manus: this is "bloomberg daybreak: europe," i am manus cranny in london and these are

the stories that set your agenda. race for number 10, rishi sunak inches closer as boris johnson bows out of the running. market alarm -- chinese stocks slide after president xi stacks his cabinet with lawyers . plus, giorgia meloni sworn in as italy's first female prime minister, facing a mammoth burden and rising interest rates. it is earnings season and we are knee-deep and phillips delivers their mornings -- there numbers this morning, 209 million, incrementally below the estimate of 210.5. let's see where that refers to in terms of restructuring,

actions have been initiated. signs that that is maybe where the charges are coming from. we will break that down for you. let's get into some of these pretty monster moves across markets. you have a reappraisal of fed hiking, the scale of hiking from the fed. the kite was flown on friday in terms of perhaps less jumbo rate hikes. that infused in equity market rate hike that powered over 5% at the close of business friday. larry summers says we are at a doom loop risk of debt and price spikes in oil markets. the s&p 500 with the best week since june last week. as we move into the peak rates debate, i put it to that equity markets have yet to capitulate. $9 million wanted to equities last week and yet the sentiment indexes for bank of america survey suggests capitulation had taken place and that is not so

in the money movement viewed as futures up one third of 1%. the brutality of what is happening and reappraising china is self-evident. xi jinping shows no relent in the meredith -- the narrative of a new china. let me show you the currency and rates market, sterling of one third of 1%, it is giving back some of the gains the fact that rishi sunak is ahead. we will get to that in a moment. dollar-yen, what is the scale of the intervention? commentary from rhoda -- governor kuroda and suzuki. yields dropped, demolish on friday. i liked with steven major had to say, you could build a case for rates at 2%. i say that again -- you could build a case for rates at 2%. in the united states of america based on a hard landing. is that what the fed are trying to avert as they go with this

narrative that they may be beginning to consider where we are in terms of peak rates, which would equal a pause, the equivalent of a pivot. more on the china data in a moment. reporters around the world standing by, anna edwards, reunited again, she is in westminster. another big week in u.k. politics. colum murphy helps us digest the chinese party meeting. and annabelle droulers. rishi sunak has taken a step toward becoming the next prime minister. anna is outside the houses of parliament and this is mesmerizing if you look at it from outside world. boris flew home, put his hat in the ring and then withdrew. good morning. anna: good morning.

what a week and it has been. rishi sunak the front runner, penny mordant still in it. boris johnson is out. the weekend developed with great drama. we heard from penny mordant yesterday that she would stand, we had to wait that rishi sunak would stand. he is the front runner and he is quickly gathering support of many tory mps behind him. he had to wait until late yesterday evening to hear from boris johnson himself. when we did, it was fascinating. the man who wrote to brexit -- two versions of brexit, picked one at the end to great effect. he seems to be writing a two-part negative -- narrative of whether he would step in. he started putting out all of the reasons he should stand as prime minister but then came to

the conclusion it is in the right time, he would not be the person to unite the party, and therefore boris johnson is not standing, leaving rishi sunak in the top spot. we wait for confirmation as the day progresses. manus: it is fascinating. it is like the wriggling pool of political vipers. what are we watching in this process? boris steps aside and that leaves some key names, rishi sunak above 100, but what about penny? where does she stand and could she be a significant potential opposition in the running? lizzy: -- anna: yes. based on public support, she doesn't yet have the 100 she would need to be on the ballot at 2:00 or at least be considered at 2:00. at some point this morning it becomes apparent she can't get to 100, she steps away and the we could know before 2:00 today whether rishi sunak is essentially the prime minister. if she stays the course and gets to 100, and the key question is

where will the people who supported boris johnson decide to go? these are publicly declared supporters of boris johnson, in the 50's or lower, but he said he had over 100. where will those of mps put their support? rishi sunak does look like the front runner but a lot could happen. a lot of the timing is unpredictable, but 2:00 is the deadline, when we will know more if not before about who has made it 100. manus: i packed some papers into the bag as i walked out the hotel at 2:30 in the morning, and rip up the script again. boris and rishi had a meeting in the middle the night and then came the stamp act. chinese president xi jinping has filled the country's most powerful bodies with close allies while securing an

