>> ♪ companies are not just talking about supply chains and higher inflation impacts on margin but they're talking about demand destruction now.

>> in this environment, inflation will rewrote -- will erode purchasing power. >> energy and food inflation are not going to be the wild card. >> the inflation over the winter month has become more commonplace in the market. >> this is bloomberg surveillance with tom keene, and lisa abramowicz. >> good morning, everyone. bloomberg radio and bloomberg television, it is real simple, the first day of the third quarter and the world is catching down to the wto with 2.8% global gdp, maybe that is too optimistic. jon: here come the downgrades. we talked about all through the week. we saw from goldman and morgan stanley overnight and here comes the move lower in treasury yields. a fourth straight day. 10-year, 293. tom: 293 on the yields and that is moving in nicely. where i see it, the litmus paper

of a stronger resilient dollar and giveaway in emerging markets and some of that is a commodities rollover. jon: it is being more than strong, it has reported to the first half of the day. we had the big quarterly declined back to late 2016. first half is about the fed and we are about to see something about the ccb we have not seen since 2011, a rate hike. we will see that july 23 i believe. how far can i push this? downdraft we are seeing an economic growth, expectations are on the story in europe, just soft. tom: you and me alone next week and what we will have. ims are a, every single wall street firm as we can -- working over the weekend to recalibrate on the forecast. jon: are you expecting downgrades on the economy or equity side? tom: both. i'm more interested in the strategy frankly. jon: jp morgan coming up a few weeks. tom: what happened this week? what you need to know piling

into the weekend, lisa abramowicz's world changed. credit changed this week. lisa: we saw yield spread whitening, a real fear of recession getting worn out a little more in critic, in corporate debt. i want to talk about this tension taking hold. jon touched on it, talking about the front end, a bid into bonds in light of recession considerations. how much can that be consistent? we see both bonds getting bid even as stocks selloff. this is the traditional relationship but at what point does it say to the fed we don't believe you? we think you will not be able to raise rates as much as you are telling us you will, as many had members so you will because you will not be able to. is that right? if it is wrong, what is the potential downside risk to all sorts of markets? tom: we give you the news as it comes out, the german finance minister says no more leeway for relief for consumers in 2022 budget. i guess that is the bloom headline of the day.

let's do the data check. futures -19, the vix launched 28.7. jon: about a half of 1%. we are seeing a story of the nasdaq, negative point 7%. we kick things off with a little more the same. the change, yields lower. by seven basis points. 2.9 390 -- 293.90. jon: it is just a compression of the curve. jon: and i believe it is in the you kids well. yields tracking lower, down 11 basis points on the front end. tom: we start strong this hour. daniel morris jones -- joins us. they have been out in the front on getting -- gauging slowdowns on the global economy. how do you gauge into the new view of the third quarter? >> we are not coming up with the

new view. we have been looking for unnecessarily a technical recession but a significant enough slowdown into next year that it is essentially going to feel like one. we do see which one you already have priced in from the fred -- fed, which we think may not be enough. if anything, the fed hikes are more than what you have priced in the market and that will do the job. the job has to be to slow down growth enough to get inflation down. we know what that implies. jon: tighter financial conditions. they got tighter year today. walk me through where in this market we have more work to do. daniel: the real issue all of the central banks are facing is on one hand a lot of their problems if you will would go away in terms of inflation if the situation in ukraine improves significantly and you have commodity prices fall, if china were able to get the population vaccinated and could open up and the supply chain bottlenecks would dissipate.

you see a really swift fall not only in realized inflation but inflation expectation. we do a good chuck -- trunk of the fed's job for them but it is unlikely we will get a benign scenario in the near term. they need to ratchet further down on-demand for what they're not getting on these temporary factors. lisa: this calls into question the 60/40 portfolio after it suffered its worst loss. basically we are not seeing enough baked into the bond market and stocks still face losses. how much more will we see a reversion back to the 60/40 pain in the first half? daniel: i think it's the timing that will be the key thing. what is always challenging on the transitions from one worldview and one paradigm to the other. we are going through that right now. don't forget the beginning of the year was about the recovery from the pandemic reopening and we had to factor in the war and i think a lot of people now have

