♪ >> good morning. this is bloomberg daybreak.

i'm dani burger. and these are the stories that set your agenda. china's top leaders will focus on spurring growth following three years of strict covid curves. but stocks in asia start the week lower. deciding musk's fate. the billionaire asks users whether he shall step down saying he'll abide by the results. the beautiful game, argentina wins against france in qatar. manus cranny has had a very different weekend. manus, you were in qatar keeping track of the world final -- final of the world cup. manus, miss you so dearly on this show. but tell me all about the excitement. let me live vicariously through you. manus: let me give you a little

bit of qatar, a little bit piece of doha. there was a palpable sense of people making their way to the stadium. argentina, the first two goals -- there was literally a shivering of the buildings around me. i was in the fan zone. i didn't get to go in. i didn't have the special ticket. but i can tell you for a fact -- i mean -- so the place went quiet for about an hour. it was like this sense of dread. then france kicked it in. bang, bang, bang. then it was penalties. and literally, the whole city erupted. we can debate this as to whether it was messi that got, you know, the golden ball. or mpappe who got the golden boot. which is the more important? make your call. >> i don't know. getting a hat trick in the final match of the world cup, is pretty important to me. i was out at a pub where

everyone was french and there were so many tears it was really depressing. hats off to messi and argentina. manus got the v.i.p. treatment. you pointed this out there are those pictures of musk at the tournament. what was up with that? manus: so hopefully they're going to roll with the photos. it's his royal highness hamid altani. i think where this whole mix becomes very beautiful. elon is looking for more money for the twitter deal he did at $54. the pictures are on the screen with jared kushner and elon musk. some reported that musk is doing a followup offering. you've got to ruling family all in a box.

and he said, buddy any chance of a third of a billion? do you think? do you reckon. i might even ask my fans on twitter whether i should step down as c.e.o. so it's a beautiful -- it's a beautiful dream. it's a beautiful game. and it's a beautiful story fit comes to pass if the qatari live large for another third of the billion into twitter. pure speck lakes. -- speculation. dani: he tweeted out that poll whether he should stay when he was the qataris. there is no successor. so i don't know who else -- it seems like he's not so certain someone would take the job after him. we have to talk about the other matchup happening there at the world cup. adidas versus nike. manus: just because you're late to the game doesn't mean you don't get to win in the end.

nike had 40% of the mark. but the winning trade goes to adidas. they only had seven of the teams in their kit. but they've got messi and the number 10 shirt. you can't get it for biscuits. even adidas are saying, we have such thin stock we're printing as many as we can. nike had france, england and brazil in their kit an of course, that english game against the united states of america, they play soccer apparently if the united states, not football? maybe go to west london one weekend. but apparently that was the most watched match in the history of watching football in the united states of america. so i think the special magic of messi is going to perhaps be the sprinkling on the dust for adidas. nike delivered their results. let's see if there's a little bit of a hit to see if the world cup could have that propensity.

dani, take it away. dani: manus gets to celebrate the world cup win as many people are there of argentina. we are staying on top of markets if you. despite some of that, we are continuing to see markets fall in asia. it's that hangover not from world cup celebrations from the fed from hawkish central banks that continues to weigh on risk assets. micia pacific. down .34%. u.s. stocks those are hanging tight. but according to j.p. morgan there will be about $100 billion worth of selling from money managers to end this year as managers rebalance their portfolio to spit a 60-40

portfolio. they think bonds will do better. we're looking at 10-year yields. flipping it up looking across asset, the yen had been doing stronger today. there were reports that kushida would allow the b.a. to be more flexible. a government person has denied that the yen is still winning out over the dollar. down .10 for the bloomberg dollar spot. nymex crude, it is just under $75 a dollar. it was above this rather earlier in the morning. there's the china chick tacks. there's the sbr. they had benefited it. but not as strong as it had been back under $75 a barrel. let's get to the top stories. james mager joins from us beijing on china's economic policy schiffs. and we are in tokyo to discuss

another pivot involving the government and the boj. media reports say that the number of covid positive deaths in beijing's funeral homes are surging. here's raising concerns that china is hiding data in its worst way yet. let's bring in james mager in beijing. james what, do we know so far about how likely -- how bad this likely covid surge is? >> we don't know how bad the covid is in beijing. we don't know how bad the covid surge is. huge cities of 10 million plus, each. we're facing rising cases before china pivots earlier this month and threw open the doors and ended the covid zero policy. but it's impossible that there are no deaths. beijing has only reported two deaths since that change in policy. that's impossible. everyone in the city seems to

