shery: this is daybreak: asia coming to you live from singapore for the fifth annual bloomberg news economy forum. we are counting down to asia's major market opens. haidi: the top stories this hour, presidents biden and xi meet face-to-face. shery: asian stocks set for a mixed open as fed officials argue more work needs to be done to fight inflation. haidi: u.s. prosecutors investigating the ftx collapse and binance ceo casts himself as crypto's new savior. looking a little tepid when it comes to sentiment. a huge amount of information to process. also looking ahead also to the meeting between the australian prime minister and xi jinping which could go a long way when

it comes to diffusing some of these ongoing tensions that have built up over the past two years. we heard from the treasurer yesterday how they are hoping for a more stable, consistent, calmer relationship. downside when it comes to sydney to start the open as more stocks come online, about .1% lower. kiwi stocks higher by about .25%. we have the rba minutes to look forward to as well as processing. oscillating expectations when it comes to the fed pivot as well. we heard lael brainard's comments. nikkei futures up by about .2%. shery: take a look at how u.s. futures are trading. we are seeing a little bit of upside. we have seen swings between gains and losses throughout the new york session. lael brainard's comments helped improve sentiment a little but this comes off of kryst for waller's akos -- christopher

waller's hawkish comments. extending the rally for a third day given geopolitical tensions have been eased between president biden and xi jinping. crude prices still under pressure. around the $85 a barrel level. haidi: you and i here in singapore on day one of the bloomberg news economy forum. this was really an event to hopefully provide solutions for some of the most pressing challenges the modern world faces. we feel the list gets longer. when we were here during the very first couple of forums talking about the pre-pandemic challenges. now post-pandemic we are still dealing with inflation, geopolitical tensions. on that last point, we are hearing from two very import and speakers. former secretary of state henry kissinger and the chinese vice president. hugely interesting to hear their

remarks ahead of the meeting monday. shery: we have to take it into context because last year when we heard from dr. kissinger he was talking about a virtual summit being a good starting point for relations. we also heard from the vice president last year where he talked about opening investments to foreign investors and stressing the importance of ties with america. what will they say this year, especially as we are coming off the back of that momentous meeting? the first time they are meeting face-to-face and see pandemic, presidents biden and xi talking for three hours. haidi: this assault with a backdrop of the fight against inflation, the threat of a global recession. let's get more on that critical meeting between the leaders of the two top economies of the world. president biden and xi jinping resuming cooperation on things like climate change and food security.

haidi: stephen engle joins us live from the g20 summit in bali. so really we have not seen in a long time both leaders really shaking hands and smiling so widely. stephen: i think it was the widest smile i've ever seen xi jinping give. that does not necessarily mean it was a kumbaya moment. those are the words of joe biden in the press conference late last night. but he was cautiously optimistic. you can see the two gentlemen meeting here in southern bali yesterday. it would not be a stretch to say that there was definitely, at least before the cameras, a warmer tone between these gentlemen. since biden became president they have not met face to face other three videoconferences. five calls and videoconferences since biden became president. they do know each other and there seems to be an effort by

both sides to strike some common ground. there are still some sticky issues. big differences remain on taiwan. biden told reporters last night and that press conference he does not see any imminent attempt i china to attack taiwan. so he damped down that speculation. but xi did reaffirm that the taiwan question is the first redline that must not be crossed by the united states. but again, they did agree to resume cooperation on other issues such as climate change and food security. some of these lower-level talks had been scuffled after nancy pelosi visited taiwan. obviously that is an issue that really rankled the beijing. they seem to be moving on from it right now. both leaders coming to the g20 from bali with wind in their sails. xi jinping also stack to standing committee with loyalists. he is firmly in command in

china. joe biden did not have a disastrous midterm election so both of the gentlemen felt confident, smiles were on their face, they can move forward now. we are hearing secretary of state antony blinken will head to beijing the early part of next year to continue this dialogue. haidi: curious about the tone when it comes to the war in ukraine given china's so-called no limits friendship with russia. he may not be there, but vladimir putin is top of mind and a big topic of discussion. stephen: absolutely. the war in ukraine and russia at the back of almost every single discussion i have had with sources and those with delegations here. as far as the communique which the g20 usually posts at the conclusion, needs to have some sort of consensus, and the g7 wants harder language condemning the war in ukraine.

now, we're hearing from sources that perhaps a communique might actually be worked out. there might be compromises made. but to take out references to russia's war in ukraine. maybe it will just be war in ukraine. but according to sources they have agreed to essentially condemn any threats of the use of nuclear weapons in that communique. also xi jinping and joe biden did both condemn any threats of nuclear war so there was common ground on the issue of russia between xi and biden. my esteemed colleague yesterday interviewed the easy president ursula von der leyen and this is what she had to say about putin not being here and his war in ukraine. >> i wish that president putin would have been here so we could have the discussion face-to-face and could have said what we think of his atrocious war. stephen: we will see whether the group photo will include put

in's representative here, sergey lavrov. the one way to around that might to be to require just heads of state in that group shot at the end. that would mean sergey lavrov be out of the picture. shery: stephen engle joining us from bali and of course as we continue to see perhaps tensions easy between the u.s. and china, but also other geopolitical dynamics played into the g20 pick let's see how we are setting up for the market opens and bring in mark cranfield. this is also with the fact that we had some comments from fed officials overnight as well. mark: we are going to hear a lot from fed officials between now and the next meeting. a lot of it will be to try and cool markets down a bit. the euphoria we had after the cpi report last week, the fed needs to dial that back a bit. what they really do not want is

them getting to ahead of itself. it was very important. we saw massive changes behind -- because of that cpi report. probably a watershed week in terms of what has happened to the dollar, equities and bonds in particular. the fed needs to remind people there is a lot of data had. there is another cpi report that had of when they meet in december and they do not want -- they need to remind everybody rates need to go up. they need to still go up by another 100 basis points at least. then they also need to stay there. that is the message fed needs to drum through to traders, is that once they get to 5% or somewhere in that area the rate these to be held there to keep the economy cooling down for a while to try and stabilize things. it will not be a situation where rates go up and they come straight back down again. they will not be any fed rate cutting quickly after rates reach a peak and it is very important that fed speakers consistently put that message

through. they do not want equity markets thinking it is blue skies all the way until the end of next year. there is a lot of hard work to do and the fed need to keep reminding people about that. haidi: china looms large. domestic activity numbers as well as credit data. as well as the geopolitical overlay. our markets processing this potential for an improved relationship, or at least a step back from the levels of tension between the u.s. and china? mark: it is certainly important. there is no doubt that will raise people's optimism. but the key to investing in china is all related to the covid zero policy. the more china move back into a softer approach to covid, the better it is for financial markets. you have seen a terminus rally across china equities and bonds. they are starting to dial back slightly uncovered.

