yvonne: when is almost 11 a.m. in singapore and shanghai. welcome to bloomberg markets: asia. rishaad: i'm rishaad salamat it in hong kong, let's have a look at our top stories. new zealand central bank stepping up its fight with a second half hike, while the philippines warns of more interest rate rises to come. >> china's banking regular and the pboc urge lenders to boost growth after new lows plunged to the lowest since 2017. rishaad: and india plans to

restrict sugar exports in a move to safeguard its own food supplies just days after doing the same with. juliette: the rv and see cash rate lifted 2%. you've got bonds reversing early against the yield on the two year. the kiwi up by 4/10 of 1% when it comes to the equity future across asia, we are rising today following yesterday's 1% drop. seeing gains come through in most of these equity markets. of course, support once again announced by pboc and from the banking regulator. expected to give a boost but you have's chinese stocks tracking lower by a third of 1%. it stronger fix from the pboc with the offshore being weak against the dollar by a third of 1%. a lot of focus on central banks trying to get ahead of the inflation picture today. and the rv and see put it that way when they said they would rather do too little too late than too much too soon. rishaad: exactly.

getting in the back of inflation and how that is playing out. getting data at the top of the next hour, looking at cpi, consumer price index expected to come in for april. 2.2 percent would be about 1/10 of 1% higher then we had in the previous month, of march. 2.2% was the figure at that point. let's take a quick look at what is going on. ahead of the market in -- up by third of 1%. also seeing the bar as it releases a bit of ground against its u.s. counterpart. a four day advance coming to a halt rid a government report showing tourist arrivals jumped in april and that is important for the tourism industry, which is of course a massive foreign exchange for them. juliette: i have my wednesday

brain on, let me clarify what they said. the risk of too little too late is worse and doing too much too soon. let him more analysis on the latest tightening and bring in our global economics and policy editor kathleen hays. so we now have another have percentage of points and certainly seeing market reaction here. kathleen: and not just another one which was pretty much widely expected. indications that rate hikes are going to continue and they are going to continue for a while. so yes, 50 basis points from one half to 2%, which in the past, the rb and said estimated was there neutral rate. obviously, getting to what they thought was there neutral rate was not enough and let's remember, this is been one of the most aggressive central banks in the world. march of 2020, you can see the 75 basis point rate hike, they started hiking rates in october of last year after the bank of korea started, along with federal reserve and others. greatly five basis points, not 200 basis points in the world. a picture of it on your screen.

they say they're going to raise it to at least 3.25% this year, they see it peaking at 4%. this probably exceeds even the expectations of what investors had before this meeting, before we heard all of this. they say that large, earlier hikes reduced the risk of persistent inflation. this makes me think the federal reserve officials like jim bullard talking about frontloading. talking about frontloading. have your impact now, see if you can get those inflation expectations down. they say i'm supply and demand get back in balance, then the official he cash rate, the ocr, can return to neutral. so the message is clear. inflation is too high, they need to get it down, they are going to move aggressively, and they expect to continue from this year potentially into next. rishaad: three about the pboc then kathleen. what they have been doing.

yesterday it was certainly evidenced by equity traders at least that it was a feeling that during the talk, but not actually walking the walk. kathleen: what else can they do? until the lockdowns are over, until covid zero passes because either the virus is extinguished or controlled enough that lockdowns are not needed or we get into october and xi jinping's third term is a done deal, the assumption is wide across china and all of the china watchers i have spoken to that covid zero stays in place. as long as that happens it is difficult to stimulate the economy. however, they keep trying. you have to give them credit. in the last day, pboc bank regulators, a statement came out that they had met with china's largest banks and told them that they need to step up. they need to take responsibility and do more lending. they particularly focused on property lending. they want to keep it stable.

