haidi: you are watching "daybreak: asia." annabelle: we are coaching -- we are counting down to asia's market open. shery: bond yields and the dollar again ahead of friday's crucial u.s. cpi numbers. ashli babbitt u.s. listed shares tumble after chinese regulators did not a bloomberg report of talks to revive the ant group ipo. plus public hearings on the january 6 i talk begin assuming, with the house committee promising -- of the january 6 capitol attack begin soon, with the house committee promising new evidence. haidi: south korea's april current account deficit at $79.3

million. the april goods trade, falling to a surplus of 2.98 billion dollars. we are also hearing from the bank of korea governor, delivering a speech at an event on the 72nd anniversary of the central bank. he is talking about the economic damage from the inflation correct, saying damage to the economy will be greater if they may set the timing on the rate hikes. we did hear from the bank of korea's deputy governor saying that it is not appropriate to hike the policy rate by 25 rather than a big step like 50, as we have seen more consistently happening with other major central banks. we have heard repeatedly from policymakers from korea that inflation remains a grave risk there, but those april current account numbers are just crossing the bloomberg. we will be getting you more from the back of korea governor as we get his remarks.

annabelle: inflation top of mind investors as well. we have the opens in japan, korea and china in the next hour. we had the late-day selloff in the u.s. on growth concerns. also the mixed reporting on the ant ipo, plus more lockdown fears in beijing and shanghai. allowed for investors to contend with. futures are printing lower. japan, a different picture, it's biggest exporting names taking off from that japanese yen weakness. the nikkei has gone higher the past five sessions. the yen is a major focus, a lot of speculation as to what can force japan to intervene and prop up its currency or focus on inflation issues as well. a new survey says most analysts actually say the bank of japan will standa on its policy unless we see the yen breach of

the 140 level. shery: the s&p 500 saw its worst day in about two weeks. we had some late selling, with signs of perhaps some algorithmic activity given the cpi numbers we are expecting friday. we have the nasdaq 100 falling, not doing much, but the treasury space also following some of those government bonds we saw in europe after the ecb's hawkish decision. we have the 10-year yield in the u.s. still above 3%. wti continued its decline towards the $121 level. two forces in the oil market, whether it is the boost from refinery demand, or the renewed lockdowns in shanghai pressuring the market. oil prices are leading to more inflationary pressures around the world. the latest central bank to raise rates is peer group, 5.5% from

5% -- is peru. the central bank is saying that it's continuing policy normalization. one of the latest central banks around the world and in latin america to move because of raising and surging inflationary pressures. of course this is giving central bank hawks a stronger hand around the world. the ecb is signaling it may join the 50 basis point rate hike club. let's get more from kathleen hayes. what will the cpi report mean for the federal reserve what it -- when it meets next week? kathleen: it is way above the target. the 50 basis point rate hikes should be reinforced by this. and actually, even if it looks

like inflation may be starting to peak, that is not enough for the fed. the cpi year-over-year is expected to remain at 8.3%. surging food and energy prices and services prices, that makes up more than half of the cpi, they continue to raise. the core cpi, taking out food and energy, may actually ease a bit, to 5.9% from 6.2% because food prices are getting softer. but it takes more than that to convince the fed they have begun to do their job. they have already signaled 50 basis point hikes for this meeting and the july meeting. others have signaled more 50-basis-point rate hikes will have to come to get neutral by the end of the year -- a wide range as to what neutral is -- nevertheless, we will be getting new dot plots and new forecasts. this is more of background

noise, this is what the fed is watching -- inflation is high, it is way too high. they have to see evidence of it coming down. haidi: when it comes to the ecb, hard to believe it was just three weeks ago, the netherlands was pushing for this hawkish stance. have we seen the hawks win at the policy debate now? su: they have saturday moved the policy debate. inflation has been raising dramatically in the euro area for some time now and it was widely expected that at some point this year the ecb would start hiking ending their bond purchases as well but it seems that the hawks starting to talk about the need to be more progressive, do something to change the trajectory of inflation and yes, netherlands led the charge. but what you are looking at now, the surging inflation, this is what got the dobbs to make the compromise -- the doves to make

the compromise. may be in september if inflation is still high, then we will do the 50 basis point hikes. are they moving rapidly? no. in fact they will not get out of negative territory until the end of the third quarter. but they also talked about the deteriorating outlook for production, talking about the downside risk of the war a new crane, higher energy prices -- the war in ukraine, higher energy prices. in there also talking about greece and italy, if they stop buying bonds into the asset purchase program, do if those yields start getting out of whack? that is the kind of thing people are saying is behind what looks like kind of a compromise -- we will get hawkish, but only so hawkish. and the hawks are glad to see

them moving in their direction. haidi: our global economics and policy editor kathleen hays with all the latest moves. china's regulator denied a bloomberg news report that it is in early-stage discussions on reviving the ipo of jack ma's ant group. let's get more with our chief north asia correspondent stephen engle. i have to say, it would have been a complete game changer. stephen: absolutely. in the premarket, alibaba shares in the u.s. were up 7% when the news broke, before that csrc came out with their statement. it shows that this continued pushback into chinese tech was looking for some concrete needs. people latched on to this new. but when that csrc came out with their statement last night, it essentially said it denied it is

conducting work on reviving this ipo, but it did say it supports eligible companies going public, reiterating what the top leadership have been talking about, the platform economy. that is why we have seen today's falloff in alibaba and other tech shares. and we got the news this week that perhaps the probe on didi global was about to and. . these are the two high-profile targets on xi jinping's campaign to rein excessive expansion of these companies. so csrc has established a team to rest the share sale plans, and authorities are nearing the final stages of issuing ant a license and that would make it more regulated like a bank.

i think that is the next date in this story. essentially, what restructuring has ant done to appease the regulators, and what size ipo down the road would be? those banking services that made ant a 35 billion dollar juggernaut before it was scrapped, what with the company look like after this? shery: stephen engle joining us from hong kong. here in the u.s., the house committee investigating the attack on the capitol on january 6 last year begins its hearings in a couple of hours. it has promised to review new evidence about the assault, and our guest joins us from washington. jack, what will you be watching during these proceedings? how can we expect it to unfold? jack: keep in mind this is a prime time.