unprecedented third consecutive term at the close of the communist congress in beijing. colum, this was an amazing spectacle. people were tapped on the shoulder and taken out. if you wanted to ever deliver power moves, this gave us it all. take me through the picks of xi and theater of the weekend. colum: it has been theater for a week at this point because of course we started at the opening ceremony and all through the week, the communist party had a series of events, all of which were praising the communist party's achievements, and dimensions of xi -- i stopped counting, there were so many, every speech flew of references to xi. the culmination was this weekend and we had the incident with the former president, which is still mysterious. we don't know what happened there. despite that, the symbolism was quite clear.

it is a new era under xi. he is out with old, in with the new, and basically he has selected a team of people that are first and foremost loyal to him and this will help him to expedite his policies and his execution of those policies going forward. zero compromise i would say, definitely a surprise to many. disappointing to a lot of people as well who had held out some hope there might be some voices of moderation somewhere in his selection, but unfortunately no. manus: ironically i'm getting notes in my inbox about going full bull on china because there will be an acceleration of stimulus, old-style or not. it could be a pivotal turning point in the stimulus story for china. thank you very much, colum murphy. the yuan the lowest since 2008 this morning.

let's discuss how the markets are reacting to the shuffle. annabelle joins us. tech has taken a bloody knows, hasn't it? where are investors today? annabelle: in the doldrums, a stunning rebuke of this leadership reshuffle. colum said it, it is light on central government experience but also extremely loyal to president xi jinping. you said your inbox was full of people putting bets on some sort of stimulus coming through but it also means importantly for markets, a continuation of covid zero policies, and that is what investors are not liking today. we have the hsc i index back at a level that we haven't seen since the financial crisis, and big moves in the private sector, because there doesn't seem like we will see any support for the private sector in any way, shape or form. that's why you are seeing the likes of alibaba, a record low for the stock. also jd got, -- jd.com.

the other thing i want to mention as well is what we had in terms of the economic data that came out because retail sales, this is a story of slowing consumption in china. coming in the numbers, given they were also delayed by the party congress, gdp a little better than what was expected but still weakness coming through in consumers and also the uptick in the unemployment rate. not a great story today in china. manus: annabelle, a lot to contend with on a monday morning. annabelle droulers in hong kong. what are the events of the week? you've got the october pmi. tuesday will get consumer confidence. when say, u.s. home sales.

there we get the ecb rate decision and lots of people are talking about when they raise rates and then had to back track , but to not raise rates this week could be a folly. bank of japan watch all we could, but the rate decision comes in on friday. that could explode a mammoth amount of carry trade's out there. funded in the end, it's not just dollar-yen you want to look at but all of the crosses where you can see an explosion, picking off risk. coming up, rishi sunak edges closer to becoming the next u.k. prime minister as boris johnson pulls out of the race. this is bloomberg. ♪

manus: it is "daybreak: europe," i am manus cranny in london. let me show you the price of hedging against political risk in the united kingdom. three-month risk reversals are quite expensive, more expensive than hedging for the downside in covid but nowhere near the nadir of brexit. three-month risk reversals on cable. my guest has seen some volatility in his time. we are honored to get you in the studio, back on the wheels in "daybreak: europe." looking at the reversals, i love what you are saying, we are heading away from endless news bonds. in the u.k.. with that in mind, looking at risk reversals, would you sell vol? >> i would, we've seen peak

volatility, i think we've seen the low in sterling. we should be getting through this. we've got several more hours this morning of uncertainty, but if the conservative party coalesces around rishi sunak and we get back to more stable, fiscally credible policy coming through, we are just going to settle back to the economic news will be bad, this much austerity needs a significant recession, that is not good for sterling because we have a lot of rate hikes priced in, but the volatility was slowly leach out. manus: john authers talks about anarchy in the u.k. and a limbo for two years heavy on sterling. do you think the upside is capped? you might put a floor on sterling, but the upside is capped because ultimately you are looking at stagflation risk, which is the bank of england

