dani: this is bloomberg daybreak. i am dani burger and london with a mannish cranny in dubai. these are the stories that set your agenda. manus: in custodymanus: sam bankman-fried is arrested in the bahamas after the u.s. files a criminal indictment. the cofounder of ftx is facing possible extradition. crunch time. the fed begins its today rates and inflation data. asian stocks and futures are mixed. plus goldman cuts deeper. the wall street titan is said to be planning hundreds of addition job losses at its consumer business as a struggles. dani, good morning. they had a sloppy 10 year auction. the tail was rich. it was 80 four basis points p have not seen a tail like that since the 1990's. they don't want those bombs ahead of the cpi.

dani: it is also one of blackrock's top calls. do not buy bonds since inflation is here to stay. we will be grappling with that menace. is inflation here to stay? today's cpi print will give us a hint either direction? manus: want to dig a little bit deeper into that. here's the greatest debate of the morning which is what should we be looking at? this is one year at expectations or this is breakevens one year forward from the michigan consumer sentiment and the new york fed peered what you are looking at here is a deep road of what came first, the cart before the horse? do u.k. bonds because these are rolling down or are these an indication of a catastrophic inflation implosion that is come -- to come into 023? dani: or are they an indication that we have been lulled into a sense of complacency, that we believe inflation has pate? our colleague garfield reynolds

writing on that blog that that issue is whether or not this is going to come to fruition. this could be the market running itself off of a cliff. manus, when it comes to this equity market, if i could take us into this morning's trading session so far, it is a sit on your hands kind of morning. this is such a big risk event. historically the equity market in the u.s. swings at 3% up or 3% down on average over the past half year on cpi data. jp morgan trading desk says the way the the market is, there's a possibility for a 10% rally in s&p 500 should cpi come and softer. our expectations are for seven point 3%. not a lot of action in other words at this moment. you are seeing s&p 500 futures hanging flat. your stocks ftse futures up 4/10 of 1%. get more calls saying the earnings futures is would be worse. oldman says that continues to hear from mike wilson.

he is pivoting peered he says the market will find a new bottom in the first quarter of 2023. the bears are growing in this equity market. one place for last -- less bears is to hang saying. we are not trading as high again. it might be those cpi nerves really putting a ceiling on how much equities can rally at least before the result. manus: there is no doubt about it their initial -- there is skittishness. oil prices 20% in past month. if given back all this year's gains. there skittishness for assets. we are in for a bumpy ride. you are looking at crude up 3% yesterday. mobility, mobility, mobility. hong kong scrapping the three-day. chinese investors saying the u.s. international travels soon but when will the u.s. open the

buy back the tap? that is the question. 70 bucks on wti. reopening in china, wise is it not higher? because it is on the floor for the 30th month in a row. we can debate this as to whether that is a recession hedge or whether it is and inflation believer that we are in a downward trajectory? is not that much to discuss with the dollar. flop seat down tenths of 1%. dani: it is a rare day when the dollar is not driving the discussion. let's get to reporters from around the world. we are covering the dramatic develop and's of the ftx story. russell moore will join us on goldman's job cuts. rachel chang with the latest measure from china. manus: ftx co-founder sam bankman-fried has been arrested in the bahamas. this is at the request of the u.s. government. there tracking the story.

annabelle, what do we know? where is he? are we expecting in extradition today to the u.s.? >> timing of extradition read quest is unclear but as you say manus, the headlines today that developed in the laskey hours is that we know that sam bankman-fried was arrested just after 6 p.m. local time and he is now in detention in a prison cell basically not too far from the tourist city center there. in terms of what you said yes is was at the request of the american government. exactly what charges have been filed is unclear as well but new york prosecutors said they will unveil that indictment on tuesday and have more to say at that point. we did hear from a former u.s. prosecutor who said to indict this early when they didn't have to does tell us that they have incredibly powerful evidence. there are multiple investigations into sam bankman-fried ongoing peered another one that we heard lasky hours was from the sec.

