not become entrenched. very important that fed chair powell also said that the information coming in over the next couple of weeks, it is going to give them a lot more information on how the economy is doing, omicron as well. when it comes to the economy, we got a couple of big pieces of information that kind of underscore strength of the economy that powell was talking about. for example, the fed's beige book, the anecdotal economic surveys from their 12 districts, said pricing pressures are widespread across each of the 12 , and wages are rising. more than 500,000 jobs, more

than 500,000 expected, so it is a good number. those are the kinds of numbers that will give the fed all the more reason to consider that taper seriously when they meet in a couple of weeks. haidi: we will have much more with that exclusive interview with the cleveland fed president, loretta mester, shortly. stay with us. this is bloomberg. ♪

kathleen: we would like to welcome you and our bloomberg radio listeners around the world for our next interview. we are joined by the president of the federal reserve bank of cleveland to discuss the economy , inflation, the path forward for the economy. i want to start with fed chair powell. two days of testimony to congress made it clear he is definitely ready to discuss speeding up the fed taper. are you ready to discuss it? is it something you will be in

favor of? ms. messer: going into the september meeting, i thought there was a strong case for tapering at a faster pace than what we had actually announced, and since i saw the data come in, i am even more supportive of the case. all with a focus of achieving our goal of more employment. i'm certainly open to discussing it. kathleen: what do you need to see then? are you like, i need to see little confirmations to make sure you're making the right decision? is there something doubtful about making the case and saying yes, go ahead, to do that taper? ms. mr. -- ms. mester: i think the new issue is the risk of

omicron, and, frankly, we just don't have enough information yet. we need the health care scientists to tell us more about if this is a variant that will be like delta, or if vaccinations actually work against it, or if it will be a different kind of mutation or variant that would be much more clear and spread more quickly. i have not changed my outlook. the economy is just coming in very strong, and if the omicron variant turns out to be like delta, one thing we have learned over time is that with each new variant, there's problems with dissemination and activity, but each time, it is less. the economy has learned with how to cope with the uptick in cases and the down takes, and we have

had a higher vaccination rate over time as well. it will really depend on what the real risk is, but in terms of the underlying economy, there's a lot of momentum. firms are trying to persevere in the wake of labor market supply issues -- labor market, supply issues. they have been able to cope with it so far, but that has put upward pressure on prices, and it is important for the fed to do what it can to ensure that those pandemic-related price increases don't become more persistent. kathleen: you read my mind. two months ago, you said the upside risks of inflation outweigh the downside. there is a risk that this becomes entrenched. does this become now the bigger risk to the economy which would

again justify and necessitate a faster taper and speeding up so you can get to rate hikes quicker if you need them? ms. mester: i think speeding up the taper means we are in a position to look where we are and hike if we have to buy next year. with the incoming data, the momentum, and the last thing of the supply chain issues, i think it will be higher than i would like to see it in the first half of the year, and we are just having to wait and see how things play out. omicron may delay things, the supply chain issues may take longer to resolve, so those are the types of things we have to see going forward, but

quickening the taper puts us in a better positioning -- better position to have that optionality if indeed we need to use it. kathleen: a month ago, you said rate hikes were still a long way off. would you say that today? ms. mester: for a while, i've been thinking about we need to have a rate hike next year toward the end of the year, but with data the way it is on the job market as strong as it is in many dimensions, i think we have to be in a position that if we need to raise rates a couple of times next year, we are able to do that, so again, quickening the tapering gives us that optionality. we are going to have to observe what is going on, but one thing i would like to say is the act to quicken the tapering is not a tightening monetary policy, and even the first rate hike, monetary policy, whenever that

comes, monetary policy will still be very accommodative. sometimes i think people think if we change the pace of the tapering, we are tightening policy, and that is not -- that is just not the case. kathleen: how about the risk of falling behind the curve? a lot of economists ink the fed already has. ms. mester: i think there is a risk to the upside of inflation, but a lot of things we have done with inflation have been related to the pandemic. the risk of it persisting longer and leading to something more persistent in the underlying inflation rate is there, and that's why i think we need to provide that insurance against it. we certainly are going to do all we can with the tools we have two make sure we are going to sustainably achieve our goal over time and not allow inflation to be higher than we would like it to be. haidi: visit heidi here in

sydney. i'm just wondering, i'm very curious about the references to the supply chain and how the fed underestimated the pressures in the supply chain on the logistics side. how do you think this happened, given the availability of data and the anecdotal evidence we have heard from companies? i'm curious to what you have been hearing from people that speak to you, businesses and others weighing in, as to how it is affecting them. ms. mester: i would say the views of businesses have changed over time as well. even before the pandemic, it was part of the information we used it to make policy decisions, but they early on thought they early on thought the supply chain issues would ease up relatively quickly, so we were basing some of our interpretation of what was happening from the

information we were getting from businesses dealing with those issues. as the pandemic lingered, a lot of those supply chain issues were exacerbated and lingered longer than they thought, so they even extended their time dimension around the supply chain issues as well. on the other hand, one thing i think is striking about this whole pandemic situation is that firms are learning to cope with it and figuring out different ways, dealing with some of those daunting tasks, so there is a sense of there is some resiliency, and that's why i think activity has stayed strong despite all the problems businesses are facing because of the pandemic, and i think that is something we have to take on board, too, that the economy has been -- given how big a shock this was, no one anticipated how

well that has been able to come back. now we just have to make sure we are doing all we can to keep the economy on solid ground and make sure that inflation does not get out of hand and become endemic and also make sure we are supporting the economy as it gets back to a more normal pace after the pandemic is more under control. haidi: i would like to bring on my colleague, shery ahn. she's dying to ask you a question as well. shery: i was wondering what you thought about the functioning in the treasury market. in the past, you have talked about fixing some structural issues present. now with a faster taper, that could potentially open the option of a hike faster as well. will you have the leeway to also