some time next year a recession. from here to there is where it is tricky. at this point, we are concerned about at least a further of what you highlighted with yields going up. i hit to equities but at some point we will see a more traditional reaction to the market with rally and treasury yields. then relatively better performance for defensive sectors. lisa: when does market functioning become a problem? we have seen the lack of liquidity in certain basic instruments, fidelity's treasuries. the balance sheet for the federal reserve has been shrinking this past week, going down by $20.8 million. -- $20.8 billion i should say. not a dramatic amount based on how much they are holding. i what point do you see real dysfunction? daniel: i don't know if i would use dysfunction but it's a challenge already for portfolio

managers. it is already difficult. on one hand, with the selloff, it has at times been indiscriminate, and you get yields rising for companies that don't -- we don't think that increase is warranted. but you can't really find the bonds you want. things are functioning but challenging for our portfolio managers to navigate the rough waters we have. jon: jon: we are all asking different versions of the same question, what forces this fed to change its mind? what is he? if it is not inflation coming down, do you have to see enough stress elsewhere and how much stress would you have to see? could you put a number on it? daniel: in terms of the typical traditional assumption of some sort of central bank put, fed puts, that another x percent decline in equities will get them to stop, that is not completely irrational in the tightening financial conditions already. given where we are with inflation, given these temporary

factors will be there for a while, and then we have the more structural ones that looked to be persistent, it is going to make it more difficult for them to do that when in the past inflation was low that was the reaction we get. jon: it's the biggest difficulty in this market. daniel morris there out of london. thank you. that is the difficulty we have all got. we have all got there. this is not 2018, 2016. we don't have the capacity to give the fed the space to say it's not as much as we thought it would. lisa: to me, the biggest pivot point of the week, hearing the research out of the federal reserve and something all the central bankers were enumerating was the risk of getting inflation out of hand of longer-term expectations becoming onward was greater and potential pain was greater than overshooting and raising rates

too far. that highlights where they are -- where there concern is. it does not seem like they will pull back if inflation continues to accelerate. jon: it makes you wonder what the bond market is picking up on, isn't it? tom: i will call it friday liquidity may be. i'm looking for an excuse and i can't find it. i want to go back to what i said at the top of the world trade or date -- at the top of the wto. the world bank coming in gloomy as well. i cannot say enough about wto in april looking some 3%, global gdp was a stunning announcement then and they absolutely nailed it. you wonder in july if institutions are going to cap up with the wto. jon: that's what many people would decide -- defined as a global recession. tom: and that's what the 6% or 5% china -- granted this huge covid asterisk there but it is a

cliche. it is uncharted water. jon: understanding the piece of it is so difficult. what is the backline of china? tom: nope. jon: we have no idea with the back half of china looks like for the world's second-largest economy. isn't that an issue? tom: look at copper again. my hands, i'm making the st. louis arch chair. jon: it's beautiful. tom: someone emailed on radio and said my bowtie was festive on radio. jon: it's festive. tom: somebody also emailed in today and said thank god you have not sung for an hour and half. jon: do you want to sing now? it could take 30 seconds. tom: no. jon: july 4 weekend. celebrate. tom: my original banner of the morning, sorry, it is gloomy but it is not 1970. it is not 1970 4, 1987. those were real drawdowns. jon: it's not the 1930's.

tom: i'm not seeing the cold war. [laughter] lisa: it's not 1780. jon: here actively market down .4%. from new york city, this is bloomberg. ♪ ritika: keeping you up today with news from around the world, this is the first word. inflation in the eurozone rose higher than expected to a record last month. consumer prices jumped 8.4% from a year ago. they were driven by soaring costs for food and energy. the ecb is expected to raise interest rates this month for the first time in more than a decade. global food inflation looks to slow down. commodities such as wheat, corn, and cooking oils extend their son to the lowest levels in months. the latest catalyst is the report from the u.s. department of agriculture. a raised its estimate for the area planted for corn. in russia, a trial began today for u.s. basketball star

brittney griner who has been jailed more than formless ago -- more than four months ago. she was traveling to play for a russian team and could face up to 10 years in prison. the biden administration calls are wrongfully detained. a department chain has concluded his strategic -- coles also revised its sales outlook down. a significant step for amazon as it pushes into sports. they have rights to broadcast europe's top football term in the u.k. for the first time. analysts will do that tuesday night. bt sports will remain the majority of coverage. global news, 24 hours a day, on air and on "bloomberg quicktake," powered by more than 2700 journalists and analysts in over 120 countries. i'm ritika gupta. this is bloomberg. ♪

today's challenges require real insights, to get to tomorrow's opportunities. ( ♪♪ ) what can we expect in the coming year? this has been a record- shattering year for m&a. five trillion dollars in deal value. and we're still very bullish on the deal market for 2022. in this kind of climate, what are you advising clients to focus on? we really think companies need to elevate their risk management processes and also scenario planning. what's your outlook, kim, for the 2022 labor market? organizations really do need to take a pivot on their lens of their people and talent from a cost center to make that a value creation center.