have covid or be recovering from covid right now if you look at any other outbreak as cases rise, deaths will rise as well. whether the government of beijing and other cities are hiding these -- these deaths or whether, you know, doctors have declaring them as pneumonia or other things, what's the fact fs that more and more people are dying. we don't know how fast that's increasing and how many people are going to die here in beijing and other cities from the you break. but it's raising a lot of uncertainty about what's beginning to happen in the next couple of months as this you will break moves through the country. it's going to be hard to track. investors an people who watch china are very, very interested in seeing how this works out because it will tell us a lot about what the economy will do next year about how china is going to bounce back from this. but if we don't know how bad it is, we're not going to know how quickly that's going to happen. terror that point, james, we had the central economic work conference wrapup on friday, the

two-day meeting to focus on the economy, the policy path from here. what is china aiming to achieve in terms of growth and how is it going to do that? what is this policy shift that we should expect from china? >> the policy shift is for a more focused on the domestic economy, more faster domestic, you know, retail consumer spending growth for less regulation or -- looser regulation on internet companies which had been very, very highly regulated and cracked down over the last 18 months or so. and some more physical stimulus. you know, par of that is because the -- the -- export demand for china is looking so weak right now. exports are falling. europe is going into recession. china goods overseas is falling. they have to rely more and more on the domestic market. the question is whether that's possible or not people in china have just gone

through an incredibly difficult economic period this year. it's been very, very difficult. many, many millions of people have lost income because of lockdowns. many, many poor people are afraid about what the future is going to bring whether they're going to get covid whether their family member are going to get covid. how sick will they be? who will pay for their healthcare. there are going to be people who will save more and we don't know it's going the look like next year. how long will this outbreak last until next year. how that actually work in reality is is going to depend on what the government wants and says and how the virus and as it works its way through the country. >> the outrook is so uncertain. james mager. thanks for joining us this morning. the yen whip saws in this morn's session after a key agreement between japan's government that perhaps some of the yield

control measures will be abandoned. joining us is yuko takada. there's been a bit of back and forth here. these reports that kashida will allow more flexibility. and then we get a policymaker denying that. what do we know? >> so right now, the kind of the bottom line here is that we don't really expect any sort of policy change. all 47 economists that we polled say they done expect the change in policy. that said, there could be change coming down the line. and that's why we saw some of these moves in the mark as well. one change could be in the works but that would be next year once we have a new governor in town. if he changes policy at this -- now, it would sort of come as aa contradiction of what he's been aing so far because his point was, yes, we have inflation.

it's now 3.6% core c.p.i. gains. we're seeing in japan at the moment. but the point is we're not seeing wage gains. it's not time yet for a policy pivot or any sort of change. if we get that sort of pivot that is -- is -- potentially expected in some marks tomorrow, that would come as a very major surprise. >> ok. we'll have to see what tomorrow brings. thank you so much, kyuko is tekeo. thank you so much for joining you -- us. we were talk about this idea that elon musk is asking users whether he should step down as the head of twitter. he pledged to abide by the results of the -- of the poll. he had recently face

condemnation from the american civil liberties union for banning journalists accusing him of doxing his location with the public information posting that. over the weekend, twitter announced a policy change whereby it would create competing social networks sparking discontent among users and advertisers. elon musk will step down he also tweeted after that poll saying no one want it is job who can actually keep twitter alive. there is no successor some of perhaps some uncertainty there whether he would actually step down. as far as i saw that the rialtos the poll has been leaning yes by about 57%. coming up on the program, we're going to take a look at the hawkish messaging coming from several fed officials. this is bloomberg.