those are the things the market really wanted to see. similar to the u.s. it will be a long journey. china's problems are not going to be solved in one or two days clearly there is a little bit of light at the end of the tunnel as they move towards a stabilizing property. the 16 measures they announced recently are going to go a long way. but there are still a lot of companies teetering. they need to refinance and they are difficult. china is improving but there is a long journey ahead. haidi: bloomberg's mark cranfield there. let's get you to vonnie quinn in new york when the first word headlines. vonnie: oil fell again as opec again reduced its forecast for global demand, citing a weaker economic backdrop. the cartel is slashing estimates by 520,000 barrels a day. if sized downgrade was implemented in month ago. ruled crude markets have been in surplus for much of the. jeff bezos says he plans to gave

away the bulk of his fortune during his lifetime. he spoke in a tv interview that aired just hours before news broke that amazon plans to cut more than 10,000 jobs. bloomberg sources say the layoffs target devices, retail, and hr, and could begin as early as this week. china is giving and battled real estate developers a further boost i allowing them access to more money held in presale accounts. they will give quality property developers access to as much as 30% of presale funds with letters of guarantee from banks. late last week, china announced a separate 16 point plan to support the ailing real estate market. global news 24 hours a day on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i'm vonnie quinn. this is bloomberg. shery: coming up, newsmakers and decision-makers will join us live here at the bloomberg new economy forum in singapore.

catch our conversations with bob moritz and gary rieschel this hour. daybreak is live on the ground you're in singapore. this is bloomberg. ♪

shery: we are live at the fifth annual bloomberg new economy forum here in singapore and of course we have been talking about some of the key issues confronting policymakers, economists, and world leaders as we get into day one of this meeting. soaring inflation, the risk of a global recession, food prices, energy crisis, geopolitical tension. although on that last front there is a sense of cautious optimism after the meeting between xi and biden. shery: much more than in the past few years. we are talking about inflation continuing to soar, also more companies, speculation of layoffs. we are hearing amazon could be cutting thousands of jobs. fedex furlough and workers as well. those cost pressures ongoing for all these big companies. who else to walk us through what business leaders are talking about, joining us near is bob moritz, global chairman at pwc international. good to see you in person again. bob: great to see you as well. shery: this is what i love about

the new economy forum, bringing us all together. we were talking about that laundry list of challenges, things do not seem to be getting any better. when you talk to these business leaders, what are they think about? what is top of mind for them? bob: you have the right list of issues the prioritization might be different depending on where you are. in this part of the world it clearly is the u.s. china relationship. if you are in the u.s., pretty much the same. in europe, inflation, energy costs, and the war in ukraine. those are top of mind for every ceo and c-suite. but the derivative from those effects are huge, so they are challenged in terms of what should they be focused on. what they can control and what actions will they take in terms of scenario plans that might come to fruition. shery: that is such an interesting insight, given we are not seeing that much inflationary pressure in this part of the world. you are mentioning u.s. china tension stop of mind. you are headed to the apac meetings as well.

we are not going to have president biden there. but the fact he met with xi jinping in person and at least it looks, going to the headlines, that it was a good meeting. how positive is this? bob: i think it is an important step. the market generally and the business community specifically wanted to see that very first meeting, and at least be neutral rather than confrontational. and the important thing now is what comes after. the combination of the leadership teams getting together and the policymakers thinking about what can we actually do together is a needed and wanted desired outcome coming out of this. so the tail will be told over the next couple weeks and months. it is not just this week, it is what will happen thereafter. haidi: the last few years have been quite traumatic when it comes to business sentiment. confidence, this idea we could see a new leaf or at least in offramp for the levels of tensions we have seen and perhaps greater cooperation. how easy is it to rebuild that

confidence? bob: it depends on the organization and the sector and/or region. we see a number of companies right now being very defensive in terms of the inflationary issues. we see a number of other companies laying out scenarios in terms of what will happen with u.s. china relationships. do i want to rethink my structures in china around the region? do i want to rethink the optionality and how much investment i will make? i was on a call last week with a number of ceo's saying how much can i and do i want to invest in the region, specifically china, knowing the risks that exist with the u.s.. there is a combination of scenario planning as well as optionality in terms of the capital flow and formation that might be deployed. haidi: you talk about optionality, but is it binary? it feels like you are in two camps. one is given the leadership consolidation, the execution of policy is straightforward if you can align your investment with it.

bob: i would say it is not so binary. the reality is you see a combination of factors. you have continuing to be a huge market opportunity in china itself, while at the same time you have a risk or risk premium in terms of how this plays out with the u.s. in working in the global economy. let's not forget, these two countries, unbelievable amount of trade, unbelievable amount of dependency on one another, and people see that. what you have to do is go away from some of the rhetoric and get into the details in terms of what is my upside opportunity, what is my downside risk, and how do i want to play that over the next year or two to set the stage for the next decade-plus. shery: when you are looking at all these business relationships play out the past two years, what did you see in terms of decoupling actually happening on the ground? bob: great question. i would say you see a number of companies thinking, do i need to restructure my operations in terms of what i have in china or outside of china around the

region, but it's with flexibility to say i am not sure if it will get worse or better, so i want multiple options and flexibility to be agile to react. shery: does that increased costs as well? bob: it does but it is a cost they are willing to take. the reality is just technology alone has increased the complexity of the cost. there is willingness to do that because the upside is still pretty big in terms of the marketplace they will have access to. shery: are we going to see more of that despite the fact we may be headed towards a global downturn? bob: i think you are going to continue to see that because the reality is the market and a downturn very much depends on the company. today we see some companies being very defensive. others, full steam ahead still. we have a strong balance sheet, let's make the investments we want to make for the long-term. haidi: where does your business fall in that? i am curious when it comes to the structuring, are you talking about potentially splitting off advisory? bob: not at all. i would say the opposite.

we are committed to the multidisciplinary firm we have at scale. the reality is it is consistent with our strategy. 18 months ago we focused on trust as an opportunity for the business community and sustained outcome, meaning, are the ceo's and c-suite cutting the outcomes they want? in order to deliver against that, we have all the competencies together. we cannot afford to split it, and we are committed to that. haidi: you cannot prepare for that. looking into 2023, do you have convictions, or is it a matter of being able to ride at potentially more volatility? bob: to me, it's a matter of giving yourself multiple options, control what you can control, and react as fast as you can. the biggest thing companies can do is take away the bureaucracy and speed up decision-making so they can react to the opportunities and risks that might be prevailing. haidi: if there is only one thing you can tell business

leaders that would be uniformly true, what would it be? bob: how do you get your organization fit for purpose. be agile, fit, and nimble as fast as you can. and take out internal friction as fast as possible. shery: good to see you, thank you so much. global chairman of pwc international. we have plenty of conversations coming up for the new economy forum, including gary rieschel. haidi: we have more lineup throughout the morning. of course we do get those opening remarks from former secretary of state in re kissinger as well as the chinese vice president. so timely after that meeting at the g20 that has given people a lot more optimism about this relationship that -- plenty more to come. this is bloomberg. ♪

shery: here's a quick check of the list headlines. hsbc has opened a new singapore headquarters as it expands its asia footprint outside of its regional hub in hong kong. they have also moved its southeast mage and -- the ceo says singapore is a critical market and is pushing the bank to pivot to asia, where it makes the bulk of its revenue. haidi: frozen is exploring several options as it seeks to raise capital to repay debt. they have told advisors its domestic food and beverage business is available for potential investors pretty it also says it is weighing options when it comes to assets in the u.k. shery: infineon on says it is investing $5.2 billion in a new factory in dresden. it is due to start production in