for key insights into what matters today and what lies ahead for business, this is real time business with ey. >> inflation is a bigger risk because it is here, it's real, and if inflation does not come under control completely, it is long-term damage.

is there a risk we have a recession? yes. clearly there is a significant risk in the next 12 months we have a recession. i think there's a mindset at the fled sees inflation as a psychological problem rather than a different type of problem. jon: good morning. futures different -- negative on the s&p, down .5%. speaking to those concerns about a slowdown of growth, may be a recession, yields down another eight basis points. 200-9370 one on tens. we see this right through the curve, twos, tens, 30's. tom: i'm just looking at level here and this is truly a compression. this is not deal dynamics. fancy hands moving around, this is a recession outlook and a fact a lot of people will have to adjust the first week of july. jon: it's interesting to me you see a it more pronounced on the front end. a 12 basis -- 12 basis point

move lower on tuesday 1283. if we have this conversation about the fed going too far, growth getting hammered, interesting to me that the two-year is so well bid. tom: housekeeping, best-dressed woman from bloomberg, great bowtie, greetings from paris. jon: they go. nice feedback about the outfit as well. tom: you were mentioning colonel sanders. jon: i meant kfc on st. patrick's day where it is like the tan suit with a big green. it did not resonate? tom: it's a day to watch us on radio is what it is. jon: today? someone calling it a summer friday look. some -- is this what it was like on the trading for years ago? tom: it was. very much so. what is said here is bond market closes at two. jon: i didn't know that. -- at 2:00. jon: i did know that. tom: help me, 2:00 today?

lisa: yeah. tom: all the fancy people in bases get to leave early and the staff has to take -- stay until 2:00 04 glock. jon: the fancy people wear suits just to clear this up. >> terry joins us now with a beige suit. i want to talk about something not in the zeitgeist but something important. everybody is talking about rhinos. republicans in name only. i want you to frame the dino democrats in name only. is the president of the united states a dino? [laughter] >> good morning. you would think so but by this past -- has past track record. i think what he is trying to do is go to the left and understand where the majority of his party is and seek to represent -- seek to represent that. not for him, the old gilbert sullivan line that he led his

regiment from behind but clearly i was not surprised by this. you can see where the democratic party was going even before 2020 but he has sought to essentially do everything he can to keep his party together, but by large go to where the energy and money is. tom: where the money is. help me here after roe v. wade and the uproar of june where suburban and particularly suburban women are as they parse out rhinos, dinos, and the far right and far left. terry: i think it is more of an anti-incumbent election and economy election. the stats coming from washington that i think is not much followed on wall street but followed greatly here is real per capita disposable income which has declined 20% since march 2021.

that is yet another bad sign for democrats. i think what you have here is you will have a majority republican congress in 2023. i said the odds today of that is 60% because the senate outcomes are much less known. you will still not have a one party majority that clears the dax and sets a definite direction no matter what it is. compromise and working together in the center will be where the action is. think about the gun debate and gun law as a recent example of this. lisa: what does it say about this congress, given the bifurcated nature, the contention we see only heating up over social issues and around inflation? that congress might not get done this bipartisan agreement on how to boost chip production domestically. terry: i'm sorry to say that,

generationally, congress has become more performative than legislative. what it says to me and has set for a long time is that something that is viewed and talked about as an exit stencil -- as an existential threat, china, you can see in the behavior of members of both parties that they must not consider it to be the existential threat because a year plus after this legislation was introduced, they still do not have it done. i think there is a high likelihood the legislation gets done. today i would put that 80%. it does not say anything good about american foreign policy or resolve to confront china economically if it has taken more than the year to get to the point where we are not quite done. jon: terry haines there of pangaea policy.

