haidi: good morning and welcome to "bloomberg daybreak: australia." >> good evening from bloomberg's world headquarters in new york. top stories. the united nations is set to

hold an emergency session on ukraine after president putin puts its nuclear forces on higher alert. haidi: initial penalties failed to persuade putin to withdraw. vonnie: traders brace for further turmoil. haidi: it is really about seeing the further reaction when it comes to the added sanctions which included added sanctions targeting russian entities including the central bank and removing access to the swift system by some local lenders. this is how we are shaping up. we are seeing some boy and sentiment -- buoyant sentiment. again of over -- a gain of over 2%. we are also seeing the move and it comes to bond yields.

aussie yields dropping. we are seeing the 10 year fault six basis points and the three year moving seven basis points to just under 1.3%. take a look at fx. that is where we have seen the interesting play. dollar-yen has only rebounded around 0.3% after dropping zero point 6%. this could be a case of the dollar becoming a main haven player versus an improvement in sentiment. the euro continues to slide against the dollar. the swiss franc as well as the yen to a new intraday low. router concerns about the economic recovery for europe. these currencies including the kiwi, the loonie against that cohort. also looking ahead to what lies

in store for the crude market. downward pressure and it comes to crude but we are hearing from opec plus delegates saying the situation when it comes to ukraine, russia, the disruption to the energy markets does not change their outlook. they say it is a matter for geopolitics and it does not fundamentally change the supply-demand situation. we continue to watch the asset classes as they continue -- asset classes as they continue to react. officials from the ukraine to meet with officials from russia near the belarus border. we have already heard from the ukrainian president that he does not have much optimism when it comes to the latest round of diplomacy but any attempt to try to restore peace will be welcomed at this point. vonnie: the new sanctions targeting swift banks access. it can be expanded.

will it be expanded to include energy transactions? it is the five banks already targeted last week but it can be expanded bank by bank. it is the targeting of the russian central bank assets that may cause much more of a crippling of the financial system and the russian economy. if the russian central bank does not have access to its assets, it does not have much to do with its failing banks. let's bring in larry from washington, d.c. for the latest. it looks like there is a coalition of allies on board with the swift and central-bank action and a lot more. >> i think you are right. before the invasion, the u.s. and its allies said it would -- there would be very strict sanctions if putin invaded ukraine. now that it has happened, there

is genuine outrage and a sense of helplessness because the u.s. and its allies cannot intervene directly militarily against a nuclear armed russia. the sanctions being talked about including some that were considered, the nuclear option before going after the russian participation for some of its patrons in the swift system. there really is a move afoot to pile on here. and as you mentioned, in the past, there have been sanctions against central banks of iran, north korea but never on the size of russia's economy and it central-bank. haidi: you have mentioned the stronger sanctions came into force because the previous ones had no impact. are we likely to expect this to move the needle at all?

larry: we will find out. in terms of swift, we have to find out which banks are barred from the system, that is allowed international trade and there is an effort to figure out if there is some way to exempt energy transactions because they don't want to damage the economies of europe and even the u.s. any more than necessary by restricting too strongly russia's energy exports. you have these sanctions, there is a piling on and there seems to be more coming and there is also the fine print which has not yet been defined. i does one thing to watch. and i agree with your analysis at the russian central bank is probably the big shocker here. haidi: great to have you. let's take a look at markets and

how asia wakes up to the developments. we are seeing some pretty good gains when it comes to futures at the moment. >> hello. we have but given the developments since friday, it is very hard to see how stocks in asia will actually make the gains that futures are indicating. we need to look at the bond market of australia and new zealand. we have seen a flight to safety with yields dropping quite sharply in those markets. treasuries won't open for another hour. treasuries were fairly steady in the u.s. but what we are seeing in asia right now with the bonds and with the currencies suggests that probably there will be more