2026 and would create 1000 new jobs. they are hoping to tap into investments from the eu, which is keen to subsidize domestic chip manufacturing. haidi: do stay with us here at the bloomberg economy forum in its fifth year. we have ongoing live coverage today and the next couple days. that opening session with remarks from the chinese vice president is almost upon us. plenty more to come here on daybreak asia. this is bloomberg. ♪

vonnie: i am vonnie quinn with the first word headlines.

president biden and xi jinping have agreed to a series of goodwill gestures after a three hour meeting on the sidelines of the g20 summit in indonesia. they agreed to resume cooperation on issues including climate change and food security, and to warn russia against using nuclear weapons in ukraine. but differences remain on key issues like human rights and taiwan. >> i absolutely believe there need not be a new cold war. i do not think there is any imminent attempt on the part of china to invade taiwan. and i made it clear that our policy in taiwan has not changed at all. vonnie: fed vice chair lael brainard says the central bank should soon slow the pace of its rate hikes. she said it would take time for the fed's hikes so far to flow through. the comments suggest she is in favor of switching to half-point hikes as soon as december. u.s. federal prosecutors are said to be investigating the collapse of cryptos change ftx. the u.s. attorney for the

southern district of new york is handling the inquiry, which has not been publicly announced. ftx's sudden implosion with $9 billion has sent crypto markets into a tailspin. the binance ceo says he plans to set up an industry recovery fund. ukrainian president volodymyr zelenskyy has promised to liberate more territory held by russian troops after making an unannounced city to kherson. it came a week after kherson was recaptured by ukrainian forces. ukraine's chief commander has told the u.s. there can be no agreements or compromises until russia leaves captured territories. global news 24 hours a day on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i'm vonnie quinn. this is bloomberg. shery: and of course we have seen chinese adr's rallying in the new york session given of course that better picture when it comes to geopolitical tensions between the u.s. and

china. but when it comes to funding and investments in china, we may not be back to where we were a couple years back. this of course has to do also with covid zero policies, not to mention the fed hiking interest rates. that has been hammering private and public market valuations across the world. in china, the value of venture-capital gills -- deals has almost halved. haidi: it really feels all these various pressure points. gary rieschel, always great to have you. in addition to when it comes to specifically funding for chinese ventures, globally there are lucrative pressures. tech funding is looking softer. the regulatory crackdown in china. the threat of the u.s. china tech decoupling. how do you navigate that and still find opportunities? how do you adjust the way you look at the landscape now? gary: it is pretty natural that

you have some reset. you look at the amount of capital that went into the market between 2010 and 2020 and it was a staggering amount of capital. now many firms and countries are having to work through that capital. ftx being a good example of things that probably should not have been funded to the extent it was. in china we are seeing the entrepreneurial energy has not abated at all. so the energy in the start of community is still very strong. that does not require as much capital as a later stage crossover deals which absorbed a great deal in larger crossover funds. the numbers are naturally coming down but we have not seen a decrease in activity at that early stage, the real innovative level of venture-capital. shery: the chinese entrepreneurial tech energy has remain unabated, because you see the examples of jack ma, the restructuring of these ambitions. do you think that has had an

impact or should we be looking at it from a different way? gary: it probably makes the entrepreneurs more cautious and less promotional. on the other hand you're talking someone worth $135 billion. no one investing in it are worth maybe $1 million. so they are not there yet. i think there is a misunderstanding. it is not been a broad-based crackdown. if you are lined up with the innovation engine that the chinese company, the chinese economy needs to be successful, that remains very attractive for us. haidi: i feel your view has not changed a lot since when we last spoke in 2021 at the new economy forum. you were optimistic about the startups. but the geopolitical landscape, the macroeconomic landscape has changed so much. inflation soaring, people are being laid off. has any of that been filtered through, how do you take that? gary: for some of the portfolio

companies, they are finding it awkward now because they were in a very steep growth curve, or their business model may not have been proven. and if you have an unproven business model now you have to retrench. you have to get the business model proven before you expand again. again, the big geopolitical winds do not affect the true early-stage ec. no one starts and says i will not start my company today because of something xi jinping said. shery: well, i may not be able to get funding. i have a great idea that i may not be able to get the money to bring it to fruition. gary: but when you look at the funding available, there is still a vast amount of money available. the funds that has had a harder time are the later stage crossover funds. shery: where are the funds coming from? gary: raised over $3 billion in four months. 75% on the money came from u.s. investors, 25% from middle east, southeast asia, high net worth

families outside the u.s. so the risk -- that was a tribute to how well the team has done in china. we had nine ipo's this year. it has already been a decent year from the standpoint of normal venture-capital metrics. but you have to be more careful. you simply cannot pretend that none of these larger events will have an impact. haidi: what companies are you investing in in china? gary: we have a very strong tech practice, a strong semiconductor practice, ai, intelligent manufacturing, software-as-a-service, which is a very slow build but since china does not want any dependence on foreign software, virtually the entire infrastructure in china has to be re-hosted on self developed software. and then, health care. our health care team is very large, so we invest across a very broad range of health care. haidi: we are also seeing this trend where chinese funds are trying to manage their risk by glowing more global.

do you continuing next year? gary: it is something that is quite frustrating. because of the venture capital industry has proven you have to have people on the ground to make those investments. if you are saying you are doing crossover late stage investments, yes, it's a financial decision. if you are looking to drive tech development, you have to have people on the ground. it is very hard -- a lot of the senior partners now are going overseas. i get it, it is not that comfortable to be in china, covid policy has been difficult. but you cannot set you can be as effective from singapore, the u.s., investing in startups in china as if you were there. it simply does not make sense. so the risk mitigation of going to other markets, china and the u.s. are the only market to have had critical mass in scale in early-stage venture capital. so very hard to replicate what china has created over the last 20 years. shery: what did you take away from the party congress lately,

and the latest moves to try to support the real estate market, perhaps more targeted covid restrictions as well? gary: on the real estate market, they just refused to do what they need to do. so it will be a couple steps forward, a step back. because they cannot afford to have a crash there. the meeting lesson that with biden and xi, the take away was let's not be too optimistic that we can have less despondency. because the entire business community was simply waiting for the two leaders to meet. i think we can be confident that now we will open up other windows that will provide some opportunity in the future. haidi: we have been talking about this cautious optimism. is that how you would characterize it? is this the potential for the grown-up rivalry, competition, not conflict, with guardrails in place? gary: what has happened, largely because of covid, probably because of each country's policy, the lens they look at each other is a political lens

