haidi: you are watching daybreak asia, live at the morgans danley australia summit here in sydney. annabelle: counting down to made as to asia's major market opens. shery: looking to build on the positive u.s. session, including strong games -- strong gains for chinese adrs. recession fears remain. the global growth forecast warning of persistent inflation. we break gdp numbers from korea and japan this hour. plus how the plunging and is giving japan a flash -- a freshest's shot by boosting overseas profit and a potential tourism revival. haidi: we are getting that revised gdp from korea -- the preliminary number coming through at .6%, slightly under expectations of .7%.

the gdp year on year for the first quarter is coming at 3%, just a touch shy of the 3.1% of the prior reading. slightly missing expectations. we have seen the be ok revising inflation expectations and expected to continue through the month of june and july putting in place considerable inflation expectation given that demand-side pressure we have seen as well as higher energy and food prices. we are seeing a steady picture when it comes to the first quarter preliminary gdp number. let's get reaction from the markets and how we are setting up today. annabelle: we could see a reprieve for asian stocks ahead of the opening today with the strength in the u.s. session and the pullback we saw in treasury yields. before trade, futures point higher. we did see it close at a one

month low. new zealand pointing higher. across markets, inflation is the major theme. we had the new zealand finance minister recognizing cost-of-living pressure and in japan, we are focusing on what the weaker yen means. some economists saying it could amplify the cost put inflation pressure. but it does have a negative impact for households. a weaker yen could be crippling for individuals, smaller companies and retailers. shery: and it doesn't help we continue to see oil prices rising. wti up .2%, we are talking about a two month high as we continue to see the likes of goldman sachs boosting their quarterly price estimates. we are seeing downside pressures for u.s. futures. this would be a rally and push back up claiming to session

highs in the new york session, but it was a really volatile session. we are talking about treasury yields falling below the 3% level. we continue to see the back and forth between stocks and bonds. it doesn't help inflation hurting economies bubbly. we saw the world bank coming out what their economic outlook. we are talking about another downgrade warning of stagflation. we are joined by our policy editor, kathleen hays and garfield reynolds. let me start with you and the world -- world bank revised outlook. kathleen: revised lower again. when he spoke on bloomberg television talking about the danger to the global economy, some stagflation. what he is talking about is the fact when you have stagflation, you have high inflation, weaker

growth for some time. that is what his concern is. he cut the forecast for the world to 2.9% from -- let me get that right -- 4.3%, bottom line, it keeps looking worse and worse. let's look at asia. there's no doubt one of the things besides supply chain and commodity prices due to the war in ukraine, the world bank is worried about global growth, but the gdp forecast and weak demand is all there. when we look at east asia pacific excluding china, gdp forecast was higher. indonesia, philippines, malaysia all expected to rebound. south asia, even india having the big meeting today will have its forecast revised to 7.5%.

that is still pretty strong with the headwinds. east asian nations are facing. haidi: we are still reeling from the size of the rba hike yesterday. people we have spoken to are expecting more 50 basis points moves to come. the market reaction, could that indicate how much pain lies ahead? garfield: the market reaction was more about surprise than pain. it seemed relatively a calm response for markets and may be equities. when you look at the currency which soared for a minute and came back down, it ultimately end up being the best but not by a huge amount. it was on a massive move higher. the three year jumps as much as

90 basis points, about 15 basis points or so which is fairly standard for the day. 10 year yields edged up, so i think there was more shocked and a bit less off. part of it makes sense that everybody is still left guessing as to what the rba is going to do next. only 25 last time because it said it wanted to get back to normal. it went 50 this time. what is it going to do next time? that's going to depend on what the other factors are. i think a lot of people will be looking to the 21st of june when there is a speech and we get the minutes from this meeting. then we will get more clarity about what the game plan is. shery: kathleen, what are we expecting from the rpi? kathleen: addictions are bit all over the map but there is a solid core of people who think they will go for a 50 basis

point rate hike because they got a 40 basis point rate hike when they started in may. it is way above the two to 6% range. the estimates range from 25 basis points to a 75 point basis rate hike. talking about a sense of uncertainty -- this fits with what the rba did. the theory is if you frontload rate hikes, do bigger ones and do a couple and get them done, maybe you can have your own kind of inflation shock, reduce expectations and put downward pressure on inflation, don't risk recession, all of those things in play. as far as i can tell, that seems to be what the are b.i. has been signaling. they say they would become less than accommodative when they get to 5.15. they have laid the groundwork

for faster rate hikes and bigger rate hikes. we will see, expectations are all over the map. haidi: the reaction to the latest slight -- slight in the yen seems to be a collective me h. garfield: the groundwork was pretty well laid when we had this surge from 120 to 130 and beyond and that is where there was something of an air of panic. that was when people started to speculate that boj might tweak policy or back away from its .25% cap. however, they held off, both the government and boj. they held off and now they seem fairly convinced and perhaps

somewhat convincing that this is the right way to go. i think it probably helps that japan is experiencing moves toward reopening in hopes tourism will come back. that is another key part of it because tourism benefits a weaker currency. back when it was first meeting, it was not coming back online because of covid. now they are convincing people of this tray that we cannot only handle a yen at 130 or 140, we could potentially welcome it. haidi: let's get you to first word headlines with su keenan in new york. su: we start with the fact that bloomberg has learned a biden administration is posing a plan to wean the u.s. off of russian uranium imports.

sources at the white house say they are pushing lawmakers to push the plan with officials from the energy department leading -- meeting with key congressional staff to plead their case. the proposal would boost uranium purchases from domestic producers and require approval from congress. meanwhile, the foreign-exchange reserve of sri lanka rose for the first time in five months likely due to a deferment of payments from india. it rose to $1.92 million, including a swap from the pboc. sri lanka needs nearly $6 billion in the next six months to tackle shortages of essentials including food, fuel and benefits. to china with a warning for australia to stop so-called provocations or face serious consequences. aging night allegations that chinese jets intercepted and australian surveillance aircraft late last month over the south

china sea. australia says the chinese aircraft flew in a dangerous manner but beijing says it's actions were legal and reasonable. global news 24 hours a day on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i'm su keenan. this is bloomberg. shery: still ahead, an exclusive interview with australia's chief scientist. we will talk about the future of quantum computing and other waves of emerging technology. up next, more on the economic outlook for east asia and the pacific. this is bloomberg. ♪