breaking 280 on a two year, down 10 basis points, call at 11, 291. moves. that rate cut story is a peripheral story, may be a number of weeks ago. it is getting brought in. we are bringing the rate cut story at the same time the fed is considering hiking 75 basis points. these are big moves developing the bond market and big calls coming through. tom: this goes to the strange economic magnitude as well. this is a sideshow. imf announced a frontier african economy that they will do a negotiation if ghana collapses. i hope i'm pronouncing it correctly, the cedi is the bloomberg signal and it unravels. i go to where they should look forward as hard as we do you are overcome by events you do not

see coming. i'm watching emfx. jon: it's the s word, stress, and lisa has talked about that, particularly in credit. lisa: and we are not back to the same kinds of level of stress as we have been in previous downturns, previous times were the fed stepped in. i offer you this tension, do you think stocks are offering the same message right now bonds are with the bit in and this belief the fed will eventually hit pause? jon: our next guest has big calls. euro-dollar down to parity and cable stirring into the u.s. dollar. he's looking for 1.18. he joins us next from newark city. -- new york city. this is bloomberg. ♪

jonathan: i would not call this a boring start to q3. futures down 10% of these moves in the bond market get our attention. down nine basis points. a brief break of 280. 90 minutes away. interesting to see a trade like

this ahead of what many people this week consider an important number. lisa: i don't really understand it. i wonder if there is some sort of idiosyncratic. i don't understand why people would suddenly have conviction at a time there does not seem to be any evidence of inflation cooling off quickly enough to give them faith that they can do that. jonathan: i hear you, it might go the other way. prima is targeting 340. this market is on the bullish end. clearly, the conversation has been introduced in the last week or so. i'm going to tell brahma just to leave. she has to get to jfk. tom: we are going to go to kri

di. to stack about teterboro -- they're are like six terminals. jonathan: you would know. tom: gw bridge can be hard on the way to teterboro. be careful. jonathan: at least she is not going to the airport. tom: jordan rogers is joining us now. he is going to brief us and this is the conversation of the day. i want to go to magnitude. john mentioned your 118 sterling call it is q3 a quarter of magnitude for the major foreign-exchange pairs? >> i think so. risk outside. when it comes to what is going to happen in the next few months, next month is a key one for europe. we have the potential for nord stream one to have all of its gas supplies cut off. 60% of those are already cut off

so we are talking about the last 40%. we have already had the big move lower in the gas flows. that means germany could consider rationing its gas supplies to industry. that is going to affect europe and a big way. that is why we have recession fears picking up. for the u.k., it stands out as the main country in europe. there has not been enough to subsidize consumer but also raise taxes and third, it has a central bank that is unlike the ecb and unlike the fed, not really been accused of being behind the curve because it has been raising rates longer since december of last year. that is why we are already seeing the bank of england toying with the idea that maybe we don't need to be too hawkish. that is why we think cable will go towards 118. i think early august when the bank of england disappoints us, i think there will be a 25 basis point -- point rate hike.

tom: extrapolate sterling weakness over the magnitude of the move we are going to see in japanese yen. >> japanese yen has been really difficult for everyone. two or three things going on. when u.s. yields go higher, the japanese yen tends to weaken. when oil prices go up, the japanese yen tends to weaken. now, we are having u.s. yields go lower and risk off at the same time. that usually leads to japanese yen. and having oil prices often. i'm surprised dollar-yen as being so, on a day like this with the rallies in the fixed income but at the same time, there is a global storm about energy prices coming up where lng is going to be in big demand and that is going to really weigh on japan's trade balance. short-term, energy prices might be weak. in europe, gas prices are not weak. they are really accelerated.

i think that is pushing up lng prices and making it quite difficult for the yen to rally in the environment we are in even though we are having this huge fixed income rally today. jonathan: what a tough spot for the ecb, it just feels lose-lose at the moment. if they hike, it is a euro weakness story. if they don't, it is for all the wrong reasons. can you envision a situation where this euro does get a little bit and does rally? >> there is a way. we are looking for parity. the view from us is euro itself. there is a way which is we find some reason collectively as a market to say global growth expectations are going to turn around. when that happens, euro goes higher. always pretty much. what could lead to that risk on? it could be a cease-fire in ukraine and russia. we could see energy prices often. the other one is china.

we have a large fiscal announcement in china as they're coming out of covid lockdown. or they might relax their zero covid policy allowing more free trade of people, quantities and so forth in the supply chain but that could be another way of doing it. we see the fed turned dovish and say actually, we are not going to raise rates as much as you think. today, a massive repricing of the u.s. curve. i think we are in a different framework where we should be using yields to say where euro-dollar is going to go and should just be using growth expectations once again. fx has many different frameworks. the key part is knowing which one to use today. i think it is the growth framework that is the dominant factor today. jonathan: how relevant is ecb policy to what happens with the euro? >> it is definitely relevant. a little councilmember was saying we could do more than 25

basis points in july. if they were to do that, you would get short-term boost to euro. we have had funds go from 0% in march join know where they move today, but up to 180 at one stage. the euro fell during the period in those three months. we went from 112 to 104. higher euro yield is not leading to a stronger currency. it is a bit of a lose-lose to the ecb. at the same time, fundamentally, there are tons of traders collapsing. the ecb would have to do a lot more to improve things without just equal recession. tom: the little red book is not mao's book of china, it is stanley fisher's book. everybody in the middle of the first decade of the century had to read this in the game. fisher would say watch em.