which distorts everything. from the u.s. side i do not see a coffee cup, i see some foaming mass. the chinese side does the same. you have to have lenses that are clear where you have agreement on what you are seeing. once you have that, then you can build on that. but we have not been able to do that the last several years. shery: what are the new sectors for the next couple of years that will really drive innovation, that will really drive some of those startups and fundings and optimism about the chinese economy? gary: self therapy, gene therapy, the more personalized medicine area. china has a really strong opportunity to be one of the world leaders, if not the world leader in that area. on the tech side, the material area. we are seeing the revitalization of the cleantech investing cycles in the u.s. that is a very heavy material science benefit. china has very strong opportunities there. the biggest clear opportunity is

on the software infrastructure. the entire software infrastructure in china needs to be re-hosted on a 21st century platform and that will be a phenomenal financial opportunity. if you look at the top 100 most viable software companies in the world, only four are chinese. that has to change. haidi: with the consolidation of power after the party congress, is it easy to have conviction in china than elsewhere in the world? could it be less volatile? gary: it is pretty clear how china will be governed, so from that standpoint there is very little confusion about that. i think that we will have to see -- the problems china has are vast. so i think fundamentally, we have to see what are the policies around property. if they continue to try to micromanage technology development, that would be a bad sign. they rode off $40 billion in the last few months for two semiconductor companies.

if they pick sectors and support the entrepreneurial energy in that sector i think they will be successful. if they try to pick a company as a winner, i think they will fail. shery: gary rieschel, really good to see you again in person. thank you so much for joining us. we have plenty of conversations coming up, right here at the new economy forum. haidi: a lot more to come. great conversations ahead as we get today one of the bloomberg new economy forum here in singapore. we will also be hearing from the former secretary of state henry kissinger, as well as the chinese vice president with their remarks in the wake of that crucial meeting between president biden and president xi jinping. this is bloomberg. ♪

shery: indonesia's net zero goal is in focus as they host leaders for the g20 meeting. there is a deal worth up to $20 million to help indonesia shift away from fossil fuels. haidi: look to bring in caroline schwab. how big of an impact will this make and is it enough to get the country back on track for decarbonization?

caroline: indonesia has been seeking partners in their plan so this plan is definitely helpful to drive plans into actions. in terms of funding it is definitely not enough for decarbonization of the entire economy. our recent studies show a net zero pathway for indonesia will require up to $3.5 trillion from self investments. this is just a drop in the ocean about what we hope it does is to actually help kickstart the process to help all parties involved to find tune the framework and processes so it provides clarity and to instill confidence in the market that can then help drive capital public and private into indonesia's energy transition sectors. shery: and it is not just

capital, right? what are the key technologies needed for this? caroline: indonesia really needs to go big on renewables. call has been the technology of choice due to domestic resources that they have. but that is set to change. over 2022, in 2050, they need to add more than six times larger than the fossil fuels capacity every year between now and 2050. so they really need to focus on that segment and in particular solar is expected to take center stage accounting for about half of the capacity emissions. we expect wind to play a smaller role, but still the net zero pathway about 100 gigawatts of combined onshore and offshore wind will need to be built up to 2050.

these renewables will also need to be complemented by new technologies like nuclear, carbon capture and storage, also known as ccs, and hydrogen, to eliminate as much emissions as possible. haidi: what are the biggest challenges? caroline: i think it has to be the coal industry indonesia has which makes it very challenging for the government to phase out coal completely. it is also a large export market for them. indonesia exports about 400 million to 450 million tons of coal every year, which is three times the amount they consume domestically. but it needs to be acknowledged that this sector faces risks not just from indonesia's own energy transition, but the global energy transition, which will drive a reduction in call demand from its key export markets such as china, india, japan, and south korea. and while technologies like ccs

could provide an avenue for an energy transition in indonesia's own domestic cool use, but these plans face economic, technical, and infrastructure-related challenges. also, so establishing strategy partnerships and collaborations will be very important. but i think the key for indonesia now as they need to act very quickly to implement the necessary regulatory market reform frameworks to help bring in thos investmentse. haidi: caroline chua there. live coverage continuing of the bloomberg new economy forum. the opening session is just a few hours away. we will be listening to open remarks from the chinese vice president, coming just one day after the critical meeting between president biden and president xi jinping, where we spoke to gary earlier, he

characterized it as you could feel the world exhale, a collective sigh of relief as they seem to have managed to agree to get talks within the world's top two economies back on track. it is seen as a cautious improvement. shery: especially from last year. really doing more when it comes to ties with america. we will really be looking forward to his comments today. this is bloomberg. ♪

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shery: we are now getting third-quarter gdp numbers out of japan. breaking news, a contraction of 1.2% on an annualized basis. the estimate was growth of 1.2%. we knew there would be a slight deceleration given the drag from that trade, the cost jumping. we saw a decline in housing investments. but this is a contraction of 1.2% on an annualized basis for the third quarter. net exports being cut .7 percentage points. so you can see really dragging those numbers for japan. consumption rising as expected, .3% quarter on quarter, but inventory trims only .1 percentage point from quarter on quarter gdp estimates.

nominal gdp also contraction of .5% quarter on quarter. really, we need to pay attention to business spending and that has risen about 1.5% quarter on quarter, less than what economists had forecast. you can see how private consumption business investment might have taken a bigger hit than expected in the third quarter. but of course these are backward looking numbers pretty we will see what happens with a week japanese yen and how businesses may react. haidi: it has been quite interesting the yen, sitting below 140. this is much more of a u.s. dollar story than a yen story, but it's still nonetheless an important one to watch. that psychological level of 140. as we heard from lael brainard, really reiterating fed chair powell's stance that potentially we need to start looking at slowing the pace of hikes. we know that the interventions by japanese authorities, we were wondering to what end. maybe this is what they wanted

to get to, to get over that momentum of young weakness -- yen weakness. fedex's freight unit is furloughing workers and some u.s. markets, adding to include sing -- to increasing evidence of a slowdown. they will receive health benefits and some will be offered transfers to areas that are still hiring. fedex said last week it was cutting cargo flights as the airfreight market declines. shery: profit fell for india's top energy explorer as it was hit by a windfall tax as oil prices were rising. net income fell 30% from the year earlier to $1.58 billion. that was still ahead of the $1.2 billion average analysts had forecast and followed record earnings a year earlier. haidi: japan's biggest banks are looking to increase shareholder returns as global rate hikes boost earnings. they will buy back shares worth a combined $2.5 billion.