>> many countries will have a hard time or avoiding a recession. it's not a global recession yet. the downside risk is it could be a global recession. one of the key variables is whether supplies come back online to add growth and slowdown the inflation rate. but this is the sharpest slowdown in 80 years. haidi: the world bank president there. let's get more of those forecasts and bring in our global economics and policy editor kathleen hays with our next guest. kathleen: standing by with this is ayhan kose, the lead author on a world economic outlook report that did have these rather substantial revisions. great to have you here. as we look at stagflation, high inflation, low growth, what does

this mean for the asian region? how big a threat is it and why is it such a danger? ayhan: first of all, stagflation problem is a universal problem. in asia as well, you discuss in the previous segment major central banks have been increasing interest rates in some cases larger than what markets have been expecting. you look around the world and we have record high inflation rates in many countries. the inflation rates are multi-decade high and a serious slowdown underway. we've downgraded our growth forecast for 70% of countries this year and we are not expecting much of a rebound next year, so the slow growth will continue especially, so what

does it mean for asia? asia depends, especially east asia, on global trade and yet expecting trade to slow down significantly relative to last year, we downgraded our global trade growth for this year and next year. so inflationary pressures of course because of the war in ukraine, additional impetus there. the region has to get ready for this toxic combination of global stagflation. kathleen: how much does it depend on commodity prices? you point out some exporters in asia, particularly in east asia pacific are going to have their growth be stronger this year because they are exporting their goods and commodities at higher

prices. ayhan: indeed. when you look at increasing commodity prices, they are quite substantial but that comes with inflationary pressures as well. even in this economy, they're going to be dividends associated with higher prices, but inflation is global. inflation pressures are global, so they need to adjust their policies and withdraw monetary policy stimulus. and still support measures. those need to be withdrawn now. shery: are central banks across asia acting fast enough? ayhan: i think one of the important things where you have this type of stagflation problem, record inflation rates, you need to act promptly.

in the 1970's, we had a stagflation episode similar to what we have now. the reaction was delayed, especially the u.s. federal reserve and that basically being very aggressive. this translated into a global recession in 1982 and a string of financial crisis in emerging markets. that is why we are suggesting central banks to be decisive to fight inflation and undertake the necessary measures gradually but credibly and decisively. haidi: how optimistic are you the measures in china could lift cities out of these covid restrictions as well as fiscal monetary stimulus is going to be effective and will help the broader region in terms of

growth? ayhan: this year, because of the covid restrictions, because of the external environment, we downgraded our forecast by .8 percentage points. we are expecting four point 2% growth. next year, we think growth is going to stabilize around 5.2%. in a nutshell, and accommodation already put in place and the learning curve get a steep shape in terms of containing these outbreaks. we are optimistic about china possibility to overcome the covid outbreak and get back to growth around 5%. kathleen: how concerned are you that inflation, no matter what the central banks do is going to remain high, going to remain

weak on asian economies and economies around the world? ayhan: we are concerned. we looked at these risks and inflation is one of them and what central banks are going to do, they might be much more aggressive than financial markets expecting, but we have more related disruptions, especially in the commodities space. you might see higher commodity prices and we had this covid outbreak in china. you put all of these risks together and materialize, we will end up seeing much slower growth rate. growth could go to 2% this year and 1.5% next year. you talk about 1.5% growth for the world economy. you are talking about this very serious down term. you are close to a global recession. shery: good to have you with us.

global director of the prospect group at the world bank. you can get all of these stories to get your day going. also available on mobile, you can customize your settings so you only get news you need and assets you care about. this is bloomberg. ♪

shery: toshiba's new ceo says nothing is decided on going private or remaining public. he says the key is maximizing value for all stakeholders. >> in terms of the keeping of a fair process, i shouldn't talk too much about which one because it is causing all kinds of problems, is the ceo leaning toward this or that? first of all, i have to say this

is part of a strategy discussion we are having. we are not yet deciding whether we want to go to privatization or not. it is just a part of the process. but at the end of the day, it's most important that we create real business vision so people can be excited and people want to spend some time working together and that is the starting point. that's what i'm doing right now. >> do you mean toshiba might stay public after the entire process? >> we don't know yet. it's just a process of comparing which is best for shareholders value or not. of course this is a multi-stakeholder, not just shareholder, but the shareholder value is one of the important thing we have to check and compare. >> is there anything you could share in terms of the timing of

the entire process and how you plan to handle it? >> the next thing is we are going to have some kind of dialogue or discussion and narrow down to the best proposal to do even more serious discussion, including involving due diligence and all those kind of stuff so people have a binding proposal. this will be after agm and after that, it's going to be very difficult to say when we can actually finish this process, depending on how much information they need. >> in your new business plan, you did emphasize data would be very important. could you explain more about how that could be toshiba's new growth engine? >> important things about why toshiba can do this and how,

according to my theory, the so-called platform or's, -- pulling data out of pcs or platforms, but this is much more data around infrastructure. for example, amazon is doing all those recommendations aced on your buying behavior. but they have only so much, less than 20% of purchasing information. 80% of the purchasing is done outside of amazon or e-commerce from that perspective. that means 80% of the data is not patched yet. we are targeting those businesses together with the different ecosystem.

we are working more than 200 companies to create services together. haidi: the toshiba ceo there. coming up next, more from the morgan stanley summit in australia. we are talking with the chief scientist of us really about the future of quantum computing. this is bloomberg. ♪