what they are planning is to authorize civil charges relating to any sort of securities violations and that will be filed in court on tuesday. sam bateman freed himself will be in court in the bahamas at 10:00 a.m. local time. dani: i guess that answers the question of will he or won't he attend a hearing before congress. is that hearing still happening and about? what's the latest with that? >> the hearing is still going ahead but yes in terms of sam bankman-fried, he was post to be one of two star witnesses on the day on tuesday in front of the house panel. the first person in this, the current ceo of ftx john jay will be still appearing peered he already had his comments released a few hours ago. essentially he is keeping the same sort of charges as before that this is really what happened with ftx was that so much power was concentrated in the hands of so few and those so

few had some pretty unsophisticated trading practices and in general just a lack of know-how. sam bankman-fried was supposed to be in this panel in the afternoon on tuesday. he is now totally off the schedule of course. he is good to be attending court instead. manus: some pretty major -- can we just pause for a moment on this. some pretty major investors leave there was experience, product, and believed that there was a very good story there. some of the biggest investors in the world here have got to reflect on that. >> a lot of questions around due diligence manus. dani: yes some hard rethinking going on i must say. some twitter comments when people listened to sam bateman freed's interview, some people say there is still something to this kid still. annabelle, thank you for the update.

bloomberg has learned that goldman sachs is cutting hundreds more jobs as it restructures its struggling consumer business. joining us now is asia finance editor russell ward. russell, now seems clear that some of the pullback that goldman had been doing in terms of letting go people who were underperforming, this goes further than that. how much of this is about concern over the upcoming environment versus just in underperforming consumer division? >> think it's a bit of both dani. there's definitely two reasons for this. the underperforming consumer business. remember david when he came in four years ago he said he was going to expand from wall street to main street. things have not gone well. costs have been swelling and they have been losing money. partly this reflects that but also does reflect the chances of an economic slowdown. last week he said the chances of recession in the u.s. are high. he also said that he wants his bank to become warrnambool, to

have a right size for that. these cuts also reflect that as well. manus: i think we should put in context. they had 49,000 employees at the end of their third quarter. russell, this is to do with the punch up between fixed income ibm retail. who takes the pain? dani: does seem that even the star outperformer's and traders were facing potential bonus cuts as well. no one seems like they are being spared to some degree. >> that's right. goldman is cutting across the board now with the staff. this is something organizationwide. manus: it's got all the hallmarks of jack. we will see you later on.

that is the message if you are in those lower performing quartiles, out you go. it is brutal. hong kong is scrapping some of its remaining covid restrictions including curbing international arrivals. beijing's rapid shift away from zero-tolerance approach. rachel, this is perhaps one of the basic -- biggest signals to the world that is easy to arrive in the doors are open. >> right exactly. it is a moment to everybody in hong kong has been waiting for. i think the question really is why did it take so long? chief executive said infections don't pose a risk to local population because most people have already been infected here. has been true for months. this is a political decision followed on from china's extremely rapid abandonment of its covid zero elimination stands. if you look back at the past year, hong kong economy is in

such a bad situation. so many people have left and 70 businesses have gone a business. the question ultimately is what it was all for it? what people want to see now is the economy bounce back. that is not really going to happen until we see that border with the mainland china open. hopefully that will happen in january. experts are saying that could provide an 8% balance to the economy once a border with china is open. dani: it feels like a market that is very concerned with how bumpy the reopening is considering we are seeing the hang seng giving up a lot of the gains that we saw earlier. thank you rachel. manus, let's take a pause look at some of the key things that will be watching out for today because it is just a very, very busy schedule. we will be getting to the big one a moment. and under knauer, we will have the latest u.k. labor data. that will include jobless and unemployment. at 10 a.m. biggest economy in focus with germany cw survey.