a push to expand overseas is paying off her japanese lenders. and of course we just spoke about the stronger dollar. shery: these are the stocks we will be watching when trade opens in korea and japan surely. asian energy related stocks could be -- that's waning optimism over demand. haidi mentioned dollar strength. japan petroleum exploration as well. haidi: we are not just getting the gdp numbers. the first contraction from the first quarter of 2021, really underscoring the uncertain landscape when it comes to challenges facing global central banks, the fiscal side as well in terms of how to navigate this area of soaring inflation. even inflation and japan, without going into recession. shery: who knew that we would be talking about inflation and

japan? haidi: not the right kind of inflation. shery: not according to the boj governor kuroda who keeps easing, because they say he will not stick for a long time, despite we are seeing price pressures about the 2% inflation target. but interesting how -- was characterizing what is top of mind for policymakers around the world. inflation, not top of mind for business leaders across asia because it is not as bad as in the u.s. or europe. here, it's all about u.s. china tensions and where china goes with the covid zero policy. we have seen perhaps some easing of tensions when it comes to president biden and president xi jinping talking for three hours in person. haidi: these visual pictures, no wonder gary rishel was really saying the sigh of relief from people watching that, saying that perhaps this is the beginning of what we have been talking about, this hope for a grown-up rivalry, of a

competition, not conflict. when four months ago we saw tensions between these two superpowers at the highest they had been in years with the nancy pelosi visited taiwan. shery: which is why i am afraid to get ahead of myself, because we have seen this optimism before, just for the relationship to be derailed. the biggest problem is still taiwan, especially when you have the u.s. and congress about to pass the time on policy act, and what that would mean when you are -- haidi: you will be hearing on these and more from world leaders at the 20 new economy forum that continues in the next hour. ♪

>> is "bloomberg daybreak: asia ," coming to you live from the fifth annual bloomberg new economy forum in singapore. we are counting down to asia's major market open after we await reaction from president biden as xi jinping first in person summit. they talk for three hours. we -- haidi: i have not seen him smile so broadly, it stood out to me, as they were saying earlier you could hear the collective exhale. the collective sigh of relief, that this meeting, low as expect tatian's work, actually managed to be -- expectations were come exit mean -- managed to beat them. sam bankman-fried henry kissinger --shery: henry kissinger said it was a good

starting point for the relationship. we also the vice president of china who last year talked about opening china to more for investments. we will see what he says this year. that is not what we have seen so far with the covid zero strategy. you can see the market opens in japan, and mixed picture with the nikkei under pressure. despite that we have seen fluctuations between gains and losses throughout the new york session. the japanese yen touching that 140 level, seeing weakness against the u.s. dollar. the dollar has been going up and down with a recent commentary from fed officials, the 10-year yield we are watching, 386 is the level as we have seen the treasury yields climb again. we see the korean yuan trade in a narrow range, perhaps importers were buying dollars following the dip. we see more of an upside when it comes to korean stockmarkets,

korean won holding at that 1323 level. haidi: you mentioned that 140 level, psychologically this is a dollars story, you see that play out in the aussie dollar, on the a week i -- 8 week i. the hopefulness with the chinese property sector, sherry, the covid zero is the pivot -- pivot is a top of mind. shery: especially as we see cases coming out of china and beijing, 461 u-local cases, the optimism -- new local cases. the optimism, with easing the covid zero policies that we continue to see cases rise in china, but authorities have pulled back us on the measures. haidi: we see it, including the likes of the aussie dollar being supported in this story. president biden xi jinping

agreeing to continue cooperation psyche issues. this is the -- on key issues. this is the first meeting. shery: haidi cannot, forget that huge smile from president xi jinping. when have we seen him smile like that? guest: it was definitely a warm tone to the meeting between xi jinping and biden. that was demonstrated in a late night press conference joe biden gave to the gaggle of press at his hotel last night. yes, it is not a kumbaya moment. those are the words joe biden used. he essentially said i am not suggesting this is kumbaya and everyone will go away with everything in agreement. he did say i have silly believe there need not be a new cold war.

essentially he said both sides have a responsibility to prevent competition becoming anything ever near a conflict. president xi jinping says the two sides need to find the right direction and elevate the relationship. again with janet yellen telling reporters yesterday they just simply want to establish better lines of communication with china. we are seeing the antony blinken, the foreign sector -- the state department, of course is going to be heading to beijing and the first part of 2023 to basically continue this line of communication. with china. a good start. still thorny issues to discuss. including taiwan. president xi jinping telling biden that this is the red line they do not want the states to cross -- the eye states across.

this is what joe biden said about the taiwan issue. >> i absolutely believe there never -- need not be a new cold war. i do not think there is an eminent attempt on the part of china to invade taiwan. i made it clear our policy in taiwan has not changed at all. guest: keep in mind as well that is the big high-profile meeting between jinping and biden, he will also be meeting with emmanuel macron of france, at this part of the world you will be meeting with anthony alban's, the prime minister of australia. that is another relationship that has suffered for many years. something that jim charmers, the australian treasurer told me yesterday, that they seek stable ties. a foreign ministry spokesperson beijing was asked about it.

they said they seek stable ties with australia. anthony albanese met with the outgoing premier in cambodia the day before. essentially he told him that beijing is willing to meet him halfway them in the sticky issues. shery: a lot of stakeholders hoping for a positive result from that as well. there is one man not there in the ground, but certainly still top of mind. i am curious of how the issue of the war in ukraine is addressed. what leaders are saying about vladimir putin. guest: let me be clear. the war in ukraine is that the backdrop of every discussion here and on the minds of everybody. it is just about that delicate balance and the long late-night negotiations that were happening behind the scenes last night to find out how to condemn the war, but also find some middle ground

without necessarily isolating russia further. russia is a member of the g20. there was speculation there would not be a closing communiqué. there has always been some sort of joint statement after every g20 same -- stomach. sor -- sources tell bloomberg, that there could be a communiqée that condemns the war in without saying russia's war in ukraine. all sides have agreed to condemn any threat of the use of nuclear weapons. that is something, of course, the vladimir putin has eluded to the all options are on the table. they want to condemn that. the ec president mentioned, in an interview yesterday that she whizzes putin is here so that -- wishes putin was here so they can tell him to his face how much they condemned the

atrocious worn ukraine -- war in ukraine. it is an issue, one way to get around the group photo tomorrow, just invite state leaders to the group photo. sergei lavrov would be out of the picture. shery: always the controversial group photo at the g20, stephen engle joining us from bali, there is renewed optimism and hope that we may see some thawing of ties now that the presidents have met. let's get more analysis. tom, this comes as the backdrop as china starts to ease covid restrictions. is trying to support its developers. what is the fact that he is willing to do engage more constructively in talks with the u.s.. does that give us more indications of where china is right now that they need to do this? guest: i guess i want to have a

low caution with optimism in interpreting the outcome of this meeting. xi and biden agreed that nuclear is bad and climate change is bad. two statements, it is fairly difficult to disagree with. they have agreed that the return of baltimore to -- voldimort is bad news. haidi: you would think but this day and age we hear everything. guest: certainly signs of a thought, with a move china has taken with covid zero and the move have taken on property, you could say this is an easing of tensions of all the big concerns by china. most china relations looking low bit more positive, covid zero moves in the right direction, profit -- property moving to stabilize the market. we can see why it is improved significant lead in recent days,

perhaps a little bit of the additional impetus, same time we need to remember there is a huge amount of substance -- let's not forget the u.s. moved in last few weeks to move the -- block china's access to leading edge semiconductors. if strictly enforced threatens to turn china to an amish community with technology develop and frozen in place -- development frozen in place. shery: that one move has impact on chatting gdp growth for china as well. the narrative for beijing is that the u.s. is trying to curtail -- can china rise to its economic potential of there is a decoupling? guest: china has been a be huge -- been a huge for sherry of the stable open free-trade system