now, let's remember, just this past week, they cut the loan prime rate, the five-year rate, which they were expected to move by 15 basis points. unprecedented. they did not move the short-term one year rate, as people were looking at. and this is more close to the five-year to mortgage lending. remember a couple weeks ago, they lowered the mortgage lending rate, the lower round of the rate that most people borrow at. so they are trying. they are trying and they are doing everything they can. the problem is that there is still a lot of reluctance to borrow because the future is uncertain. things are locked down. a lot of people are going to work, not earning money. the chinese government does not feel like it so far has not indicated that it is ready to give cash handouts that other countries have done when they are in the middle of lockdowns. so, to me, it is just that it is hard. how do you get banks to learn

more if people are not there to borrow? businesses are not ready to borrow if consumers, families and china are not ready to go out and look at houses, because they cannot look at houses. well, then you're going to have trouble making these things work, but this is on top of what we had a couple of days before -- earlier in the week, 34 different types of steps. $21 billion more of tax relief on top of 400 billion back in march. they're doing a lot, jewels, not having much impact and remember, that drop in lending to a five-year low in april, that is what they are responding to. they are doing their best, but so far, it is not surprising that investors are unimpressed because they know that the lockdowns are still there. juliette: indeed. you can see that reflected in the csi 300 underperform today. thank you so much global economic and policy editor kathleen hays. let's get more perspective on how markets can be reacting. working from adrian or speaking to -- the resolution commitment to price stability, labor

shortages, the largest constraint on production. head of asia credit at black rock is here with me in singapore. i think one of the important things that kathleen highlighted was the surprise of raising projections for peak cash rates. what does this tell us about central banks trying to get ahead of the inflationary concerns? >> i think it basically is a signal that central banks are serious about teaming inflation. at this point we are seeing inflationary pressure coming from supply side constraints and demand coming back as the reopening of the economy is happening slowly but clearly everywhere in the world. so this inflationary pressure is something which is destabilizing in the long term, is really not under control. so clearly, central banks are ready to go into more restrictive territory and bring it back to the neutral rate, whether more control. clearly a sign that we will see in a lot of countries moving from here. >> telling me at the moment you see inflationary concerns and greater than growth concerns, but they are going to start weighing into sentiment.

how does this affect the credits phase? neeraj: as we go from inflation to growth concerns, he some part of that showing up in the markets right now. the markets will start getting worried about the recession. i do not think we are their as yet, so at this point, we are more focused on central bank actions, the pricing of the rate hikes different countries. and how that plays from the current markets perspective. i think the key thing is over all, where we are in terms of yields, i think it has started to look attractive and credit pre-much across the globe and if you are not worried about recession right now, you're getting closer to the point where it is an attractive entry point from a credit or fixed income side. rishaad: it is actually good you said that, because we had a few guess to also lean in that direction. where are you finding these pockets of value, that is one part of my question. and the next really is what about distressed debt? neeraj: right. so in terms of pockets of value

over all across the fixed income and credit spectrum, in asia if i look at it, we are positive on investment rate, credit and selectively on a high yield. like india, indonesia, pockets of investment-grade credit in china across as police, parent companies, outside of that in high yield, we have seen cheapening of the credit in the high-yield markets in india and indonesia. we think some of these are fundamentals that are still intact. the entry point has started to look attractive rude and local markets, even though we are cautious on the back of an asian and central bank actions, i think we are getting close to interesting point in the cycle where you will have a window to generate strong returns, potentially second half of the year in asian local markets. rishaad: what about distressed debt? that is the second part of my question. neeraj: distressed debt obviously is a very different asset class. now if you look across the

globe, there are not many pockets of distress are now. asia is one place where we have seen a significant stress in the high-yield market, china real estate high-yield. we still see some issues in india, which still exist. so you have those pockets. i would expect some of it much farther as we see more stress on the economy. specifically in 2023 and 2024, the biggest stories from a debt perspective. but it is a much bigger asset class as it grows from here. juliette: when it comes to the china picture were hearing from kathleen as well that we continue to see policy support in terms of rhetoric. what further do you expect and what is needed when you continue to get these growth forecasts being slashed. jp morgan is the latest. neeraj: overall, there is downside risk to the growth. that is a given. i would say the biggest boost for the economy will be the reopening of the economy itself. right now if you think about the

consumer or infrastructure spending, it is somewhat constrained by just the shutdowns and lockdowns that were going through right now, the very restrictive covid policy. we do expect to see for sure as we look forward, more push from a fiscal impulse perspective, higher credit growth, and this is what the discussion we talked about in terms of pboc talking to the banks in the coming months and quarters, to provide support through the consumer and infrastructure spending in the second half of the year. but you do have to be able to spend that money, whether it is the consumer or projects from a perspective. rishaad: there is a lot of differing views of course on where the dollar goes next, but people are veering towards a softer dollar in the near term. how does that affect credit markets here? the other part right here is the dollar may come back.