that's not the big one. there's more important stuff coming up on the schedule that could move this market. manus: i think it will be 48 hours of brutal angst for every bond and fx trader. the boe will have a report at lunchtime in the u.k.. u.s. inflation data print and on the headline, a cpi should continue to build in november. the numbers we are looking for on the core dani just excluding food and energy is plus .3% as it was the last time. 7.3% on a year on year basis. dani: rbc says this is going to be driven by services. goods should continue to decelerate. that's how you should be thinking about the dissection of this data. coming up, we're going to dissect the data even more. investors are becoming more and more certain that inflation is

set to evaporate rapidly into 023. we will discuss what to expect and how to trade around u.s. cpi data today. manus: plus, the uk's winter of discontent is living up to its name. rail work is ramping up strike action. nurses also set to walk out. this is bloomberg. ♪

manus: this is a drumroll. the u.s. cpi will be tonight and the fed decision tomorrow. it dani, reiterating downside risk is there in the stock market between now and the end of the first quarter. economists, we love the economists. that is a drop from seven point 7% last month. the man with a mission to make the trades. it's mads peterson the investment officer for human edge investment technology you know you have the capacity to go full risk off. when you look at the repricing in the bond markets i 100 basis points in the implosion on inflation expectations, how does that set the stage for risk for you? mads: we move i and risk more than a month ago.

we have been out of the market and of course nobody knows what is going to come out in the coming days we think that the worst of inflation is behind us paired with think it has a lot more to do with economics then so much with markets. we seek -- we think inflation is coming down. the world husba and through a tough year and things are healing. money is not being printed as quickly anymore. that's the overall picture. we think that equities should have relatively positive returns but the next two days will be intense. dani: intense is a very fair way to put it. hopefully you are stocked up on caffeine and can get through it. look, if you can take a more constructive view, how do you do that without knowing whether or not this recession if there will be one, if it's soft or a hard landing? how does that color how bullish

you can get an this equity market? mads: well, it may be in terms of how long we can stave it off but if you look at fundamentals, we know that money printing came down. we know that qe has turned into qt. we know that commodity prices came down. all these things are very fundamental things which work --inflation is rolling over and it looks like powell might be right in his speech from last time that the housing market will also help with the cooling to get inflation down. at this is the case, then the case for a potential recession being a weak one if it comes, a smaller recession than the big one needed to go inflation is growing. markets are down, depending on the day in the week, 15 to 20% on the bigger indices and some down 30 to 40%. a lot of technology more. in that environment, when the chance of a recession comes down

and when the chance of a very severe recession goes down, it becomes more attractive to equities. is not a question of we say there is no recession. there is a recession in europe at the moment. we are saying the probability of a really nasty recession is going down. manus: that chimes with what mr. gundlach had to say. let's listen to him and then get your credit calls. gun lock recession risk. >> the effects of these rate hikes and accumulation of quantitative tightening and draining of liquidity from the bottom market is going to make 2023 in my view probably a recessionary year. manus: ok so we are all jumping into the middle of the boat and nobody wants to go to the sides of the bell curve appeared that has repercussions. your equity exposure, but from across the portfolios, you want to more high-yield exposure. in the u.s., europe, or asia? mads: not in asia yet.

we talked about a year ago. european looks relatively interesting so we are buying some there. we have a significant upgrade in the average rating compared to last time. we had economic difficulties. we also have a u.s. high-yield peer we still hold some of the in the shorter duration were we also see a relatively solid backing from the ratings levels. even if we get a small recession, that should hold off. we are also -- which gives me some comfort. we are seeing analysts on the equity side is starting to have negative earnings expectations for next quarter just marginally. this gives us a little bit more realistic picture of what is going on. in a realistic world where maybe we also get a u.s. recession, that can happen, but things don't have to blow on like they normally do.