that the u.s. is working -- welcomed china into. there was a huge technology transfer, china would not have risen so vast if there are not been so much expertise from the u.s. and europe and catalyzing their rapid develop it. from beijing's perspective the tariffs we saw under president, the tariffs biden has left in place, and even more so the specific moves to block access to technologies. especially leading edge semiconductors does threaten to stymie china's the relevant. -- develop it. there is risk on the website side is well. it is a huge market with its own r&d capacity. it is possible the u.s. will attempt to block china, in the end -- haidi: who needs the other more? guest: at the moment china is

playing catch-up, with technology, and develop it, gives -- development, it gives the usa lever, that will try to engineer change in china. if they cannot engineer change that at least slow china's rise. the question in my mind is whether the world look like in 10 years time, when china has overtaken the united states to become the world's biggest economy. does china remember, when you are in the charged you to guide us access to the technology we needed. guess what? we are in charge now, let's see what decisions we take. shery: what happens in one years time? we'll still be down to the twin pivots? haidi: i am scared of that outcome we have had the pandemic , and then since the end of last year we've had the ukraine war. shery: all the black swans coming home to roost. is it still going to be focusing for can get a fed pivot as well as a covid zero pivot?

will the global economy be ok? guest: there are substantial risks looming over global growth heading into 2023. have a federal reserve that will probably slow the pace of rate hikes going forward. that is the message we heard in a presentation she gave at bloomberg's ec office earlier in the week. -- d.c. office earlier in the week. still a terminal rate of 5%, very likely that will push the u.s., still the world's biggest economy in the -- to recession. while we hope for a milder winter in europe that reduces the stress for gas prices, if gas prices rise again europe could head into recession as well. china, the signals for exiting covid zeros what the market wants to hear. let's not forget this will be a gradual and potentially stop and go process with controls removed

and that perhaps put back again as cases rise. i think this is a moment of optimism for the global economy. perhaps the fed will slow the pace of rate hikes. europe will have a cooler winter, china is moving in the right direction of properties and u.s. ties. haidi: a reality check, but at least we got a harry potter resident -- reference. shery: let's get you back to new york for vonnie quinn has the first word headlines. >> opec reduces a forecast for global demand setting a weaker economic backdrop and china strict anti-covid measures. they are slashing the measures for the amount of crude they need to pump this quarter for -- by 520,000 barrels a day. world crude markets have been in surplus for much of this year. jeff bezos says he plans to give away the bulk of his fortune during his lifetime, he spoke to a tv interview that hours before

news broke that amazon plan to cut 10,000 jobs. the e-commerce johnny -- giant artist ever headcount reduction. the sources say that the last target retail, -- china is giving embattled real estate the lepers a boost by -- developers a boost by giving them access to more money. they will be giving quality developers as much as 30% of retail funds with letters a guarantee from banks. they announced a separate 16 point plan to support the ailing real estate market. global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. i am vonnie quinn, this is bloomberg. haidi: today we have more in-depth discussions with our guest from the bloomberg new economy form you share underway behind us. the head of eq to asia

chairperson, jean joins us next. this is bloomberg. ♪

shery: you are watching "bloomberg daybreak: asia," we

are live at the fifth annual economy form in singapore, we are watching what the markets are doing with the conflicting that statements we are hearing -- fed statements we heard this morning. not to mention the easing geopolitical statements. haidi: we talked about funding, not to mention when it comes to tech, shrinking liquidity, let's take a look at private equity investments in asia. he is with eqt chairperson, is great to have you in person is great to be sitting here and having this conversation. we have been asking people going into next year, do you have any convictions? will it be managing your way out of volatility? you are very optimistic. guest: yes, we feel that this vintage of investments coming up will be good for private -- private equity investors.

we have not been caught up as much in the bull market we saw the last couple of years. we are focused on buying controlling stakes in companies, creating value in the business through the changes we make, putting in great leadership teams and managing the changing growth. we think the current environment presents an interesting entry point because valuations have come up so much. haidi: you are not struggling to fund raise, in contrast to allow the small shops that have struggled. guest: private equity has proven to be a haven in the volatile markets, large established layers like our firm and others are attracting capital because of the ways we invest in the way that we drive value creation independent of the economic cycle. we are able to make money in good markets and bad markets. the industry is consolidating, that is probably one of the key drivers of our decision to combine our firm with eq dcom at to be part of this industrywide

consolidation we have global scale firms like ours. the have global specter -- sector to billy's that can invest -- that have teams that can invest in sustainability. teams are limiting the number of funds they invest in and concentrating capital and fewer gps. that is a trend that will continue. haidi: you see them being challenged with rising rates in a different macroeconomic picture. when you have all that capital what is it like? guest: there has been a big reset in valuation, public markets are up .5, 35% across the region. -- 25%, 5% across the region. -- 35 percent across the region. the two sectors we focus on the moat is technology and health care, see a lot of interesting

macroeconomic in the sectors. in terms of entry price of berries country by country. we have -- where it makes more sense for the businesses to be privately held and growth of the volatile period as a private company and relist in three or four years time. there are companies that consolidate market position by acquiring other companies. we give them capital to help them without acquisition, with bolt on acquisition. >> with covid zero going on is -- is going on forever,'s perhaps some loosening of restrictions, we've heard from people about the un invest ability of that space, what you think? guest: i could tell you in 1990's china was on investable. today it is nothing like the 1990's, is much more investable

than the past. what has changed is the way you invest in china's continuously evolving. you need to look at the areas where china has competitive advantage. certain areas were china dominate. they have tremendous renewable energy scale in terms of green energy. second, is a country that has tremendous amounts of innovation and technology. there is lots of r&d centers created, filled in china that draws further innovation. china has tremendous scale as a demand market. looking at china not so much as a place for low-cost made fracturing. looking at it as a place where there is innovation, where you can drive scale at domestic companies and you could use the green eight energy -- energy available in the coming you can make an interesting market. our perspective is very positive on china. the regulatory changes that have taken place cause people to pause and wait for the dust to settle a little bit.

we see more clarity, i am happy to see how warm the initial meeting between president jinping and biden and how they sat down for three hours together. ultimately these are the two largest economies in the world. they have to figure out a way to work together. they are so interdependent. i believe there will be continuing opportunities. shery: are you currently investing along those narratives of the energy transition, tech opportunities in china? or are you waiting days -- to continue to increase exposure? >> it is more the letter, we have a large team in beijing and shanghai, we have been making historic investments in china. we are slowed down to see policy a look. i am pretty confident the directional become more clear. shery: what is the catalyst? guest: the recent party congress was one catalyst, the next will be another.

more clarity on policy direction, seeing the opening of markets, stock markets for ipos again for public market investors help us get more confidence. haidi: asia z qt had, and eq to head person, it is great to have you on. we do have breaking news free right now. shery: we have been talking about the elements when it comes to the chinese property sector and the comprehensive rescue plan. the developer raised 3.9 2 billion hong kong and a shared place, we were expecting the 3 billion-dollar debt to be extended, it is estimated -- should we see that rescue package bmp meant it and rolled up by the chinese government -- be implemented and willed dow by

the chinese government. more to come on "bloomberg daybreak: asia." this is bloomberg. ♪

shery: you are looking at live images from the g20 summit. he is welcoming world leaders as he walked -- opens the summit. somewhat of the action has happened on the sidelines of the g20's, had the three hour meeting between president joe biden and president xi jinping that has infused some optimism as the guardrails of the critical relationship established. a grown-up robbery, a competition, not conflict,

shery: this is "bloomberg daybreak: asia."

i am vonnie quinn with the first word headlines. president biden and xi jinping have agreed to a series of goodwill gestures. they have resumed cooperation on climate change in food security and to warn russia against using nuclear weapons in ukraine. differences remain on key issues such as trade policy, human rights, taiwan. >> i actually believe there need not be a new cold war. i do not think there is an imminent attempt on the part of china to invade taiwan. i have made it clear that our policy and taiwan is not changed at all. >> g20 diplomats have agreed on a proposed communiqué on tuesday, they have had to revise language that acknowledges russia's concerns extracted concessions from moscow, the plan draft declarations may .28 earlier u.n. resolution deploying -- point to an earlier u.n. resolution.

>> after making an unannounced visit to the city of curbs on, -- kherson. several ukraine's chief commander says there can be no negotiations, agreement, or cover rises until russia leaves its captured territories. u.s. federal prosecutors are investigating the collapse of the exchange ftx, sources say the u.s. attorney for the southern district of new york is handling the inquiry that is not been announced publicly. ftx sudden implosion with $9 billion with liabilities and 900 million in assets has sent into a tailspin. cz says he will set up an industry recovery fund. global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. i am vonnie quinn, this is number -- bloomberg. haidi: we do have breaking here for you, the first of november

reading, it has -- meeting it has slightly differentiated itself from other central banks. slowing the pace of tightening, even as inflation remains high. the labor market is tight, and the notes it is clear the rba is prepared to pause or return to outside hikes, considering 25 or 50 basis point moves. reviewing fall guidance to set future approach. we do see a potential pause in the tightening cycle, and returned to larger rate increases if the economy warns. that is according to the minister at the november 1 policy meeting that is when they lifted the benchmark by a quarter of a percentage point there. they have decided on a stronger case for 25 basis points given that we are questioning if we

will see the full effect of the path of the rapidfire we have seen since may still have us. shery: we continue to see inflationary pressures. a big part of the commodities boom we have seen, we see more stabilization in prices. the next guest is behind the world against new copper mines, increasingly lower end of the 2022 production guidance and its mind in condo, is robert always great to have you with us. guest: it is great to be back. shery: we have talked about in the past about we do not have enough metals for the clean energy transition. it seems so far that economist are saying we might see a surplus in copper production the next few years. how does that compare with the potential economic downturn globally as well? guest: they are dreaming we have

had decades of underinvestment in mining and basic raw materials. you can create a recession, you can raise rates, you can suppress economic activity. the minute our chinese friends, out of their lockdown, the minute world goes back to normal economic activity you will have a sustained long-term shortage of critical metals for the new economy. shery: what about the fact that we see metal prices ongoing with the invasion of ukraine, has that pushed the timeline for the transition to green technologies? guest: what we would see is the evolution of a just in case economy to the just-in-time economy. the balkanization of supply chains and how everything is interlinked. the price of food rises as the result of ukrainian war. international shortage is appearing a lot of commodities. nickel and copper, for example

right now are at the lowest inventories we have seen in decades. haidi: where are we at when it comes to the super cycle and the investment in the cycle? guest: i do not know about a certain super cycle. shery: you do not think this is another super cycle? guest: if you want to stop burning hydrocarbon and one start burning coal and maintain troops in global gdp growth then we have an enormous amount of work to do to provide the raw materials to provide that transition. if you want to continue to burn coal and oil still have a major challenge just to maintain 3% gdp growth for a lot of critical raw materials. haidi: does the move away from covid zero significant a change the alec demand? guest: massive, china consumes half of the world's copper. when everyone is locked down they are the streets consuming. when you saw on the night states

that when everyone came out of lockdown there was an explosion -- u.s., there was an explosion of demand. that is likely to happen in china as well. haidi: what do you make of the recent summit between president biden and xi? are we headed towards a closer or improved relations between the two? guest: i am very happy for our children and our grandchildren president xi agreed with the united states that we should not use nuclear weapons. that will temper the behavior of the third major participants, russians. shery: at least when it comes to the investments in some of these technologies and mining these metals that are critical for national security, that will continue. guest: absolutely we are seeing

the balkanization of the world economy. the chinese want to secure their entire supply chain top to bottom. americans and canadians as well. we see a lot more concerned about national security for these metals as opposed to just the greening of the world economy. one thing democrats or republicans agree on is that we need more copper metal. democrats for the greening of the world economy and republicans for national security. haidi: and moved to secure -- are moves to secure critical metals at this point too late? guest: it takes 20 to 30 years to secured natural -- critical metals, it is -- china has been forward-looking for this 20 to 30 years, the western is catching up with critical raw materials.

in germany they are very cold to get through the winter, that should never have happened. shery: when you talk about the greening of the economy, mining is not necessarily a green industry. what are some of the technologies you are hopeful for were optimistic about to get there when it comes to the industry itself? guest: mining has to be transformed, here in the studio everything you touch is the product of mining. the table and chairs, all the cameras, like any human activity can be done better or worse. mining industry is making rapid strides that reinventing itself. we have the advantage of the sum total of technological develop. everything, broadband, internet, wireless, supercomputers, machine learning, artificial intelligence will help us find a better way to mind and what we might. haidi: is there more funding now that there is a greater understanding that this is what we need?

guest: they have huge cash flow from iron or, they are now investing in disruptive new technologies to reduce energy consumption and environmental footprint of mining. haidi: heavy you changed the way you split your energy and focus when it comes to tech ventures when it comes to traditional ventures? guest: we are more more involved in disruptive technologies, developing new ways to crush and grind rock. 5% 8% of total global warming gas, is from crushing and grinding metals. you have to grind it to talcum powder, that uses a huge amount of energy. there is new technology to do this. if you come back from mars in 20 or 30 years, this little planet, there will be huge changes in the mining industry. far more energy efficient, less

disruptive, more likely to be underground than on the surface. shery: since that first new economy form of feels like the global economy has been hit by compounding crisis after crisis. a lot of them have been black swan events like the war in ukraine. into 2023 what are we not seeing? what are we underprepared for? guest: the western world is desirous of a energy transition. most people cannot define what energy means or transition, transition to what? if these lights or these cameras are going to be powered by sustainable energy, the electric cars, you do not need the car just for the electric car. the entire grid, the way we generate and transmit electrical energy has to be massively transformed. if everyone in america plugs in an electric car at 5 p.m. the grid would die. there is a massive underestimated investment

required in the critical raw materials to enable that transition. shery: always a sobering conversation, robert, chairman at ivanhoe here at the new economy form. we have so much in store for you for the next few days. check some of these conversations that are coming up, at the times on your screen. haidi: the opening session is less than an hour away will be hearing from chinese vice president who is delivering the opening address. last year he talked about going to open trying to more foreign investors, really improving ties with america, we will see what he says in 2022. this is bloomberg. ♪

shery: a little bit of a mixed picture when it comes to equity markets across to asia, the trading session with the kospi down 0.1%. we are seeing australian stocks is still under pressure to .1%, kiwi stocks are wrong -- around the nikkei, a little mixed when it comes to the sectors of health care into indications, gaining ground.