, at its in about one hour. a lot of the focus is presenting their findings to the american people. a lot of lawmakers on the panel have talked about laying out the facts that in their view, there was a level of premeditation and organization on the part of some people on january 6, and it was not just a spur-of-the-moment kind of thing. some of the questions that they may answer our was there the involvement of lawmakers, former or current? they may bring up clips of the deposition that was participated in by the people close to president trump, it may be family members, potentially chief of staff mark meadows, sort of laying out a timeline of january 6 and making the case that there was some level of organization leading up to it is a significant factor for the members of the panel. haidi: what are we expecting in terms of evidence or

documentation that might point to the level of involvement from the former president trump and his allies? jack: the deposition of people close to him, they may play view clips of the people who participated, in videotaped depositions early in the process that could be to that. i would also point out that there are two people testifying in this hearing, what is a capitol police officer he a traumatic brain injury. the other is a documentary filmmaker who was embedded with the far-right groups the proud boys, that may have had another connection with another group, the oath keepers, leading up to this. the timeline that the filmmaker may layout, it could be a significant focus of this hearing. haidi: bloomberg government's jack: patrick with a preview. let's get to su keenan in new york with the first word

headlines. su: we start with the chinese defense ministry, it says the ministry will take moves against taiwan's independence plucked. gigabit the common in response to the u.s.'s approval of military sales and equipment to taiwan. it urged the u.s. to revoke sale. . meanwhile, chinese president xi jinping is calling on his government to balance its covid zero policy with the needs of the economy. stayed media say that xi is urging all regions and department should be resolute to overcome economic challenges and maintaining. social stability. china's economy is expected to miss its growth target this year because of the strict virus curbs. bloomberg has been told that the sec is investigating whether marketing of the terra usd stablecoin violated investor

protection regulations before last months crash. out with sources say sec attorneys are looking into whether the firm behind the coin, terraform labs broke the rules. the implosion of the coin in early may sent shockwaves across crypto markets. to sri lanka, where the president has issued a decree, making electricity an essential public service. this after workers at a state run utility threatened to strike. there was a stop work plan for thursday that was called off. power cuts were being reported across the island nation. this has mired sri lanka in the worst economic crisis in its modern history. global news, 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i am su keenan. this is bloomberg. shery: still hate fresh

coronavirus outbreak has a shed light on koreans' attitude towards the lgbtq+ community. we will be looking into that with human rights watch a little later. but first, the ecb is set to announce an end to large-scale asset purchases. nomura tells us how that may affect foreign exchange rate.

>> the new projections percy

annual production -- they foresee annual projection 2.5 percent in 2022 for it is projected to decline in 2023, and higher than in the march projections. this means that headline inflation at the end of the production horizon is jaded to be slightly above our target. >> what worries me jon, and you are not going to like this because it is looking forward, june month-on-month rent will be worse than the may month-on-month print. those who boldly said inflation has beat and is coming down may have to change their minds. haidi: bloomberg opinion columnist mohamed el-erian, and ecb president christine lagarde there on inflation expectations. euro traders were doubting the

conviction of the ecb at the overnight session. it didn't help that we had u.s. dollar trading at a three week-high overnight. dollar euro is looking at -- looking unchanged at the moment. those comments were not enough to bolster the strength of the euro. it is fueling the basket of risks from the economic recovery. the yen is sitting just at 134, a whisker away from tumbling to the lowest level in 24 years. economists warning that this potentially is turning into on one hand an opportunity for japan, but also looking at the downside for asia and its trading partners. finally, the aussie dollar is set for a weekly loss along with the kiwi, really a reflection of that risk-off trade sentiment, now sitting just above $.71. the ecb capping a week that we saw rate hikes from the central

bank in australia and india as well, with analysts like mohamed el-erian warning that inflation is yet to. he heard from david einhorn saying that we are yet to see the peak of inflation as well. let's bring in our guest from nomura here in sydney. it was interesting the reaction we saw across markets. it feels like the hawks have now taken the reins at the ecb. andrew: great to be with you and great to be with you back in the studio. the ecb is now playing catch up. they have laid out this game plan, asset purchases finish this month, and they have signaled quite precisely a 25 -basis-point rate hike , a 25-basis-point rate hike. they are coming from behind, but definitely playing catch up. haidi:. haidi: given they are coming from behind, does it surprise

you that they don't go 51st? andrew: -- does it surprise you that they don't go with a 50 basis point hike first question mark andrew: 25 is the new 50. we have seen that from the rba and the rbnz. they are signaling a steady start and then they will dial up the pace. they are mindful not to rock the markets. we have seen this pattern -- the fed started in 25 and went to 50. the bank of england started with 15 and then went to 25. haidi: where bond yields go from here? we are seeing hints about recovery and that it is just taken away because the sentiment seems so fragile. there doesn't seem to be a lot of conviction in the moment. andrew: i always think that the u.s. 10-year bond yield is the single most important rate in the world. that 3.04. we have it going up to 3.15,