and you look at dollar debt and indigenous currency? neeraj: first of all, there are two parts. the dollar view and where we go from here and then how does that impact your view from an asian credit, local markets perspective? on the dollar we have seen the cyclical high of the dollar last month. we may see more impulse as you see the fed normalization, but i do not expect to see a significant impulse and we have seen more stabilization from here in terms of dollar direction rude how does it impact credit markets, local markets? the key is a strong dollar is never good news for emerging markets or asian economies for that matter. the credit markets, through the mismatch of innovative currency channels do -- if the dollar strengthens a lot, but that is not the best case, dollars as a source of a risk is lower, looking forward from here in my view. and i think it is more the view around the growth, the policy

outlook and the financial conditions that will actually define the direction of the credit and local markets from. rishaad: local markets, you can find direction. it is a game of wait and see isn't there going on? we're looking at many participants. trying to get a sense of when the fed is going to be stabilizing. what sort of levels. we've seen how interest rate hikes have been according to markets and what they price and, perhaps ratcheted down for the next three meetings. not as aggressive. neeraj: so overall i think fed is going somewhat of a steady path, continuing towards more normalization. i would expect the fed to pause in the mid to potentially go three corner -- three-quarter level over the next 12 or 18 months. i do think once you see that pricing in of the fed find rate in the markets, there will be a little less of anxiety from an

investors perspective and gives you a bit of a backed up. juliette: always a pleasure. thank you for coming in crude from blackrock, just getting some outlines coming through from governor adrian or who has been speaking after we saw them lift the cash rate by half a percentage point to 2%. the board agreeing that stabilizing inflation was a priority. governor or saying as i mentioned they are resolute in their commitments. they're saying labor shortages are the largest constraint on production, but they are confident that households can cope with higher rates. the neutral cash rate is in the two to 3% range. and the economic headwinds that they are seeing our strong underlying strength, remaining in the new zealand economy. the rbz talking about how they raise rates to 2%. that has certainly been seeing new zealand bonds reverse in gains in the kiwi rising. you can turn to your bloomberg

for more on this. go to tliv to get commentary and analysis from bloomberg's expert editors. rishaad: yep. resolute in commitment to price stability. others of course also looking at monetary policy rather closely in this part of the world. let's get more on that as we get to the first word news with vonnie quinn in new york. vonnie: the philippines being one of them, the central bank saying it expect a follow-up rate increase at its next policy meeting in june. after raising key interest rates for the first time since 2018 earlier in may. in an interview with bloomberg, governor benjamin confirmed the decision will remain data-dependent as the country battles the second-fastest inflation rate in southeast asia. >> data dependent, so we look at the data as presented by our staff. we will act accordingly. we are likely to maybe increase by 35 basis points and our next policy meeting. vonnie: u.s. seeking to raise

pressure on russia by letting a sanctions waiver expire on out then cash flows. thanks individuals will be barred from excepting funds from russia's government. bondholders outside of the u.s. may still be able to receive russian coupon payments. analysts say allowing the waiter to expire raises the chance that russia will fault. sri lanka has chosen -- financial advisors. debt restructuring efforts key to a bailout from the imf, however the government has not appointed a finance minister to lead talks with global creditors. sri lanka suffered its first default last week as the governor struggles to stay eyes to the economy. president biden has called for a new restriction on firearms after a gunman killed 19 children and two adults at a texas elementary school. police reportedly killed the attacker at the scene. he has been identified as an

18-year-old man who was armed with a handgun and possibly a rifle. >> as a nation we have to ask when in god's name are we going to stand up to the gun lobby? vonnie: that is your first word news. rishaad: let's have a look at what we got coming up later this hour. india putting a cap on sugar exports. doing so to safeguard its own supply. we will be asking about food grosses. next is our exclusive interview with christine lagarde, discussing withdrawal, stimulus and chances of recession in europe. that is next and this is bloomberg. ♪

juliette: we are watching governor adrian or speaking in wellington after they raised the fishel cash rate for a second straight week. saying the risk of too little too late is worse than too much too soon. also saying there resolute in their commitment to price stability and that labor shortages are the largest constraint on production although they are saying as well the economy is capable of coping with the rate increase and confident households can cope with these rates. meanwhile there has been a lot of talk about possible ecb rate hikes.