>> i hear watching "daybreak asia", we are counting down to the market open in japan, australia and south korea. ahead of that we focus in on stagflation. the global bank cut its economic forecast. it reflected in our bloomberg monthly growth track. near zero in may. we are seeing a drop in the four year forecast. there's something about the central banks to contend with as slowing growth is coming up with inflation pressures worse. if you change the chart, you could see that a new club is forming, and this one called the supersized hikers. australia is the latest to join with a 50 basis point move, yesterday joining the rbn fed and the bank of canada. you could also see a new member join today as well, this is india said to deliver another supersize hike ahead of those demand pressures we see in the economy. our bloomberg economics team is expecting a 50 basis point move. but certainly a significant range we are seeing all the way from 25 basis points to a

three-quarter point move. india's central bank is going to be emphasizing that the fed does remain supportive for growth, but that's a classic trade-off when you do see those supersize hikes. shery: we have more comments on those price pressures coming from secretary yellen, as well in the u.s., and vonnie quinn -- vonnie quinn has more on that. lexi u.s. treasury secretary saying inflation is likely a say hi and she had not called a transitory last year. speaking to lawmakers she defended the biden administration's $2 trillion american rescue plan, saying it's not to blame for the surging cost of living. u.s. consumer prices remain near a 40 year high. >> i think that bringing inflation down should be our number one priority in president biden, in an op-ed on inflation and recent remarks, as indicated that it is our top priority. vonnie: vietnam's health

minister has become the latest high-ranking official for the nation's anticorruption campaign, with parliament voting to dismiss him. he was also expelled from the communist party for allegedly wasting state budget resources. vietnam has been investigating a wide range of illegal activity. nasa will launch three rockets in june and july from a base in australia's northern territory. it will be the first time the space agency uses a commercial launchpad outside of the u.s. and its more than 50 year history. the space center is privately run by -- and the prime minister said it will be the first nasa launch from australia since 1990 five. two u.s. senators have introduced an ambitious bill to boost cryptocurrency regulations. the bipartisan bill would face stablecoin issuers to may -- maintain 100% reserves and this goes as they are backing it. it targets sanctions on the

impact of bitcoin mining. it is unlikely to pass before midterm elections but could act as a starting point for negotiations next year. global news, 24 hours a day, on air and on bloomberg quicktake, powered by 2700 journalists and analysts in more than 120 countries. this is bloomberg. haidi: they are focused on a theme of disruption accelerated. in these technologies have the potential to speed up this disruption more than quantum computing. it is critical for the field and australia to capitalize on its investments in the emerging technology. for more we are joined by the chief scientist. quantum is really seen as the underpinning of future technologies. so take us through why it's important, given that it's really global for dominance in this space. >> is great to be here, thanks for the opportunity. one of the things you have to

remember is this is a new technology. we have been doing quantum physics for a long time since einstein. it has allowed us to be able to region and be able to manipulate quantum states. with that comes a lot of new technologies, which is under development. with that in mind, what does it mean and where can it impact? we have many applications, but the project we want to look at today is quantum computing. quantum computing is still in the early stages. there are early stages of what they call quantum computers, which are able to demonstrate, in some cases, the advantage that they have that they are something we could use every day. so, this is a perspective capability, but the impacts will be extraordinary. it will be the sort of thing that will disrupt everything from our logistics, from our security, communication, health and medical, being able to find mineral deposits. it's just every aspect of our

lives that are impacted because of the ability of what quantum computing can do. haidi: the timeframe is anything from five to 50 years. when you think australia will get to the point of having, computationally, relevant quantum computing? and, do you see this challenge as a way to ward off risk, geopolitical risk, strategic risk, or is it more about opportunity? >> both. the thing that's important to remember is there's many aspects. one is from a security perspective. if you are able to get to a quantum computer that can use algorithm, which can have peak -- that's used for the security base and all transactions, that means we have to have a whole new way of operating. what we are seeing already is companies are setting up a with quantum distribution and random number generations, which are

beginning to create new ways while engaging with industry, and also creating that preparedness down the line. i think we will see absolutely, quantum computing in the next 16 years at the full operational level. the rate of investment, the weight -- the rate of inventing and creativity and the issues that have to be dealt with is phenomenal every day. reading the newspapers about new investments, you are also seeing in the science journals, new scientific operations. when they come together, we are seeing human ingenuity at its best. shery: how do you see australia's position in the sector? >> australia has been investing in quantum for nearly 40 years. but in the last 20 years there has been a massive investment through the university sector. in the other thing that was really interesting was around the 2000 with the advent of nanotechnology.

what we saw was a challenge put out there with an idea of having quantum computing based on silicone, which is the basis for all of our electronics today. it's embedded in creating a new wave of creating computation. australia had a focus front from day one, and i think we are seeing that develop over the last two decades, and we are seeing two companies been up, and there is already 17 companies, plus australia that has been out from the university sector. and we are also seeing international companies coming in and investing in australia. so we are really well based with the talent. we've got the ambition and we also have the support of government to be able to say this is something we want to do here in australia. >> i was going to ask about talent because we hear about these labor and talent shortages and all of these different sectors of the global economy. what does it look like in the scientific community?

>> in australia we actually have extraordinary universities. it's 3% of the worlds population. we have a of our universities in the top 100 in the world, which is phenomenal, and we have are you -- our universities in the top 100. we have excellent education and excellent training. bringing that together means we have been training a people, particularly in the quantum area at a level that has been very attractive internationally. what we have seen is some of our on show lands going off overseas to help businesses. and what we want to do is try to bring them back into the countries. that's something we've heard our government identify as something important. the other thing that's interesting is there's a real talent squeeze particularly in i.t. and all engineering areas. this is something where the

government's new priority areas is to see how we can build the workforce and increase it by 1.2 million by 2030. there's an extraordinary -- that we can deliver, but it's something that will require focus and determination to make that happen. >> great to have you with us, we really appreciate your time. australia's chief scientist. >> we have plenty more coming up. thailand's recovery from the pandemic with an exclusive interview with one of the country's oldest ferry operator just ahead. this is bloomberg. ♪

shery: thailand's tourism industry has covid ease. with the rise expected to triple from october from one million a month. that's million visitors seen in 2019. it's one of so many businesses forced to reevaluate and adapt during the pandemic. it's one of the oldest operators. it was about 100 years ago. the family run business has four generations of women -- he spoke

with bloomberg's juliette saly about how they navigated the pandemic and her explant -- expansion into the property sector. >> their transportation is riverboats. he lost 90% of our passengers during the peak of the pandemic. there were no tourist coming in so we had to terminate the operation. for our hotels, obviously is for terrorists, so use this time for a renovation for the restaurant. we took some time to convert to cater to covid stations. after that we implemented the policies.

they want to have expectations. that became popular. >> so you are able to adapt your businesses, but i imagine the revenue hit was quite high. tell us about that and what sort of returns you are seeing now. >> we are still in the recovery time. i would say it's not back to normal and it will take a while. our hotels pick up quickly and we could see 80% occupancy in our hotels and not restaurants. i think covid has changed their way locals commute and only a few numbers of torah started coming back, so we haven't seen real pickup in that segment.