untethered and doing pretty big rate hikes? kit: the upside is definitely limited partly because we will not get the rate hikes priced in. the economy is going to weaken too much for that, each piece of economic news scares me, quite frankly, as we come into this winter. i think what it means most of all is the next big move for sterling is almost certainly more to do with euro-dollar than anything in the u.k.. we get terrible news out of ukraine, or we get serious gas shortages in europe, you can take euro-dollar down another leg, i think that is slowly getting less likely but i would not that my house on that. manus: another tank on the euro gives you a cap on where sterling can go because it is a dollar accelerant? kit: yes, and by the same token,

if you were to get better use on the -- news on the euro, that could drag the pound up with it. or likely that happens and we get a piece of wonderful news. manus: let's pivot for a moment because we've both been through a number of bank of japan mentions but i wanted to bring valerie into the conversation. valerie has the biggest question of all, unilateral bank of japan intervention is what we understand we have of the moment, but i want to know from you, what happens on the curve? valerie: i think the question after friday's massive intervention is does the bank of japan throwing everything at plan a means they realized it doesn't work and they need to assess plan b, what is possibly a break of their yield curve control? i have a chart, the two big interventions from the boj. they spent nearly $20 billion in late september. friday's intervention was probably larger. some saying it could be up to $30 billion.

that is nearly $50 billion of liquidity sucked out of the system. we know japan sells treasuries to fund this kind of intervention. maybe plan a isn't working, they switch to plan b and maybe it means the yield control break is more likely. manus: thank you, valerie. unilateral intervention in itself has never been very successful. as far as i remember. what happens next? they throw $50 billion at it in terms of actual intervention, do we need to shift on yield this week to shift the narrative on dollar-yen? kit: yes, i think it is unlikely that happens this week only in the sense that i see no sign the bank of japan governor kuroda wants or is willing to back down from his kind of view that he wants to see this out with easy policy, that this is his chance to escape deflation and move forward.

he is still pretty committed to it. it might be early. he may feel that even though we are back at 149, that friday was quite successful. he caught the market at the right time of day for him, the wrong time of day for some of the positions any probably caused some pain and we are three figures lower than where we started. this might not be the last go around of sending a clear message. manus: that there needs to be another bank of japan intervention that delivers a flesh wound that frightens people like you? kit: yes, the moves we saw on friday with the pound and yen going up and the euro having abounds, the whole package, but the equity move and the bond move, the market is very short treasuries and very short equities, very long dollars.

gradually we are getting to the point where the market is inclined to look at this and say the bank of japan is not one to be scared of. when we are all too cocky and we have too big a position and the news that sends us there gets a bit stale, i get worried. for example, the story that the fed is trying to talk us back away from 1% in 75 to 75 and 50, i don't know anybody who thought we were doing anything else. but you have to move in the treasury market. there is a piece that looks to me as if we are in the very volatile, very bumpy, very dangerous final stage of this dollar rally now. manus: so you are not calling peak dollar just yet, but a wriggling boa constrictor? kit: possibly. possibly a spitting cobra, something thoroughly dangerous.

manus: a spitting cobra, the final legs of the monster dollar rally. we are getting you back, high quality in the studio. kit jutes stays with the show. some headlines, this time credit suisse, we get earnings a little later in the week. as morning, the compliance officer set to leave the firm. more details on the trials, tribulations and capital requirements for credit suisse. ♪

manus: let's get the first word news with simone foxman in doha. simone: good morning.