♪ >> we have clear signs that demand exceeds supply in our economy and our labor mark. >> we're going to go until the job is really done which is 2.5% inflation. >> we're going bring inflation down. >> we're going to have to move rates up. ongoing increases to above 5% and hold there for some time in order to get inflation back down to 2%. and that's what we're about doing right now. >> fed officials there continuing the hawkish drum beat saying that higher rates are in fact needing. camilla head of central strategy for g-10 event strategy. thank you for joining us. we have all of the fed speakers that continue to say we need higher rates. we have to hike and hold it there powell is zeroed in on a very tight labor mark. yet, i'm looking a t a treasury

market where yields have done a round trip at 3.5 where it was on tuesday before the fed decision. why is this a bond market that isn't buying what the fed is selling, not believing their message? >> yes, indeed that's a very fair question. and we remain focused into the first quarter of the year. let's bear in mind that we are in december. supply has diminished greatly. and we'll have to wait to see all of the supply and to put pressure on bonds again. but i've seen it's pretty clear indeed from the fed that the job is not done yet. they remain extremely cautious and efficient. it's not just one print of inflation that's where we will give confidence to the fed that their 2% target. and they were pretty telling indeed with seven members

expecting more than the median fed suggests or more than 525% an only 2 expecting it. so it is very telling, indeed. and the market -- i mean, struggle to have the momentum into the first quarter. but we've seen that the decision remains to the seeing. >> how -- how far to the upside could yields move, camille? >> in the u.s., we have a forecast over about 30% in the first quarter. but i have to say that where we are the most bearish, in fact, and the more convinced that it will rise still more from here is from the euro zone. we expect a record am of supply next year. and just into one, we would

expect 210 billion of net supply. this would be a record here. and we above what we had even during the summer in the crisis when governments were mov at a decent pace. >> after we're seeing a huge amount of supply, the government is spending. trying to keep a lid on the energy crisis. we haven't seen the worst of yet. can they continue to hike in that environment? >> we -- actually have a terminal right of the city to 3% which to some extent mike look almost a bit doveish since the conference last week where they did extremely hawkish. but you knower when you look at the projections from the e.c.b. -- and we think that the

recession will be a little bit more than what they expect. and therefore we would not expect them -- at this juncture to deliver more than 3%, which is a bit like he has suggested. you know, that market was not correctly priced. there is an inflation issue. they're looking at it's the mandate. and there they still have to hide into the recession. dani: to that points bear inflation target, 3.4% in 2024. 2.3% in 2025. camille, were you surprised to see the ecb come 2025? >> it is surprising indeed especially by the fact that you know, they have revised them.

their grows numbers. and at the seam time they are i have vised up. so that was pretty telling and for us it's just risk to inflation remains. and indeed, in 2025, it is quite stead wig. which concludes the presence conference which is all about we have to do more. the market is not pricing you enough. we do note expect inflation to reach on to target any time soon. that's why we have two to deliver at a pretty fast face in the next few months. >> ok. camille, that's all we have time for. thank you so much for joining us tonight. head of strategy for g10 strategy. coming up, the l & b terminal open for business. we'll bring you the details next. this is bloomberg.

♪ dani: germany's l & g terminal has arrived on the country's west coast it's the first of tankers that they're counting on to ease the energy crisis. >> this is now the new german speed with which we are moving infrastructure forward. it should be a role model. this is a good day for our country and a good signal to the whole world that thier maman economy will be in a position to continue being strong. dani: let's get out to oliver crook who is right now in the background of a dark germany. so oliver what roll will it play

in germany's energy complex. >> so really shultz was stressing that this is this is independence from russian gas. as he saw it this is a victory for the german government. that is a record time for german infrastructure which we've counted in years or decades. we the first storage comes with a storage and l & g from nigeria. the more important function is it converts lng and can be pump into the mainland. gas will start flowing on thursday. he wishes that this will ease their problem. >> dani: it's so competitive especially if china is about to come back from the map. can they replace it with other sources? >> this is the big question.

so we sailed past the boat over the weekend with shultzy saying welcome to germany. we are so happen to see your ship. you can opts why. it's freezing out here. germans have fallen below gas%. >> we hopely begin to solve some problem so this can demand more for gas. there are six more coming by ten of next year that will cover more than a third of german consumption. the pass is where would they come from. and that's very much an open question. >> capacity is the one question. the other kiss question are the price. the e.u. gas captivate are happening right now, as we speak oliver. >> yeah, and this is a very tense debate for germany. there's a lot of angst here over that. they want to create a ceiling on how much they're willing to pay for gas. but the concern for germany is a very competitive mark.

germer germany is much more dependent. and they have deep pockets some of you're willing to pay for that gas that they need to run their economy. so these are all some of the debates. this is an important first step. but doesn't solve all of the problems here in germany. >> oliver. thank you. and the line is coming up in germany. the china story says it is to boost domestic demand as its going to open the economy. perhaps on outsized impact. we're going to discuss all of that next. this is bloomberg . well, we fell in love through gaming. but now the internet lags and it throws the whole thing off. when did you first discover this lag? i signed us up for t-mobile home internet. ugh! but, we found other interests. i guess we have. [both] finch! let's go! oh yeah! it's not the same. what could you do to solve the problem? we could get xfinity? that's actually super adult of you to suggest.

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am dani burger in london. back to business -- china's top leaders will focus on spurring growth in 2023, seeking to revive the economy following three years of strict covid curbs. stocks in asia start the week lower. deciding musk's fate -- the billionaire asks whether he should step down as head of twitter, saying he will abide by the polls results. plus, the beautiful game -- argentina wins the world cup after defeating france and the nailbiting final, a dramatic end to a controversial tournament for host qatar. hopefully everyone has shaken off the cobwebs from staying up late watching that nailbiting match in qatar. now what we have in markets it declining equity markets. it really follows on from last week, and ugly week, but it is the final few weeks of the year, so a lot of audit things do happen. jp morgan says $100 billion will be coming from money managers to

rebalance to a 60/40 portfolio. they say that will be to the detriments of stocks and benefit of bonds paired bonds falling -- bonds. bonds falling today. stocks are being led lower by china. the msa a asia-pacific is down 3/10 of 1%. the yen yen, some of the gains over reports that the boj would have more flexibility in its inflation target, it has come down from the highest gains we have seen but it is appreciating about half a percent versus the u.s. dollar. a government spokesperson has denied the reports or perhaps that's why we are not seeing too much strength from the end. in general it is a dollar weaker story, down by 2/10 of 1%. nymex crude was up at one point more than 1% at this week's open

after china pledged to revive demand as covid zero policies are on the way out. let's get more, joining us is stephen from our energy team. the story has been one of oil markets not responding that much to covid zero's abandonment? what accounts for the fact we haven't seen bigger gains coming from china's comments? stephen: there is a dichotomy being played and it is frustrating to watch because on the one hand, you are right, there should be a larger reaction if china comes out and the demand were to jump up and imports were to rise, suddenly you have the world's biggest fuel importer back in the market when it was quiet for most of 2022. at the same time, because they are abandoning the zero covid policy, you see this huge surge in cases. we saw the first death reported in beijing, for the first time

in the last month, as well as a jump in covid cases and just anecdotally, you talk to folks in china and the streets are empty and there is not a lot happening. at least in the near term, it looks like because there is an increase in covid cases and people are sick or want to stay home, the increase in oil demand is low. i think a lot of analysts are watching to see if china were to claw back some of those revisions. over the long-term when you look at 2023 and if they do push back with this reversal of zero covid, you will see the increase in demand and likely a higher oil price. but you have to temper that with the global recession and how that also affects demand going forward. dani: gear us up for 2023, then. we had a curry from goldman sachs thinking this would be another big year for the commodities market, but what are some of the downside risks as we contemplate the year ahead for

the oil market? stephen: certainly it is this recession fear. if the world work, or is in a recession right now, you will see a drop in demand. you are also seeing energy-saving efforts out of europe, they are trying to reduce energy consumption. while oil isn't a huge contributor to the power read, it is something worth considering and looking at. at the same time, you also have to look at russian flows. russian oil output, while a lot of people thought that because europe was going to slap some sanctions on russian oil and penalties, there would be a big drop in russian oil exports and production, and that hasn't materialized yet. opec-plus is a wildcard. navy they will come out and say we want to add barrels back into the market. they surprise the world earlier this year when they reduced production by 2 million barrels per day. they might add some back in an effort to rebalance things and

that might push down prices. there is a lot of uncertainty in 2023 and it is hard to get a clear signal whether things will go up or down. some analysts are saying things will go up, but there are a number of different factors to keep in mind going forward. dani: ok, stephen, thank you. let's talk more about the china story. joining us is the chief china economist at standard chartered. thank you for joining us. it is a strange time in these chinese markets, perhaps some euphoria about abandoning covid zero has given rise to concerns about covid cases. how are you thinking about china's ability to hit economic targets at a time when we are hearing reports of more cases and hospitals filling up? >> it is likely to be a very cold winter for china, before spring, as mentioned.

the recent surge of covid infections, following the hasty relaxation of the covid zero policies, that will deal a big blow to near-term economic activity. we have already seen a decline of mobility in other cities, and that could be followed by earlier than expected and faster recovery of economic activity later on. from the policy side, at the world conference, the annual planning meeting, it just concluded last friday, they set a progrowth stance after china almost certainly missed the growth target for 2022. it is highlighting the importance of boosting confidence in the market. in order to achieve that, the government may set ambitious but achievable targets, we think, for next year, about 5% is likely. dani: you say this economic

growth will come down the line once we've got a handle on covid cases. how long do you anticipate that taking? wind we finally see the growth spurt to get above 5% growth? ding: based on the experience of other economists, usually it takes several months. we think in the first quarter we may still see quite week economic growth, but from second quarter, if the macro policy continues to be supported, which is also confirmed in the central economic conference, we may see a rebound of activity, and in that context, the policy pivot, both in terms of covid control and also the property sector, those are very important. and more recently, the government started to encourage the internet platform.

to develop and compete internationally. those policy pivots, together with supportive macro policy, we think could generate consumption that will rebound the economy in the second half of the year. for example, in our base case scenario, we assume consumption could recover to the pre-pandemic level in the second half and would contribute 4% to 5%. our annual gdp growth forecast of 5.8%. dani: meantime, i wonder what will happen with supply chains when you have the likes of volkswagen, you have sinopec, all of them preparing for significant covid outbreaks. from a global perspective, what will arise in -- a rise in covid

cases mean for supply strain chain -- supply chain strain from china? ding: it has spread from one city and province to another. it could be, for the infected workers, they may stay home for seven to 10 days. it is likely to be a rolling absentee situation and affect the capacity of factories. most likely, like in a lockdown situation, we don't expect a stop of operations, of the major supply chain. rather, the capacity may not run at full capacity for some of the enterprises. dani: i wonder, if you are bullish on chinese growth, their ability to hit some of the growth targets, what is the rest of the market getting wrong?

in the hang seng, we are only up about 30% from the lows, and at the same time, down about 20% on the year. what is everyone getting wrong in that we aren't still fully pricing in a return to a pre-covid environment? ding: on the other hand, the rebound of the stock market was quite impressive, given it is still sluggish on the ground. maybe three miles or six miles ahead. i would say the financial market acted much faster than the real economy, for the real economy, it might take another two to three months before we see more activity. before we forecast low gdp growth for the first quarter followed by a pickup in the

second in the second half of the year. the markets may from time to time start to worry about the recent surge of cases in major cities. dani: how much further would we have to go, and quickly, to actually price in what you expect for year end? how bullish should we be on chinese assets? ding: on the one hand, i think the markets still compare with normal i think valuation, still way below the normal valuation. i think the market would like to see more evidence. it is not just based on the policy set by the government. they want to see some early signs of rebound activity in

consumption, especially in the property sector, which has experienced a very deep contraction with property investment falling almost 10% year on year in 2022. i think they need to see some positive signs of stabilization in the industry. dani: ok, thank you. let's get to the first word news from adrian wong in hong kong. adrian: the eu has reached an agreement to expand its flagship carbon market, extending to road transport and shipping and heating. under a provisional deal, the bloc will accelerate the pace at which some companies must reduce pollution. separately, they signed an agreement for the group, including the european commission, to develop offshore nubile energy projects in the north sea. moving to china, the country's

top leaders say they plan to focus on boosting the economy next year and teeing up business family policies. at the work conference, xi jinping and others planned to support the private sector, a market shift. policymakers are likely to target gdp growth of at least 5% in 2023. and sam bankman-fried is said to be planning to drop his fight against extradition to the u.s.. sources tell bloomberg the disgraced ftx cofounder is expected to tell a court this week he will not fight the request. he is currently being held in prison in the bahamas and denies knowing committing fraud or breaking the law. 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: thank you. coming up, we are going to discuss argentina's win at the

world cup final. what it means for host nation qatar. that is next. this is bloomberg. ♪

dani: lionel messi has finally added the world cup to his trophy list after argentina to on penalties in one of what might be the greatest finals in the tournaments history. what a match. mbape with the hat trick. also coming back is manus cranny, in doha. what a way to cap the world cup, that was quite the finale. what was the atmosphere like? manus: there was a real sense of

