>> these are the stories that your agenda. manus: chinese industrial output sinks to the worst level since the pandemic began. shanghai is on the brink of easing restrictions. germany will stop importing russian crude by year end, even without the eu-wide band. sweden and finland plan to join nato. goldman-s lloyd blankfein warrants there is a high risk of u.s. recession. dani, good day to you. a question we can debate, whether it was chaos or capitulation in the market, but we have breaking news from ryanair, with a after taxable your loss 355.

that is a compression in the loss relative to what we expected. the number of passengers for the full year was 91.7 versus 27.5 year ago. on the forward guidance, let me give you this line and we will get in the meat and potatoes of the day. bookings have improved in recent weeks, but the booking curves remains much closer to typical bad this time last year. does michael o'leary have revenged tourism on his hands. he joins later on in just over 30 minutes time. we will catch up on his guidance and the capacity of the birds and irish to deliver revenged tourism. dani: you know i love a little bit of revenged tourism.

it is revenge of the markets this morning. the poor macro chinese data. souring the mood of what was a stronger friday in a volatile week. the csi 300 down. s&p 500 futures were at lowe's when the china data hit. similar level for the nasdaq 100 futures as well. they clocked the sixth consecutive week of declines. the longest losing streak since 2012. manus: that china data has pummeled everybody. the capitulation might not be done. china has imploded the oil market even though germany is going to go without russian oil. we'd futures -- wheat futures up

over 5% with india looking to ban exports, or restrictive exports i should say. cable is on its knees, and it has got further to go. the mliv survey, u.k. is in the danger zone the pounds and the gilts. goldman sachs say sterling is our strongest g10 fx underperformance. they are slashing their view to 1.19. a lot to take on board, the dollar remains triumphant. reporters are set to analyze stories in the markets. in the current -- our europe correspondent maria tadeo with the latest on the eu sanctions in brussels. dani: and we are joined from rome for a nato briefing and annmarie hordern on the ground

in the uae. in china, the economy contracted in april. millions of residents have been confined to their homes and teresa forced to -- factories forced to halt production. joining us is our asia economics correspondent. economists found it very wrong in their estimates, what were they underestimating? enda: they were underestimating the hit from covid zero. we saw big falls in key metrics, industrial output, retail sales are down, that cost of the core of any economy, the survey jobless rate, and youth unemployment hitting a record. it shows that the economy has been split into turmoil by covid zero. the worst may be behind it, there was a briefing saying some shops and stores will be opening

. perhaps the lockdown impact is behind china. as long as china is pursuing covid zero, the threat of ongoing restrictions will remain and raise questions over how quickly china's economy can recover from this hit. manus: depends whether you follow universities outlook, or the world health organization guidance. enda, thank you, our chief asia correspondent in hong kong. another headline on the oil sector. we are trying to grapple with this. [indiscernible] will sell their russian holdings. this is a 67% holding in russia. that is to be divested and we will come back to that story, a non-cash adjustment will go through.

germany plans to stop importing russian oil by the end of this calendar year, even if the eu fails to agree to a ban in its next set of sanctions. it comes as european ministers meet in brussels. hungary is digging in, maria tadeo has the latest. this path that germany is taking, how significant is that in terms of this impasse with budapest? maria: for the germans, they are sending a clear message. we want to unplug from russian energy. if we get a deal on the eu 27, we will go it alone. if you look at imports to germany, they have declined from 35% to now 12%. the trajectory with or without a deal was already falling.