carry out those improvements? ms. mester: the markets will be able to handle that. we are not talking about something that would swamp the markets. but your point is well taken. it was surprising to many people, including me and my other colleagues at the fed, how stress they are under. usually they see people going into the treasury markets as a safe haven. again, i don't think that a safer pace or what would be on

the horizon for monetary policy, really, it is going to affect that work at all. >> you did see you could see the possibility of a couple of rate hikes next year. with inflation doing what it is doing, a lot of people think it may not get quickly back to 2%, and with the labor market looking tight, labor shortages may be keeping unemployment rates from not getting to that pre-pandemic level, jay powell in fact, mentioned that in his testimony. why would there be any hesitancy to raise rates, at least a couple of times next year when you have the key rate at zero at a time when the economy is strong and there's no doubt you met your inflation mandate? >> we look at both of our goals and had to make that assessment and wait and see how the economy is going to fall, but i take your point in the sense of at the moment, we were just talking

about today, what it looks like very strong labor markets and very strong inflation numbers, but two things to remember, what policy works to the last, so you want to have some policy idea going forward. i think the first step is really quickening that taper, which i think is appropriate, and then we can look at being in that position to start raising rates if it turns out that the inflation numbers don't come back down this year as many forecasters say in the second half of next year, we should see inflation coming down. kathleen: quick follow on being open to the taper, many economists suggest the fed should double the size of the taper so it can wrap it up by

march instead of june. would you be in favor of this? ms. mester: we will have to see what the appropriate stage is. for in the first quarter or maybe the second quarter, right now, i would support that. we will know in two weeks more about omicron, and we can talk about what the appropriate pace is. kathleen: i want to shine a spotlight on the cleveland fed's simple policy rule gauge. it came out today. it looks at seven policy rules and looks at where the funds rate should be based on the state of the economy and on three economic forecasts. it signals that the funds rate, the median projection would be that it should be something like 2.7% at the end of this year and 3.5% by the end of next year.

how are we supposed to understand that, and what does that say to you? ms. mester: i do like to look at rules because they are a good summary of what policy reactions have been in the past and, you know, they are based on when you had actually pretty good policy, so if you use that as a gauge, you can get pretty good insight. the pandemic and what has happened in the economy is very, very different than earlier, right? i think we have to use that information, but i would not necessarily -- not necessarily, i do not ascribe to the fact that we should use those rules in particular to guide our decisions today. i think this is a very different situation than we have ever faced in the past. i think the fed has been i think

very good about facing this situation we have and being resilient about if the data change or outlooks changed, we are using our tools in the most appropriate way, so i think that is the path we have to do going forward, so in the past, i always like to be a little more not changing policy aggressively one meaning to another. i think the nature of this event and this situation calls for being more agile than perhaps what i would have argued in the past. it is just the nature of what we are facing. kathleen: i would like to bring haidi stroud-watts back in for another question if you don't mind. haidi: this is the seasonal

question we have to ask every year, but i suppose more this year. what are the risks you see going into 2022? i know it is difficult to predict given the curveballs we have been thrown so far. ms. mester: it is inflation. we want to make sure we are positioning our policy so that inflation does not, you know, move in a direction that is persistently high. right now, i think we are in a good position, but i think that is probably the biggest risk going forward. and we want to make sure that our policy is supporting getting back to maximum employment. the two goals, usually they are coincident, right? this is a case where perhaps the inflation number is too high and

we will have to take some action. there's a lot of evidence that labor markets are very strong. i think that is going to be something that is -- that is tricky going for -- going forward for us. kathleen: thank you very much for joining us. this year is going to be an exciting one for the fed and everybody else looking ahead. ms. mester: thank you for having me and thank you for engaging in a great discussion. kathleen: thank you, too. haidi: the statement added there's no discussions. we will be watching when hong kong markets resume trading on

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shery: let's check on the market action no. we are joined by market live editor garfield rentals. we just heard from the cleveland fed president loretta mester saying we should be able to height rakes -- hike rates a couple of times in 2022 if need be. what i found interesting was despite the hawkish pivot from chair powell, we did not see a huge market reaction across asia. garfield: one, i'm not sure we

did not seek a huge reaction. it is more that this is part of a complex picture building up. we will certainly see a strong reaction today in asian stocks. we have already seen strong reaction from australian bond yields. we have actually got this potentially concerning mix where the omicron variant is raising concerns about a weaker global outlook, but at the same time, the fed is making very clear it is going to push ahead fast for tapering. it will be biased toward higher rates because of inflation concerns, and it does not see the omicron variant as necessarily helping it out on the inflation front. it could even worsen matters by increasing supply constraints, so we've got potentially higher rates from the u.s. along with potentially slower growth worldwide. that's not a particularly good

outlook for risk assets. shery: i know that you said we did not see a huge reaction, but what i was referring to was we did not really see equity markets plunge like we were expecting or like what we saw in the u.s. session after chair powell's comments. we actually saw asia rising. where will we see the impact of faster tapering and in fact faster hikes if we do see one across asia? >> the main impact has been flat or yield curves -- flatter yield curves and increasing bond opportunities. asian markets have something of an advantage in that they have in lagging for much of this year because of china concerns, apart from anything else, so they perhaps have had a little more scope to bounce back more readily than u.s. equities and also european equities.

at the moment, too, in asia, of course, the spread of the existing variant has not been strong. we have had europe facing a very strong outbreak still of the delta variant leading to the potential for lockdowns there. asia has escaped much of that, and that helps explain equity relative resilience. haidi: haidi: let's take a listen to what president mester had to say. ms. mester: the data have come in supportive of the case, so i'm very open to considering a faster pace of tapering. haidi: when it comes to the outlook for 2022, that big risk remains, inflation.