dani: got to push you on this point because when it comes to credit, both junk and ig, we have already seen spreads compress very considerably. they are back right now at long-term averages. as a chart i have up for you. junk is on the top. investment on the bottom. they are nowhere near close to where they are during normal recession. even if it is just a mild recession, how much further can these spreads already compress? to some degree are the not already priced to perfection to a mild recession? mads: they are probably price to a mild recession and that is to a very mild recession. they will why did now yet but they will not widen a lot. if we get a recession from these levels, we will have underlying bonds coming down a bit. if you look at the chart that you should before, if we go back in recessions, there can be a

few months where the spread is wide and quite significant but then they tighten dramatically. for bond pricing we also have very low default rates. most companies have been able to which it out and refinance relatively comfortable. the problem when we have a short recession only, people expected to be longer. the dynamics is different. manus: let's squeeze one last one in. i think you are brutal. it needs to be signed like a pair of above mutual. you are scathing to say the least. they are going to tank into a slump there let me put to this way, and read writing for you on the notes ways and get a wrong, what is the risk of a trichet mistake from lagarde where they have to ramp up and rollback and very quick succession? what is the risk of a trichet take-two?

>> 25 to 33% something like that. that is the normal risk that there should be for the 20 years we've known them. manus: [laughter] dani: i also love that perhaps the market is getting used to ecb mistakes that you write. biting words. thanks so much for joining us. we are out of time. mads pedersen human edge investment technology each it's intending to reach a deal to cap gas prices. we'll bring you more about that meeting. this is bloomberg. ♪

manus: let's get you some first word nudes. >> former ftx ceo sam

bankman-fried has been arrested in the bahamas after u.s. filed criminal charges against him. a new york attorney says the arrest was made at the request of the u.s. government. more than 100 ftx related entities filed for banker see last month and make been freed as facing investigations into a range of possible misconduct. china is warning that it faces a steep surgeon covid cases as a rapidly dismantles pandemic controls with one of the countries top advisers saying a jump in infections is surely unavoidable. hong kong meanwhile is removing its three-day ban on international arrivals going to bars or eating at restaurants and scrapping a contact tracing app used for entry to public venues. eu nations have reached a deal to clear the way for ukraine to receive 18 billion euros in aid after hungary dropped opposition exchange for a reduction in penalties over draft concerns. other countries also agreed that hungary's pandemic recovery plan

which entitles it to 5.8 billion euros in grants will need to of clement measures to bolster it to. china has filed a dispute with the wto against u.s. export controls on microchips. beijing says the restrictions threaten the stability of the global supply chain. meanwhile, bloomberg has learned that japan and the netherlands have agreed in principle to join the u.s. in tightening export controls on to painting -- chipmaking gear. the countries are going to announce measures in the coming weeks. 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. dani? dani:

manus: this is "bloomberg daybreak: europe." dani: sam bankman-fried is arrested in the bahamas after the u.s. files a criminal indictment. the cofounder of ftx now faces possible extradition. crunch time as the fed begins its two day rate meeting. u.s. inflation data awaited. the dollar slips. goldman cuts deepen. the wall street titan is said to be planning hundreds of additional job losses as its consumer business struggles. the countdown is on to the first risk event of this week, it is cpi and you really get an idea of how crucial inflation is. is talking to mads peterson as we were, his more sunny outlook, he's buying equities, he's buying credit. it all hinges on inflation that has already peaked.

manus: that narrative is what provokes a real pivot from the fed? that is a much bigger debate, which traders have at jp morgan relative to kill an average. who wants to take a risk on a day like this going into the fed meeting? cpi today, you have oil recovering even though mobility in china, there is debate about when will the u.s. refill the sp . iron ore is down. nobody believes they are going to go out and buy lib ilio in terms of housing. 10 year yields at 3.6%. we have traveled a great deal on the peaking inflation narrative, down 100 basis points in six or seven weeks. the dollar is flops he -- flopsy, which belies a much bigger move we will dig into in a moment. dani: that makes me think the dollar is a rabbit.