what the germans are trying to do is put a bit of an ultimatum on the table. the g7 has agreed to an oil embargo, the eu put out a plan two weeks ago and yet, the eu 27 has not managed to get a deal done. a lot of this precisely because of viktor orban. ministers will meet in brussels hoping to get this unanimous deal approved. the message from the biggest economy is if you don't agree, that's fine, but we are going to do this. by the way, just to remind everyone, i will be speaking with the ukrainian foreign minister who will be participating in that meeting a few hours from now. dani: looking forward to that interview, and a toxic mix for oil, already down off the back of that china data. nato members have enthusiastically rallied around finland and sweden after they

announced plans to join the alliance. there a session will bring improved ability for the alliance to defend the baltic. >> this would be an historic moment. there membership in nato would increase our shared security. demonstrates that nato store is open, and that aggression does not pay. dani: for more, alessandra, what has been the reaction and how does the process go from here? >> sweden and finland are due to give their official applications later in the week in brussels. there has been a last-minute hiccup because turkey has voiced concerns about sweden, saying

they are not supportive in what turkey says is kurd terrorists in turkey. but this is something that will not delay the assession. this is going to change dramatically in a country like italy. some top officials have said this might be a risk, but the wind reaction has been this is something that will strengthen nato and our reaction to russia in ukraine. manus: bloomberg's alessandro speciale, lots of reaction from various leaders over the wee kend. all of the world leaders including boris johnson

dissenting on the uae to pay tribute to the leader who passed away. the u.s. delegation includes, lie harris. annmarie hordern is traveling with the team. she joins us now from abu dhabi. we are looking at pictures of them dissenting from the plane. this entourage sends a clear foreign policy message as we go through succession and asession here in the uae. >> the united states is sending an extensive delegation, very high level. it will be led by the vice president. they are en route. i came with antony blinken, the secretary of state, they had an earlier meeting in berlin alongside his eu partners. he got diverted to join the delegation in abu dhabi.

alongside harris will be the secretary of defense, the cia's bil burns, john kerry, brett mcgurk. it is clear this is a diplomatic foreign policy and security alliance, and an energy climate alliance in terms of who the united states is sending. they are clearly sending a strong message that they want to make sure this relationship endures, and strengthen this relationship. manus, you will note that there has been some hurdles, how the iraqis feel about the united states negotiating with iran to back at potential nuclear agreement, and the fact that the m iraqis have not sanctioned the russians -- emiratis have not sanctioned the russians.

they have been a safe haven for russian money. you can see that for real estate. it has been a fragile relationship. but this is a moment for the united states to show their strength in its partnership. dani: let's get back to these red lines, he broke them earlier of renault selling their russian state in a carmaker which they will sell to un-automobile research institute. these are lines that came up under the past 10 minutes. manus: it is 100% of russia's renault group. 35,000 employees in russia, and property, assets. they have got an option to buy this business back in six years. this is why the 2 billion euros is going to be a non-cash right

down -- writedown. so that's critically important to keep an eye on. let's see how the stock opens a little bit later on. dani: a lot of european companies are grappling with russian exposure. we will watch out for that when the market opens. for the week, the european commission will be releasing their spring economic forecast. tuesday the fed chair will be speaking at the wall street journal's future of everything conference. manus: wednesday, tencent reports. thursday is ecb day, publishing their account from the april policy meeting minutes. friday, biden begins a four-day trip to japan and south korea. recession morning. we hear from lloyd blankfein as

he says the outlook for the u.s. economy is at high risk. dani: and we was be speaking with the hermitage capital ceo and cofounder. this is bloomberg. ♪

>> do you think we are headed towards recession? >> it's certainly a very high risk factor. there's is a path, a narrow path, but i think the fed has very powerful tools. it's hard to see the effects of them quickly enough to alter it, but i think they are responding well. it's definitely a risk, if i

were running a big company, i would be prepared. if i were a consumer, i would be prepared. but it is not baked in the cake. manus: the goldman sachs senior chairman all in preparation for recession. that as the bank cuts its u.s. growth forecast for this year and next. does parisha saimbi agreed? ? make your call, roll the dice, the solitary refuge among financial analysts is the dollar, do you agree? parisha: we think the dollar is fairly expensive levels. our models are screaming rich for the dollar at the moment. there might be another 2-3% higher in the dollar, and there is pressure that way, but we think the bigger move will be to