russia's defense minister has called counterparts in the u.k., france and turkey, warning of a drift toward uncontrolled escalation in ukraine and the potential for kyiv to detonate a radioactive dirty bomb. ukraine has consistently denied any such move and says russia often accuses others of what they plan themselves. the u.s. called the allegation transparently false. giorgia meloni has been sworn in as italy's new prime minister, becoming the country's first female leader and heading its most right-wing government since will door two. she must steer the euro area's third biggest economy through an energy crisis compounded by rising interest rates and slowing growth. she will address both houses of parliament this week for a confirming confidence vote. australia's chancellor says he will save a windfall in community -- commodity prices rather than spend it and add to

inflation. he will unveil his budget on tuesday night. >> the slowing of the chinese economy and their approach to zero covid does have consequences for our economy and you will see that in our budget forecast. not a revolution in how they go about that but a bit of a re-think and making sure our markets are diverse. i work very closely with our big employers and exporters to make sure they've got the mix right. china is an important economic partner, there is no use pretending otherwise. simone: 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. this is bloomberg. manus? manus: thank you very much, simone foxman. credit suisse with more news, the chief compliance officer is

set to leave the firm in the coming weeks after spending just under a year on just about a year in the post. we understand his departure is not related to the strategic overhaul credit suisse is set to announce this week. to date, credit suisse down. we need to ask how much capital credit suisse needs? will they tell us answer when we sit down with them later this week? they are coming to london to do the interview. $4 billion, between $4 billion and $9 billion. will they do bonds, will they do convertibles? would you buy it? who is the sovereign investor that makes it side-by-side with the ceo? they braked in $12 million in terms of capital from investors. how much more they need? for sale, the asset management

business, spg could be for sale and indeed other parts of the business. the mandarin oriental, savoy in zurich, hard assets, the latin america wealth business. what is credit suisse? will the real credit suisse stand up? not to be left out of action, it is earnings week. i am in town. ubs is in town. i will catch up with ralph demers -- hamers tomorrow. we will continue to track the race for prime minister in the united kingdom as boris johnson bows out. millions have made the switch from the big three to the best kept secret in wireless: xfinity mobile. that means millions are saving hundreds a year with the fastest mobile service. and now, introducing, the best price for two lines of unlimited. just $30 per line. there are millions of happy campers out there. and this is the perfect time to join them... save hundreds a year on your wireless bill over t-mobile, verizon and at&t.

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it will release your fat and it will release you. manus: good morning, this is "bloomberg daybreak: europe," i am manus cranny in london. race for number 10 -- rishi

sunak edges closer to becoming the uk's next prime minister as boris johnson bows out of the running. sterling climbs for the third day. johnny stocks slide after president xi jinping stacks his leadership team with loyalists. the hong kong index falls to the lowest level since 2008. and giorgia meloni is sworn in as italy's first female prime minister, facing a mammoth debt burden, energy costs and rising interest rates. warm welcome. monster movements in the equity markets on friday and that continues this morning on the narrative we could be debating some kind of a pause, which may lead to a pivot in 2023 and rates. equity markets continue to trade higher. do you want to buy some convexity? do you think it is expensive or inexpensive? s&p 500 the best week since june last week. bank of america, no shine -- no

sign of capitulation. the survey may have screamed capitulation, that data did not. people are debating what xi jinping's third period of power will mean for tack, and for the economy in china. let me show you the currency markets, we are waiting for additional information on the size and scale of the intervention in dollar-yen. you can see the dollar up this morning by 8/10 of 1%. there has already been a flesh wound delivered by the japanese on friday. two year yields continue to drop as we raise the specter of a pause or perhaps a less monster jumbo rate hike from the fed by christmas. nymex down nearly 1% this morning as the chinese growth data disappoints ever so slightly. rishi sunak has taken a huge

step toward becoming the uk's next prime minister. that is as his former boss force johnson pulled out of the contest. let's get to anna edwards at westminster. the intrigue rises as boris johnson, the theater of him, tracking his flight on friday, to pulling out of the race by the close of business last night. what is the latest? anna: absolutely. the latest is rishi sunak seems to be the front-runner here, the front runner to become the new u.k. prime minister, the leader of the conservative party. penny morden is still in the race. she is still in. one of the key question is where will the support of those who were going to back boris johnson land? some might be happy to switch to rishi sunak but others might be unhappy with that, they might think anyone but rishi sunak, given that he helped to bring