>> could we see international finance corporation to expand your electric votes? could you tell us about the agreements and what development plans you have? >> the key initiatives is the impact on the environment. it needs to be at the frontier helping to lower the footprint. we are going to start working on this to see the viability of c electric boat. we hope to retire the diesel engine votes into fully electric in the coming year. >> one about other businesses when you focus on the hotel

developments, real estate development, what feature are you seeing? >> the main one is real estate. i would like to build the real estate portfolio. my grandmother had a lot of land to build her boat. and at that time they didn't have much. -- that much value. now they have a lot of value for riverfront. we do hotels, restaurants and shopping malls and they have been picking up quite fast. they have been growing, and we have for real estate projects in the pipeline for the next two years. hotels, apartments, retail, and bangkok and outside of bangkok. we will continue to grow that real estate portfolio. juliette: from a fourth-generation in terms of your business and a fourth generation of women, just tell us how much the business has evolved from your

great-grandmothers days? >> in my great-grandmothers days the river played a major role where transportation and thailand, especially bangkok. she started with rowing. and at that time we did not have any bridges, skytrain's underground. and in my grandmother's time, she put the motors into the boat, so they became motorized boats. it lets people rely on boats as a way to commute, and they are starting it underground. it has become small, but tourism is the business for transportation. >> did you feel pressured to join the family business? >> not at all. when i finished college, it was actually my choice to come and join the family business. i saw there were a lot of

opportunities for me and i came back and i did not join the core business right away, i started my own real estate company under the brand. that was about eight years ago, and that's when i started my first project. so that was very fun for me, and i was able to do something i like and i have's success of the project that mimi earned my right entity other projects and into the core business of other companies. juliette: how do you think your great-grandmother would be and she looks at the business? >> i'm trying to continue the legacy of the women in the family, but more importantly, a my mother has always taught me that whatever business we are in, whatever we do, we should try to maximize the value that

it creates. for our community, for the country, and that will reflect, and that will make your business sustainable. we had a very bad flood in 2011, we had many political unrest around the years. we did not stop operations, we operated through all of them in the past 50 years, and i think it's like that and the partners that we have today. we are very proud to say that we are a privately owned company and are able to charge one of the lowest fares for public transportation and thailand. you can get on a boat at $.10 for the ferry crossing or at $.50 for the express boat. and we believe that this is the

reason we are able to have strong partners and allies with us today. quick speaking to bloomberg with juliette saly. watch live and see the past interviews as well on our interactive tv function, tv . there you can dive into any of the securities are bloomberg functions that we talk about. also become part of the conversation by sending us instant messages during our shows. this is for bloomberg subscribers only. check it out at tv . take a look at the japanese yen. we see the weakness against the u.s. dollar. we are talking a level close to that 133 and it touch that level already. earlier this week their weakest level since april of 2002 against the u.s. dollar. you can see all of the pairs in the japanese yen continues to depreciate. rate differentials making a huge difference.

central bank is not tightening monetary policy. we are getting the latest gdp numbers out of the country. when it comes to the final force -- first quarter numbers, contraction of .5%. this is a smaller contraction than what was expected. we have seen the economy being pressured because of the ongoing covid restrictions, but also, a lot of easing has happened in the first quarter and we have seen capital expenditure falling a little bit, but is doesn't seem to have made that big of it that when it came to the final numbers. a contraction of .1%, which is smaller than expected. we are also getting for current account coming in at 501 billion dollars. we have more analysis on the data ahead. this is bloomberg. ♪

haidi: let's take a look at the lines crossing when it comes to japan's gdp. first quarter gdp on an annualized basis that was better than expectations of more than 1% contraction. 0.1% on the downside quarter on quarter was better than expected of a contraction of three tens

of percent. nominal gdp has arise of 2/10 of a percent, beating expectations. we knew break it down, consumption seeing arise, expecting no change. business falling by 7/10 of a percent. that is much worse than the expectation of a gain of 3/10 of 1%. we also had some losses on the account of net exports. take a look at the end, still trading close to around that two decade low. but it comes to the market policy reaction as we do currency plunge potentially giving japan another shot at the reflation campaign. trading again is one of the biggest macro traits out there which traders really seem to be filling in and big volumes around the clock. let's get more from our senior effects and rates reporter. days of relentless setting. there is a little bit of stability. do we potentially see some strengthening from here? >> the yen has pulled back, so

it could be -- if there are any of them out there. but it does still remain at the policy diversion story with the interest rate at the bank of japan thinking to its ultra dovish and monetary policy. many are saying that they are targeting 135 or dollar-yen, which means that there is quite a bit enforcing the yen, as young as the boj sticks -- as long as the boj sticks with its monetary policy. shery: what's the verdict from economists out there? >> surely someone has to be benefiting from a weak. . a week. is positive for the japanese economy. a lot of economists do see that because you have the reflationary forces for decades.