perhaps 3.25 in the worst case scenario. but the thing for us kids that the fed is serious. do you think uscp i will come out on the high side tonight and for the next couple of months, and the fed will be hiking more than it priced. the big thing is the u.s. 10-year yield probably cannot go much more. the biggest threat is the yield curve flattening. if this progressive central bank hiking causes a risk-off in markets, it could also obtain long-term inflation expectations and keep the long -- the long end cap. we are positive on the u.s. dollar. we have had good news in china, some easing of lockdowns, but we cannot see a true recovery in china coming just yet, we think

that is some way away. in europe, the big thing we have been pushing is that the u.s. economy has such strong domestic demand and more internally generated. euro is exposed more to the war in ukraine. so that u.s. dollar looks good against the euro and august cnh. that near term trend is usd trend. shery: what does due to economies that rely heavily on commodities? you also have the rba's very fast pace of tightening. andrew: that aussie dollar is such a tricky one. i watch it closely and it is really rattled between the losing forces. what i would say on the domestic side, domestic fundamentals for the australian dollar are fantastic. the economy is growing strongly. the central bank has turned

hawkish. we are running current account surpluses. there is a lot of positives for the aussie dollar right now and we do have it higher by the end of the year. the challenge for the aussie dollar is it remains a risk. proxy. overnight we saw the s&p closed down, and in the risk environment, the aussie dollar is starting to struggle against a stronger usd. haidi: great to have you back in person, andrew ticehurst, nomura senior economist and rates strategist. you can get a roundup of the central-bank action that we have been talking about as well as other stories you need to know to get your day going. terminal subscribers can get that at dayb . this is bloomberg. ♪

shery: is a live view of people

arriving for the house committee investigating the january 6 attack hearing. this after a violent mob of trump supporters stormed the u.s. capitol to block the transfer of presidential power. this will be the first of six public hearings on the topic over the coming weeks. haidi: yes, some other things to watch out for is really getting the first behind the scenes glimpses of what president trump was doing and reacting to as we saw the unfolding of the riot, the president, of course, maintaining silence. it will be looking for indications of his involvement, the involvement of his allies. what they knew about the plot to disrupt

>>

haidi: we know that the economic outlook of the situation is quite different to what we see across other major economies. >> especially with the u.s., consumer inflation, people are looking run 2.2% greeley reflecting cooling prices for energy and food, the opposite story to what is going on in other parts of the world. we also know what is going on with aggressive lockdowns. at least in terms of the global impact, there will be a base effect expected to drag on consumer-producer prices, commodity prices as well. some are talking about china

being a source of global disinflation. there was a debate about how much these price increases were being passed on to producers around the rest of the world. economists are saying it is the opposite. the net result of today's headline cpi data is expected to show inflation well under control and of the race over to pour more money into the economy. shery: a very different picture to what is happening in the u.s., and this chart showing how we are not just talking about may cpi numbers but realized prices for two straight months, followed by double digits for the first time since the 1980's. when to be expect this to be? -- peak? >> we will be well off the peak of 8.5%. there is question about whether

it has peaked. the food story continues to hit off the charts. the fed will not be anywhere near close to saying, they are pulling clear of this cost inflation crisis. the question is how much higher u.s. interest rates have to go. there is this debate going around u.s. inflation may have peaked but it still has a long way to go before it is back to the comfort zone for policymakers. smart economists are saying it will not be far off the mark speak -- march peak. shery: let's turn to standard charter, it ceo saying hong kong is bouncing back and the lender remains committed to the city

and the chinese market despite covid related descriptions. he spoke about the brink's -- bank's performance. >> there are no storm clouds on the horizon. economic activity remains strong. we note is being met with high levels of inflation, not to mention the condition that markets operate and banks are responding with higher interest rates which was so economic activity. for the time being, it is quite good. we are seeing healthy level of resilience and recovery in hong kong, one of the later markets to come out of the pandemic. we are encouraged economic

activity in china will bounce back. economic activity remains strong, and the evidence of resilience and recovery will be there. for the time being it feels good. as interest rates increase, some of the problems in developing countries exposed to a stronger dollar, we have seen some of that already in markets like sri lanka, other countries are facing their challenges, it could become heavy in the second half of the gear -- year. >> is there a reason to reassess expansion in china given expectations of a slowdown? the zero covid policy will be sustained given 2023, 2024? >> we are not agitating at all.

our intentions and china are long-term and they reflect a few underlying things that have not changed at all. economic growth in china over the medium to long-term will remain high and will be a contributor to global growth. also selecting i percentage growth. -- reflecting high percentage growth. to facilitate the movement of capital and cash in and out of china, payments, investments or other types of initiatives, that is the role that we play. we have a structural opportunity against the backdrop of a structurally growing market. haslinda: we are seeing central

banks hiking rates in a major way. what is the risk of a stagflation recession? what are you factoring in? >> we are prepared for a substantial economic slowdown toward the end of this year and into next year. if you were going to be successful in containing inflation that will be an impact on economic growth. we do not think there will be a recession. the economic impact is very strong. the financial system globally and did most of the markets we operate is very strong. they act as a catalyze or to turn an ordinary credit cycle --

or they can act as a buffer. the financial system was a bit of a buffer. because the financial system is strong i think we will continue a relatively weak recovery, which is necessary in order to contain inflation. haidi: the winters speaking exclusively to haslinda amin. vonnie:: 19 cases in hong kong top 600 on thursday for the first time in seven weeks. the city not 674 cases, the highest since mid april as infections have as well. officials are warning the omicron subvariants continue to spread. residents face mandatory quarantine. dow's committee investigating to