down or stops in as prime minister in the first place. it has been weakened of incredible intrigue, watching the tallies and the rate at which these contenders it to 100, you need 100 mps to back you if you want to be in the running at 2:00 today. that is the deadline to watch for. they need 100 mps, penny morden looking to get to the 100, she still has far from that publicly declared. but as i said, where the boris johnson backers go is crucial, 2:00 is when we find out how many have made it to 100. is it just rishi sunak? that will dictate the timing, whether there are votes in the party or if rishi sunak just gets it. manus: as you are talking, we are showing the u.k. papers, the sun, often looked at as a bellwether, bojo, it is a no. but i am drawn to another, rishi

sunak set 4:00 p.m. -- for pm. bojo is the one with the mandate, he is telling the country, but is not over. and will rishi sunak stay there for two years? it is like a sideshow but it is and put in for the big giving len to consider the pmi's out later today, kit is next to me, he says maybe we have seen the worst of the currency, but what about the economy? anna: pmi expected to be below 50 for all of them, which suggests recession. vander research sees a clear path for recession. the top line is whoever becomes prime minister, they inherited an economy that looks really challenged on a number of fronts. inflation at a 40 year hi, soaring interest rates.

we will wait to see how far the bank of england goes. depressed consumer sentiment and whoever leaves the country, some form of us dirty. we heard over the weekend, honesty is needed in this conversation, how tough the times will be ahead. you mentioned the pound and talking to kit about that, bank of america and still sticking with the parity call, iod talking 105. if rishi sunak is on, that doesn't mean the pound soars yields have been coming down on gilt but also the bank of england conversation. we are getting ready for a fiscal statement on the 31st of october and the bank of england on the first of november. manus: i like your style, pitting other guests against kit

beside me, how very dare you. [laughter] anna edwards tracking the political storms outside westminster. my next guest says he is loading up on companies that could lead to the next bull market. he says we are at this point in the nasty bear market with those buying the glamour tech stocks of the last 10 years on the way down are at a crucible. what does he mean? also joining me is kit jukes. cold, good to see you. the folly of tradition, buying the glamour stocks of tech of the last 10 years, why are we at a crucible and why are we folly to do this trade? cole: good morning. you were talking about the equity flows not long ago and we really haven't capitulated on those stories. i think of america report last

week, investors are not -- if you look at the bank of america report last week, if you ask investors how they feel sentiment wise, they are negative but if you look at the allegations, it doesn't match. the stances bullish and they think equities is going to be the way out of inflation. i point that out because it looks really foolish. manus: what is capitulation in your mind? let's talk about it at a micro level. there are a gazillion people like me, part goes to a fund for retirement every month. you don't switch it out. you live through it. there are a gazillion people like me, constantly on a monthly basis getting washed up into mutual funds. does it ever really capitulate? what is capitulation to you? cole: let's use the u.k. context. i was in london last week with investors talking over the

weekend i think what really is keenly and acutely hurt u.k. investors is quality growth managers and equity stories dying. the idea that you can way overpay for blue-chip companies, anything from microsoft out to colgate-palmolive or coca-cola. these are great businesses, the question is what price should you have paid for those businesses? those of the kind of things the s&p 500 is loaded to the gills on in terms of its composition. in comparison, there is a great bull market going on in energy stocks and nobody owns those peer therefore, they cannot make up for the folly in the index or investor portfolios right now. manus: are you prepared to buy anything in the u.k. right now given the crucifixion of the currency, just quickly before bring in kit. are you actively considering stepping into the u.k. market? cole: we own stocks there and we have been buying there recently. i wg, which is a diversified