the downside over the medium term. that will be exacerbated [indiscernible] , our position metrics are showing fx investors with a significant amount of dollar exposure. dani: does that mean you are not dusting up that recession playbook? parisha: it's a risk. there are pressures affecting not only the u.s., but europe as well. but we think the u.s. is slightly better placed. we think ultimately they will avoid it. if we take a look at balance sheets, they are in a much healthier place in the public and private sector. we also have a tight labor market, and we're still looking for that catch-up in the services sector getting past that omicron effect. we think these three factors should be supportive. but the data will deteriorate, and that will pose a challenge for central banks. manus: so the dollar is

screaming rich. tell me, is the pound screaming poverty? goldman trashing it this morning. the mliv blog saying there is another 6% lower. when all the world cries, that says to me may the worst is done. so is the pound screaming poverty? parisha: it really is, we are bearish on the pound. we have been for some time now. if we look at the u.k. economic situation, it is extremely weak. they have the most acute fiscal tightening compared to the rest of the g10. they all vernal volta the higher energy crisis, if prices remain high, the u.k. consumer will continue to be squeezed. dani: let me jump in here. what levels do you see it at? parisha: on the energy side, we expect brent crude good average

$130, with the risk of spikes to $150. other calls depend on the situation in ukraine. if we get a further deterioration, we could see $190 in the worst scenario. manus: the risk of $190 oil, i don't think anybody has got their had around that. i reckon we are in for a g7 bumpy ride. corona is on the tape now. -- kuroda is on the tape now. fx moves are unfavorable, do you expect g2 intervention in dollar-yen and if so, what would retribution be? parisha: i think it would be hard for the u.s. to explain it. to weaken the yen in that sense.

sorry, to weaken the dollar. we don't think that is possible. but will there be other forms of intervention, it is quite possible, but i don't think we are at those thresholds yet. if we think about the comments from both boj, certainly, further intervention is stepping up. but i think there levels for actual intervention to be higher from here. dani: to be fair, we have also seen the yen start to lose some of its stamina last week. the dollar dropping 1% versus the yen. are we finally seeing the yen as those recessionary fears come to the fore, yet again be connected with risk? parisha: that seems to be the case. i would add that we have had a significant move higher in dollar-yen. as a result, we are getting

increasing levels of intervention. it will make for the rises in dollar-yen sticky. if u.s. yields continue to rise, which is our base case, we think dollar-yen can trickle higher. a move lower in dollar-yen would be more of a momentum move towards the back of this year because when kuroda leaves, markets anticipated boj may move away from established policy and perhaps put in a rate increase in the back of 2023. dani: 1.35 on the dollar again the moment. parisha saimbi, g10 fx strategist at bnp part of us, thanks for joining us. saudi around composts record profits amid higher energy prices, we will bring you that story next. this is bloomberg. ♪

manus: its daybreak europe, i'm manus cranny in dubai. dani burger in london. saudi aramco posted its highest profit, the world's most valuable company saw a boost from surging oil prices in the wake of the russian invasion of ukraine. the dividend did not rise, did they just get away with it? >> good morning, manus. as you say, aramco benefited hugely from the oil market in the first quarter. and the huge swell in oil demand plus the invasion of ukraine creating worries about supplies, oil traded above $100 a barrel,

a key number four aramco and the state as well. the royalty that around co-pays to the government rises from around 45% to 80%. so the government still makes a huge additional amount of money for any oil prices over $100 a barrel. that is what we saw a lot of through the first quarter. dani: the saudi's have said the run-up in prices is because of a fall in investment. this brings up a question around oil majors posting these profits, can it really continue as we start to contemplate the risks of recession? >> i think that's a risk that the saudis are cognizant of. throughout this period they have been cautious about new oil

because of fears of a collapse. if you look at the government budget, they are keeping spending very restrained even in the face of this oil windfall they are getting because they are trying to avoid falling into the boom and bust cycle which they have had in the past. the price collapses and then you create a deeper recession. dani: matthew martin, our saudi bureau chief. coming up, michael o'leary on xfinity mobile runs on america's most reliable 5g network, but for up to half the price of verizon, so you have more money for more stuff. this phone? fewer groceries. this phone? more groceries! this phone? fewer concert tickets. this phone? more concert tickets.

and not just for my shows. get $400 off an eligible samsung device with xfinity mobile. take the savings challenge at xfinitymobile.com/mysavings or visit your xfinity store and talk to our switch squad today.

manus: this is bloomberg daybreak: europe, i'm manus cranny in dubai with dani burger in london. dani: chinese industrial output and consumer spending sink to the worst level since the pandemic began. shanghai is on the brink of easing restrictions. germany will stop importing russian crude even without the eu-wide band. sweden and finland plan to join nato. blankfein warns of a high risk of recession. manus: we are going to debate whether it was chaos, catharsis or capitulation. that's when you sell everything you love according to bank of america. let's see across the assets, i wonder if the dollar is

screaming rich at the moment. it could be time to top out and take some profit. week is up - wheat is up as india goes poor export controls. keep an eye on bitcoin, again we are seeing cryptocurrencies come under pressure again. as equity markets start risk off, so do across the assets. bitcoin is down by 2%, $30,374, we are not there yet. dani: some think it should be much lower than where it is now. let's start with the debate in europe over russia sanctions. routers latest book continues

the story of exposing russian corruption and acts as the blueprint for many russian sanctions today. joining us is bill browder, ceo and cofounder of garment touch capital. really great read, and you write about how a lot of sanctions which you fought for, and more sanctions being put to hurt putin, to freeze the trustees of his money. we are 12 weeks into this conflict, can he still be swayed by money? bill: i don't think these sanctions will sway him one way or another. if we had done that before he invaded, we might have had a different outcome. now that he has crossed the line and gone into ukraine, he never backs down. there is no reverse gear for vladimir putin. dani: so we are too late to be

focusing on sanctions? bill: not at all. the purpose is to bleed him dry financially. this war cost him a million dollars a day. he has got money in the central bank which is frozen. and offshore money with the oligarchs which is now frozen. the key to this exercise is to freeze his savings which is what we have done with oligarch money. and two breeze's which is coming from the purchase of oil and gas in europe. dani: do you share concerns that by putting putin into a corner, he might act out more dangerously? bill: i think he acts out dangerously no matter what you do with him. no one told him to go into ukraine and redraw the maps of europe. he did that on his own volition with full violent aggressive intention. we should do everything possible to put a boot on his throat and

to stop this man. dani: the magnitsky act made putin angry. bill: he is humiliated and getting more angry as time goes on. today's announcement about finland and sweden is a total own goal. now he has got two more countries around him that have joined nato. this is been a complete disaster for vladimir putin. from the ukrainians fighting back, to sanctions, he has set russia back decades in terms of economic prosperity. dani: does putin attack somewhere else besides ukraine? how does that change the calculus? bill: at this point, the key is

to get the ukrainians to fight him off. yes, he would go much further than ukraine if he could. the ukraine was just one stop on the way to nato. so the best thing to do is to keep him fought all in ukraine, and they are doing a very good job of that. dani: to what degree is the west still enabling putin? bill: at this point, i don't think we are enabling him at all. to the extent that we are, it is conversations like micron had where he said he is pushing ukraine to give up territory. we should not give putin an inch. we should take away whatever territory he has already gotten in ukraine. crimea, for example. dani: to what degree is the banking sector aiding those trying to launder assets from russia?

in 2019, a bank was admitting assets. have we reckoned with the size and scope of western institutions involved in this? bill: in think -- i don't think there is much money lingering going on -- laundering going on. i would guess there has been a trillion dollars of dirty money from russia flowing to the west. and where is that money? that needs to be investigated. and that money needs to be frozen. when we talk about sanctions, and freezing of money, the numbers are pretty small right now. dani: to what extent do you take boris johnson at his word, or is it just so embedded that that sort of task is becoming increasingly impossible? bill: he has done a good job, as

has the eu, u.s. and canada in putting together a high target sanctions list. but now what we have to do is figure out how they hide their money. once the shell company, and the other company underneath, and which crony is the nominees and custodians? dani: is it just in bitcoin? bill: now. it is mostly in financial assets that are still held by big institutions, the ones we talk about every day in london, new york, switzerland. dani: giving your intimate knowledge of the russian financial system, what makes sense in terms of birding out this money in the western world? where should our focus be? bill: one place we have not begun to talk about is there is a holland of lawyers, bankers,