it also increases the profits of japanese companies. however, speak to japanese households and he will probably get a different story. smaller companies and retail goods are hurting. if you are someone who is learning yen right now, you will be hedging quite a bit. >> our senior effects reporter with the latest on japan in the end. we will have plenty more, especially at the japanese market open. coming online in sydney as well. this is bloomberg. ♪

shery: clear counting down to asia's major market open. we saw the world bank cut growth forecasts again and worn inflation. we see central-bank starting to add whether the rba are the central bank with more to come. haidi: half of those 50 global central banks have cut big increments, at least half a point and we see that movement and reaction in the markets. >> india could be the next want to join. we have opens in japan, south korea and australia. the other one we will watch will be the duration of treasury yield. we did see that the client in the radius week. it is above that 3% level.

he put pressure on the end. 135 is the next venue trading around 132 282 decade period is continuing to point out the benefit. this is a check on where the action is in. . it is slowing more than expected. foreign investors are again turning negative i we are watching today and the cossack index. the lawn also is in focus. we have seen leaning declines. with a check on australia and the asx 200, just recovering some of its losses that we softer the biggest drop in a months. bond yields looking little change. more commentary coming through on the rba's 50 basis point hike.

the willingness of the central bank in australia means that we will see a peak in the bond selloff in the third quarter. haidi: both the japanese and korean opponents will see it recover from the weakness. let's talk from the outlook for the rest of 2022. it's a great of hope for a courier and we see exports potentially at risk. kathleen: we just spoke with their world bank author about how china's slowdown central bank is in asia as well. let's start with japan. the easier it is to export your goods to the rest of the world if they still have enough money

in their pocket books to purchase them. what happened with japan's gdp number is only when it got revised from -0.1 so i to 0.2. this investment actually fell and was -0.7% and came down to a gain of 0.5. we can only assume that it recovered from the covid outbreak, trying to get back on your fee in terms of reducing and strictness -- restrictions on people. travel is something that affected them. it may help exporters, but it may help importers. that gdp was revised from 3.1 year-over-year to 3.01 year-over-year. china's the threat because it slowing down but so far, so good for korea. shery: a lot of that was really

centered on what's happening with the chinese economy. what did they say about apac, asia-pacific economic growth? kathleen: we know they are warning about stagflation. if it stays high for a long time and slow, and supply chains don't of, i think that's one of the most powerful points we heard, but that is a big threat. in terms of actual growth forecasts, the world bank revised their forecast from 2.9%. it was 4.1 in january. march and april is when they actually put out their previous forecasts, but it is something that they are very concerned about, and we could see individual instances of the economy picking up. their world bank is concerned of bigger forces, which are global. and it's in the other direction and eliminate what we see from

benefiting from higher commodity prices. shery: global economic and policy editor kathleen was mentioning oil prices rising. inflationary prices, let's bring our next guest who has added more exposure to commodities. the asian equity senior investment director. it's good to have you with us, so you added during a short-term pullback, so what is your view about commodities and are you talking about energy companies, what about minors and food traders? >> thank you, so good to be back. we are talking about the mining companies and we saw the lockdown situation and it was looking pretty attractive and we actually see commodity prices staying higher for longer and we

have the companies in the balance sheets that are really strong. shery: does investing more in these commodity companies have these fossil fuel ones that go against any of the renewable calls that we have seen so far? >> apart from investing in there, oddities and the companies that we see, there are the structures on the stimulus plans as well. we are actually seeing a cool off of the renewables. that's also where we are seeing very strong earnings in such an

uncertain time that we are talking about right now. the visibility and lower valuations. shery: what about technology companies, they have been a bit expensive recently, we have seen a selloff. do you get into the more highly priced in names? >> i think we are generally a bit more cautious of technology companies. we got to break things down a bit. but we are not cautious with the higher price names, low -- those with low profitability and those that are downstream where you have economic correction and that's when the first cut will happen. some of the downstream names are seeing the earnings revision, which is where we are being more cautious. we actually have a gain where we see the highest earning and strong balance sheet was the

quality and such an certain times. haidi: we continue to see energies and commodities climb higher, what is that mean for renewables? >> i think what that means that in the short to medium-term, it will actually spur the transition. across the sector it makes sense to do so, and i think the other side of the equation is that renewables are declining so the costs are coming down and that's far from economy's perspective. it does make sense to speed up the transition. and from a a longer-term end steve security perspective on weights about concerns around climate change, it is a path everyone needs to follow, and we see there would be an acceleration from here over the next 10 to 20 years, so really longer-term here.

haidi: what are you seeing as the currency effects? what he see's benefits or disadvantages? >> in terms of benefits we are seeing in asia, are these countries that are rapidly more resilient because their economies process more by the commodities prices. they show us, for example, that they have been relatively more resilient. and they have pressure in japan, that we are seeing a really weak yen. it puts pressure in terms of -- when japan opens up, traveling to japan is extremely cheap. you have the opportunity. releasing the right companies stirring the overall environment that is very volatile at the moment.

>> asian equity senior investment director at aberdeen. let's look at some of the movers. >> checking in on big uranium names in australia we've had this media report that alipay and singapore is planning to sell 5 million shares in block shares at a discount of 11.8% over the previous time. moving to the board for a check on the else trillion uranium minors. we had a bloomberg scoop that the biden administration may slaps sanctions on enriched uranium imports from russia in response to its invasion with ukraine. we saw with the big u.s. names overnight and in canada. we see it for the australian uranium producers. more checks on the mining and

metal sector. jeffrey's upgrades great minors. that's for china to continue its recovery post-covid. shery: let's now get to vonnie quinn with the first word headlines. vonnie: u.s. treasury secretary janet yellen's that is likely to stay high and she should not have called the transitory last year. speaking to lawmakers she defended the biden administration's american rescue plan saying it's not to blame for the surging costing limit -- living. they will show u.s. consumer prices remaining near a 40 year high. janet: i think that bringing inflation down should be our number one priority and president biden, in an op-ed on inflation and recent remarks, has indicated that it is our top priority. vonnie: the biden administration is proposing a plan to wean the u.s. of russian-uranium imports.