>> it is almost a relief for asia if the fed is going to tighten. you know, there is the potential for some disruptions if they are tightening faster than the fed. i think a key point for asia so far has been an issue created by the omicron variant. the u.s. has lost a lot of its mojo. at the end of november, the fix in london saw a very strong dollar move up, which was almost immediately unwound, but traders are wary of holding on dollar positions. that again is good for asia because a strong dollar has usually led to week equities. if that mix of omicron and powell uncertainty continues to

undermine the u.s. dollar, that is something that could change if payrolls come in really strongly. until we get that strong dollar move, we might well get a relative sweet spot for equities globally when it comes to asia. shery: china said to be closing a loophole. these variable interest entities, what do we know about how they use -- how they are being used at how potentially they will not be allowed to be used? nine stephen: they have been used for years. almost every big tech company listed abroad and even in hong kong uses avi e structure, and more recently and much to the scorn of chinese regulators, vd

global uses it, so if this even plays out in the securities regulator is going to ban their use, it will have significant ramifications. this is a very lucrative line of business, raising ipo's in new york for these chinese companies. a little bit of the luster has worn off as some say this has been a decoupling between china and the united states. this essentially could be another step in that potential decoupling. very quickly, a v.i.e. allows these tech companies which are classified a sensitive sector because data security is national security in china, so they use these structures to essentially sidestep chinese regulations that prevent foreign ownership in these sensitive

sectors. they incorporate and find a way to list in the united states with foreign investors participating. this could choke that off. the big question is would it force existing vip structure companies to revamp their existing structure, and if it is a highly sensitive company in a highly sensitive industry, would they be forced to delist? shery: what would that mean for hong kong listings? we have seen those homecoming ipo's. stephen: that could absolutely accelerate the homecoming of shares to hong kong. what our reporting has found -- and again, this has not been confirmed by chinese regulators. chinese regulators, when they were asked about this, report that this could happen -- they essentially said not true, but again, where there is smoke,

there is fire, obviously, and we stand by bloomberg's reporting, but sources have told us that hong kong listings -- listings with avi e structure would still be allowed in hong kong. that is significant. however, they would still have to go through data security and other regulatory reviews, but regulators according to our sources would not choke off v.i.e.-structured listings in hong kong. haidi: -- shery: our chief asia correspondent stephen engle watching those for us. let's get to vonnie quinn for first word news. vonnie: a campaign to blame covert on china -- the swiss

embassy in beijing says there is no swiss citizen by that name. china and the u.s. are reportedly preparing for a phone meeting next month for top military officials amid rising tensions for taiwan. beijing and washington have discussed talks. arms control may be among the main topics. the first confirmed u.s. case of the omicron coronavirus variant has been detected in california. the cdc says the patient is a san francisco resident who had traveled from south africa, was fully vaccinated, and has mild symptoms. the new cases have been detected in 20 territories. south africa caret -- south african cases have doubled in one day to more than 8000. fed chair jay powell has reinforced his message that the u.s. central bank will keep inflation in check, saying that

officials should consider speeding up withdrawal of policy support. he said that inflation has been more persistent and that policy will continue to adapt to that. 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. shery: coming up, a ceo joins us with her long-term investment outlook. this is bloomberg. ♪

shery: our next guest runs an asia-focused investment house. it has 150 members with collective investable assets of $150 trillion. she joins us from hong kong. great to have you with us. throughout the pandemic, let me start by asking the last couple of years has really characterized the investment strategy that the group has taken. >> i think we have changed our focus to tech and concepts that

fit humanity. electric vehicles, clean energy. shery: in terms of your clientele, have they changed their areas of focus and what their priorities are in terms of the way longer-term wealth is managed? >> i think it is important to think about how their fortunes have changed. the interest rate environment has pretty much mended all their assets significantly. families that were in retail, hospitality, travel, trading, i think they have had a pretty hard time, but i think if you were in technology or food, perhaps as a family, you have done really well.

if you look at southeast asia, india, as well as china, india alone has produced 41 unicorns. shery: you are talking about mostly in tech, right? how is digitalization affecting these families and how they operate? >> i think it fundamentally changes how family offices look at their investment strategies. if you look at the next generation of family members now coming into play, what they are really doing is filing family investments in two key areas. firstly, they are looking to organize food technology, their own operating businesses. secondly, they are looking to the entire transformation

creeping across asia and not just asia, i would say globally. if you look at asia itself, the lives of people are changing. some amazing things are happening, so i think that is something investments will be focused on. shery: when it comes to going digital, as you say, how much does it help that we are seeing this intergenerational shift across asia as well? >> if you just think of numbers, $2.5 trillion is the amount of assets that wealthy asians will transfer over the next 10 years, so that is a significant impact in how we think about investment, right? i think the great intergenerational transfer of power has begun. i think it is also going to sweep through very quickly india, japan, and other parts of

asia. i believe it is forcing a lot of older generation patriarchs to really think about family office struts, right? that is where they are putting all their money. essentially locking in the pot of gold and throwing away the key. haidi: with that changing demographic of wealth, does that also change the diversification aspect? is there more interest in things like crypto? >> yes, i think in ft's are all the rage. some have been early movers and done reasonably well.

on crypto, is it real, is it not real? i think there is a slow and steady move certainly in that direction. haidi: you mentioned investments really in things that will make the world better in the future. tell us more about impact investing and what concrete shape that takes across asia. >> yeah, as i said earlier, a whole lot of things are changing in asia. health care, education, it is all being transformed by digitalization. i feel that creates a huge amount of impact, so i think just because they have the luxury, they are free to tailor

their portfolios. shery: thank you so much for joining us. coming up next, a look at the top supply chain stories from around the world as president biden works to reassure americans ahead of the holiday season. this is bloomberg. ♪

>> this is a worldwide challenge, a natural byproduct of an economy shut down for months. prices are still out of sync as the world comes back. shery: we are tracking the fallout of the global supply chain crunch. these are the top stories today. president biden said his administration's work has begun to alleviate supply chain disruptions and that higher inflation is a natural byproduct . the head of the port of long beach says the record movement through the port is likely to be the new normal.