thai baht unraveling. indonesia ready to go through 15,000. filipino with marcos. what is the symbolism to the developed institutions that em is unraveling before our eyes? >> agreed. basically short positions. it is going to be really difficult for em to rally in this environment with higher yields pushing up the funding for the cause for everybody else. the hope was that tourism flows could support some countries such as thailand. in general, if you have peripheral yields in europe, u.s. credit widening like we are, essentially systemic distress building up, that is just not an environment where emerging markets, especially those with trade deficits do well. fetish is not going to happen. from a structural perspective,

the long dollar view that we have in this quarter, i expect emerging markets. jonathan: u.s. 75 for the fed. >> our team has really hit the nail on the head. i think they are going to be right next year as well. let's talk about what we published over the past two weeks. they are calling for a recession next year and this year in q4. that is rather dense pushing those views. when it comes to next year, we are pushing also fed hikes to finish in first or second quarters. let's say we get to tolerate three point 5%. then the fed starts to cut rates from september onward. i think that is what the market is doing, moving toward the u.s. view. jonathan: who leads that team because they have been great?

jordan, thank you. they were talking about 75 long before anyone was talking about 75. one of my favorite functions on the bloomberg terminal, this gives you a snapshot of foreign exchange. you can select whatever you want. i go through the weakness, the underperformers, the turkish lira down. the argentine peso down. the best performing em currency year to date, do know what it is? tom: i'm guessing brazil. jonathan: the ruble, by a margin. tom: i look at them as frontier. jonathan: you want to call it frontier now? >> such an audit economy.

they call all of their fellow employees. i'm going to miss gruma song. -- bramason. jonathan: i might try to get a phone interview on the way to jfk. tom: i thought she was going to teterboro. jonathan: we live very different lifestyles compared to you. tom: bitcoin has got to get to tuesday. i really don't know given the financial and regulatory interest, it is a complete mystery to me how bitcoin gets a bid. i read this weekend bit -- bitcoin mining at seneca lake up in upstate new york. they are arguing over doing mining there because they are going to heat up the water and all of that. i just don't get it. jonathan: do know what i struggle with? that the thing carries on trading through the weekend.

what time are we closing the bond market? and crypto is going through the weekend. tom: i have to find a new song to sing. jonathan: bonus round in the next segment. features down .25%. this is bloomberg. ritika: the iran nuclear talks are likely to resume after president biden's trip to the region this month. discussions in qatar failed. the 2015 agreement offered iran sanctions in return for its program. donald trump pulled out of the deal and reimposed sanctions. the stage is set for the ecb to raise interest rates this month for the first time in more than a decade. inflation in the euro zone rose higher than expected to a record last month.

consumer prices jumping 8.4% from a year ago driven by the soaring cost of both food and energy. china's president defended his crackdown on hong kong's pro-democracy movement in a landmark speech knocking -- marking the 20 for the anniversary of chinese more. he says the former british colony should focus on its economic development. hong kong -- he said hong kong has entered a new stage from chaos to governance. -- the current agreement between the dockworkers union ends today. a deal before the deadline is unlikely. americans will buy more fireworks than last year to celebrate the fourth of july. buyers may get sticker shock. prices are expected to be up about 30%. transportation costs have been a

big reason for that. i am ritikia gupta, this is bloomberg. ♪

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>> the consumers going to have a big summer. people going out and doing all of the things they have not been able to do for the last couple of years. over time, the cushion will get spent and in particular, inflation will erode. purchasing power to a degree. jonathan: the chief economist at amherst pierpont. if you were looking for a quiet start into the week, we are not getting it down about .25% on the s&p. we are waiting for news from gm.