the white house is pushing lawmakers to support the $4.3 billion plan. officials are meeting with key congressional staff to plead their case. the proposal would boost uranium purchases from domestic producers. sri lanka does foreign-exchange reserve rose for the first time in five months likely due to a deferment of payments to india. it rose to $1.92 billion at the end of may. that figure includes -- from the pboc with $1.5 billion. sri lanka needs nearly $6 billion in the next six months to tackle shortages of essentials, including food, fuel and medicine. china is wanting australia to stop so-called provocations or else face serious consequences. beijing denied allegations that a chinese jet -- late last month over the south china sea. australia says the chinese aircraft flew in a dangerous manner but beijing said its

actions are illegal and reasonable. global news, 24 hours a day, on air and on bloomberg quicktake, powered by 2700 journalists and analysts in more than 120 countries. shery: we look at the biden a ministrations efforts to reassert -- for the council of the americas. central banks around the world take aggressive action of fight inflation and we look at what's expecting from the rbi in pboc. this is bloomberg. ♪

>> many countries will have a hard time avoiding a recession. is not a global recession yet, the downside risk is that it could be a global recession. one of the key variables is whether supply comes back online and order thaad growth and slow down the inflation rate. but this is the sharpest slowdown in 80 years. >> more than 50 central banks around the world, including the

federal reserve, have taken aggressive action to combat inflation. australia and chile are the latest to join the club in india is expected to follow suit. let's ring and enda curran. the forecast for the rbis rate hikes seem to be a little bit all over the place, what are you expecting? >> they are expected to go by 50 basis points. the central bank is moving whichever rate hikes. it's all about inflation. the rbi with a target of 2% to 6%. inflation is india's 2.7 percent. a lot down to supply-side pressure. nonetheless, they do have to respond, otherwise they risk inflation expectations becoming unanchored. the thing to think about is how the forecast is going forward. they are taking measures on their side of things to slow sugar exports. they've also been taking steps

to take a live on diesel and gas. that raises the question of if those measured unsuccessful, how much more with the rbi have to do. the rbi will have to hike rates. it's only 50 basis point move. >> dampening chinese exports, what are we expecting out of the trade numbers? >> it's an interesting story there because there has got to be a boost from their reopening of shanghai. ships will get moving again and factories can get producing again. we have been speaking to factories and what producers are saying is consumers in the western markets in europe in the u.s. are changing how they spend. eight are spending more with goods, impacting it. the stores and bars have high

inventory level, so they don't need tobias much stuff as they were last year. in the third point is inflation and mortgage costs are increasing in its having an impact on disposable income. when you added altogether, exporters are saying there is less demand for products. nobody is talking about a trade recession, it's more of a slowing of demand. they do say once we get into the later part of the year, they are expecting a material softening. the china trade boom is cooling. certainly coming off, not expected to be what it was in the last few years. >> chief asia economic correspondent. we do have an alert on the bloomberg, western digital is nearing a settlement according to the wall street journal. the act of this investor has

urged them to spin off their business saying the chipmaker has underperformed and we are saying -- that the western digital will involve the view of a possible split and board changes according to the wall street journal. this could be unveiled later this week and they are very near that settlement near the two parties. and we are focused on the stagflationary fears. they cut their global forecast for the third time this year, warning that the pain of stagflation can last for years. we spoke to the lenders chief economist and global director who told us asian central banks need to be more decisive in the fight against inflation and slower growth. >> it depends on global trade and expecting trade to slow down

significantly that it took to last year. we also downgraded our global trade growth forecast for this year in the next year. inflationary pressures grow because of the war in ukraine. the region has to get ready for the global speculation and consequences. >> how much depends on commodity prices? you point out that the commodities exporters and asia, particularly in east asia pacific, are going to have their growth even may be stronger this year because they are exporting goods and commodities at higher prices. >> indeed. you look at increasing commodity prices, they are price substantial, but that comes with inflationary pressures as well.

even in these economies, there are going to be dividends associated with high commodity prices. but inflation is global, so they also need to adjust

>> this is bloomberg. ♪

>> a quick check of the latest business flash headlines. nothing is decided on the potential plans to go private. they told bloomberg that if there's more value than stain public then there's an option.

they have received a buyout offers. kwuex this is just a process of comparing, which is the best for the shareholders. of course this is a multi-stakeholder, but the shareholders see important element that we have to check and compare. kwuex australians tollroad operator hasn't received any proposal in the fund offers a 7% stake at $8.10 per share and exchange defiling on wednesday. the shareholders don't need to take any action at this stage. >> is talk a little bit about

citigroup because it seems the bank may be returning to hong kong -- to hong kong. the staff is stepping up its presence in the region. here doing pretty well and we have talked about this from hong kong and it seems they will start hiring from their in in singapore as well. >> it's interesting we will see this. still pretty early days, but as we see covid restrictions in place in hong kong, because on the back of city saying they want to hire tech staff to tap into digital explosion. very interesting, the hiring another crazy day? of course—you're a cio in 2022. but you're ready. because you've got the next generation in global secure networking from comcast business. with fully integrated security solutions all in one place. so you're covered. on-premise and in the cloud.

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annabelle: this is daybreak asia

i check on how markets are doing 30 days and traded -- into the trading session we are seeing gains to the upside. we had that move higher with wall street overnight but we did have growth concerns with the world bank cutting its global economic forecast. the headwind here for traders. japan into its fourth straight day of gains. we have the yen continuing to weaken against the greenback. treasury yields and focus below the 3% level, so that is another supportive factor for equities in this part of the world. looking at a chance at how movers are going. target was one of the most-watched stock. they did cut their guidance for a second time. target is a bellwether for the helpless consumers in our bloomberg intelligence team saying it could signal similar challenges at other retailers, so far not being reflected in asia. still in the middle of the mining space as we move the board on, we can check in on how

the biggest miners are faring after jeffries upgraded eight big names with their conviction. it will continue to go out on china's economic recovery. haidi: let's get you to vonnie quinn with the first word headlines. vonnie: the world bank has cut its global world outlook saying it was figured by the war in ukraine. the world economy is expected to grow 2.9% in 2022 starting with the april forecast of 2.2%. accelerating inflation and growing global -- growth raises concerns of the economy entering stagflation that could persist for years. >> many countries will have a hard time avoiding a recession. it's not a global recession yet, the downside risk is that it could be a global recession. one of the key variables is whether supply comes back online in order to add growth in

slowdown inflation rate, but this is the sharpest slowdown in 80 years. vonnie: two u.s. senators of introduced a bill for regulations. it's to maintain 100% and it would close assets. it also target sanctions and the impact of coin mining. it could act as a starting point for negotiations next year. nasa will launch three rockets in june and july from a base in australia's northern territory. it will be the first time they use a commercial launchpad outside of the united states and its more than 50 year history. this space center is privately run. prime minister says it will be the first nasa launch from australia since 1995. vietnam's health minister has become the latest high-ranking official cut up and they anticorruption campaign with parliament voting to dismiss them.