industrials and consumer discretionary are down. the gdp numbers came out of japan, it was a contraction of 1.2%, the expectation was growth. haidi: when it comes to japan's biggest bank, they have announced plans to -- our finance editor joins us now from tokyo. russell, is this a positive sign for investors? what does it mean for sentiment? >> these are generally positive resorts -- results. he was calling the results solid and that is a good description. lending income rose overall. citing demands for loans of rising interest rates. the four-year profit forecast, on the other hand the ink -- bank had 4 trillion yen and losses. the global bond market slumped, japanese bank is a big holder of

u.s. treasuries. it shows how rising interest rates older -- overseas has been a double-edged sword. overall is a net positive, particularly as they continue to grapple with the zero rates at home. shery: exactly, i was can ask how the big banks are doing compared to smaller local banks? is there a big divergence? interest rates in japan are nowhere and they not going anywhere. what is the key takeaway? guest: that is right. you have the regional bank, has his business model that is tied to the domestic economy and low rates at home. that is a negative for them. three megabanks are able to go overseas and expand lending and other businesses overseas. one interesting sign from yesterday's press briefing from the ceo, the three megabanks

chiefs say they have no plans to cut investment banking jobs in the u.s. during the current slump in dealmaking. that is in contrast with citigroup and goldman. they say the slowdown in capital markets will end and they want to make inroads. the three megabanks in japan are on the front and a looking to expand outside of japan. the regional banks are in a tight spot, with the government not shifting on interest rates. shery: bloomberg's russell ward there, here is a quick check of the latest business flash headlines. bloomberg has learned that fosun is x -- exploring as it seems to raise capital and erase that. the domestic food investors -- and beverage business is available for investors, they are weighing options for investments and you can europe. >> they are investing $5.2 billion in new factory, the

facility will start production in 2026 and bring 2000 -- 1000 new jobs. they have investment that is key to subsidize domestic chip manufacturing. >> the lender remains optimistic in the medium to long-term, despite cost-of-living and interest rate pressures. the bank reported a first-quarter cash profit up $2.5 billion, aussie dollars. net interest income grew 16%, driven by higher deposit earnings. haidi: second quarter profits fell, hit by a windfall tax. oil and natural gas report that income fell 30% from the year earlier to 1.5 billion dollars still ahead of the $1.25 billion forecast. following a record earnings a year ago. shery: we have more to come from the bloomberg new economy form

on "bloomberg daybreak: asia." this is bloomberg. ♪

>> market, generally, the business community and specifically, one see that very first meeting and see a be neutral instead of confrontational.

the important thing is what comes after. the combination of the leadership team scheme together the policymakers thinking of what we can do together is a and wanted desired outcome coming out of this. >> we can see whether mood and the china markets have improved significant in recent days. perhaps present g and biden -- resin xi jinping and by the will get that low bit of impetus, there is still a lot of substance that buys u.s. and china. >> it has already been a decent year from the standpoint of normal venture-capital metrics. yet to be more careful. you simply cannot pretend, none of these larger events will have an impact. shery: just speaking to us here at the berg new economy form here in -- bloomberg new economy form here in singapore, weighing in on the meeting between president biden and xi. haidi: we are told by very --

various guest that we are too optimistic and getting ahead of ourselves. are they listening more to the reality check? they come on -- they come online just a half an hour ago, we have been here several times ago, have there been anything that stands out about this particular rally? >> first off i would like to say great coverage on the ground. you talked to a lot of big names and vips. you saved the best for last. kidding aside, what is different about this, for the longest time, we have been told by analyst and strategist that this market has been cheap. we were waiting for a catalyst. to borrow a geopolitical phrase, a détente on the two big issues. covid zero and the property space. what we see differently is volumes and turnover and foreigners rushing back into china. we are back 20% from the bottom on several benchmarks. we have a long way to go before

your verse completely the -- reversed completely the losses of justice year so far. do not get me -- just this year so far. do not get me started on taking this back. we have had a lot of good news. markets at some point will run into a reality check that this market is not word -- economy is not where it needs to be yet. at this point it seems investors are switching back to neutral. shery: you are talking about chinese fx and rates running into that reality? how far can they go after the sharp moves? david: absolutely, we took out 705 on dollar china on the way down, he pointed out it triggered a lot of sell stops on the way. most of that is behind us. it might mean less inclination for a big move down. seven is a level we are watching here. what has gone largely unnoticed is this bond rout in recent

days. and some days this is the bond markets readjusting lenses to the possibility that china recovers a lot quicker x year than initially thought because of the pivots we have seen -- next year than initially thought because of the pivots we have seen. we will see if it is supportive of the currency. haidi: my favorite day of the month this china data dump day, all of the mistake activity indicators what are you watching? david: this is interesting, it is coming at a time where we are getting covid cases moving back up. the preview coming from economist in bloomberg economic is that when you look at some of the hotspots during the month of october that will show up in some way in the set of numbers. also what is interesting, as i pointed out, markets are running not with the covid case numbers, but the reopening stories. in many ways this is a most backward looking. it will show -- we will see what

it shows. this is one drilling -- trillion yuan that will mature this month and there are expectations it will roll that all the way back. back to you guys. haidi: david ingle looking ahead to what could be very interesting for the chinese market session today. there is so much going on, let's take you back to bali, live pictures of the g20. we saw the president welcoming world leaders. getting this conference underway. so much is already happened. the real action we know is always on the sidelines. the three hour leadership meetings between china and the u.s.. i feel like we have been taken down a peg or two when it comes to our cautious optimism. allow the guests in singapore the bloomberg new economy form to manage -- telling us to manage expectations. shery: we have seen china u.s. watchers think this is perhaps this is the start of falling up

-- thawing of relationships we have been here before and it does not go anywhere. when you have pressing issues, taiwan, for example being a biggest meeting challenge. >> you can see the prime minister arriving there, speaking of someone who is a key stakeholder in terms of how these key geo political relationships develop. he is meeting present xi jinping himself. given that we have seen that deterioration during the australia china relationship. shery: when he was elected we thought there would be a thawing of relationships, his campaign has been hawkish on china. the opening session of the bloomberg new economy form is a few minutes away. we will hear from vice president --

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