no other information whatsoever. tom: we are going to aggregate the news flow and there is nothing to aggregate. i just don't see anything on twitter, nothing from a legitimate source we are not going to speculate, but there is a big deal. gm, let me read it. general motors halted for news pending. jonathan: we will wait and see what that news is. i can talk about the front end of this yield curve. looking ahead to the ism and about one hour 12 minutes from now anticipating maybe weaker data. this conversation about not rate hikes but may be rate cuts in our future. tom: fractional curve steepening. equities have not played. it will be interesting to see coming off the economic data. jonathan: that is such a good point. they have not played at all considering what we are seeing layoff in the bond market. tom: we will see.

what we are going to do is cover airlines and all of the uproar and we are not wedded to the goss about there. everybody is having a field day with this we are going to try to get some clarity thought. we are going to go to nashville, tennessee which is the franchise of raymond james but first, we have kridi good with us. the brand spanking new system outlook already a. it is not the panic of two days ago is it? kridi: i think the story here is going to be the trade-off between the airline story and the the driving story. you talk to people here and flight attendants and they are saying all of the russian chaos happened earlier in the week because everybody already got out of town. aaa actually said this weekend is going to be the slowest holiday weekend going all the way back to 2011, the busiest holiday weekend for driving.

the second busiest going all the way back to 2000. it is very clear people are looking at airfare and saying it is too expensive and driving instead. tom: you have all eyes all the time on your taxes as well. what is the anecdote you get of dfw? kriti: in less than an hour since we have been here, we walked in, no flights were canceled, we checked again an hour later, three flights are canceled, two of them out of dfw. about a month ago, i was there. dfw is an international airport and also major domestic tub -- must -- domestic hub. the shortage is almost magnified in that spot. tom: now we go to nashville. airline managing director at raymond james. what are you going to write about tuesday about this airline chaos? >> what i would say is for my

cancellation rate, operationally, airlines are having a harder time. what we have been writing has been consistent i think for the last several weeks and it will be consistent on tuesday which is that operationally, airlines would love to fly more. definitely more demand than there are flights today. even with maybe some consumers choosing to drive. still too much demand for the amount of supply airlines put out there. they have taken effect because they want to maintain decent operations. we are probably trending only one percentage point higher than it was pre-pandemic. they are doing enough ahead of time to try to halted from the pain that comes with the current operational environment. jonathan: you are speaking about something that does not get talked of quite enough. the amount of regulation that requires a certain amount of

trading, how long it takes to onboard people, get them to operate in the airports. can you run through that, just how difficult it is to build capacity and buildout a labor force for some of these companies is just tremendously difficult, isn't it? >> it is. in the last year, you saw across the ecosystem airlines having problems, not as airlines, their partners and airlines as well. a lot of that is under control. they have hired ahead of time, the biggest bottleneck is on the pilot side. we have had a lot of pilot retirements during the pandemic which we did not know if that would come back. you are trying to hire and put pilots in the cockpits as quickly as possible but it is a longer time horizon. not necessarily pilot supply yet although that is the concern longer-term, but right now, it is about class sizes that are

three to four times bigger than they used to be pre-pandemic and trying to get those pilots into the cockpit in time. jonathan: clearly, they are reluctant to build at capacity. not just unable to build that capacity. there is a worry about whether this so-called revenge spam on travel we'll head into the rest of the year. >> the key here is because capacity is so much below demand, even if demand comes down, yields might be lower, fares might come down, but generally, it is still a strong investment for airlines into the fall and maybe into next year. jonathan: awesome as always. second quarter net income at $1.6 billion to 1.9 billion dollars.

tom: this is in real time. again, all of this at the speed of modern digital. this is the 8k form, a substantial form loaded with numbers and we will have to go into the 1-2-3 major paragraphs. again, semi conductor shipments and other supply side disruptions. 95,000 vehicles in inventory. jonathan: we will talk about in the next hour. what a lineup we have got to get you through the first trading day of q3. from new york city, this is bloomberg. ♪ nine >> welcome to another special wimbledon update. rafe on a doll remains on course for the calendar slam after day four of the championship in london.

the spaniard took care of business under the roof on center court to advance to the third round and a meeting against italy. after his wins in paris and melbourne, profit looking for his third major title of the year and to extend his lead over roger federer and novak djokovic in the all-time list at the slam. american cocoa golf also -- coco gauf. and don't forget, tennis channel daily coverage from london all startup 4:38 a.m. eastern time.

jonathan: getting q3 started. equities a little bit softer. the countdown to the open starts right now. ♪ >> everything you need to get set for the start of u.s. trading. this is bloomberg the open with jonathan ferro. ♪ jonathan: live from new york city, we begin with a big issue. here come the downgrades. >> economists have begun to cut their top-down economic forecast