generate six attack on the capital will hold its first primetime television hearing shortly. it has promise to prevent new evidence on the gestalt in a coordinated effort to overturn the election and stop joe biden from taking office. lawmakers have announced plans to release their own version of the riots. pres. biden: i think there was a clear and flagrant violation of the constitution. they tried to turn around the results of an election. there was a lot of question about who is responsible involved. i am not going to make judgment on that. a lot of americans will be seeing for the first time some of the detail that occurred. vonnie: pope francis gained -- the neutral status remains unaffected by its status. japan was also one of the countries chosen for rotating

post on the security council from 2023 to 2024. global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. i am vonnie quinn. this is bloomberg. shery: anti-lgbtq plus sentiment search in korea last year. we ask human rights watch whether things are improving? this is bloomberg. ♪

shery: progress were lgbtq plus is a such as japan, thailand, and i one. i laggard is south korea. as part of our focus on the prior month a program researcher at human rights watch. good to have you with us. we show you -- so you in the height of the pandemic. the pandemic prompted more homophobia in the country. tell us more about the situation right now. >> during the pandemic we saw lgbtq people demonized for the pandemic in south korea. this is part of a larger pattern

where protections lag. people might be fired from their jobs or bullied at school. with cultural -- where we demeaning lgbtq people in public and saying things that diminish the community. shery: why is this the case? other parts of asia are making progress on issues related to the community. what is unique about south korea? >> i think one of the unique features of south korea is the strength of the very vocal conservative protestant minority. even things like student rights organizations that tried to protect lgbtq kids were being

bullied at school. there are cultural events. you see these conservatives come on in force to push back against the recommendation of lgbtq rights. that feels different than many other contacts in asia including places like the philippines where there is been opposition in catholic church. lawmakers have been willing to buck that pressure. haidi: you take a look at the wording and commentary from leaders, from the very top leader and the south korean president saying although one may have the right to choose their sexual orientation we need a couple of hours because denying biologically assigned genders could have a significant social impact. the secretary of the religion

and multiculturalism saying they are personally against homosexuality. we know that south korea as this deeply embedded patriarchal view when it comes to sexuality, women's issues as well. what is the right approach for activists to be effective in a jurisdiction like this? >> one of the really difficult things in south korea is you have the lack of legal protections and you have hostile agencies and lawmakers. one of the things that has mattered in other jurisdictions, this idea that when people come out and parents get to know their lgbtq children, people good to know their coworkers that changes people's attitudes towards lgbtq people. without medical leadership in

south korea that allow people to come out and feel safe sharing with their peers it is unlikely the attitudes will change. stereotypes you see being parroted by lawmakers in south korea will circulate. it is difficult. haidi: we have also seen an interesting survey saying the majority of lgbtq plus employees say inclusivity is key when it comes to retention. at a time when we are seeing tight labor markets, the great resignation post-pandemic, is there a stronger role for businesses to play when the broader legal infrastructure is not standing up for these rights? >> nothing in south korea

prevents companies from enacting their open -- their own policies that promote diversity and inclusion and provide support and safety for their staff. even though south korea's government including the judiciary has been slow to recognize partnerships or provide benefits and things like that. there is nothing that prevents corporations for doing that in standing up for their coworkers during pride month and saying lgbtq people and their relationships are valued and respected. that sets the table for local governments to replicate those protections were competitive corporations to recognize those protections. haidi: thank you so much for your time, ryan.

much more to come on "bloomberg daybreak: asia." this is bloomberg. ♪

shery: breaking of japan, ppi numbers year on year for the month of may grows 9.1%. we are seeing easing in

inflation coming down from that 10% level with we the previous month, and this will have been the fastest rate since the 1980's, a little bit of deceleration and month on month ppi numbers staying flat instead of accelerating as economist had expected. this as we continue to see inflationary pressures. softer prices of raw materials given that china's lockdowns continued during the month of may. ppi numbers in japan easing year on year. take a look at the japanese yen, we continue to see that weakness against the u.s. dollar, very close to the 20 year low against the greenback. 135.15 is the bank of japan's isolation grows. haidi: this breaking news when it comes to turkey to raise the

lira is not going to a. it is already on track for its worst weekly slab we have seen all your. it is seeing further weakness at the moment, turkey announcing they will issue a new government bond, the first of measures the country is pushing through to adopt and curb inflation. we are not seeing that reflected in trading in the lira at the moment. we are seeing the worst weekly underperformance this year. the weekly drop is 4.5%, the biggest decline since december 31. it does seem like things are going from bad to worse for the lira as it is deeply negative rates continue to push further downside to currency weakness, down 23% in the year and quite

clearly worst-performing em currency. coming up we will be speaking to a ceo about the impact of lockdowns on the company's bottom line. hsbc says investor concerns have quickly shifted from the fed's aggressive rate hikes to the possibility of those spikes causing a recession. we continue to watch action out of washington, the january 6 capital riot feels like a long time ago but when you watch that footage the chaos is still fresh in everyone's minds. shery: we are gearing up for the house committee investigating the attack about 1.5 years ago. this will be the first of six public hearings, and the members of the committee have promised that there will be surprises in this primetime hearing. they want to show the american public the evidence it collected about how the assault unfolded

including taking the case that former president trump was at the center of this conspiracy to overturn the 2020 election and prevent the transition of power. they are going to present this web of information including more than 1000 interviews and thousands of documents. haidi: it is extraordinary. if ivanka trump and jared kushner are not expected to appear at the public hearing, by the both of them gave sworn testimony is the committee intake depositions. we could see clips of those depositions as part of a huge amount of multimedia documentation expected to be presented. we are looking for further evidence to suggest -- to support the finding that a federal judge who is already overseen to civil suit, trump