revenue business around the world, and a pound-based homebuilder. it is crazy there are interesting things to go on. one thing i will mention, this is a 20 year redo in the dollar's high like we did in 2002. i'm not mentally long the dollar. all the consternation in the u.k. looks more interesting because cheap currencies drive economies. manus: ok, i am not mentally long the dollar, this is a new departure for me. i deal with a lot of mental thoughts. i'm going to bring in kit and larry summers, larry summers had this to say about a doom loop. larry: we get amused when we don't live there by some of the things that are happening in britain, but if we think of it as an experience entirely outside of any kinds of concerns other countries could have, that would be a real mistake. manus: the folly of thinking what happened in the u.k. is not

a lesson to everybody else. larry summers there on the lessons for global policymakers. kit jukes, bringing you into the conversation. cole is not mentally long the dollar, there is a new one for you. we talked about nearly the end of this extraordinary dollar run. larry is warning about what happened here is a lesson for other countries on their fiscal largess. are you worried at all at any level about the fiscal largess of the u.s.? kit: not yet. the u.s. is special in that regard and the rest of us have to put up with it they can sell treasuries in large quantities good i would worry more about -- in large quantities. i would worry more about the treasury market. here, we had the ldr crisis.

we are not the only people were we will find damage is being done because of the move higher in yields. we have become a very addicted to low yields, very addicted to central banks buying government bonds and we have repriced things in such a way that historically, it is a huge move in terms of the speed of the move, but they are not high-yield historical -- historically, we've just been used to very low yields. there will be other damage elsewhere from what is going on in this big repricing that will come down the road. manus: more volatility, more damage, perhaps more gray tail events been how do you prepare for that in the fx dynamic? kit: we are in this last stage of a dollar rally in my mind. there is a stage where you get capitulation in equities, where the news isn't good and people are starting to worry about we are at peak rates or past peak rates and so on but equities are

still suffering and the dollar is still strong. that innocence is where you've got to be very careful because there will be an opportunity to sell the dollar but not yet. this almost easier in the bond market when you get those u.k. events where you can sell off and turn around and say the economy canonically -- cannot cope globally. we are closer to peeking yields in time turning terms that we are the peak of the dollar but they are both coming. manus: the dollar is driven by risk, whereas the bond market obviously is about the fed narrative. the dollar is behaving like a risk asset. kit: increasingly for the last bit. manus: cole, back to you. we see the dollar mentioned a number of occasions last week in the equities space. it was mentioned. i think tesla was some thing like 800 million, maybe a billion dollars at different levels.

how does currency play into your proposition if mr. juckes thinks we are at the beginning of the latter part of the dollar ascendant? cole: i think about it a lot. let's say the dollar peaks today, let's say it technically peaks in six months, i don't think it matters. if you go back and look at the prior height and the dollar in 2002, six years later, it woke up getting crushed against many currencies, waking up at par with the canadian dollar, dominated by euros and pounds . it happened two years after the worst bear market in the last 20 years has started. it doesn't coincide with equity markets, that is the interesting part. it added insult energy -- insult to injury for international investors. they started losing money on the currency and panicked out of u.s. markets at the bottom.

that's the other part, visiting with u.k. investors, they own a lot of u.s. names and the problem is they could wake up in two years where they not only lost money in the equity markets and have not made much of it back up but they continue to lose money on the dollar now, which had been part of their double tailwind. strong s&p, strong dollar, it was a 10 year winter and that game is over. those are carry trade's that are done in my mind. manus: ok, i can tell you both that the indicator, i've begun saying dollar a set of sterling, i think that is an indicator that if i have begun to believe in the dollar -- i am late to the trade, but it could be one of those contrarians. cole, sorry we could not see you in the studio, unfortunately political events took over. cole smead my guest this morning and kit juckes.