i will think about that. the equity market trade, it is the encapsulation of a do-nothing day. i point to the hang seng, up 0.5%. this even as hong kong is removing a lot of its covid measures. at one point we were up 1.3% but even with that positive catalyst, how much risk do you really want to take ahead of the cpi numbers? this market swings 3% up or down on the cpi day so far this year that is a step for the s&p 500 which jp morgan's trading desk says if you look at volatility options around it there is potential should cpi come in soft to rally 10%. it is a lot of risk just wound up in this event. the king at european stocks, those are outperforming. u.s. equities closed up higher. europe did not. overall we are not seeing big numbers on the board, just sitting, waiting for 1:30 p.m. u.k. time for cpi figures. manus: i think they want some

confirmation it is 50 basis points from the fed. what is the trajectory? that is going to define the overall trajectory for the u.s. dollar and that is what our next guest is perhaps -- says is the best place to benefit from a global recessionary environment. thanks to its haven status he expects the greenback to outperform its counterparts. 7% roll down from the peak. abba karsh -- abukarsh is looking at the chart saying that is a thing of beauty, isn't it? good morning. collect we have had a correction in dollar. we had two events that drove everything. cpi in november and the intervention which made a statement on where the yen should go. we have had pricing in the forward curve. the fed, the issue is 50 basis

points. everybody is in line in terms of normalizing rates. we still don't know the recessionary outcome in q1, q2 two next year. in that scenario, you have at least three, the fed is still on target for potentially 5.5 percent. this is not the issue of direction, it is an issue of pace. the fed is moving more aggressively, much more reactive to the rate cycle. cpi numbers are important insofar as letting us know how much of the pace will reduce. will reduce. willoughby 50 basis points in q1 of 2023? 25 basis points? this is where we are talking about the fed numbers. from our perspective -- dani: how much does where the terminal rate ends up if it is

the slower pace -- steve englander over at standard chartered just writing out now a note saying a market reaction to a 5% to 5.25% terminal rate would be benign as long as you say the hikes are split -- spread out throughout 2023. as long as it is a slow pace, the reaction to a terminal rate above 5% would not be that dramatic? >> we are in a unique situation. equity markets are hitting differently. equity markets are behaving in a pavlovian way. if it is much reduced we will belong risk because of the perception the fed will be having a reduction in rates. the story as we do not know the inflation outlook over the next two or three quarters. the recessionary outlook is clear. we expect inflation will remain up within this 6%, 5% range for

2023. we do not think things will be dropping especially given supply chain over the next two quarters. manus: so you say the question is the scale of recession in the u.s. and europe. the last time you were with us you called the euro could break 95, it could break 94. is that an extreme call? or is that the dollar muscles up in recession and the euro implodes because of recession rather than the rate differential? >> in a recession environment, dynamics change. demand changes. we have one constant. we are looking for credit reaction. will credit be impeded by the recession? will we have a change in the credit cycle? in terms of mortgages, housing? that is the haven trade we are looking for. investors will look for a haven trade until the map becomes clearer.

europe and asia still stands way behind the because i central-bank cycle in terms of the curve. the fed has done a lot of physical work in terms of positioning the forward guidance. the wild card here is where do you want to be in the case that we do have a recession which is far exceeding expectations? the curve tells you we have priced in recession, but it is not really aggressive recession, more of a soft landing. if we do get surprises we will see the dollar gain value quite quickly. is it a relative trade? we are looking at relative economies, europe versus the u.s., asia versus the u.s.. it is all relative given that we are -- dani: a lot to unpack, but in terms of dollar as a haven, is not some of the bite taken out of that trade because so much of it had to do with interest rate differentials?

if we get a fed that is moving at a less aggressive pace, can the dollar still act as a haven if that piece of the puzzle is no longer there in 2023? >> the wildcard is essentially the effects of higher risk, higher levels of inflation on em economies and the unwinding of the em space in terms of debt. that is the wildcard. look at turkey, brazil, we still have a tremendous amount of em that has to be repriced over the short term. that is where you still see the demand for dollars coming. in a recessionary environment i think we would see a different dynamic. traditionally dollar would not do so well but given we are looking at tapering from the fed, the ecb, the bank of england, across-the-board we are looking at different cycles from we have seen syndicates before. manus: we have spent time on the fed, we have the ecb and the boe as well. you would maintain sterling would be the biggest loser. is that a pan sterling trade,

almost in splendid isolation to everything else? the bank of england are seriously the most -- they have been in 20 years. where is there tolerance and their terminal rate and how does that tie into the biggest loser of the month, sterling? >> the u.k. economy is in a ruptured phase post-brexit, we are looking at degrading gdp, current-account which is exploding, debt with his -- which is exploding. overall we are looking at a situation where sterling could suffer from the european slowdown and american exceptionalism. still in terms of the equity space and growth, sterling stands to lose the most. if you look at the bank of england, they are hiking rates to normalize inflation, but that is in lieu of a recessionary environment. i think sterling stands to experience more in terms of weakness.