british columbia, home to canada's biggest port, bracing for a daily after extensive flooding damage has cap goods like lumber from reaching the port, threatening to raise commodity costs further. but ending on positive news as we read is it asia factory gauges, outside china, pmi data stabilizing last month, putting the region's export heavy economy to face possible challenges from the omicron variant. dated through wednesday shows strong readings with india, vietnam, and japan posting highest readings in many months. bloomberg terminal users can read more about those stories in our newsletter, "supply lines." haidi: that's got a quick check of the latest business flash headlines this hour.

cfo paul jacobson says sales have been strong. gm has been able to mitigate mass production caused by the chip shortage. he says the semiconductor crunch has stabilized but does not expect a normal infantry level until at least 2023. disney has named board member susan arnold as its next chairman. she will succeed bob iger, who stepped down last year. arnold has been on the company board for 14 years and has served as independent lead director since 2014. unicredit is planning around 3000 more job cuts, doubling down on profit after an error of restructuring. sources tell bloomberg many of the cuts will come from the italian lender's corporate center. it is up to focus more on look at of products.

shery: we are counting down to the start of trading. south korea has confirmed its first case of the omicron variant in five people. it is introducing a mandatory 10-day quarantine for incoming travelers from friday. also, we had eco-data out today for november. consumer inflation prices coming in at the highest in the past decade. also gdp came in in line with estimates from the advanced numbers, a gain of .3% quarter on quarter. over in japan, economic data including the monetary base and consumer confidence for november as well. we are also watching japanese airlines. after halting new inbound bookings this month following a government request. also, reports that fujifilm will spend 530 million dollars on expanding its u.k. pharmaceuticals plant, its biggest investment there in

decades. fujifilm manufacturers' active ingredients for the vaccine developed by novavax. haidi: consumers continue to process information on the omicron variant and high rates ahead. you are looking at the newest trends and options as markets try and mostly fail at scaling this global worry. david: so far. so far. hopefully it does not remain that way for very long. you have two charts you are looking at here. for one, you have this spike in news coverage and information out there, and ironically, a lot of that information still is incomplete, which is why you are getting also this preference, and we are looking at three months in five in terms of the key options market on the japanese yen. i'm going to make it very simple

-- 36,000 stories on the number of omicron, compared to at its peak, about 20,000 for delta. essentially, what you are looking up from about a week ago, you really see the spike in at a lot of these corresponding smile -- corresponding styles across the options market. we are trading virtually at about seven-week lows on dollar-again. we will see where we go from here. couple of functions to tell you about. back to you. haidi: bloomberg markets anchor david ingles. coming up, we take a look at the latest on the omicron variant. shery:, audrey from standard

chartered's wealth management group is here. markets open in tokyo next. this is bloomberg. ♪

shery: welcome to "daybreak: asia." i'm shery ahn. haidi: i'm haidi stroud-watts in sydney. major markets have just opened for trade. fx stocks set to follow lower opening concerns about the omicron strain. tapering stressing vigilance on inflation. a bloomberg scoop. >> i thought there was a strong

case for tapering and a faster pace than what we had announced. since that time, the data had come in supportive of the case. i'm open to supporting a faster pace of tapering. haidi: china looking to close a loophole used by tech firms for foreign ipos. shery: take a look at the japan and korea open. broad downside pressure for the nikkei and topix. nikkei led lower by real estate and consumer discretionary stocks. the only sector gaining ground, a little bit of haven play. the japanese yen holding at the 112 level. a little bit of strength against the u.s. dollar -- weakness against the u.s. dollar, but after significant strength given the uncertainty over the omicron variant. not to mention we had seen the turnaround with the japanese. hawkish comments by chair

powell, pushing the yen lower, the focus on yield differentials. omicron fear is bringing it back. we are watching jgb's, because we have the bond being sold by the government. the kospi down at the moment after rebounding in the previous session. the korean won at a high, holding at the level. strong export numbers, really bolstering sentiment. this morning, we had more confirmation about third-quarter gdp rising 3% quarter on quarter. a little bit disappointing, but cpi growing at the fastest pace since december of 2011. really seeing inflationary pressures play out in south korea. haidi: i'm really broad bank downside momentum. australia and new zealand. second straight losses for the asx. just industrials and utilities seeing modest gains. losses coming from the material

sector as well as information, technology, and technology more broadly. the aussie dollar is holding positively, 71 u.s. cents. it could see it hit 70 before stabilization. we will get back to the dollar. we will get more views on that. shery: we saw the roller coaster ride for the greenback, erasing losses following the news of over -- arrival of the omicron variant in the u.s.. reinforcing the hawkish tilt. given the jobs data, the report that without. let's bring in audrey go. great to have you with us. the strength of the greenback so important when it comes to asian assets. with this, perhaps faster tapering, a faster rate hikes, what does it mean for asia? >> i think it means we do see the dollars will be upside in

the near term, given we have seen the revival of the pandemic in europe, which will likely continue to hit downward pressure with the euro and u.s. dollar. on back of asian assets, there will probably be pressure in the near term. a stronger dollar is generally quite negative. raising our flows in emerging markets. and if we look at china, china is going through a softening of economic growth data, on prosperity and the overall asian assets. shery: talking about china, the chinese yuan has been resilient. this chart actually showing how against a basket of -- the current bloomberg index, nearing its highest since inception in some cases. how much of a shelter does it provide for asian assets, especially with a strong dollar on the other side?

>> it does provide relatively in the strong bank or the emerging-market of the asset space. we are also biased to the yuan strength. you see how much it has strengthened against the backdrop of a stronger dollar, there's a question to how much it will continue. something key will you -- something key we will be watching out for. economic growth was slowing in china. and whether the policymakers will ease monetary policy to support some of the downside in growth, and it might also be a risk over the coming quarter. watching the upcoming meeting minutes and so on. haidi: when it comes to the fed

taper question, we spoke in the last hour with loretta messner. take a look at what she had to say. >> i thought there was a strong case for tapering and a faster pace than what we announced. since that time, the data have come in supportive of that case. i'm hoping to consider a faster pace of tapering. haidi: since the fed and jay powell dug their heels in, we have seen that reaction. flattening on expectations of a faster taper. 30's down as well to a level we have not seen since the pandemic hit. as an investor, how do you mitigate the volatility? the used a short duration? -- do you stay short duration? >> we short-term duration, given the strong economic data coming in from the u.s.. and we have also seen in the last fomc minutes where more

members are nonbiased to thinking inflation may not be as transitory as we expect, and not biased to tapering as expected. typically, if we look across history, the first rate hike generally doesn't derail the market value. it will introduce some volatility into equity markets. but the first rate hike, markets can generally digest it. looking at the past few rate cycles since 1983, we find on average, local equities rise about 80%. the rate hike is not the end of the world. let me put it to you that way. haidi: across other asset classes, where do you see opportunities? do you see recovery happening when it comes to the chinese property sector? >> yes, certainly. in the asian u.s. dollar

high-yield bond space where they issue bonds, it is predominant. we do find value opportunities. if you look at the overall credit spread of high-yield bonds, they have risen. it is still above the historical averages. at the same time, also seeing some easing of policies in china. some easing in some of the cities, or property loan issuance. at the same time, you look at the last statement, basically removed a key sentence that highlights -- basically -- they are not looking at stimulus. to us, it probably signals a shift to more accommodative in the coming months ahead. haidi: audrey goh, appreciate your time. let's get you to vonnie quin

with our first word headlines. vonnie: south korea consumer prices rose 3.7 percent, reaching the highest since 2011. it extends the run of inflation gains above the bank of korea's target to an eighth straight month. the decision to raise interest rates. the data reinforce concerns strong price pressures will resist the pent-up demand running up against the time bottleneck. opec and its allies have held the first of two days of meetings to debate a planned output increase. the decision was made, expectations are growing the group will take a pause due to the threats on the new virus variants. experts are now examining forecasts that show oil surplus growing in the first quarter. china plans to ban companies from going to foreign stock markets to variable interest entities. it would cause a loophole long used by the technology industry to raise overseas capital for

the country. it may be finalized as soon as this month. china's market regulators said a media report about the ban is not true without giving further details. the women's tennis association is suspending all tournaments in china, including hong kong, effective immediately. the organization says it is because beijing has failed to quell concerns the tennis star is free and safe. her welfare has been in question since she posted an essay on social media about a month ago accusing a former chinese vice premier of sexual assault. 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 quin, this is bloomberg. haidi: coming up, we speak to an australian medical researcher who says it is far too early to make assumptions about the omicron variant. david anderson joins us later this hour. exclusive interview with the fed

president, loretta messner. she's weighing in on jay powell's market moving comments about a faster withdrawal of policy support. this is bloomberg. ♪

haidi: cleveland's fed president is open to considering a faster taper pace. she spoke exclusively with us a little earlier. >> going into the september meeting, i thought there was a strong case for tapering and faster pace than what we have actually announced. since that time, the data have come in supportive of that case. i'm open to consider a faster pace of tapering. always with a focus on what is best of achieving our goals of price stability and maximum employment, and making sure we are incorporating the data that comes in. we have a couple more weeks before that meeting.

i'm certainly open to discussing it. >> how close are you -- what do you need to see? just a little confirmation to make sure you are making the right decision? is there something you are doubtful about making the case and actually saying go ahead to do that beat of the taper? >> the momentum in the economy is clear. we have seen very strong labor markets, very strong price pressures and high inflationary -- i think the new issue is the risk of omicron. frankly, we don't have information. the health care scientists to tell us more about if it is a variant that will be more like delta, where the vaccinations actually work against it, or if it will be a different kind of mutation or variant that might be much more verlander and spread more quickly, we will have to develop vaccinations for.

that is a risk. the economy is going to coming in very strong. the omicron variant, if it turns out to be like delta, with each new variant there is the activity, that is sure. but the economy has learned and households and businesses have learned how to cope with and cases in the down tick. and we've had a higher vaccination rate over time, as well. it will depend on the real risk. in terms of the underlying economy, there is a lot of momentum. firms are trying to persevere in the wake of labor market supply issues. they have been able to sort with it so far. it is really important for the fed to do what it can to ensure

the pandemic related price increases don't become more persistent. >> you read my mind. i wanted to ask you. two months ago, you said the upside risk on inflation outweighed the downside risk. are you in the camp that says it is not transitory, it becomes entrenched? does it become the bigger risk to the economy, which would justify and necessitate a faster taper speeding up so you can get to rate hikes quicker if you need them? >> i think making the taper faster is definitely buying insurance and optionality so that if inflation doesn't move back down significantly next year, we are in a position to be able to look where we are and hike if we have to.

my base case is inflation will come down. with the incoming data, momentum, and the lasting of the supply chain issues, it will be higher than i would like to see it in the first half of the year. we will have to wait and see how things play out. omicron may delay supply chain can it -- issues, they make take long. we will see where we want to be. but quickening the taper puts us in a better position to have that optionality if we need to use it. >> a month ago, you said rate hikes were "a long way off." would you still say that today? >> for a while, i have been thinking we need a rate hike next year toward the end of the year. with the inflation data the way it is, the job market as strong as it is, in many dimensions, i

think we have to be in a position that if we need to raise rates a couple of times next year, we are able to do that. quickening the tapering gives us that optionality. haidi: loretta mester, president of the federal reserve bank of cleveland. let's get more from kathleen hays. that was a great conversation. we could also see another really official signaling faster taper. what was your take away? kathleen: she is open to it. we showed when she said even in the september meeting she was taking about tapering faster. very interesting. we have seen this as a big change. when you look back at the elf see minutes again from the meeting, i will look and see. but loretta mester was clear -- one of her biggest points was the strong momentum in the economy. there has been this question of inflation rising, but what about

the other part? what about for employment? she was so confident to start doing this. so they have the optionality in case they need to speed up rate hikes. in terms of that, she has been looking for one rate hike, but in the course of the conversation said a couple of rate hikes next year. the omicron variant seems to be the only reason it could slow her decision down about tapering. that is what she is waiting for. my analysis or interpretation would be it will probably have to be bad information about omicron to get the fed officials who want to taper that are considering it. there is more we even realize to not start it in a couple of weeks. haidi: that is kind of the theme we saw from day two of jay powell's testimony.

flexibility and vigilance was the claim. kathleen: everything he has said the last couple of days, inflation is no longer transitory, supply chain constraints and how that hit prices and how they were kept higher and more elevated, he's also talking about a strong economy. he's also talking about data in the next couple of weeks. the door is so wide open. when it comes to omicron, i think one of the most important things powell said in his days of testimony was the situation now, what will happen with omicron, is not remotely comparable to what happened in march of 2020, when everything was crushed. it wasn't the deaths from the coronavirus we mourned, it was the lockdowns, the attempt to prevent it from being worse. it is the first thing officials could think of enough. that is what hurt so many economies around the world.

jay powell, loretta mester, rafael bostick telling us on bloomberg tv they are open and ready to do it. it will be an interesting meeting, certainly from the inside. in three weeks, we will know if they speed it up. haidi: kathleen hays there. the turkish lira tumbling after the president broadly replaced his son as minister amid deepening risk in his administration over interest rate cuts. simone foxman joins us from new york. why was he removed? >> the official gazette where this came out gives very little information, but the underlying message is clear. erdogan is no longer accepting anyone in his government who has a different opinion than him about what to do on interest rates. he has endorsed the idea of

cutting interest rates and excluded folks from the monetary policy committee a month ago or so. it is not a complete surprise he is out. there was speculation about it since the middle of last month, because he was seen as disagreeing with the policy of continuing to cut interest rates, which pushed the lira lower against the u.s. dollar. the new guy is much more in line with erdogan's program. he is said to be close to the minister of finance. until -- came into the role last september. shery: we saw the world bank intervene for the first time in seven years. that was really interesting. it really wasn't the other state owned lender to have done it in the past. but do they have enough reserves to keep at it, given the

relentless plunge in the lira? >> no, analysts do not think they can do it for long. in 2018, they spent 106 he five billion dollars to support the -- 106 he $5 billion to support the lira. they don't think they have the ability to do it again. that is why we are watching the lira going to 13.44 against the u.s. dollar. i think in this absence of sensible policy, erdogan believed higher interest rates breed higher inflation. the focus is really turning to what could potentially happen if erdogan is no longer in power, and how elections will play out by june 2023. but the message until then seems to be expect more rate cuts. erdogan has repeated that over

the last few days. shery: simone foxman with the latest on the lira and turkey. you can get a round up on the stories you need to know in today's edition of daybreak. subscribers go to your terminal. this is bloomberg. ♪

haidi: let's get a quick check of what is moving in tokyo and seoul. we are watching travel stocks falling after japanese carriers have been suspending inbound bookings for all of december. in korea, travel names are also being affected. they have reported their first omicron variant cases in five people. korean air one of the biggest losers. we are seeing some of those tour companies down. korea announcing to implement the 10 day quarantine for two weeks.

watching those japanese airlines. in australia, we are watching after pay. the delay of the vote for $26 billion takeover. it could lift the odds of its failure due to the 23% discount in the 2021 peak. we are also watching after pay on account of the meeting being postponed amid the spanish regulatory approval delay, as well. shery: here is a quick check of the latest business flash headlines. crown resort has opened its books to blackstone after the board said the buyout firm's latest offer doesn't offer compelling values. the casino operator will allow them to access nonpublic information for initial due diligence inquiries. the state added there is no certainty discussions between crown and blackstone will result in a revised proposal. we will be watching sun city's group when markets open thursday after it applies to resume trading. macau's biggest junket operator says he has resigned from his

post as chairman of the board and the chairman affected wednesday. they say they have not been carrying on any of the ip business. up next, omicron reaches the u.s., ireland, and south korea. we will discuss. this is bloo it's another day. and anything could happen. it could be the day you welcome 1,200 guests and all their devices. or it could be the day there's a cyberthreat. only comcast business' secure network solutions give you the power of sd-wan and advanced security integrated on our activecore platform so you can control your network from anywhere, anytime. it's network management redefined. every day in business is a big day. we'll keep you ready for what's next. comcast business powering possibilities.

haidi: we are just getting the latest trade for australia. the trade balance coming in at 11.22 billion australian dollars. a tiny bit of a gain from the previous reading. exports falling 3% from the month earlier. and we saw when it comes to imports, also falling 3%. $11.22 billion trade surplus. this after we saw the australian economy contracting in the previous quarter. less than feared, despite the

impact from the latest rounds of lockdowns. and we do know that tension between china and australia trade relations. some are effective trade exports have been badly hit. turning to the other major risk to the broader economic recovery. including in australia. the omicron variant. researchers are racing to understand the impact of the new variant. the first case in the u.s. confirmed. anthony fauci shooting down a suggestion that there is a public health benefit to allow omicron to spread on reports it is less virelent than delta. the deputy director associate professor david anderson joins us now. great to have you with us. given everything we don't know, dr. fauci has said we have to wait two or three weeks before we get adequate data. what is the smartest and most

practical way of talking about this new variant? >> i think we really need to use the precautionary principle. there is no way we could have enough data in a short time to know whether this variant is slightly less pathogenic, or as some are trying to suggest, may be harmless. there is no way we can know it after a couple of weeks the variant was identified, given severe disease and most hospitalizations are two weeks after infection, anyway. so we cannot say yet whether it is with us, better, or the same as the delta variant. we know it grows faster and seems to spread faster than delta did. and eltel spread a lot faster than the original variant -- delta spread a lot faster than the original variants. we know that the genetic sequence of this virus suggests it may be more resistant to our

current vaccines. if that is the case, and the level of protection of many western countries have achieved pretty good uptick of vaccines, at least in eligible populations. in australia, that is only people about 12 years old. that level of protection may be less if the variant shows reduced susceptibility, particularly to the antibodies from the previous vaccines. haidi: so far, we have seen a hodgepodge of policymakers scrambling to do these protective things, like closing borders to a certain extent, putting in place quarantine measures if they weren't already. president biden considering sending the mast mandate through -- mast mandate through. >> we have been advocating vaccines, plus i'm a member of the group that has been

advocating all along for not relying just on vaccines. even if there isn't a problem with this new variant, vaccines are not the complete answer, even in a country with as high coverage as australia. there are high-risk settings wear masks are appropriate. and if indeed this variant is more resistant to vaccines, more places will require masks. but things like improved -- is extremely important. and people just need to be careful. if the pandemic is not over, if we are lucky, it will get back to just being an epidemic. we are a long way away from this just being an endemic disease. i think the selective travel bans are not the answer, not helpful. in fact, they are harmful. much better to have quarantine.

and you can triage people arriving from different countries with different levels of quarantine. we know south africa is not where the virus emerged. there are now reports there were cases in the netherlands before south africa reported the sequence. south africa does a lot of sequencing. . nearly every one is going to get picked up there. so we should have improved quarantine and a lot of sequencing of the virus is picking up in people arriving from overseas. australia is so far, it has only been found in people newly arrived in quarantines. shery: what does the fact we continue to see so many different variants, we seem to be running out of the greek alphabet at this point. what does it tell us about the need to vaccinate developing nations that don't have these vaccines yet, and what are the implications for boosters in

advanced economies? >> i think it is absolutely essential that we improve vaccination rates in developing countries. that is why we will see a lot of variant shery: cropping up in countries through africa and much of asia. there is either no vaccine or limited dose of vaccine. one vaccine is probably worse in driving selection of vaccine resistant viruses. many have said it is not over for many of us until it is over for all of us. the restriction on the intellectual property, really it has not been possible for local vaccine manufacturers. australia, like many countries, has been really backward in fulfilling even the inadequate promises we made for vaccines. last week, we hit about 12% for

what we promised to give at this time. countries need to step up. we got smallpox by having a global effort to get rid of it everywhere, rather than focusing on vaccine nationalism. that is not the answer. shery: as we speak, we see south korea is reporting a record number of daily covid cases. not to mention, critical patients. we are talking about an economy that has vaccinated more than 70% of its population with one shot. what is a problem, especially on the side of critical patients also rising? >> i can only say, because i don't think we have sequenced data on hospitalized page from korea yet. but the problems in south africa, the epicenter of the omicron spread, their

hospitalization rates have gone up fivefold in a little bit over two weeks from covid. not all of them have been sequenced. but the patients who have been sequenced are 100% omicron. it is fair to say it is causing a spike in hospitalizations. in south africa, that is mostly in unvaccinated people. but if it is break through and making people sick even though they are vaccinated, we know the vaccine is not 100% effective at stopping people getting infected, but highly effective at stopping people getting sick. that is not true with the new very at, we would see much higher rates of hospitalizations of those vulnerable populations. elderly and otherwise compromised people. haidi: i think it was burnett's report that looked at potentially a 10 year vaccination timeline going at the current rate for some

coronations, including the pacific neighbors from australia. is it tenable to get to 2030 and have some of these nations not fully vaccinated? what does it mean for the type of variants and how long the pandemic will be around for all of us? >> it will be around for all of us for as long as it takes us to get higher vaccine coverage around everywhere. we made a global effort, smallpox we made a global effort for polio, global efforts for measles, smallpox is gone. polio is nearly gone. measles, we are struggling to get rid of it completely. we know it is bouncing back a bit with covid interrupting health delivery in much of the world. but this disease has to be classified with things like polio and measles. not with seasonal influenza. because this virus is not going to go away. i don't believe it is going to

come sufficiently mild where we can ignore it, like we do seasonal influenza in populations. and the only way we can do that is to make sure everyone around the world has equitable access to vaccines. and we are a long way away from achieving that. part of it will come from new technology. there are many new vaccines being rolled out. but the technology is somewhat wrapped up in intellectual property. that is the problem. >> stephen anderson, burning institute deputy director. thank you for joining us with the latest on his views on the omicron variant. breaking news at the moment. razor is getting a privatization offer. this is the maker of gaming hardware listed in hong kong. it will be taken private at two hong kong dollars, $.82 per share. this according to hong kong's stock exchange filing. the offer will be financial

advisor credit suisse. we had heard earlier about no potential offer price being determined. finally getting some confirmation that will be taken private at two hong kong dollars, $.82 per share. more to come on "daybreak: asia." this is bloomberg. ♪

vonnie: i'm vonnie quinn with the first word headlines. jay powell said for the second time in two days officials should consider speeding up withdrawal of policy support. the house financial services committee that inflation has become more persistent and policy will continue to adapt. the cleveland fed president told us exclusively she supports that view. >> going into the september meeting, there was a strong case for tapering and faster pace for what we announced. since that time, the data had come in supportive of the case. i'm open to a faster pace of tapering. vonnie: turkey's has abruptly replaced his finance minister as risks deepen over interest rate cuts that have undermined the turkish lira and fueled inflation. -- has been named the new finance minister. erdogan regularly asserts his

unorthodox mantra at high borrowing costs calling inflation rather than curbing it. the u.s. deputy secretary of state will meet eu officials in washington on thursday to discuss a joint approach to an increasingly assertive china. the u.s. and eu china dialogue are looking to find common ground on key issues to make it harder for beijing to ignore those topics. agenda items include technology, human rights, and taiwan, as well as potential areas of cooperation with china. meta has removed a china-based network of more than 500 facebook accounts to push a false narrative about the u.s. government's attempts to blame the covid pandemic on china. it evolved the fake persona of a swiss biologist named wilson edwards, who posed as the u.s. doubling scientist to take the blame on china. the embassy in beijing says there is no citizen by that name. 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 quin, this is bloomberg. shery: china set to be closing a loophole that allowed big tech bunnies to list overseas, such as in new york. for more, let's bring in stephen engle in hong kong. what do we know about these moves? >> this will be the biggest step yet, one of the biggest steps in china crackdown on big tech. it has evolved from a crackdown on anti-competitive behaviors, antitrust, and now more data security and other areas. and to the chinese, data security is national security. as we have looked at this over the year, the structures have been critical for the last two decades for china's big tech companies to list overseas. in particular, the nasdaq through adr. they have a structure that essentially allows chinese firms

to transfer profits to an offshore entity registered in places like the british virgin islands or the cayman islands, with shares foreign investors could own. it allows these companies like alibaba, like cnet.com, like more recently, to sell shares to foreigners and sidestep the investment rules that forbid foreign investment in critical, sensitive areas, like the internet. if china were to cut that off, it would cut off a lucrative line of business for wall street. it would potentially force the companies listed in the united states to either revamp their shareholder structure, delist if it is a particularly sensitive issue, such as dd.com. we have heard companies are already asking didi to look at delisting. where would they go next?

potentially hong kong. haidi: to that point, what does it mean for hong kong as a listing destination given all of these return densities? >> i kind of led you there. that could be a huge boom to a market like hong kong. there's kind of rumblings, not-so-subtle, that beijing would like to see a homecoming of these chinese listed adr's in the u.s. back to hong kong. what is interesting, sources are telling us if it pans out, as the securities regulator in china looks at making this ban in the u.s., their structure would reportedly be allowed in hong kong. however, those companies would still have to go through data security and other regulatory approvals. very importantly, we have heard the securities regulator has posted a statement on its website saying those reports

that it will ban the structure are "not true." obviously, bloomberg sticks by its story, and we will continue to follow this very closely. haidi: of course, stephen engle. coming up next, the sun city saga continues as the company files for a resumption in trade after the chairman of the board resigned from the company. we will bring you the latest. this is bloomberg. ♪

haidi: we are here reporting from the south china morning post. chinese developers to meet with offshore bondholders over the repayment options still available. the developer will be -- owns more than 50% of its u.s. $400 million bond, according to sources. offshore bondholders have offered about $2 million to finance kaiser through seven options. they will be discussing ways of repaying loans, including selling convertible bonds exchanged for shares of hong kong's news corporation. this comes after we heard kaiser bondholders rejected the company's offer into avoiding a default, to extend the majority of the debt and avoid a message of fault potentially next week. this would deepen the crisis at kaiser. -- kaisa.

it has also launched a fire sale of various assets to meet liabilities. they include about $3 billion of dollar donated -- dollar bonds that come to you. they will be set to meet these offshore bondholders over any repayment option. shery: another company we are watching in hong kong, sun city shares set to resume trade in hong kong after the chairman of the board resigned. joining us is our bloomberg reporter. what can we expect? >> we will obviously be closely monitoring the share moves off of sun city. sun city earlier put out a statement saying the chairman and executive director resigned, and the group actually doesn't operate junket businesses in macau. sun city said the company that operates the junket businesses in macau is a company wholly

owned by alvin chow. we will see if this statement can ease investor concerns. when sun city resumed trading on tuesday, the stock plunged 48%. today, i think it is likely the share could fall further. haidi: do we see a broad impact on the december gaming revenue numbers from macau? >> yes, it is likely the december gaming revenue will be affected by his arrest. and the wider implications on the junket business. sun city is macau's largest junket operator. it accounts for 40% of the ip revenue. the ip revenue in turn accounts for one third of macau's gaming revenue. we already saw that in november, the gaming revenue remained little changed from the previous year. in december, more uncertainties, including the junket crackdown,

as well as uncertainties over omicron. so it is very likely we will see gaming revenue in december being greatly impacted. haidi: our reporter shirley zhao. here's a check of the latest business flash headlines. general motors boosted its forecast at expect to learn $14 billion in pretax profits. the cfo said sales have been strong and gm has been able to mitigate loss production caused by the chip shortage. he says the semiconductor crunch has stabilized, but doesn't expect normal inventory until at least 2023. unicredit is planning around 3000 more job cuts as its ceo doubles down on profits after an era of restructuring. many of the cuts will come from the italian lenders corporate center to reduce bureaucracy. also set to boost the current

dividends policy and focus on more lucrative products and i businesses. disney has named susan arnold as the next chairman. she will succeed bob iger, who stepped down last year, and is expected to lead the company later this month. she's been on business boards for 14 years. >> women's tennis association suspending all tournament in china, including hong kong. they say beijing has failed to quell concerns punctuate is free and safe. less get more from our china editor. the wta has threatened to do this, and made good on this. it is significant, given the history of how we have seen sporting associations react when it comes to china. >> that is right. this is the first time we have seen a major sporting organization -- over business. in 2019, the nba apologized over houston rockets manager and

backing hong kong democracy protests. it is a big departure. a courageous move by the wta. it will put a lot of pressure on the league in the lead out of the beijing games. shery: what does it mean for the wta right now? >> it is a huge publicity boost in the short-term for them. they did not have any games in china currently because of covid-19. but to show this sort of a risk. china's response has been muted. but going forward, it could put pressure on players, sponsors with chinese backing to withdraw from the wta. vacancy cyberattacks. china can come back hard at the wta. we have to see how china reacts. shery: jenny marsh there. take a look at stock markets trading right now. broad downside pressure, whether japanese stocks or korean stocks. european futures are down more

than 1.5%. this as asian stocks lose ground, about a quarter percent. we have concerns about the omicron variant, not to mention chair powell's hawkish pivot. "bloomberg markets." china open is next. this is bloomberg. ♪

>> good morning, it is 9:00 a.m. in beijing, shanghai, and hong kong. i'm david ingles with yvonne man counting down to the trade. yvonne: stocks falling, bonds rallying as markets are jolted for the first confirmed u.s. case of omicron. jay powell reiterates a pivot to a faster taper. cleveland's loretta mester tells us the data supports it. >>