of a risk off day in equities. the other assets to watch will be the ruble. we are seeing also some indication that there could be emerging market contagion. you have the rand, the turkish lira down sharply this morning. and treasuries are going to be interesting to watch because we have a flatter yield curve. there is a suggestion that investors are concerned about a further slowdown in growth and increasing inflation and that is where the treasury markets are torn between those. it is going to be an interesting day. at this point it looks like the risk off sentiment will continue. vonnie: the euro weaker by more than 1% and it is early in the trading week for that to be happening. you mentioned the lira down 1.7

percent. there could be big moves in currency markets. the ruble will get whacked more than it has been already. what can the russian economy with stand -- with stand in terms of currency appreciation? andreea: that is right. i think one of the biggest things we have to look for is the impact of russia's most liquid and biggest dollar debt. those bonds were down by a quarter last week and i think with what we are seeing with the sanctions on the central bank, freezing the access to cash buffers to russia, the cut in the credit rating to junk, and

crimping the access to global markets will be one of the major things investors will be looking for. it is worth noting a blackrock capital group, some of the largest russian debt holders come what will the impact be on them? investors are also watching whether russia will be able to meet some of the payments for its ability to service its debt. those will be some of the main things that are going to be featured in markets this week and definitely something investors will want to see. haidi: look at the bond markets. look at what we are seeing when it comes to the 10 year yield dropping 10 basis points. dropping down to 2.13%. and kiwi bonds as well. it reflects potentially what we

see when we start to see treasury yields open. we have seen the treasury curve flattening over geopolitical concerns as well as what the fed will do next and the potential for the risk of recession. the australian 10 year yield dropping further. as the haven bid continues. let's get over to paul allen in sydney with the first word headlines. paul: global governments remain reluctant to sanction russian energy for now however, eu officials are set to convene on monday to discuss a u.s. proposal for a coordinated release of emergency oil reserves. member states are divided over whether the block should take part. the u.k. is also considering reserves. opec-plus could stick with its plan to only gradually increase oil production when it meets this week even after russia's

invasion of ukraine sent prices surging. several delegates have said the price jumped does not reflect the supply-demand imbalance and the group should add crude as planned. they meet wednesday to do serve -- to decide production targets for april. more than 26,000 new cases were recorded in hong kong on sunday and 83 deaths. the city is adopting an online reporting system for residents who would be allowed to isolate at home if they have no or mild symptoms. hospitals will also help covid positive patients. fully vaccinated passengers will no longer need isolate though they will still need to take a pcr test upon arrival and isolate until they have a results. official said the program will start in mid-march but it could be brought forward if the virus numbers improve next week.

the goal is to lift all requirements by april. 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. i am paul allen. this is bloomberg. vonnie: more analysis on the war in your crane -- in ukraine who says nato's credibility is on the line. we will discuss what is in store for markets with medley global markets advisors, ben emons. this is bloomberg. ♪

>> we are confident that the

measures we have taken will very, very seriously weaken the russian economy. >> the sanctions will not target the oil flows going forward. >> what we need from president biden and the western democracies is much more urgent and deeper financial sanctions. >> sanctions that will hurt us now but will protect us from the bigger sanctions if putin thinks we are weak and begins to enter on the borders of nato. >> the baltics should be very concerned they are next. >> vladimir putin is starting with ukraine but this is not the end goal. >> if it does not end with ukraine and democracy in ukraine, everyone else will be involved later anyway. vonnie: some of our guests reacting to the were in ukraine. the russian invasion will continue to dominate the

headlines in the week ahead. resident biden dilip -- president biden delivers his first state of the union address on tuesday. economists are skeptical congress can do much to cool price pressures. jerome powell will likely -- a strong jobs report on friday will further strengthen that case. opec-plus ministers will be weighing all of those same risks when they meet to discuss strategy after crude storage past $100 a barrel last week. haidi: a jampacked week ahead on the ego front in asia as well. standing pat on tuesday after ending its bond purchase program. and we have china's manufacturing pmi's sagging in february. the official gauge is expected

to fall into contraction. there is an array of topics we will be monitoring out of that parliamentary pageantry from covid strategy to crack down targets and the war in ukraine could also be a topic with beijing urging russia to hold talks. those are the major events in the week ahead. the decision to exclude -- exclude various russian lenders to the swift system could result in missed payments. credit suisse says it could also spur monetary authorities to reactivate daily operations to supply the market with dollars. let's talk about all of this with ben emons. you have taken a sanguine approach to this and part of that has been because there has not been the full menu of sanctions. with the developments over the weekend, is there greater caution that we could be heading for that full menu? ben: i think we are making

record progress. earlier, the white house press secretary did mention energy sanctions are on the table. they are looking to use that on top of swift. this weekend. i think the market has to digest the next stage of the crisis. you can see what i think indicates that the markets will be quite risk off at open. you shut off banks from the swift system in russia. [indiscernible] that is an uncertainty that overhangs once again. not as severe as march 2020. it will certainly be a risk. haidi: what do you recommend in

terms of being able to find safety in a portfolio or even opportunity at this point? ben: i do think crises offer opportunity. you could think about putting cash into treasuries with yen or gold, traditional safe havens. fair enough, they have worked over the last few days. but if you think about what is happening, the demand for materials like copper and energy is only going to increase because the big risk of the crisis will be an energy disruption. and it will also affect food and other global commodities. there is a focus on different commodities including energy. it will be interesting to see how the energy markets open on monday in europe. you're going to get a relative

value. u.s. energy companies will do initially better than european companies. vonnie: norway's fund selling out of russia as well. i wanted to mention that reuters is reporting the russian central bank has ordered markets players to reject foreign clients bids to sell russian securities from 4:00 a.m. greenwich mean time. the russian central bank ordering market players to reject foreign plans bids to sell russian securities. this is the beginning of something. what happens next in terms of russian securities and people trying to get them out of russia? ben: if you reject any type of selling, the liquidity evaporates and the russian debt markets and it will also have an

effect on emerging markets. this is the point made over the weekend. the dollars are being reactivated. you can expect those to be down to cents on the dollar. [indiscernible] it is not going to be a very pretty opening. when you put sanctions on each other, you reduce liquidity in markets and that is what we will experience. vonnie: where will we see secondary impacts? what markets will be on the receiving end of this? and how long will it take the russian economy to be crippled? ben: on the receiving end, there will be a flight to safety. the treasury market could benefit from this but the

russian economy is already being crippled. just shutting off the entire airspace. you are turning off banks from the swift system and you will have more companies doing cell sanctioning -- sell sanctioning. there will be an ongoing spillover affect from each side. and the russian economy will freeze. it is an accelerated process. vonnie: reports that the ruble is being traded privately for about 100 to the u.s. dollar right now. i believe you said this is the eighth crisis in your career. hard to believe. ben emons. you can get more on ukraine and other stories you need to know to get your day going in today's edition of daybreak. terminal subscribers can go to dayb or you can customize

your settings so you only get news on the industries and assets care about. this is bloomberg. ♪

vonnie: a quick check of the latest headlines. bp has moved to dump it shares with russian oil. taking a financial hit. bp has been in russia for three decades and weeks ago was staunchly defending its presence there. however, it came under growing pressure. bp is roughly -- roughly has a 20% stake in rosneft. according to sources, the move sent the oil giant rushing to line up a new financial institution to keep its russian oppositions. operations going.

berkshire hathaway reported an 11% rise in fourth-quarter earnings topping off a year that saw profit more than double. net earnings attributable to shareholders was just shy of $40 million. the chairman said there is little that excites us in the current investment climate. sources tell us asian insurer fwd backed by richard lee is close to filing an ipo in the city. we are told the company may try to raise about $1 billion in a share sale and filing could be lodged as early as monday. taking a look at the day ahead. haidi: the second-biggest pension fund, the australian retirement trust wants to merge with other funds as it looks to double its assets to 500 million

aussie dollars. this according to the financial times. we are also expecting australian sales -- retail sales for january and a couple of hours and a print of switching wireless carriers is easy with xfinity. just lean on our helpful switch squad to help you save with xfinity mobile. they can help break up with your current carrier for you and transfer your info to your new phone. giving you a fast and easy experience that can save you hundreds a year on your wireless bill. visit your nearest xfinity store and see how the switch squad can help you switch and save. switch to xfinity mobile and get connected to the most reliable 5g network. talk with our helpful switch squad at your local xfinity store today.

>> under this package rush banks will be excluded from the swift system. we will also ban the transactions of russia's central bank and prevent all efforts from financing's war and target russian oligarchs. grexit went to take every step to maximize cons winters were prudent while minimizing impacts on the global community.

haidi: so the key voices on sanctions against russia, and vladimir putin has put nuclear forces on high alert in the face of a barrage of western reprisals for the invasion of ukraine. >> dear colleagues, you see that not only are the western countries engaged in unfriendly actions toward our country in the economic field, i am talking illegitimate sanctions everyone knows about well. top nato member countries officials allow them -- allow aggressive stages what our country as well. i'm ordering staff to switch forces into hilar mode. haidi: our next guest says the campaign is likely to continue. matthew suffolk specializes in russian and foreign security policy. great to have you with us.

i refer back to the incredible speech gave last week. -- putin gave last week. what happens after he is successful in doing what he wants with ukraine? >> i think it has become increasingly clear that the types of aims putin had for ukraine were completely different than he said. the russian state media is full of claims the only reason this limited strike is going on is to protect people in the donbas region, but with the encirclement in kyiv, assault and attacks by special forces in all of ukraine, it is quite clear he wants way more than that, and just this morning it

was revealed an article was published loading -- lauding the great victory russia had achieved over ukraine. that was immediately pulled, but it was obviously something that was precooked that was intended to show off what putin's aims are. it may be he does not end up there. the course of the war in ukraine is not going well, and he has ratcheted up the nuclear saber rattling. haidi: does this change the responsibility of nato even though ukraine is not a member of nato? does it change the obligation of western allies if democracy in europe is what is at stake? >> i think what the european nations have done, but nato has

more brightly done is effectively tried to cripple the russian economy with sanctions. it is suggested it will provide aid to ukraine, including fighter jets. none of this puts one nato boot on ukrainian soil, which was one of putin's redlines. he then has to go to nuclear saber rattling. realistically capitals in europe and washington, d.c. will see this as an attempt of brinkmanship by putting to trade on fear and threaten western publics with something they have not faced in years, the threat of nuclear annihilation. vonnie: in some ways it has been

such a strange innovation. how much do we actually know about russian positions at where they are mobilized and will there be more of a mobilization of ground troops? >> russia surprisingly has not been able to take any of the large ukrainian cities. i think initially they have attempted to protect infrastructure and certainly protect civilians as well by using light troops and jumping ahead in order to take over things like airfields and force zelensky to flee. that has not worked at all. the unfortunate part of this is it means the option open to prudent -- putin is something more familiar to the russian playbook and that is using unguided, indiscriminate strikes

to level populations and destroy morale in order to win. vonnie: we know that vladimir putin himself is not all that concerned with spending or money. at the same time the sanctions put in place and will continue to be drift upon russia are going to hurt is oligarchs, his company and his economy. how long can he hold out before he has to cede? >> emotionally russia has $6 billion worth of u.s. sovereign bonds. theoretically that could keep russia going for one year. however, it is also the case that not all of that money is in russia or friendly nations or neutral nations.

70% is in g7 countries, therefore it is very vulnerable to asset freezes. the fact that russia's central bank has also been sanctioned is important, given that is where a lot of the oligarchs' wealth and putin's personal wealth is sitting. haidi: the united states failed with its security goals in europe and asia. >> i think this is a security test for nato more broadly. the u.s. has in the past tended to view russia as a problem it wishes would go away. putin has now made the question of how the west treats russia front and center, and if it does not respond in a way that reassures nato allies in europe,

then it will say an awful lot to the countries it is attempting to court in asia, which are not necessarily as tight as the nato alliance so it is extremely important for u.s. credibility worldwide. vonnie: matthew sussex, thank you for joining us today. the events on the ground, the u.n. is reporting 360,000 people have fled ukraine into poland and other neighboring countries in the wake of the invasion. a journalist drove more than 24 hours to slovakia's border, where she and her daughter found long lines of others waiting to cross. >> the women with a lot of kids and luggage, that they were trying to reach the border the

whole night. they wanted to reach the border. they were passing the border. the cars were moving one car, two cars per hour. we reached the border. i was standing in line and one man asked to take his daughter with me. any man cannot reach the border. i took the girl with a beautiful dog and my daughter and she became a friend. we are helping each other. [indiscernible] it was so great to see women

wake up and begin to prepare food, tea, coffee. we are not tired. we are exhausted really. we are reaching the border by foot. all of those lines were only with women and kids. we left our houses, i left my father and mom and brother. they are hearing the alarms a few hours per day. it is awful, it is a disaster really. they are hiding themselves in a

bunker the last three days. they are very frightened, really. for the first time in my life i feel like i am a real refugee. it is awful, it is an awful feeling. i hope ukrainians will stay safe. haidi: a freelance journalist detailing her escape from ukraine. let's take a look at fx numbers, so much price action when it comes to repricing the risk of the moves within that swift story, emerging-market currencies limping on the australian bonds surging. when it comes to dollar yen trading we are seeing a stable dynamic, but a lot of traders saying potentially this is more about the u.s. dollar as a potential haven trade as opposed to any risk on sentiment. the yen trading against other currencies and seeing that climb continue. when it comes to the euro, down

over 1%, not just the dollar but also the frank and the yen getting close on border concerns for the european economy. currencies are doing poor as well, aussie dollar down just under $.72 u.s., weakness in the kiwi as well. taking a look at emerging markets, we continue to see some of the weakness continuing to play through. we will continue to monitor the impact of the ruble already trading at a record low, but it is in focus as we continue to monitor contagion concerns around the rest of asia as well. let's get you first world news. paul: russia's plans for ukraine are facing rapidly rising costs as it resistance on the ground. the military would have for

faster progress. u.s. officials seek moscow as only having committed two thirds of a sustainable firepower so far. the kremlin as not commenting on details of the operation. ukraine is said to hold talks on the nation's border with belarus. president zelensky says the meeting will take place with no conditions and belarus has made security guarantees to ensure the safety of the ukrainian delegation. he said he must explore every chance for peace. sources say the eu as approved banning all transactions with russia's central bank. the move is part of an effort to isolate moscow's economy and financial system. in a worse case scenario if the bank would lose access to much of its $640 billion of reserves except its gold and chinese yuan holdings. the eu as a great to send $500

million of military aid to ukraine for lethal weapons. it will come from the bloc's peacetime facility. a chief says the package may include supplying fighter jets to the ukrainian air force. member states can abstain. global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. i am paul allen. haidi: -- vonnie: thank you. commodities are headed for a -- week. how it will affect flows of energy, metals, and costs. details ahead. this is bloomberg. ♪

haidi: time no for morning calls ahead of the asian trading day and the chance for a crisis with russian banks has increased according to bloomberg economics. they now see risks for the deeper dive a directed economy and bigger spillovers to the rest of the world if president clinton -- president putin retaliates. a spike of uncertainty also can drink investment. vonnie: economy surveyed by

bloomberg abroad for their expectations on some central banks in southeast asia and will raise their benchmark rate is a battle inflation. media estimates show expectations of hikes in indonesia in the third quarter and a 50 basis point raise by another central bank in the fourth quarter. prices were key commodities have been surging after russia's invasion of ukraine adding further upward pressure. let's look at those prices. bitcoin was below the $8,000, up 8% but down in general in terms of sentiment the last week. new york crude down $1.22, but brent up 105 per barrel. it closed at 97.93. we will be looking very closely at the european natural gas opening, 456, and primary

aluminum trading and london as well also lower. we will see if those direction moves continued into the beginning of the week, it is hard to imagine that they would not. haidi: staying with commodities, the week ahead is expected to bring more volatility, opec+ continuing to meet, iran nuclear talks continuing in the u.s. planning for oil reserves. >> big focus on where it goes from here, it has come back from the 100 level but i'm manic week expected for all commodities. as mentioned the market will first and foremost be watching reaction to how these new sanctions impact russia and commodities. they affect the flow of energy, metals, and crops and out the market reacts is a big event. we have the opec was meeting wednesday as mentioned. the question is will take change their course of moderate monthly

output increases, a 400,000 barrel per day increase or will they do something different now that we have the ukraine-russian situation that is most aggressive? analysts believe they will stay the course. there was a view it was fear and anxiety and the geopolitics that push prices above 100. brent surged above 105 before paring it against. there was a view it is not fundamentals or supply demand quotient witching prices higher. british oil firm bp announcing its plan to exit it stake in the firm and it will take 25 billion to do that, they are joining the campaign to isolate russia's

economy, so a strong message there and that is one of the many factors that will be in the mix impacting commodities. haidi: we are seeing inflationary pressures stoped not just for oil, across the breadth of commodities. >> let's start with gas and go to the bloomberg once again, the majority of gas we get from russia. this bike last week. there is news it may go higher with new sanctions. everything as mentioned from wheat to corn, gold is spiking higher, all of those in the last two weeks have had terrific gains. wheat by the way is that a 13 year high and russia is one of the biggest producers. back to you. haidi: su keenan with the latest. coming up next we take a look at

berkshire hathaway recording -- reporting arise in fourth-quarter earnings. we have got all of the details ahead. this is bloomberg. ♪

haidi: warren buffett's berkshire hathaway reported a rise in with what earnings jumping of the year that saw

profits double. the conglomerate as messed $150 billion of domestic infrastructure assets. for more let's bring in our finance reported. -- reporter. >> last year it was dropped that greg abel would be his successor. every investor as their eyes peeled to get a sense of timing for the transition. what we did not give specifics when buffett would hand over the reins, greg abel wrote about sustainability. this is a question that has become more dominant at berkshire over the years because of their huge energy operations as well as other businesses and

it will be a question the next ceo has to contend with. it seem to be happy that they got to hear from greg abel a little bit. one of the huge topics he will have two face. vonnie: there is so much focus on sharing purchases. why so much focus these days? >> if you read the letter you would get a hint, buffett admitting there really is not much for him to buy. part of that is they need a big deal to supercharge berkshire hathaway's growth. many assets including publicly traded stocks they like to snap up. they said there is little interest there. you had a huge push dedicated to share repurchases. buffett is leaning into this in one major way that he can put money to work for shareholders'

returns a little bit. he bought a record amount last year, $27 billion and it has increase the portion of what they own it berkshire, and there is a sense even in a landscape devoid of major acquisitions, no exciting new stock purchases berkshire can put some of their stockpile the work. vonnie: thank you so much, catherine. a check of business flash headlines. toshiba's ceo says he cannot support taking the japanese conglomerate private even as activist investors called for a reopening of talks. he thinks there are too many risks and says a split of the two companies is still the best plan. a meeting is set for next month to review operations. a bank backed by a hong kong

billionaire is close to filing ipo after u.s.-china tensions derailed plans for an overseas listing. those are your business flash headlines. more next. that is it for "bloomberg daybreak: australia." this is bloomberg. ♪

>> complicated uncertain task -- taxes pushed most countries in need of cheap labor towards china, costing the economy an estimated $140 billion a year. >> they have been saying they are open to the rest of the world but there are still a lot of barriers to doing business with india. >> to reach the goal of being a $5 trillion economy by 2025 india needs to create a model where it succeeds both at home and abroad.

>> good morning. in sydney we are counting down to asia's market open. >> i'm vonnie quinn in new york. the union -- you in general assembly holds an emergency session of our russia's invasion of ukraine. >>