bloomberg spoke exclusively with the person in charge, president christine told block wall that europe is at a turning point. -- francine lacqua that europe is at a turning point. christine: we have all of the components in place for that. we are turning back to negative interest rates, moving very lightly into positive territory at the end of the third quarter. and of course, we will calibrate, we will establish exactly by how much we want to do that. >> when you talk about no longer like -- negative rates, could this mean positive rates? christine: well, you know, when you are out of negative, you can be at zero or slightly above zero. this is something that we will determine on the basis of our projections, on the basis of our guidance. i think that there are good reasons to believe that all three conditions would be satisfied in june and further on

during the summer. >> where are we in the third quarter? can we be above zero in terms of interest rates? christine: what i am saying i will stick to. we will be out of negative interest rates most likely before the end of the third quarter. >> how does inflation develop from now? there are so many unknowns because of the war. christine: you know, there are lots of forces and some of them, you know, counteracting against each other. you have the war, which in and of itself is an absolute trauma. and it is not just in ukraine and russia, but for the rest of the world. we have energy prices which have gone up significantly and presents a big chunk of inflation. we have food prices. there's a whole series of things that are weighing on growth and pushing inflation of crude >> how likely is it that the eurozone goes into recession? christine: we do not have that as a baseline.

which we have the negative, the adverse, you know, various alternatives there on the basis of hypotheticals, such as boycott of oil, interruption of gas supply that clearly would have an impact on the economy. for the moment we're not seeing a recession in europe. rishaad: european central bank president christine lagarde speaking exclusively to us. getting breaking news from the jrc, this is the japan investment corporation. this has signed a confidential agreement with toshiba for access to detailed finances and it seeks to explore an offer for the company. this is just coming throughout the moment. that is one we looking at. a lot more on the way, this is bloomberg. ♪

juliette: you are watching

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rishaad: that is the tower in shanghai. again, you can see lockdown with little or no traffic as far as that goes at the moment. shanghai 1.5% currently. markets moving to the upside crude otherwise, if you have a look at what is going on currently with regards to sri lanka because we have a political and economic crisis in the country. people on the streets protesting about huge amounts of inflation,

the prime minister about -- has been appointed as finance minister here and this would be on top of his portfolio as prime minister. that at the moment he is set to be appointed at that at the moment. he has been in talks with invoice from the u.s., china and india discussing the problems of the country because they need to replenish food, fertilizer, medicine surprise. they need $4 billion to pay for essential imports, with the government coffers actually empty. so we got the premiere saying that they were going to/expenditure in the interim budget within six weeks. and also we are seeing him being appointed as finance minister. that will also mean he will be in charge of any talks with the international monetary fund for a bailout. all right, look at chinese

markets. going to the upside as we are in the lunch break. there you go, jules. juliette: but have a look at the broader market picture. modest gains across the region. the pans market pretty flat now though, hong kong being lifted slightly and gains coming through in australia and south korea. but also in new zealand after of course the policy there. investors are assessing the sharp -- assessing the sharp selloff in shares and concerns of fed tightening plunging the u.s. into recession. let's have a look as well as what we are seeing with toshiba. we've heard the j i see considering a bid for toshiba according to people with knowledge of the matter. kic has signed a confidential agreement. and some firms have approached kic for this potential joint bid. we understand deliberations are ongoing and that they could decide against receiving the offer. you are seeing a nice pop

they're going from toshiba shares in tokyo. let's head to new york and get the first word news with vonnie quinn. vonnie: the president christine lagarde says the central bank will not be rushed to withdrawing monetary stimulus. ecb officials may already be materializing over how aggressively it needs to act. she told bloomberg in an exclusive interview that there is no need to panic. christine: we are not in a panic mode. and we have started the journey thinking about it very carefully. back in december, with steps along the way. we are now at a stage where there is every certainty that we will stop purchases early in july. vonnie: china's central bank urged lenders to boost loans as covid restrictions threaten growth. pboc governor and other