likely intended to disrupt -- a lot we know the investigation has devoted an entire team to examining what preparations there were for the threats of violence i had -- ahead. shery: we are headed toward midterm elections in two publicans -- those republicans are struggling to defend especially as the electorate is friendly to former president trump. we will have plenty more coming up on "bloomberg daybreak: asia" including this committee hearing. this is bloomberg. ♪

shery: the latest from the ecb not to mention the unfolding drama in the u.s. ahead of inflation numbers when the world's two largest economies. haidi: it is going to be different picture when it comes to price pressures in china, but regardless looking for the impact of the most recent lockdowns, let's get you to annabelle. >> shall he also locked on fears persist to china with the mass campaigns are seeing in beijing and shanghai, but the open is upon us in japan, shanghai, south korea, also cash markets. we will check in on two year and five year yields as well. we have two years yields around

the 2015 i. japanese stocks to the downside. sadly reversal of what we have seen to the nikkei, yet weakness boosting biggest exporting names nearing the 135 level against the greenback. moving the board for a check in on korea, the kospi buying -- eyeing its biggest drop. the korean won, we are seeing a low. we have the asx 200 coming online to the downside, .2 of 1% lower. we are seeing biggest banks shedding $32 billion in market cap with the 50 basis point move from the rba. the aussie dollar in focus as well, westpac saying we could see as well again $.70 against

the dollar. haidi: the u.s. house committee investigating last year's capital insurrection is said to begin its public hearing. it is expected to place much of the blame on the former president donald trump. let's get details from jodi schneider. what brett -- breadth of evidence, what sort of cases going to be built against donald trump? >> they are fed more than 1000 interviews, more than 140,000 pieces of evidence and now we are at the first hearing. there is a lot of drama, is going to be in prime time, 8:00 p.m., it is just beginning.

we are not only going to hear from witnesses, we are going to see video from a videographer who was embedded with the proud boys as they stormed the capital on january 6 2021. we are expecting this to be emotional testimony. we are going to cure from a police officer at the capitol building who was badly hurt that day. there is going to be a lot of very dramatic scenes we are going to see. the committee will make the case that it is something that he did not stood by and watched but precipitated this. that is the case that your bennie thompson will be making. the american public, many of

whom are still loyal to trump, the question is will they by this? they are trying to sell that narrative. shery: our viewers can see the january 6 hearing on the u.s. capitol building assault as open did washington dc. this is the first of at least six public hearings we are expecting in the next few weeks. what are the implications for the midterm elections if any? >> the midterms are in november, not that far away. democrats are trying to make the case with the keyrings and doing them now, trying to make the case against the former president that he tried to disrupt the stratification of that election on january 6, that he wanted his followers to disrupt it so that the new

president joe biden would not be able to take office. that is the case he will be trying to make. whether or not they can do that, and what happens after that, what are the implications are an open question. we have not seen this kind of hearing before involving a former president. haidi: all of this is expected to play out as well as we had what the midterm, what is the political environment at the moment in terms of support for the administration? >> in the midterms the party in power can lose seats, and this year is expected to be no exception particularly as the biden administration has been dogged by i inflation, high gas prices voters see every day, the

messy withdrawal from afghanistan, baby formula crisis, there been a lot of things that have led to low approval ratings. i do not know if it is time to get votes, but the commission is said that what happens on -- and democrats behind this are saying what happened on january 6 is something that cannot be allowed to happen again and they say they want to make sure that does not occur. the country is divided. donald trump still has a lot of supporters and he has been endorsing republican candidates in senate and house races across the country and many of them so far have done pretty well, not all of them. it is a very divided country. we'll see how many people take this evidence to heart and if it

changes opinions. shery: jodi schneider joining us from capitol hill, turned to bloomberg forum her on this. get a commentary and analysis from bloomberg's experts. take a look at our asian markets are trading at the moment, we are seeing a sea of red with currencies under pressure, the korean won dropping to that two week low against the u.s. dollar as we see the asx 200 moving .4 of 1%. let's bring in our next guest who has gradually moved into issue growth in the last few months. had of -- head of apac strategy. it is interesting you are moving back into growth because so far the chart on bloomberg has shown value as been feeding growth in asia so far. the outperformance has waned. give us your rationale behind

this rotation and why you were moving back into growth? >> we are doing it very gradually. we are facing growth sectors and growth stocks. it is starting to disappear. i think we are in a situation where markets are going to talk with lower inflation going forward and numbers are starting to come down. i would not be surprised by the end of the year we are talking about [indiscernible] so that is a significant shift in market dynamics and it is favorable for growth. while at the beginning of the year, we have gradually moved were growth and we will continue

that for the remainder of the year. shery: in a week like this one where we have so many monetary policy moves, ecb, we are headed toward inflation numbers from china and the united states, complete the divergent monetary policies, what do you watch out for and what are you aware of going into trading and how does that set you up for the next few weeks? >> there are quite a few things going on. when i look at asia, we have got u.s. inflation and spending, so i went to see more evidence, for example, without interest rates have starting to impact the u.s. economy and retail spending. the other issue we have in asia is food inflation, the conflict in europe is increasing grain prices.

rice prices have not risen so much yet. there are a lot of moving parts that we will be carefully assessing. that is the difficulty of where we are. we do think inflation will move higher or lower. we need to be gradually shifting as evidence for that is going to become clearer to us. haidi: you moved to overweight china internet. take a look at what is happening with alibaba, it tells you how policy driven this market is that we will get a revival of the ant ipo, u.s. selling falling the most since march. we have seen steady improved

sentiment when it comes to chinese tech and internet. is this still a segment where the risks are binary? >> we just talked about value to growth in china internet is a grow sector. early in march we had this massive sell down. we thought this was a bit overdone, there was still value in the stocks, you can invest in them, so let's go for this. we started buying some of these internet stocks. they are a little bit higher. interest rates are going to come down eventually. these stocks can do reasonably well. the regulatory environment will improve for the stocks as well. this is a very different sector not that it was 1.542 years ago.