i'm looking for below parity in 2023. dani: in terms of this call, how it extends to bonds -- it sounds similar to something we have heard from blackrock. philipp hildebrand avoid long-term bonds. debt levels are going to rise. government borrowing costs are going to climb. inflation is going to keep climbing and the central bank, the fed, it ain't coming to the rescue. would you avoid long-term sovereign debt? >> the sweet spot is in the two to five year phase. we are moving the paradigm here. the paradigm over the past 14 years is that central banks are there to provide liquidity. the true mandate is employment. the fed, the bank of england,

the ecb have to make an issue of credibility. they cannot move back to liquidity. the underlying mandate is inflation and unemployment. the equity market is not ascribing to that theory yet but as we see recession slip in and earnings drop, that test will be for the banks to provide their commitment to inflation targeting over the next two or three quarters. the fed has been very clear. they want to cap inflation. it's going to have to be two or three quarters before the fed changes the direction as well as the central bank. we are seeing a paradigm shift and that is why we see the bond market positioning. you still are unsure about the fed cycle or the inflation cycle, so you see that is why -- where the inversion comes from. it is coming from uncertainty. dani: he comes onto the program

on cpi day and tells us one point of inflation is not going to do it. how bold is that? manus: after the last print they wrote that as well. he is a very tricky customer if you ask me. >> we have to keep looking at data over time. if the fed is not committing i am not committing. manus: he has commitment issues. dani: thank you for committing and showing up to our show as always. saed abukarsh at our capital management -- ark capital management. collect sources told bloomberg goldman sachs is planning to cut at least 400 positions from its retail banking operations. it goes beyond the banks annual exercise of reading out underperforming staff -- weeding out underperforming staff. david sullivan has signaled he is going to manage headcount and

limit costs. bloomberg understands 600 members of britain's armed forces are being trained to drive ambulances. the military also asked to cover for border guards as the government warns of significant disruption to the u.k. health service as nurses and ambulance staff. to go on strike in the run-up to christmas. workers are striking overpay given the rising cost of living. microsoft has offered sony the right to sell call of duty as part of its gaming substituent service. it is part of a bid to win regulatory approval for microsoft purchase of activision blizzard. sony has not excepted the proposal and has been a staunch opponent of microsoft's bid for activision. that is your bloomberg business flash. manus: you caught me having a chat. coming up on the show, the eu nations attempt to reach a deal on the controversial proposal to

cap the gas prices. more on this story on bloomberg. ♪

>> this with regard to security of supply, is not a binary situation. security of supply is important to the continent as a whole. we have to keep gas flowing to europe. that means if we have an intervention, it should be linked to the world markets. anna: -- dani: belgium's energy ministers speaking to bloomberg about a price cap on gas. let's stay on the energy story because eu nations will make a fresh attempt at reaching a deal on a controversial proposal. that proposal of the cap on natural gas prices to sealed --

to shield consumers and companies as the region battles freezing weather. joining us now, john, this has been a conversation that feels like it has been ongoing for some time. what are the key issues preventing the eu from getting a deal done that caps the price of gas? >> yes, that is the key thing being debated with energy ministers in brussels. the main things are actually -- it is quite a conceptual issue. there is one group of countries led by germany and the netherlands which does see this as a mechanism of really taking away the very highest prices, the excessive prices we have seen than the last year. whereas another group of countries including the likes of spain, italy, greece, they want a lower cap which can lower prices even for consumers. while not getting us down to the very lows we saw before russia's invasion of ukraine, it will

make a big difference to energy bills. of course within that we are looking at what level the price cap will be set, how it will be triggered, how many days the price has to be above that cap to trigger it as well as a host of other things to ensure security -- if security of supply to the block is affected, the cap can be removed quickly. manus: therein lies the conundrum. to reduce that relationship, the oil relationship is virtually gone to zero. 2023 maybe much more difficult. we are off the hook for this year. would you concur with that? we have enough for now, but the real risk is still very manifest, isn't it? >> yes. what we have seen, the eu has managed to fill the gas it has in storage.