officials card for loan approval and delivery. the meeting came after credit data showed loan growth as worst level in five years. china's top officials want pandemic controls -- worn pandemic controls are putting pressure on the capital. signaling cautionary restrictions. chinese vice premier and health czar urged authorities in beijing to stick to covid zero and stop the viruses spread more swiftly. after -- a sign the government can be losing patience. north korea is reported to have fired up to three ballistic missiles early wednesday morning, both south korea and japan confirmed the launches in separate statements. they come on the heels of president biden's trip to the region where he discussed the security threat posed by the regime. they have been firing missile is at a record pace this year. global news, 24 hours a day. on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in over 120 countries. i'm vonnie quinn. this is bloomberg.

rishaad: all right, just getting more news coming out of sri lanka at the moment. it is really about what is going on at a governmental level as they try to grapple with this economic crisis and political crisis here as well. the current prime minister is going to be named as the finance minister. this as he did early on say they were going to have a new budget soon, interim budget, where he has vowed to cut spending, so we've got that story. let's get details on that and that to jeanette rodriguez. jeanette, give us a sense of all of these changes and what the country is facing. without having actually a finance minister, they have not really had anybody who is going to be able to deal with the imf. they had negotiated with other countries as well, because it seems that the coffers are empty. jeanette: well first, the coffers are absolutely empty. sri lanka really is living on

payouts day-to-day from india, from the world bank, from the adp. and a finance minister is needed it more as technical appointment signoff on agreement. now, the appointment of a finance minister or rather the appointment is expected soon. it comes as a great relief for investors who can now start debt restructuring talks and proceed with bailout talks. however, the appointment, rishaad, also hides a troubling truth and that is that the opposition, the political opposition, has been on delaying to be competitive with the finance minister. it shows that there could be further political instability concerns down the line for sri lanka, because the president was really hoping that he could work with the opposition. but the opposition wants the president to take certain executive changes. they want the president to dilute his powers, for instance. or even better, they want him to resign. before they work with the sri lankan government.

right now, the finance minister job is seen as the job that could be challenging for any incumbent. and while appointment is welcome for global investors, it cannot be taken as the end of the road. juliette: just tell us a little bit more. sri lanka has been hiring advisors for debt restructuring and how important this debt really is. jeanette: it is an extremely important step, because in the less the debt restructuring talks start and there seems to be a good faith attempt to reach an agreement, to make the debt situation stable, imf will not release cash to sri lanka at all. so even to tell the imf that we are doing every thing that we need to do, to be eligible for an imf bailout, they need a finance minister, which they are set to do in hours from now. they need to appoint advisors to conduct debt restructuring talks, which they have already done.

and three, they need to start talks with global bondholders in earnest and reach some sort of consensus. to tell the imf good faith negotiations have begun, give us the cash we needed yesterday. rishaad: good stuff jeanette. mumbai chief fund. sri lanka has the highest inflation in asia and second inflation -- second highest inflation is in pakistan. it is something a country is grappling with as they tried to also shore up their own financial reserves as well. there currency reserves sustained for about two months. we are looking at all of this as indeed those prices go up. and it is something that the acting central bank governor has been weighing in on. >> it turns out the economy has been going fast for the last two years. 6% in 2020 and april of 2021.

fiscal expansion occurred this year as well, which is adding. this move is aimed at making sure that core inflation remains under control. rishaad: the acting central bank governor there of pakistan. all right, staying with south asia with india set to limit sugar exports. turns out banning wheat sales is designed to safeguard its own food supply. we got details coming up ahead. this is bloomberg. ♪

gita if you look at food exports:, 20 countries have put restrictions on food exports. it has been. palm oil, any product. fertilizers also we have seen. so we worry a lot about what is going to happen with food prices. i think it is one of those prices that is going to go up in the future. and it is a major concern. rishaad: first deputy managing director talking about inflation. ok, let's have a look at some of

these stories that investors are watching for today. big day for earnings results after the likes of petroleum and inter-globe aviation or indigo as it is called. having a look at what bloomberg sources are saying about the softbank hotels company. shelving plans for an ipo this year. global market downturns are going to be hurting valuations. the earliest we can expect one is 2023. the government is scrapping agricultural levies on imports of soybeans and sunflower oils as it takes steps to cool surging food prices. juliette: india is putting a limit on sugar exports. let's bring in our agriculture reporter for more on that. tell us more about the details of this export cap. >> hi. it seems that the government, they put a ban on wheat exports.

now it is sugar. sugar production at the current level in exports are surging. exports exceed the estimate, it should be a problem. they want to make sure adequate supplies are stocked up. so that probably prompted the restrictions. rishaad: correct me if i am wrong, isn't india the second-biggest sugar exporter in the world? this is going to have an impact on food prices right around the world? pratik: yeah. india in 2021 will begin to be the biggest exporter and it is still the biggest producer. the market is expecting tons of sugar exported in 2020 to, but now it seems only 10 million times can go.

it is a bullish order for the global market, yeah. looking to get some support here. rishaad: in new delhi, agricultural reporter joining us there. and the food price situation is certainly one of many uncertainty is the markets have been facing from a global front. and as one would expect, it is something that has been hitting world equities, including those in india. let's have a look at our next guest, remaining positive in believing that equities in india will bounce back faster and more significantly than most others. joining us is vice president and head of strategy at rocky shares and stock progress. thank you for joining us. food prices, food inflation is one thing that the rbis is having to actually deal with. there is a host of other things that the reserve bank has to grapple with. are they doing the right thing at the moment after of course that surprise interest rate hike recently? >> thank you for having me over.

obviously, inflation is somewhere at 88 year high. recently, the finance minister announced a number of measures to tackle inflation. subsidizing to reduction in certain food prices, to increase export duty in order to improve supply chain management. i think inflation as an approach requires more of a mix with regards to a rate hike. you know, a mix of duty cuts and supply chain management. we recently had a rate hike in a place where we are expecting a couple rate hikes to have been in the next few monetary policy meetings. so i think the key drivers for the current equity market, which is fundamental liquidity and evaluation, at least with regard to the indian equity markets are neutral or positive. so we are expecting these

measures by the government of india to prevail in the medium to long-term. rishaad: i was going to get to the government's role in all of this. a slew of majors that have been cutting pump prices here, cutting export duties as well on steel companies. now, how does that affect the way that you have been looking at your sector preferences? tanvi: the second the government announced preferences with regard to exports, we did see certain stocks tumble. with the guard to sector preferences, i think the earning growth in the last financial year has been close to 100%. the consensus for the next 12 months is around 10%. i think we are expecting a great possibility of being in a positive trajectory for the next 12 months, with respect to surprises as opposed to negative trajectory in the next 12 months with the guard to india.

sector, we are positive on information technology, telecom, goods, mutual on financials, and negative on health care, chemical durables, auto, iron and steel. juliette: what earnings downgrades do you expect given as we are focusing on this potential move from inflationary concerns to growth concerns? tanvi: we are not expecting too much growth with regards to earnings. on a trading basis, it is somewhere 20 times prized to earnings ratio, which is an average that has been maintained between 2011 and 2015. on a consolidated basis, this is at a discounted level to what it was trading from may 16 to 2021. so although, i would not argue that equities are cheap, they are not too expensive there. juliette: let's talk about the ipo market, because there has been quite a dichotomy there

when you look at positive momentum and big flops. what is the outlook in your view of the ipo market? tanvi: birth regards to the ipo market, -- with regards to the ipo market, the secondary market investment with the guards to ipo, i feel that if the fundamentals of the company are strong, and future prospect of the company is bright, such investments should be looked out with regards to a longer-term loan with regards to volatility. i think to take a listing gains with regards to ipo's is currently wind up with regards -- juliette: some of the risks out there, i know the volatility, do expect that there could be an exodus of some of the retail investors? tanvi: absolutely. i think with regards to the investors, we had an influx of investors when covid started.

we saw investors increasing in participation and i believe that the participation is going to continue, even when we are seeing indian equities. we seen domestic investors remain stable and positive on the indian markets, with regards to regional investors, i thing i would expect them to not have too much of an outflow during this time. at the same time, i think that investors need to understand that equity markets are going to remain volatile over the next couple of months. so with regards to strategies to do more harm than a betterment, we are not expecting too much of an outflow with regards to investors at this point time. juliette: thank you for your insights. vice president and head of strategy at shares and stockbrokers with us there. let's check in as indian markets open up, we are seeing some gains after two sessions of losses. it got the nifty and sensex both rising by half of 1%. a lot of the heavy lifting to

done by the banking sector. we are focusing very much on india restricting sugar exports as its precautionary measure to safeguard its own food supplies, an issue that we are seeing across many parts of asia. we have plenty more ahead. this is bloomberg. ♪

rishaad: this is bloomberg markets. and we have been hearing a lot of voices and one of them is the goldman sachs international chief executive. talking about the bank, saying it is surprisingly strong as companies look to buy assets and also mentioning terms and discussing the impact of rising inflation. >> the volatility is going to continue. i think there is so much more in front of us. richard: the whole growth question, talk about the s&p, the consumers seem to be strong. and you can make many arguments for that. the market supply and demand seems to be reasonable. but clearly, the economy is starting to weaken. and really to me it comes down to inflation. if the central banks have to do more than the market anticipates, they are going to -- either the rates go to a level two really well inflation, that could push the markets to a

different level. and i think that is with the markets are trying to figure out, so we see the s&p, a huge amount of money came into equity markets through last year, as we all know. we have had 40, 50 billion outflows over the last month or so. but that is a small percentage of what came in, so i think there is still a journey in front of us. >> do you see it in the pipeline? for example, ipo's or just the business that you bring in, that europeans are more cautious, taking a step to see the oil band, which i imagine is top list of their concerns. richard: if you look across the corporate client base, the thing that is surprisingly strong is business. and we really have not seen a slowdown in on that front and that is the corporate side and other companies who have been wanting to buy assets for a long time. prices run away from them and they're going to a place now where prices are coming towards them and people are continuing to see focus there. wait and see as we get to this

volatile time. and the whole alternative asset manager of a private equity community continues to be very, very active. they obviously depend on the financing markets. in the financing markets are there. they are not as confident as they have been. and we need to find a floor and the markets, particularly the high-heeled side, and the question there is where is the tent you're to settle? -- the 10 year going to settle. at what rate should we be there is still some uncertainty around there and that is what the market is going to try to figure out. the market flow will turn back pretty quickly on the side, to sustain the private equity bid financing markets have to be that. you talk about it obviously been way off your on your, it is down, 70 or 80%. different place. juliette: that was a goldman sachs international ceo speaking to francine lacqua and davos. a quick check now of the latest

business flash headlines. bank of america is boosting pay for tens of thousands of u.s. employees. that earned less than $100,000 a year. adding reimbursements for a portion of electric vehicle purchases. base salaries will clive as much as 7% for workers who have been with the firm since 2021 or earlier. the size of the raises, which started to month, will depend on time spent at the company. sources say oyo hotels is shoving plans for an ideal after market downturn hurt valuation. the indian start up is said to have talked to a change in the offerings timing. this after consulting with its anchors and investors. the earliest possibly for an ipo has been pushed back to 2023. first quarter revenue beat estimates rising to around $3.1 billion. growth slumped to the slowest pace since the company went public in february last year. china's tech sector has reported some of its worst quarterly earnings in a decade as regulatory concerns, lockdowns

and canonic slump hit. rishaad: let's check in with what is going on in new zealand after that rate decision by the reserve bank earlier. raising rates 50 basis points, that is pretty much expected. but what was not respected -- expected was how they decided that rates may be peaking next year close to 4%, peaking at the end of this year through three and one quarter of 1%. just been hearing from areas voices within the rbnz, bond yields jumped at the moment, perhaps the overnight index shifting higher as well. that is down to the projected part of the ocr official cash rate and we've got of course inflation at three decade highs there. a lot more going on then that. juliette: indeed. we're seeing gains at around half of 1% on the regional petsmart index after yesterday's 1% loss.

gains coming through from the likes of australia, south korea hoping to lift the regional index. that is it for daybreak middle east, live from dubai is next. this is bloomberg.