coming up, the future of china lies in the hands of xi jinping and his all-male inner circle of proven loyalists. that means for the world's second-largest economy on bloomberg. ♪

manus: some pretty big market moves, hang seng tech at the bottom of your screen down nearly 8%. at the moment we are down just under 6%. this all coagulates around the story of the global market map of risk as president xi jinping fills his buddies with his closest allies. there are some powerful signals coming through here. you've got a big narrative coming through, a bounce back here, the dollar, dollar-yen on the move as well. are we near the end of this

massive dollar rally? you are looking at the yuan, trading at lows we haven't seen since 2008 this morning. you are seeing various drops in these currencies as the dollar reassesses to the upside. australian rates, what you saw on friday was this huge move in the short end of the curve in the united states of america and also this massive receiving into 230's as a narrative about perhaps the fed would consider less jumbo rate hikes. that is pervasive this morning in australian rates, down 13 points. the belly of the curve continues its trajectory from friday, down by 7/10 of 1%. that is the state of play. keep an eye on crude. the china data in and of itself can be taken apart and the exports were not that strong. a little bit of headwind for the global economy.

that is your global market map at the moment, which is yen down and dollar up this morning. but resident xi jinping has filled up the country's most powerful bodies with close allies, securing an unprecedented third term at the party congress in beijing. meanwhile, gdp grew faster than expected with industrial act to video improving despite the covert restrictions and a property slump. these retail sales weekend. -- weakened. let's bring back colum, and charlotte. what a spectacle as people were taken out of the auditorium. what does this tell you about the next steps going on for china politically? colum: well, the first thing it shows is xi has surrounded himself with loyal allies and it also shows he is not concerned anymore about maintaining a

façade and adhering to norms. that would mean basically any sort of policy direction he wants to implement going forward he could do so very efficiently. that includes things like building china into a tech superpower and also it would help with the support, he will not have to go back and get a second opinion, he can just push ahead and do as he wishes. if he doesn't get opposing voices or critics, that also is a big risk. does that mean he can sort of have anybody stand up to him and contradict him. it doesn't look like him under the current set up. manus: no. all-powerful, and that has consequences for the market reaction has been quite verlander -- virulant this morning. charlotte, you're looking at the technology sector being better this morning and the currency as

well looks to be on a trajectory lower as well. your first take on the market? charlotte: yeah, it has been a very volatile trading day. we are seeing weakness across chinese assets. the yuan has weakened. a lot of traders are saying this rings back memories of panic selling movements. the tech companies are usually a favorite, we are seeing some like jd.com down. investors are finding it hard to navigate the ambiguity, especially with a line coming out there was a surprise to many of them. the gdp figure was stronger than expected but it was not able to provide support. investors are focusing on the unemployment rate is higher and the weakness with consumption. then the whole political lineup

just brings back concerns with of the covid policy and the broader economy. manus: ok, thank you. colum murphy and charlotte yang. coming up, georgia maloney calls for unity as she is sworn in as italy's most right-wing leader since the second world war. we are live in rome for the latest. this is bloomberg. ♪

manus: giorgia meloni has been sworn in as italy's new prime minister she is the country's first female leader, heading the most right-wing government since world war ii. investors are watching how she navigates the energy crisis, inflation and italy's mammoth debt.

let's get to our guest from rome. what will define her government? >> internationally she has been reassuring, she met emmanuel macron and she has told a u.s. and european allies she will remain very loyal to their ideals. on the domestic front, she is italy first. definitely that agenda, before other countries. manus: what do you think italy first really translates to an terms of her plans? is it around energy, fiscal expenditure, what is the definition of that? >> in a sense, i think she will definitely try to show a sense of continuity to mario draghi's government. on energy, she will keep the same energy minister that was in

his cabinet as an advisor. also she is going to take some symbolic steps to make sure people understand that the government has changed. i will give you an example, the agricultural minister has been renamed into food sovereignty, italian food sovereignty, gives you a sense that while it is cosmetic, italian comes first. manus: pretty powerful. let's see how the week plays out with the ecb meeting also to contend with. bloomberg markets: europe is live from westminster this week in london. ♪

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anna: good morning and welcome to bloomberg markets europe.