trustees and company formation agents that have been involved in money laundering for the last 20 years. this is very sophisticated staff. -- stuff. they have the best asset protection schemes that money can buy. i think the best way to do it from this point is to make an amendment to the law which is to say that anybody who has been helping a russian oligarch setting up a scheme is under legal obligation to inform how these schemes work under penalty of law. dani: you have had your share of tonsils as you write this book, how realistic is that law? bill: i think the basis for it is already in place. the u.k. and u.s. government and others have to get serious, and make life difficult for these people, so we start to find the

money. there is just a big sea of this money sitting out there in the west which nobody knows about. dani: we are just about out of time, but what is your take on european oil and gas sanctions. seemingly no cohesion there especially because of hungary. what does it mean that this united front has reached an impasse? bill: i don't think hungary really matters. we just heard germany is going to do it with or without hungry. germany is what matters, france, some of the other big countries. as i've learned, germany is planning on setting up huge lng storage terminals onshore and offshore which in theory, could replace a lot of russian gas. germany has the will to do this, that is what matters. dani: bill broderick, ceo and cofounder of hermitage capital.

coming up, we speak with the ryanair ceo. results are in with the recovery in the aviation sector. this is bloomberg. ♪

manus: it's daybreak europe. i'm manus cranny in dubai, dani burger in london. a smaller than expected loss for ryanair. providing specific full-year, stepping back from setting full-year earnings guidance. summer bookings are booming, demand could be disrupted by a number of factors. let's get to the ceo, michael o'leary joins us. you talk about a booming summer,

can we just get a little more on what reasonable profitability looks like -- that's the language you have used, will you translate that to a bandwidth for the market? michael: we have exceeded 90% load factor for the first time since covid. we expect pricing to be down in the first quarter. we are pricing down to get our planes full again. looking ahead to the key september quarter, looks like we have strong load factors and pricing might be up by a single digit percentage. the recovery is still fragile. christmas got massively disrupted by the omicron variant. easter looked like it was going to be strong, it fell over as a result of the ukrainian invasion. we think it's impossible to give any accurate guidance on a full-year number, particularly

as there may be recession in the second half. the ambition here is can we restore profitability to pre-covered levels if it was just over a billion for the full year? there is a prospect we might if everything goes well in the next 12 months, but the risk disruption of negative news flow means if we were to give guidance, it would be such a wide range, it would be almost meaningless. the best thing is to say we hope for modest profitability. we are going to be price active, -- sort of a price passive load factor active, so we can pass on the savings -- with lower airfares. manus: there is a lot impact there. he talked about the risk of recession, and we have got a cost-of-living crisis. have you seen any evidence on the key roots that the

cost-of-living crisis is beginning to bite on peoples ability to book with you? michael: at this time we see very strong forward bookings into the summer. people are going out on family holidays after being locked in. but we are not sure how an winter will look like. whenever there has been a recession, the lowest cost provider, which is ryanair, does better. but it is too early to say yet, and it would be wrong for us to be making predictions on profitability for winter this early. dani: you might not want to make predictions, but what would you say to stifle analysts who call the next six months a toxic mix, and they named ryanair as one that will have to deal with this. what do you make of that argument? michael: i think it's rubbish,

frankly. if you look at the ryanair business model, traffic is recovering strongly. we are facing whether it is a downturn or a recession next winter, in every past recession, we have grown stronger and faster. because people don't stop flying in a recession. they get more price sensitive. ryanair and others will be the beneficiaries of a downturn. and i look forward with some optimism to an economic downturn because it will be better for ryanair's business. in hungary, we will overtake whizz! in their home marketplace. we keep passing on incredible value to families in europe the next 12 months. manus: i want to know your

strongest routes, but i want you to qualify -- bookings have improved, the booking curve remains closer than in typical pre-covid, so which routes are setting off a red flashing alarm. you get the data, and you wonder why is greece not booking so happily? what are the warning signs on this curb? -- curve? michael: we are big across many markets across europe. there is strong demand to leisure destinations. we also have a huge domestic travel, and that books later because it is domestic. it is prone to being adversely disrupted by adverse news. we saw it with ukraine in easter. we have seen too many airlines

in recent weeks talking of the recovery, maybe their balance sheets are shot to pieces, we can't eliminate the risk of another variant next winter. you see what is going on in china at the moment. so i think we are seeing very strong recovery into the summer, but i'd be cautious on next winter for the moment. dani: are you so cautious that you would want to raise cash in order to prepare for tougher times ahead? michael: the answer is no. we have raised cash from shareholders and the bond market during covid. we finished the year with 3.3 billion in cash, that has since risen to over 4 billion thanks to strong bookings in the summer.

we have a strong balance sheet and no requirement for additional equity. but we continue to be opportunistic. we have more aircraft. we can promise our shareholders very strong growth at -- with our very low-cost space, and in a marketplace where we are competing with airlines who is balance sheets have been destroyed. manus: you say you are taking delivery of more aircraft. in terms of capacity, are you going to be cash's in -- cautious in adding capacity? michael: there is extraordinary growth opportunities all over europe. a lot of airports are struggling to participate in the recovery, if you take the case of

alitalia, they have reformed with 50% capacity. easyjet has taken seats out of its aircraft and ba is cutting staff. we are operating. , and we expect to win market share from competitors across europe. we have a line outside the offices at dublin to encourage us to open more routes at their airports. that will negotiate adventitious growth across europe. that will continue. dani: we will have to have you back on the program. ryanair ceo, thank you for joining. could change becoming at the top

of credit suisse? our exclusive story next. this is bloomberg. ♪

dani: welcome back to bloomberg daybreak: europe, i'm dani burger in london alongside manus cranny in dubai. credit suisse is said to have held early-stage talks on potentially replacing the ceo as soon as this year. while they continue to publicly voice support, some members are concerned he is not getting a handle on the banks problems. we are joined by our middle east editor tom metcalf, how likely is a change at this point? >> a really interesting story. moves are eight-foot -- afoot

when it comes to thomas. seen. -- thomas gottstein. the big question is if it is worth the trouble. there has been a lot of change. manus: he has seen everybody out the door, quite literally. i didn't get to ask him did the board support him? what it do any good, i am hearing he can get nothing done. nobody can make a decision, it is hard to get anything through. do they really need this level of change now? >> there has been so made changes you think, but they have been quick to remove the

chairman. so perhaps they are keen to get some change of the top. dani: elsewhere in the banking world, there is this ft report saying goldman sachs will offer unlimited holidays to senior staff. what does this mean in the hustle per talent? >> unlimited is very interesting praising. the main thing is when you see these unlimited holiday allocations, how widely will they be used? i don't personally see many goldman staff taking off for five or six weeks at a time. it is an interesting symbolic move. it shows how much competition there is per talent. goldman doing this is extraordinary. manus: they are not prone to taking a great deal of leave, not unlike bloomberg staff.

tom metcalf with the latest on the holiday leave entitlement at goldman. let's get a quick snapshot at risk. it is still the dollar. although we heard from bnp paribas, it is screamingly rich. the aussie is down on disappointing china data. dani: all about that disappointing data. the aussie dollar weaker as our chinese stocks. manus: bloomberg markets europe is up next. we will do it all again tomorrow. inside, outside, big or small, angi helps you find the right so for whatever you need done. with angi, you can connect with and see ratings and reviews. just search or scroll to see upf on hundreds of projects.

and when you book and pay throug you're covered by our happiness it's easy to make your home an a check out angi.com today. angi... and done. what's it like having xfinity internet? it's beyond gig-speed fast. it's easy to make your home an a so gaming with your niece, has never felt more intense. hey what does this button do? no, don't! we're talking supersonic wi-fi. three times the bandwidth and the power to connect hundreds of devices at once. that's powerful. couldn't said it better myself. you just did. unbeatable internet from xfinity. made to do anything so you can do anything. whoa.