-- 1.5 or 2 years ago. the future normal be significantly lower than what it was in the past. i think this is going to be a trading sector over the course of the next couple of years. haidi: it seems like there is a broad repricing of market risks, not just tech. is this a turnaround? >> do you mean in particular for china? in particular for china. there are two things here. it seems like we have had a bottom end with using things are starting to improve. on the margin things will be better on that front. if you look at sentiment in the

market that is for for chinese assets. underweight or at best neutral in those assets. it cannot get much worse either. even if you have a marginal improvement in the economic environment for earnings growth in these companies, that shift in sentiment supports the recovery in chinese equities. it is not something you want to be underweight at the moment. shery: always great to have you with us. let's take a look at movers we are watching in tokyo. >> japan is muscular at the start of trade with one segment that is not helping is its biggest machinery maker because we seeing declines across the board. we had preliminary machine audit tool data after may and we start slowing so we did see a gain of

30% on the go. jeffrey saying fortis could be plateauing and another headwind are lockdowns. flipping the board for sector in the red, aussie bank stocks, they a been on track for the biggest weekly drop since may 2020. the reason for this loss that we have been seeing across the week is the rba rate decision, someone saying -- as we have seen losses across the rest of the week. haidi: let's get you to vonnie quinn. vonnie: turn is is calling on us government to balance its covid zero policy with the needs of the economy. state media saying he is urging all regions to be resolute to

maintain social study. chan's economy is widely expected to miss its rut target this year because of virus curbs. covid-19 cases in hong kong top 600 on thursday for the first time in seven weeks. 674 cases, the highest since mid april as infections linked to bars and school subs well. officials are working -- warning omicron subvariants have as well. residents face mandatory quarantine if they test positive. the military will take powerful measures against taiwan independence. the ministry made a statement in the approval of a military sale to taiwan. global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries.

i am vonnie quinn. this is bloomberg. shery: we speak with the north asia president and janet ceo of a company about -- while striking a balance with the needs of the economy. more on that strategy next. take a look at the live hearing happening right now on that january 6 attacks on capitol hill. u.s. lawmakers holding this primetime hearing. a band of drum supporters -- trump supporters storm to give us capitol building. this will be the first of six earrings. plenty more ahead. this is bloomberg. ♪

>> what worries me, and you are not going to like this, the june month on month will be worse than make month on month. those who boldly said inflation has peaked and is coming down may have to change their mind. shery: a bloomberg opinion columnist, bond markets are supporting this idea that in fact inflation may not have peaked. a surgeon price pressures given central-bank office a stronger

handle. let's get more from our global policy editor kathleen hays. we are bracing for the u.s. cpi report on friday. what will this do to the federal reserve decision next week. kathleen: it will convince them that they're absolutely right, at 50 basis points and another 50 basis points in july. no matter if it is stronger in the forecast for weaker, inflation is way too high, above 8% if you look at the cpi. even the people of talked about may the inflation peak is here, the peak is not enough. it is starting to come down and stay down. core cpi take some food and energy prices. core goods prices have softened a bit, post-pandemic demand is softer for some items, that line

which includes food and energy, 8.3% year on year, food and energy prices up anywhere from 50% to 20% -- 15% 20%. the fed has signaled rate hikes of 50 basis points. more is needed. the doves think they can pause by september, keep going if they have two, but there is probably nothing in this report that could change this trajectory for the fed. haidi: when it comes to the trajectory of the ecb i thought it was interesting the euro was unmoved to the upside despite the fact that the hawks are in the hot seat. kathleen: it was an interesting market reaction, but it was not entirely surprising because the

hawks have been squawking loudly for the last three weeks, even longer suggesting that inflation is getting out of hand and raising this question to which the consensus seems to persist for sometime, but they have definitely signaled that there bond purchases are ending, their next meeting they will probably do a 25 basis point i. 2.5 months later they are saying maybe a 50 basis point hike if it is needed. one of the concerns and markets is because the ecb has started a rate hiking cycle after not doing anything since 2011, the question is are they leaving it a bit too gradual and will they find out that they have to beef up rate hikes later in the year. that is another concern hanging over the bond market right now. haidi: kathleen hays, very interesting, and unexpected market reaction in some parts of

asset classes. look at how the european futures session is opening, stocks firmly negative. across the board extending declines after recite european equity swelling the most in three weeks after the ecb announced plans to raise interest rates. they want higher inflation would prevail. that was the big reaction we saw in the euro. speaking of inflation china's prices may have continued to slow due to a high base in commodity prices as well as impacts of lockdowns in shanghai and other major regions. let's get more from our guests. what are we expecting? >> on the consumer price set of things, looking for a gain of 2.2%.

very subdued, because price gains have been nothing like in other of the world. the consumer mains under so much pressure due to the ongoing lockdown said on containing covid. on the producer side of things it is interesting. some of it will be the base effect compared to a year ago, some of it will reflect cooling for key commodities. economist or saint when you put all of this together china's subdued consumer and the fact that factory prices are coming off that china might become a source of global disinflation which is returned from last year . a very different picture for china compared to the u.s.. shery: enda curran there. we have plenty more to come as we look ahead to the hearing

ongoing right now, the january 6 riot at the u.s. capitol is being dissected at the moment. live go is your function. this is bloomberg. ♪

haidi: a check of the latest business flash headlines, state street says it is not pursuing any acquisition with credit suisse. it comes to date after a report on a possible bid for the european bank. credit suisse ceo all the question about a possible takeover stupid. a most remarkable comeback in output when it comes to the chinese factory, the company tripled production in a

producing more than 33,000 cars it is june plan. tesla has gone to great lengths to keep its chinese factory running amid strict lockdowns with step working around the clock in a closed loop system. shery: across markets in asia, the nikkei falling for the first time in six sessions, the korean won also losing ground against the u.s. dollar and the cost be done. we continue to watch that i was hearing on the january 6 right at the u.s. capitol. they are unveiling results of the investigation. live as a business owner, your bottom line is always top of mind. so start saving by switching to the mobile service designed for small business: comcast business mobile. flexible data plans mean you can get unlimited data or pay by the gig. all on the most reliable 5g network.

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shery: we are watching the

january 6 hearing on the u.s. capitol assault ongoing in washington. they had about results of the committee's investigation. this will include a series of comments and witness reports from the u.s. capitol police officer not to mention a phone maker and documentarian embedded with the extremist group broad boys. let's go to emily watkinson. this will be the first of six public hearings. what were we expecting at this time. >> we did hear an opening statement by chairman bennie thompson laying out the context. lawmakers need to make sure the u.s. is protected from all enemies foreign and domestic. we are watching liz cheney, a republican and one of the most

outspoken against trump lay out the timeline as well as what the committee is trying to do. she said that trump had a seven point plan to overturn the election and thought about various clips. we are beginning to see depositions, thousands of interviews. the former attorney general bill barr saying he told trump he had lost the election. ivanka trump, the president's daughter and senior advisor multiple high-level people. this is just a taste of what we are going to get into later tonight as well as the next several public hearings that will culminate with the committee releasing its full report in september. haidi: what are some of the witnesses we expect to hear from? >> we will hear from a police officer who suffered a serious injury on january 6 and this is another thing the committee is

sitting on, there was a mob, more than 100 injuries, at least five to contact her dead specter january 6 and sewing -- showing trump new was going on but refused because to call off the mark. we will be hearing from a documentary filmmaker who was embedded with the broad boys, a far-right group, who was charged by sedition to conspiracy in their role for january 6. we were expecting more witnesses to testify publicly as well as more video testimony. shery: how much interest is there among the american public and will it make a difference for the midterm? >> there is a reason they put it at 8:00 p.m. this is prime time, people are home, they are able to watch. americans know what happened on january 6. this is a matter of narrative, a

matter of framing, a matter of making the case that former president donald trump knew what was going to be happening and this was for the purpose of keeping him in office despite him having less the 2020 election. democrats are hoping it does make an impact, people understand the gravity of the situation, but i think it does remain to be seen. there are lots of other issues americans care about right now, gas prices, inflation, it will be hard to of this issue through an be something that shaped people's minds. haidi: emily wilkins with the latest from capitol hill. do stay up-to-date go to tl i.tvgo. there is analysis from our experts as the january 6 hearing gets underway. we just heard from the

deposition from ivanka trump. let's get you to vonnie quinn. vonnie: bloomberg: the sec is investigating into whether marketing of a stablecoin violated investor's protection regulations. sec attorneys are investigating it whether the firm by the coin world for securities and investment products. it sent shockwaves across tectum markets. the sri lankan president is issued a decree making election to public service after workers threatened to strike. unannounced power cuts were being reported across the island nation. a troubling currency and lack of supply as mired sri lanka in its worst economic crisis it is

history. -- as won enough votes to gain the un security council. japan is also among the country's jurors into one of the rotating post on the security counsel from 2023 to 2024. a sharp decline in the stock market is not over just to get. the chairman and cio said is best guess what -- best guess is that we are six months into a bear market. he said it is highly probable to bear market as a waste to run -- has a ways to run. global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. this is bloomberg. shery: annabelle, you are watching the markets right now, so much risk off sentiment that even the japanese yen turned positive against the u.s. dollar. >> the mood is risk off and we

are seeing that reflected the nikkei, yet weakness had been helping it. we are seeing turned negative. the cost be also in the red on track for its worst weekly drop in a month. we heard from the bank of korea governor, he is speaking of plans to frontload rate plans. he says the risk of allowing inflation to run rampant will be worse for the economy into long-term. australia and new zealand and the red -- in the red. two main indicators will watching our court and services numbers. we are seeing that slipping over the past few months. that is a major indicator of an underlying week said the economy. as our bloomberg economics team is saying the worst of the economic downturn may be behind

us but we are nowhere near a recovery yet. haidi: we shall feel risk when it comes to china tech and stock market risks. we are watching alibaba shares, they struggled in new york after the denial of discussions of the renewal of jack ma's ant group. this is the crown jewel and reviving that would have been a total game changer. >> we will have to see much of a crown jewel it is for alibaba after the restructure and its biggest regenerating units and lending are stripped or put under regulatory control perhaps in a holding company with oversight by the pboc. that is what happened with the ipo in 2020, it was scrapped at

the last hour and alibaba and ant were put under regulatory scrutiny. they have been restructuring. it response to this bloomberg news story regulators aren't early-stage stocks -- talks to revive this ipo. they are denying their working for a resurrection of that and they are working on restructuring. bloomberg news is reporting these security regulator as established a team to reassess the shared sale plan of ant group and authorities partnering the final stages of issuing a long-awaited license that would pave the way for the resumption of an ipo and clear the way for regulators to essentially regulate ant group like a bank.

that is the bigger back story, what is the restructuring going on? for the time we do not -- shery: i think we have lost stephen engle. the latest on those chinese tech names. coming up we speak exclusively to l'oreal about how china's stringent measures have impacted them. this is bloomberg. ♪

haidi: we are seeing the house hearing into the january 6 committee over the capitol riot underway. testimony of prerecorded depositions that are already being rolled up. we heard from ivanka trump. she will not be appearing in person nor will jared kushner. those are taped depositions being rolled out over the coming hours. this is the first of several hearings to present new evidence on the assault, a concerted

effort to overturn the results of the presidential election. we will monitor those developments. we are hearing from liz cheney saying the white house has a report of the days leading up to the riot that elements of the card were preparing for violence ahead of the event. get all of that on bloomberg as well. get commentary and analysis. shery: take a look at out markets are trading right now especially in the commodity space, we see pressure on wti and brent prices. you're talking about 121, 122 levels, but you have to put it into bigger context. we have had nude lockdowns in chennai but more renewed demand from lifted restrictions elsewhere. we continue to head for the

seventh weekly game. copper under pressure given demand skepticism given what is happening under china. let's talk about what is happening in china. president xi jinping is called on his government to adhere unwaveringly to is covid zero policy will striking a balance, conduct mess covid testing drives. rachel chang joins us now. this is a tricky balance they have to achieve, and so far it seems concerns about covid zero affecting the economy effort predictions about the chinese economy. >> it is a dilemma local officials are getting from the top.

they cannot have any cases at all, they must do everything they can to prevent transmission. on the other hand there getting a message on economic growth, we cannot this target. those two things are contradictory to each other and i do not think china has found a way to balance these ideologies yet. the fact that china does have these contradictory goals and no real strategy for achieving most of them. haidi: because of that it seems managing covid will be one step forward and two steps back. shanghai going back into lockdown this weekend, best testings held as well. is this giving us a glimpse as to what this next stage will look like? >> exactly, that cycle of

lockdowns whopping when you maintain the covid zero goal in terms of transmissible variants such as omicron and it substrates. -- sub strains. when you resume activity gazes increase in that will throw you back into what you had before. millions of people will be left out in order to complete mass testing exercises. it will potentially make the government put the entire city back into lockdown. we are just in the cycle right now that shanghai is going through. the number one economic goal is stability and certainty. how are businesses in shanghai going to resume? haidi: our next guest overseas l'oreal business in china and

asia. several companies are betting on a strong rebound in consumer sentiment. joining us now is the north asia president and ceo at l'oreal. great to have you with us. to what our previous report of us talking about, the stop-start uncertainty about whether the removal of these restrictions will be a one-way journey or whether shanghai will find themselves back under lockdown again. i was that impacted consumer sentiment? >> [indiscernible] we have been reopening offices and we have seen rebounding. we have seen consumer sentiment

has been improving. we have seen this also in the appetite of products. [indiscernible] haidi: what about the impact of inflation globally? not so much in china but the impact on materials, supply chains and logistics? has that been felt in your part of the business? >> it is very concerning. inflation is at a higher level.

we are partnering with retailers. we have seen consumption is quite resilient. it is quality that we provide to consumers. shery: what about the pattern of consumption? we know that will be 19 as change a lot of your business especially on what products people prefer to use when they are wearing masks and not going out of the house as much. what are you seeing as lasting changes from the pandemic? >> consumers have changed behavior. the last few months and years have changed certain behaviors.

skincare is the biggest category of the beauty market. they are seeking more benefits, more quality. they want to understand what they are buying. there is an emotion with the product and what impact this product could have for them but what impact this product is having for the environment. it is the responsibility of compassion emerging strongly in north asia. you did that is diverse but a more responsible. shery: we know that asia is a very beauty focused region whether it is south korea were local competition. what are you seeing in terms of being able to compete in a

competitive edge? >> [indiscernible] being in north asia and the world of beauty, the chinese will the beauty, the korean world of beauty, you have to understand from consumer perspective whether you meet expectations. i very much believe what matters is what consumers want and what we can provide to consumers. that is at the heart of what we do. this organization because we have innovation centers in the country, our position for the

consumer, we are very much year for the future beauty. haidi: speaking of technology and innovation and investment can you tell us more about that shanghai-based investment company? what are your investment targets and goals here? >> we have been opening up a system in china in terms of operations. when it comes to the physical and digital echo system that provides to consumers a highly digitized experience, we have been looking at science, and we are seeing that there was a lot of opportunity that can [indiscernible] the future of

beat -- beauty. this allows us to get closer to the echo system -- ecosystem. the company will invest in this ecosystem. shery: it was good having you on, thank you. we have more to come. this is bloomberg. ♪

shery: jeff bezos is said to begin a ferocious bidding war. >> half of the world is obsessed with it, the other half is not know how it works. a battle between billionaires is shaping up over world class rights for the indian premier league. jeff bezos and india but your guess richest man both went to win. for the first rights -- time the rights are being sold online. india is cricket crazy, hundreds of millions of fans watch the game every week. more and more are streaming it online. the bidding war should be intense. in one corner, jeff bezos.

the other, ambani. bloomberg is being told to expect $7 billion or more. there are other challenges but it might be more personal for these two who are fighting for supremacy in india's booming e-commerce market. it may be as much about prestige as it is profit. shery: -- haidi: we will be speaking exclusively to the decision of the german deal board. the company is making its hong kong trading debut over the next hour on bloomberg tv, and the highlight, the exclusive interview with the new zealand finance minister on a visit to asia. this is bloomberg. ♪

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