he was expelled from the communist party for wasting state budget resources. vietnam has been investing a wide-ranging of illegal activities. this is bloomberg. ♪ -- global news, 24 hours a day, on air and on bloomberg quicktake, powered by 2700 journalists and analysts in more than 120 countries. su: -- shery: more than 20 heads of government are expected to be in los angeles. they are approaching the event with a mix of skepticism and interest at a time when china is expanding its influence in the region. let's bring in the vice president at the council of the america joining us from a l.a.. always good to have you with us. you said recently that each summit has become progressively less ambitious. with that state for the biden administration? >> there's a lot at stake, frankly, but their trajectory

has been downward since the first summit was hosted in miami by the united states in 1994. i was there, i will tell you held i was. the comparison between them and now is starch. in 1994 we were coming out of the cold war, democracy was coming to latin america and was being entrenched in the world was building into blocks, europe, the western hemisphere in asia. there was a strategic component. but that has seemed to break down as it has progressed in the idea of a hemispheric trade arrangement that was moved back in the first summit is nowhere to be found. now what we talk about today and this week in los angeles are migration records, may be cooperation on global climate change issues and things like that, which are important, but it's a totally different agenda and doesn't appeal to some leaders. shery: talking about those

leaders, we have seen more than 20 attending, but this has been pretty controversial and one of the biggest figures. tell us a little bit about the dynamics at play, especially when you have another rival like china expanding its influence. >> it's unfortunate that the president of mexico decided to sit this out. a couple of weeks ago he made clear that if the united states didn't you -- didn't invite the dictatorships of cuba, venezuela and nicaragua then he would not come to los angeles. it's curious why he would want to align with the riddle dictatorships in the hemisphere, rather than coming to los angeles to meet with other leaders to really talk about and make progress on things like economic growth or migration. and you're right, the china issue is real, it's not being discussed in the same way here in los angeles perhaps because this is the hemispheric leader

summit. air china find ways to cooperate among ourselves, but china is here is the dog that doesn't bark and people are aware of it and aware that if the united states is an able to come up with some real compelling initiative, then there's always china out there is a potential partner. >> is it effective to isolating these countries and have been on the receiving end of significant investment in a? in the asia-pacific, a different approach. a renewed level of trying to engage with these countries, even as beijing continues the approach. >> that's right. i've been an advocate for a long time that we need to step up our game in the western hemisphere. the united states needs to step up its game. most countries in south america has china as their top trading

partner. that's based on commodities. at the same time there's a lot of infrastructure needs. a lot of u.s. companies just don't look at latin america and the same way they look at asia. there are real opportunities. i would like a lot more attention to be paid to the region in this summit will hopefully bring attention to it, but at the end of the day it will have to be the private sector that makes the decisions and they will make it on risk-adjusted return and having secure and -- secure investments. a lot of work needs to be done to make it more attractive and competitive. >> what would be the biggest policy priority to get that back on track? >> there are a couple of things in my view, one is a commitment to get out of the pandemic, latin america, despite having only a percent of the worlds population in over 25% of the world's death from covid, it's a

tragedy, that at the same time, we need to get the region back to economic health. and getting beyond the pandemic is part of that. more to the point, we need to think in terms of debt relief, investment flows to the region, and there are a lot of things that can be done. many of them technical. but the political level commitment to the region to really focus the resources that are necessary for the region. at the end of the day, the region needs its sources and it will try to find them from wherever they will get them. if there's no trade agenda from the united states and limited agenda on investment or pandemic relief for that sort of thing, then we take ourselves out of the game unnecessarily. i'd like to see a much more robust and aggressive economic partnership package coming out of the summit. we will have to see if that actually happens. >> always great to have you with us on bloomberg. council of the americas via

president. australia and new zealand have 60 $5 billion worth of m&a deals. we will discuss that momentum next with morgan stanley live from the bank of australia summit. this is bloomberg. ♪

shery: take a look at how asian

markets are now. japanese yen still at that 20 year low against the u.s. dollar. we also saw first quarter gdp surprising to the upside, so rising -- surprising to the downside. the stock is up 3/10 of 1%. haidi: bloomberg data is showing us that australia and new zealand has six he $5 billion worth of m&a deals. that's the biggest start to a year since 2007 benefits and contract to a wider global deal. let's get some perspective now by morgan stanley, the group. so great to have you with us. my question is, does that momentum continue, or just at front load, given what we have communication on what the rba will do, and does what the rba is doing, the aggressiveness of the tightening, change the momentum? >> i think what we're saying is

the number of substantial transactions. some of the sectors that we are seeing stronger activities in health care. obviously there transactions are one of the biggest deals announced this year. i we are also seeing other deals in that sector, including the bgh. so that sector, being health care and the one that is attractive to the investment. multiple markets have come down, which maintains the m&a opportunities even greater. last year there have been multiples for the australian sector that was around 30 times, it's now 24 times. and all those private equity management risks spots in the marketing global and domestic funds i think provides a bit of a flaw in the market from growth evaluation perspective, and then that will fuel the public supply and activity in the market.

so i guess it is to be good activity from an m&a perspective. >> so you think if there are broader liquidity sentiment concerns, the money will still come in throughout the course of the rest of the year? >> private equity raised a large amount of capital with one of the biggest fundraisers and private equity. we are seeing some of the global funds increase or reinstate their offices. it brought back their australian office and they are opening up their office here. so what we are seeing is australia is an attractive destination, particularly for private equity capital. the cost of debt will get a little bit higher, but from a context of 20, 30 year perspective, the interest rates we have now are still very low and the cost of debt is still relatively low on a long-term basis. shery: also, esg is very

important, especially with the labor government prioritizing green technology and renewables. you see that affecting how deep -- how dealmaking proceeds from here? >> i think that we are seeing this to be a strong level of activity. i think the change in government will impact some sectors, particularly in the energy sector where there will be some consideration to understand what policy and regulatory settings might be in that sector going forward. we can see that we expect to see, particularly a be in the next five to 10 years. and so, i think with a bit more guarantee in the coming weeks and months around any changes in

our political and regulatory, that will provide more certainty to think about what also might happening in the coming years. >> we have seen that rotation. it follows when it comes to the dealmaking space. we are likely to see more old-school industries like manufacturing get more dealmaking money. quake sets the services scenario where a lot of clients are focused and continuing to do deals. risa the group holding last year. a good, strong defensive business with an attractive valuation. still seeing some interest with the g rating nec opportunities. people take a stab at this end we see inconsistency. i don't think tech is still done from a dealmaking perspective, there is very high quality technology names that have been

oversold, and we are seeing parties look at those assets and see if they can provide opportunities. quick so great to have you with us. morgan stanley's australian managing director. emma james here with us. shery: we are getting more lines when it comes to the western digital agreement. we are now hearing that they signed a nondisclosure agreement. they will review options, including separating -- and this as they had urged western digital to spin off their flash business saying the chipmaker had underperformed their potential. we had seen earlier media reports that they were close to a deal and we are now seeing that the two sides have signed a nondisclosure agreement and they look forward to continuing dialogue and they have named them as advisors. plenty more to come. this is bloomberg. ♪

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shery: the chinese automaker is taking on spacex as they launched nine satellites into orbit last week, making it one of the first chinese -- two assemble the -- assembled by elon musk company. we spoke exclusively to the ceo. >>'s three phases for the future mobility network. the first phase includes over

400 stations on the ground covering china. the second phase will have 72 satellites and eight orbits to provide services in space. we will finish the first and second phases by 2025. we will put the first phase based on precise point positioning and real-time services into commercial uses by july of this year. >> can you tell us more about what specific services will be offered as soon as the end of this year? will it be the autonomous driving or other services? >> our precise point positioning services on ground infrastructure will be put into use for the second half of this year. in addition, we are working with autonomous driving to make plans for precise point positioning services. so far, the research and developments of our projects are in key stages. we expect to see the driving we use this price point positioning

into the space and infrastructure. we are building up the service network in europe and america to prepare for entering overseas markets. >> why did they decide to build its own network? why not use someone else's network or partner with someone else? why decide to build your own network? >> we think there are many synergies between auto manufacturing in the aerospace industry. i think the collaboration isn't just limited to autonomous driving. it represents 5g, 5g plus, 60, and a significant revolution of the future transport of human beings. >> would you allow another car company to use your network? we will -- >> we will, of course. our future partners are not just limited to the ecosystem and vehicles. we are also planning the ecosystem of our partners in urban industries. on the other hand, our network

can support areas including small manufacturing, unmanned aerial delivery. we can build an advantage on the ecosystem through our partner systems. -- partnerships. >> how much will it cost to get the entire network up and running at full capacity as the company envisions it today? >> our first may satellite are completely invented and developed by g space. they will serve over five years, they are lows cost, highly reliable satellites. so that satellite has reduced to under 10 million yuan. the cost is estimated based on the satellites of the first phase. their cost will be further reduced to under 6 million yuan scale manufacturing and industrial integration. >> how will you finance the costs of constructing this network? >> it comes from our planning from our business model and we

use various fundraising methods -- methods to guarantee building up the system. our current cash flow is very healthy right now. we will introduce more strategic investors who will resource for the industry. >> would you consider, at some point, a public listing. >> we don't have a detailed timetable yet. with the development of the chinese markets in the secondary markets, we will possibly consider when we need it. >> i think for a lot of our viewers, the space company they know best is spacex. and i know that the focus on transportation is different from spacex, but what are some of the other differences you would want people to know about? >> the difference between us is that our goals of developing satellites are different. spacex provide satellite broad bank service. g space will integrate the ground infrastructure, precise

point positioning, cinematic service, space information network, along with the beta free module. and that's all based on the future mobility network. that will realize the integration of telecommunication, gps, remote sensing in the shortest time to provide a comprehensive solution for mobility in china. geespace ceo tony wang. the reports are for tuesday, but there were -- but the situation has a rebound in growth and sentiment. bond traders are fearing that this could lead to a liquidity crunch amid rising demand for cash. it's bring in our chief china correspondent. short-term debt markets could be particularly vulnerable. >> yes, exactly. good morning. so chinese bond traders have actually had a really great time because funding conditions are

so low onshore. there's so much liquidity, and it has nowhere to go because credit demand is so weak. when you have these conditions this toluse, what has happened is they have been buying up short data bonds and cds, that one year yield is really low, and that starting to tick up. concern is that there will be credit demand, there will be greater economic activity going forward. and also, coupled with that, there will be in an oversupply of bonds as the government really ramps up its fiscal spending, it's fiscal stimulus has been an enormous amount of debate around what that fiscal stimulus will look like. but almost everyone agrees that it will come in the second half of the year. shery: what are we expecting in terms of monetary policy, we have plenty of data the markets need to digest including exports and inflation as well. >> that will be key, as will be we are expecting this data on

bond outflows, and that has been a key concern for the central bank. if outflows did kick up again in may, that is why the central bank is unwilling to ease too far. we will see if the ppi print picks up. so far, china has been one of the few places in the world where inflation is a vital problem. but yes, it will be key to watch. shery: with the latest on those markets. of course, we are looking ahead to the start of trade and hong kong, shanghai and shenzhen. standby for bloomberg markets china open. this is bloomberg. ♪

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