we heard president bandar lion -- von der leyen saying this year is safe and that is because of how much gas is in storage. we have had a relatively mild winter, that is changing. but the general consensus does seem to be the eu will make it through this winter. where the problem does arise is next winter because most scenarios point to know gas at all from russia. russia accounts for 9% of the eu's gas imports so that's going to make it quite difficult to fill storage next year. the question is how is the eu going to do that? it is trying to agree to join purchases and it will go to other countries like algeria to try and source gas, but that could be quite difficult without a huge surge in prices. manus: absolutely. great columns every day from john on the very latest on the gas crisis in europe. eu nations are gathering for

preliminary agreement to clear the way for ukraine to receive 18 billion euros in support from the bloc. it comes after hungary dropped its opposition in exchange for a reduction in penalties over graph concerns. the imf recently increased the range of foreign aid it estimates ukraine will need to three to $5 billion for the next year. ukraine's prime minister, france's finance minister, or do to speak at 3:00 p.m. today, moderated by maria tadeo. you can catch that on live go on your bloomberg terminal. dani: coming up on this program, strike action. u.k. rail workers are striking today after latest talks failed and they are certainly not -- we will explain. this is bloomberg. ♪

dani: let's take a look at some of the events we are watching out for. it is set to be a volatile day. 10:00 a.m. u.k. time europe's biggest economy is in focus. we are going to get germany's zew survey to see how business confidences shaping up. manus: 1:30, you have the print on cpi. finally, a little bit later, 10:30 we get the rba -- the pmi should say, the rba governor philip lowe due to speak. dani: also on the docket, or not, u.k. real workers walking off the job after talks between the largest rail union and the government failed. other groups are planning on striking as well, so let's bring our u.k. correspondent lizzy burden who joins us now for

more. another strike, what is the latest? >> let's start with the health unions. nurses have met with the government but they are complaining because the government did not discuss pay and the unions for the nurses are angry because they say they cannot go back to their members empty-handed. the government says if they get a double-digit pay rise, that is taking away funding from front-line services. the dispute continues. officials met yesterday to discuss how they are going to get through this. you're going to have military personal trained to drive ambulances which is dangerous in emergencies to asians because legally they cannot run -- in emergency situations because legally they cannot run red lights. you had millions of people warned they have to brace for disruption because of all of this. you mentioned the rail unions. they are split over the pay deals. one union expected -- union accepted an offer and they are

canceling the walkouts. another union rejected the offer because they said it will lead to redundancies down the line. that continues, six days of travel chaos start today. not exactly festive, is that? manus: it is not. that is why i'm not heading that way for christmas. that end of reasons. we are going to get data at 7:00, that's going to talk about wages, unemployment rate which is incrementally rising. our people concerned this is the beginning of a bigger reset in jobs which is yet to feedthrough? >> you are starting to see we are in a recession and all the forecast from the ob are, the bank of england, the oecd, say the recession is beginning. you may start to see that feeding through to jobs numbers. crucially for the boe this week is how much the labor market is pulling as you say, we are expecting the un-limit right to pick up slightly to 3.7% in

three months to october, but really -- the unemployment rate to pick up slightly to 3.7% in three months to october, but really if the hawks are emboldened they could go for a bigger move this week. manus: let's just finish off cable, 12280. this is the currency that is going to take the most brutal mauling of all. there is real risk of back to parity. there is your call for the day. tune in today break europe. -- tune in to daybreak europe. dani: it is all dollar strength in his mind. that is offer daybreak. this is bloomberg. ♪

anna: