haidi: good morning. we are talking down to asia's major market open. shery: the top stories this hour, russia to cutback military operations in northern ukraine, but some analysts say the move may be tactical. haidi: moscow's pledge to desolate triggers optimism on the market.

shery: plans to cushion the impact of inflation as scott morrison looks for a pre-election boost. u.s. futures coming online under pressure this is after the s&p 500 gained ground. apple seeing the longest winning streak since 2003. we had wti losing ground on the expectation we may see a cease fire on ukraine by that pared back losses given that they fail to reach an agreement. wti higher at $105 per barrel. there are expectations of a cease fire and we are seeing most of the losses regained since the invasion of ukraine. another occurrence we are following is the chilean peso. the inflation over in chile is at the fastest since 2008.

we are seeing central banks around the world including the federal reserve starting to hike rates. look at this chart on the bloomberg because we are seeing new treasury space really reflecting those expectations of faster rate hikes, the part of the curve in burning for the first time since 2019. we keep asking ourselves what do curve inventions mean. we had the five 30's -- 530's, but those are brief inversions. it does not happen for a while, that is the box and boom you have seen in this chart. we are watching what is happening on this front as policymakers keep cautioning not to make too much out of this. we even had chair powell say that he only watches the yield curve out to 18 months. we are not seeing any warning

signs there as of yet. the concern is there. we continue to watch inversions just to see where we are headed and historically, the precision has never happened without an inversion -- a recession has never happened without an inversion. haidi: indicators are predictors of a policy misstep. it is going to tell us when the next recession, if the next recession is going to come sooner. we have the former president of the new york federal reserve and he says what the fed has done has made a u.s. recession inevitable. jerome powell said that the inflation monetary framework is not responsibility for the sharp surge we are seeing in consumer prices and he gave the examples of the previous tightening cycles and saying that you could achieve a soft landing. bill dooley says he disagrees

with both of those assertions and that the weight of the fed has set itself up he sees a recession as inevitable. shery: that is being priced in the equity space. we had a boost after we heard from russia as well that they wanted to de-escalate the war on ukraine. we did not get to that cease fire with negotiators still talking about ukraine and aware hope words are. we continue to watch for any time signs -- for any signs of hope. biden saying he will wait and see how russia acts from now on. haidi: let us get more on the ukraine talks and the latest developments. jodi schneider joins us now. jody, where do we stand when it comes to these negotiations? there are concerns that this latest overture from moscow may be tactical.

>> the concern this is more talk then action or hope of action as antony blinken has said. there is what russia says and what russia does. those talks ended with russia indicating that it might allow a pathway to talks between the russian president vladimir putin and the ukrainian president. there are several hurdles even to that. there was no agreement on key measures like a cease fire or a withdrawal of russian troops or the security guarantees that ukraine has been seeking for it to deliver on its concessions that it may move back from certain areas. security guarantees that russia has not discussed. there was a little bit of

movement in the market, the market responded optimistically that there may be, there was nothing significant, no two ways from president biden and antony blinken said that we will see what is delivered. there is a lot of talk but a little movement. haidi: not even a scheduled call for the two sides. what are we seeing in terms of fighting the ukrainian cities? >> there has been a pullback from kyiv. that was already starting. question sent they were pulling back but they have done that as result of not being able to really make headway there. we have seen that. that is nothing new, that does not appear to be a strategic or tactical move, more a response to what is happening. we have continued to see other regions continue to be fighting and also not to be clearing most humanitarian pathways that russia had said it would be willing to clear for refugees to

be able to leave. again, what they are telling us militarily is not something that appears to be a big change. shery: the latest on what is happening in ukraine. let us turn to the yield curve and version this is exciting. a classic signal of impending recession, flashing the red light as the two year note has the top, keeping concerns about federal reserve tightening. kathleen hays is here with more. i was talking about this earlier, there has been a -- there has not been a recession without the inversion of the curve. the question is how long it takes. >> also, the fact that it has proceeded recession so many times. there is a recession since 1950, there was a curve inversion before that. that is why people are watching

this so closely. there are a lot of different versions of the yield curve but this is been the classic signal that fed officials watch. when you can see from the chart, what you see is that in march of 1989 there was an inversion. april 2000, inversion, it was only about six months but it was a recession. november of 2006, recession. that is what followed it. if we go back further in time, we would see some instances of the yield curve and burning and not causing recession. what is different now is how much of the fed is expected to hike rates to get inflation down. right now the markets are pricing in more than 200 basis points of fed rate hikes over six meetings. at least one has to be 50 basis point rate hike. this has been the gradual fed, saying we had to wait so long to get a 25 basis point rate hike. they are going into overdrive.

bill dudley did agree in addition to being a former head of the new york federal reserve, he says because the fed is now behind the curve and they're going to have to take the unemployment rate which is now at 3.8 up to at least 4.3% or more to get rid of inflation, that will cause a recession because it has in the past. let us listen to what he has said on television. >> is ready to tighten in a time that inflation is above the target and the target is 3.8%. the labor market is extreme we tight to it if your going to try to get inflation under control, you will have to push up the unemployment rate. it is almost impossible to avoid a recession at that point. >> a lot of people who are not sword but recession, there is a strong labor market. the economies went to slow down, but to withstand the rate hikes,

that is where we are not going to get rid of the recession. how about the fed using quantitative easing? they have been buying bonds like crazy. that is a restore of the relationship between the markets and the fed. there is some research of people saying that jerome powell looking at different yield curves like the three month yield to the 10 year yield. even so, it has been a strong signal of the past, if you look at things that fed policymakers have said in the past, they watch the yield curve very closely and you know that they are watching this one very closely just as the markets are. haidi: let us take a look at how markets are shaping up, we get this tension between optimism, cautious optimism over these development in ukraine and russia talks and the potential de-escalation. that inversion and whether that

does signal that we are on the precipice of potentially the next recession. new zealand stocks are trading optimistically up by .6% whom the federal budget was delivered last night and broadly met expectations when it comes to market expectations. that is for some of the incentives of how two through the rising prices. the australian 10 year yield a sitting lower, it has been as high as 2.9, we are seeing a little bit of a pullback there when it comes to the 10 year. not so much for the three year, we see some resilience when it comes to those, and watching the job earnings from the finance ministry but still sitting pretty close to 1.23 to the green after the extraordinary period of weakness that we have seen. the dollar showing some resilience, about .75 cents

again. >> president biden is not convinced that russia's announcement to scaled back military advancement will lead to a change in the war. biden said he is waiting to see what russia offers after it talks to ukraine. >> i had a meeting with the heads of state for allies of nato, france, germany, the united states, and great britain. there seems to be consensus that let us see what they have to offer. >> his pick for the federal reserve is one step closer to senate confirmation after two day vote in deadlock in the banking committee. to confirm her and three other nominees to the central bank including jerome powell for a second term as fed chair. cook would be the first black

woman fed opener. a team of u.s. investigators could head to china as soon as this week to unravel why a boeing 737 jet crashed earlier this month. the national transportation safety board since beijing has issued visas for its staff along with the technical advisor for the u.s. federal aviation administration and boeing. the jet nosedived to the ground killing all people on board. global news 24 hours a day, on-air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in over 120 countries. haidi: the australian government has pitched a new proposal at voters for the upcoming election. >> pushing up the cost of living at home. high fuel, food, and shipping costs are increasing inflation and stretching household budgets.

tonight, the morrison government announces a new temporary targeted and responsible cost-of-living package to ease these pressures. haidi: australia is making one of the largest investments in cybersecurity. let us get over to paul allen who joins us from cam brooke. >> the budget deficit for 2022-2023, seven billion trillion dollars forecasted, that does a little bit narrower than expected. that is narrower than the g20 average as well. the revenues are getting a boost from iron or prices, budgets are predicated on the iron ore price of about 55 dollars per ton and over the past year we have seen prices north of that. it is giving the government a little bit of room to move on the cost-of-living issues. you heard the treasurer mentioned some of them. a cost-of-living payment for 6 million australians, a one-off

payment of a tax offset, a howling of the fuel excise to get the -- halfing of the fuel excise. it is due before may 21. the challenge is to have income relief and went some good motors back. -- when some voters back. it is aggravating the problem that they are practice all which is really from rising prices. haidi: we will have more on australia's budget. we will speak to the shadow treasurer for his you on the spending plan and the insights of the upcoming elections. finance minister simon birmingham joins us for the outlook for australia's economy. this is bloomberg.

shery: we are in new york. haidi: and i am in sydney, alan is standing by with the shadow treasurer. >> i am here in the courtyard of

cam book and i'm with the shadow treasurer. it might be the treasurer, he is -- thank you so much for joining us. this year's budget reply speeches even more important than usual for you because it may include some measures that you could be introducing. what would you have in the budget? >> the big gap in the budget if you go beyond the short-term cost-of-living relief which is presented in a hellish in context, it is to be a lagardere plan to grow the economy that does not add to inflationary pressures. the difference in approach is seeing beyond the may election, there is a will for cleaner and cheaper energy, trying to deal with these skill shortages that we have, childcare, advanced manufacturing, there is a range of things we are missing from the budget which are absolutely crucial to our growth prospects going forward. we are attending to that even if

the government is not. >> we want to return to the issues you raised in a moment. the cutting of the fuel excise, and the cost-of-living support payments, these are issues that face australians today. is labor going to vote to support them? >> we will not stand in the way of cost-of-living relief which was made necessary by the fact that the wages are falling in this country, we have the cost-of-living going through the roof and real wages falling. a lot of australians are falling further behind. we will not stand in the way of cost-of-living relief even if it is presented by the government as a short-term election fix. we want to provide that cost-of-living relief. we want to have a plan for the future and that is what is missing. >> providing support without soaking inflation, how do you do it? >> you need to be attuned to what is happening in the budget and the economy. it is possible to invest in the drivers of growth without adding

to those inflationary pressures. the government has some support which we will provide some support for in the parliament. beyond that, we need a plan to grow the economy with stalking that inflation which is punishing so many australian working families. >> what is your plan? >> get the economy growing the right way and make sure that the recovery works for everybody. we have skill shortages that need filling and areas that we need training and the has been an issue over the last decade that has been neglected. we need to get import costs down and people's energy costs down. we are making the workforce figure so people can work more if they want to. we want to modernize the digital economy and improve and modernize digital capacity. we want two invested areas like advanced manufacturing and the care economy so that we can have a future mate in australia, recognizing the pressure that has been put on our supply

chains, seeing how much value we can adhere -- add here. >> on the revenue side, have to pay for this, would you consider raising tax rates for wealthy australians? >> we are interested in the multinational tax fairness agenda that has been promoted by president biden, and others. we look to work with other like-minded countries to make sure that multinational corporations fair their fair share of tax. -- pay up their share of tax. >> we have the budget and deficit. when do you forecast a return to storefronts -- surplus? >> we have deficits as far as the eye can see in the budget. we have got a trillion dollars in debt, not enough to show for the debt we need to make the spending in the budget more

focused on quality, not just quantity to improve the quality of our budget. we have heard you say before that there was a modest improvement in the budget and that is important. commodity prices are a big part of the story there but we have deficits around $80 billion for this year and next year. we have a trillion dollars in debt, people understand there is a need to borrow but we need to be borrowing for more productive purposes. i am not sure of what the government has been. >> i want to circle back to climate policy, south wales is underwater for the second time in a month. what concrete measures are you taking to address the climate? >> we are getting a missions -- emissions down. there is an energy transition underway, we think that we can leverage our traditional strength, particularly in the region to create more jobs and boost investment and grow the

economy by east on cleaner and cheaper energy. the whole world is moving in that direction out of the business community is moving in that direction. the only ones preventing that has been the incumbent government. we want to change that. >> is there some sort of her conciliation with china going to be needed? >> we do not kid ourselves that the relationship has not gotten more complex and difficult to manage. china has become more assertive, if not more aggressive in our region and that has economic consequences. there is a bipartisanship when it comes to managing the complex china relationship, we have a lot of stake there. we have a massive export market for us and we need to manage that ocean ship carefully and in the interest of our exporters and employers. -- relationship carefully and the interest of our exporters

and employers. >> all right. shery: plenty more to come, on daybreak australia. this is bloomberg. ♪

haidi: bank of china reported the biggest puppet increase in almost a decade -- profit increase in almost a decade. income jumped around $34 billion year on year. china construction bank also reported a 12% jump in estimates . two more of china's big banks report today. intensifying competition with

rival bytedance, sales jumped 35% for the three months in december, almost $4 billion. active users grew by 41%, time spent per person climbed a >> wef

of the peace. >> and do not think it is a major surprise for the bond market. >> we have a lot of inflection to deal with and allow monetary tightening. -- and a lot of monetary tightening. >> it is perplexing that markets are reacting to this as strongly as they are. >> do not think president putin has changed his goals.

>> we need a sustainable peace and not the original piece. >> it will take a wild to sort out what -- it will take a while to sort that out. haidi: only two words to cause a breakup from the volatile trading, cease fire. with us is the senior portfolio manager at crede investments. where are you expecting the biggest upset out of the war in ukraine? >> the areas i think would benefit the most would be in the international markets and in the european union. we like the spider euro 50 stocks, their global companies that are based in the eu and

they would benefit from a stronger euro versus the u.s. dollar in a post-covid and post-ukraine conflict world. and they are trading at about a 33% discount to the s&p 500. we think that is a very wide gap and one that people should start building positions in. >> what is cease fire offset the damage being done by the yield curve and versions that we continue to have from time to time and the expectations that a recession may be coming soon? >> the yield curve envision needs to be sustained -- inversion needs to be sustained before it is a predictor of anything. along with the u.s. and the eu, the emerging markets are all poised to have earnings revisions higher once you get that cease fire, once people believe there is something of substance there.

who will have volatility in the stock and bond market. we think that progression will lead to those earnings revisions and in the emerging markets, if we look at the spider etf, you do not see that the traits have about 11.2 times the board pay. -- the forward p. we think it will get to demand and the commodities and the coming resurgence. haidi: what is your exposure to international, continuing the strength of the u.s. dollar having an impact? this is bloomberg. he so simple back -- >> we saw some pullback against

the euro today. we some pullback in some of the other major emerging markets currencies against the dollar. that is strengthening against the u.s. dollar. i believe we really need the global economy to go back to its growth plan post-covid once we have a real cease fire for long-term investors, i would not wait for all of the eyes to be daunted. -- i's to be dotted. shery: yield curve inversion is very top of mine at the moment, what else are you looking at as the biggest risk to the resilience we are seeing in stock markets? >> some of the biggest risks are that the russians are just

playing the ukrainians and the rest of us while they rebuild their military positions, of course something, there is a lack of trust currently. i think if the market truly believed that we were going into a permanent cease fire, marcus would have been a much stronger today. -- markets would have been much stronger today. another risk we have is the ongoing supply shortages due to covid. we have seen that comeback in china and singapore has been shut down, protesting. if we do not have those supply operations going, the rest of the global markets really can take off. shery: always great to have you with us.

we have an update when it comes to evergrande, a heavily indebted chinese developer announcing the disposal of its interest in the crystal city project. we continue to see ways that they try to pay overdue bills and dues. we have seen the dispose of the interest in the crystal city project at the cost of 1.66 billion yuan. we are seeing that this agreement which been struck, we are seeing the transfer of evergrande's interest in the grand city project to other buyers. we have seen evergrande try to offload some of its other assets to be able to pay back on dues and keep other development on course as well. we heard they were planning to sell a property project in china

to the provincial government to get proceeds for overdue payables to other construction investment groups as the restructuring of the property relative or continues amid all of the debt issues. the former new york debt -- fed president says jerome powell is too optimistic about engineering a soft landing for the u.s. economy. a recession is all but in evitable, he spoke with berg's david -- he spoke with bloomberg's david westin. >> the unemployment rate is low at 3.8%, the labor market is extremely tight. if your going to try to get inflation under control, you have to push up the unemployment rate. it is almost impossible to avoid a recession at that point. they will try to stretch this out for as long as they can but i think at the end of the day, it will be difficult for them to

pull this off. history is not kind in this situation. >> as you just said, the fed waited too long. i wonder if it is because of the famous framework. you talk about that and you say that the fed's application of the framework and they have to rolet here, it is behind the curve in controlling inflation and has made a hard landing in evitable -- inevitable. does he need to admit that the rumor was a mistake? every time he refuses to admit that the framework was a mistake. >> i do not think it was a mistake in the sense that they change their objective to 2% inflation on average. the problem is how they operationalize that. if you recall, with the fittest said is we are now to raise short-term interest rates until we see 2% inflation, we are confident that inflation will be

over 2% and we have also reached full employment. we are basically at 0% interest rate in a time when the economy was going for it, for at least a neutral monetary policy of not a tight monetary policy. there is a big gap of where we are and where we need to be. the fed has changed dramatically. we are low longer talking about -- we are no longer talking about lowering rates, we are talking about how long until we hit neutral. >> how long until we tip into a recession? how can we make it shorter and more shallow? are there things we can do to make a not quite as painful or as long? >> we hope inflation goes down a lot because some of the statutory factors which have pushed inflation to reverse themselves over the next year. i do not think used-car prices

are going to go up. there's something written about the original story that a good portion of these pressures were transitory. the problem is that inflation has been high enough or long enough it is now getting into wages. when we have wage trends of 5% or more, that is not consistent with 2% inflation which is why the fed has to generate more slang in the labor market. best case scenario, a year from now, inflation will be at 4% instead of 5%. in that case, the fed can be gentle because the 3% inflation is not a huge problem. 5% inflation, the federal -- the fed will have to keep tightening. shery: i was bill dudley speaking with david westin. it is time for morning calls good the recent rebound in u.s.

stocks is a bear market trapped at the call from bank of america. strategists say that warning signs are flashing for the market, given the weaker u.s. fundamentals. the january selloff is not over, start rallies are common in volatile bear markets and the tightening dead is not likely to -- fed is not likely to rescued stocks. china's equity is overweight from underweight. it has drawn a line in the sand for me meant equities. this is to boost sentiment in the next three months. haidi: coming up next, the bank of china has reported the biggest profit increase in over a decade. he tells coming up, this is bloomberg -- details coming up, this is bloomberg. .

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>> russia says it will cut back military operations the ukrainian city of kyiv. this comes after negotiations in turkey. it could pave the way for a meeting between vladimir putin and the printing president. moscow's announcement is being

met with hesitation. patrick harker says they have between hike in may could be warranted as near-term data shows more price pressures. harker confirmed. he says he is worried that inflation expectations could become on death -- unmoored. a second booster from moderna and pfizer and beyond tech. it will make more people eligible for the shot, there is a new wave of infections. pfizer and moderna are also working on omicron-specific boosters. $600 million from a blockade system connected to the infinity online game. fees took either and u.s. bc tokens march 24, the breach only discovered tuesday. it was one of the biggest trip to hacks to date -- crypto hacks

to date. global news 24 hours a day, on-air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in over 120 countries. haidi: the bank of china and oak china construction bank have recent postings of profit growth. the banks laid out a policy should the encouraged lending and bad loans also fell. we bring in steven engle. what stood out to you? >> the fact that the numbers were pretty good is probably tribute it to the policy shifts we saw late in the year of 4021 as the government wanted to stimulate -- of 2021 as the government wanted to stimulate the economy. encourage some lending. the number started improving for the big banks. the biggest profit increase

since 2015. the income was up 12.5%. -- 12.3%. april percent year-over-year rise over income, both of these banks saw ratios go down a bit. against the backdrop as well, of the rising crisis that we saw in the fourth quarter, in the property space. to bring up a terminal chart, that tells a lot of things but how investors -- investors are reading the banks. you can see they are trading at about half of the book value. it is showing you that perhaps investors are more worried about the hidden liability at these banks perhaps have and they are not necessarily reported because the nonperforming low ratios is coming down. d.l. down 4.2% from a year ago.

it is better than the estimate. are there hidden liabilities, in particular in the property space. we heard from a president, he warned that the bank faces in his estimation of the most challenging operating environment for a full year coming this year in 2022 that he has seen in his entire 30 year banking career. covid lockdowns, geopolitical concerns, and overall waning demand for banking services and banks are not borrowing -- corporate is not borrowing as much. shery: we have seen authorities try to encourage more lending and loosening restrictions but now they later -- the later legislation showing less credit demand. >> facebook international is a

private survey, it is not tied to the government and it does paint a different picture, a grimmer picture for credit demand than the official data may suggest. it counteracts what the pboc did by cutting its policy rates. we are seeing according to the facebook international survey, -- beige book international survey, let me give you the key points of it. borrowing by chinese businesses plunging in the first quarter. given the lockdowns we have seen because of covid and now in shanghai, but interest rates on those loans surged. only 15% of the companies it surveyed in the quarterly pole applied for loans in the first quarter of 2020. corporate in china are taking a wait and see approach. shery: we have plenty more

earnings out of beijing this week. we are watching china's oil majors, we already heard from one which had a record to increase production. later, we get patrol china reporting thursday. china is aiming to boost production to 200 million tons this year. the government focuses on energy security but china's covid related lockdowns are dampening demand and a could demand -- impact crudes internationally. haidi: australian finance minister joins us to break down the key measures and the latest budget ahead of the may election campaign. here are some of the other stores who are tracking on the day ahead. more than 50,000 people are expected to attend the memorial service for the legendary australian taking place in melbourne today. he was named ceo -- cfo, brady

will take the helm through september 1. a lot more to come, this is bloomberg. ♪

haidi: australia's government has announced a series of spending measures to cushion the impact of rising living costs

and a putting encumbrance back into election. -- incumbents back into the election. >> i am with sam in birmingham, finance minister. i want to cut to the elephant in the room, there is an election soon. >> this frames the choice for australians between politics to cap the economy strong and putting us in a world leading position with economic growth and recovered from covid and other g-7 economies. we have jobs growth that is push unemployment towards 50 year lows, forecasting the budget go from 4% down to 3.75%. it contrasts with our labor opponents and we will obviously campaign strongly on our economic job creation.

we have created not just income tax cuts for us chilean households but through driving down company taxes for small businesses in australia -- for australian households but through driving down company taxes for small businesses in australia. emphasis on workforce and uplifting their logical capabilities. using tax incentives as vehicles to drive that. >> yes, the on employment rate is set to fall, revenues have been much better than expected. we have closed borders, we have had a really high iron or price which is helped revenues as well. how much of this is down to good management and how much was we got lucky there? >> we are continuing the pattern of our government of being conservative about a four

production and forecasting when it comes to commodity prices. iron ore prices, coal, it will all come back down to a lower level in price within the next six months by september of this year. if you look at the budget that we have demonstrated, over the next few years, commodity prices by a small role and negligible role in most of the forward years, the real dividend is a stronger labor market, stronger business performance overall. it is enabling us to bank around $100 billion of budget savings and ensuring that deficits come in lower than previously forecasted, around half of what was previously forecasted in terms of deficits and gdp. that will help underpin the strength of our credit rating for which we are only nine countries in the world to continue to hold the aaa from all of the major international ratings industries. >> one of the important things

was the one off measures, the cost of living, prices rising, particularly for fuel prices. how do strike a balance between getting relief and not stoking inflation and making those prices rise even further? >> the vast majority of the budget upside we have seen from a stronger economy we have put against budget improvement and lower deficits into the future. we could see repression or for us really is in relation to the cost of living as a result of oil price spikes that have happened since russia's invasion of ukraine. everything with covid-19, so much of our support was temporary and carefully targeted. we are doing the same here. oil prices were not remain ultra elevated -- will not remain ultra elevated forever. and is about farmers, businesses, with higher petrol prices. it is important to maintain

consumer and business confidence. the impact of higher petrol prices can shake that confidence. the economic growth remains as strong as possible. >> if oil prices stay high, would you go beyond six months? >> this is a six month measure, that will be legislated through the parliament and all of our predictions is we will see a stabilization in oil prices within that timeframe. it is about making sure that households are not feeling the pinch right now get the $.22 dividend of lower prices for a period of time until we see the stabilization. >> the question of debt, debt is expected to peak around 25, above one trillion australian dollars. how are you going to bring that down to levels that we are more used to? it is still low by international standards but it is high by australian standards. >> we had to respond to covid-19

with exceptional measures. it has been a global pandemic and the evidence of the effectiveness and worthiness of the spending measures we have applied in -- is in the strength of the australian economy. more than 40,000 australian lives, many thousands of businesses from going out of business. now is the time to make sure we can consolidate economic games. -- gains. we are going to clearly grow the nation's economy in ways to shrink the share of gdp, this budget is proof that the strategy is working and we are going to see a peak in the nation's debt occur sooner and at a lower level than had been forecasted. the share of gdp that was previously been forecasted running around half the previous forecast, it is a demonstration of strategy working and we have to stick to the strategy to preserve that economic strength.

>> one of the missing pieces of the puzzle is wage growth. to a larger extent beyond her control, what can you do to try to promote wage growth in australia? >> making sure we keep the jobs market as strong as it has been to drive the jobs growth into the territory that is achieving the 50 year low. wages growth is excited to run at 3.5% -- 3.25%, increasing over the next couple of years, showing real wages growth during that time. critical productivity for the nation and record investment in infrastructure that is getting more efficient around the country and intermodal terminals to increase the efficiency.

all of those things can deliver productivity to the nation as well as the incentives in digital economy to get small businesses using tools like a human voicing things more rapidly, that will drive a more productive economy and from the stronger wage comes outcomes. >> there are $10 billion for cybersecurity, who is also later to protect itself against? >> we have been the victim of cyberattacks in recent years and it is in relation to cyberattacks to countries like russia, we saw in relation to the war in ukraine that before the first bomb was fired and the war deteriorated into the catastrophe we are seeing, there were initially cyberattacks launched. this is the new modern arm of warfare. just we have restored australia's defense spending two to 2% -- spending to 2%, we need to uplift capabilities outside

of security and $9.9 billion investment over the next year that will create around 1900 rolls in cybersecurity and offensive and defensive capabilities. we were helping ukraine prior to the invasion in relation to this, we want to make sure that we remain at the cutting edge because it is about protecting our energy networks, communications networks, critical infrastructure in a wage of ways -- range of ways. >> you did not mention china. what is happening to improve relations with china on that front? how will the growth picture look if relations were to improve? >> we can see a strong evident from trade with china. there are more assertive in relation to national security, china is standing in terms of confidence around the world.