-- saturday i was walking down the street and there was a producer with me, i said it was more like a wall concert -- a rock concert vibe. it really did begin to evolve. i want to put it out that the print reporters had a nicer hotel than me. i was in the boonies, they were downtown. that in mind, we arrived and two more plane loads of argentinians arrived. about 40,000 came in for the world cup. not all of them got into the stadium but about 40,000 in total. that is nearly 50% of the stadium. there was a sea of white and blue shirts. this is sort of a groundswell from about 2:00 yesterday afternoon. yes, i went to get in a taxi yesterday afternoon in qatar on the day of the world cup final. dani: a taxi -- i saw your

instagram, your with people on public transportation. manus: on the metro. dani: i was going to say, you are a man of the people. manus: you've got to get out there, you've got to hustle, you've got to talk to people. we went to one of the suks, which was really cool. at bloomberg, we spend so much time talking about brands. nike and adidas, we will get reports from nike on their results this week. the merchandise is worth $30 billion. who do you dress and put on the pitch, it matters. adidas had 7% and they had lionel messi, who got the golden ball, scored seven balls. mbepe, he wore the nike kit.

if you are on that winning moment on the pitch, the brand value is immense. dani: of course, is not just the brands that have i guess their legacy, brand status at stake, but also qatar itself had as we have been discussing, it has been a world cup marked by controversy. manus: look, huge controversy. we have spent a large amount of time and i don't want to dwell too much on that -- we should not stop talking about workers rights. how people are treated who build these amazing buildings behind us here and in the rest of the gcc. or for that matter, stop talking about lgbt rights, or the iranian protests, or ever stop talking about the right to protest, something we are very privileged to have at home. but what we should talk about is this was a seamless runoff at

this occasion. this was an amazing tournament, one of the most-watched ever, one of the biggest grossing revenues for fee ever, nearly $1 billion higher than estimated. but what will happen when everybody gets on their flight tonight? if anybody wants to give me an earlier flight, please feel free. the population will drop about 8%. the qatari government, they leased 60,000 or 70,000 apartments. they pumped up the rent. is there a risk afterward? qatar has brought shoulders and can probably take a financial hangover from this extravagance. $300 billion to be precise. dani: if the pound would do just a little better, i would sponsor your flight, because i want you back for daybreak tomorrow. manus: not until 9:00, i have a

ticket going in economy. [laughter] dani: oh manus, truly a man of the people. no four seasons. look forward to seeing you tomorrow. that is the story on the world cup. coming up, we focus on japan and look forward to the boj policy meeting tomorrow. will there be any change in yield curve control? we will discuss next. this is bloomberg. ♪

dani: the yen got a boost and came back in in early trade today after reports of a potential change, a key agreement between japan's government and central bank. all of that fueled speculation of potentially a hawkish pivot

of abandoning yield curve control. the bank of japan is meeting tomorrow in what is the last major central bank policy meeting of the year. our markets reporter is here with me to discuss what the market is looking out for. what should we be looking out for? valerie: most participants in the market think there is unlikely to be change on yield curve control or interest rate decision at this policy meeting. but we will be watching for key remarks on the inflation outlook, specifically the wage negotiations going on in the first quarter of next year. this will happen before governor kuroda's term ends in april and it will be key to deciding happens with interest rates. they have remarked over and over again that wage inflation is what they need to see in order to exit their easing policy. but the big one is the possibility of a policy review or any comments directly from governor kuroda, he has not commented on the revision of the

2013 government accord. this accord was between the government and japan when they decided that deflation was the enemy and kuroda has spoken many times that this is the key reason he has kept with the extraordinary easing policy. the exit from yield curve control, we only have to look to the reserve bank of australia and their messy exit from yield curve control to see there is reputational damage at risk for the bank of japan. we know there is a power of markets to overwhelm here you can look at my next gtv, my next chart, to show it it was only a few is ago when the bank of japan had to defend yield curve control, as you can see, the 10 year yield hitting up against the 25 basis point target. we know the market -- it is quite nervous because we know that when you exit a policy like this you almost have to shock the market.

you have to do it as a surprise, else you risk the chance the bank of japan will have to load up their balance sheet even more with jgb's. we got data over not that the bank of japan owns 50% of that market. dani: it is remarkable and it shows how nervous this government is, really hinting at abandoning it. we had a spokesperson saying we are not abandoning it, denying the reports. valerie, thank you. next, it is bloomberg markets: europe. this is bloomberg. ♪

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dani: good morning and welcome to "bloomberg markets: europe."

i am dani