♪ ♪ shery: you're watching

"daybreak: asia," coming to you live from new york, singapore, and hong kong. annabelle: oster has just come online. asian stocks are facing a weaker open after the treasury curve widened 1980's leavens. recession fears are worsening. traders are also waiting on the rb's fresh economic forecasts and any signals from japan on the next d.o.j. governor. and the u.s. says the chinese balloon it shut down was capable of annabelle: annabelle: being, and part of a broader military led surveillance program. we have the open of the asx 200 and at the start of trading, looking weaker. bigger moves in the bond space, particularly led the shorter end of the curve. traders are bracing for that statement from the rba that is due in the next hourm the

quarterly statement, whether that will underscore the hawkish rhetoric that came through in the latest rba meeting. in terms of australia, it is looking fairly flat. geopolitical tensionsm also in focus given beijing has told australia that it is open to discussing tariffs on wine. . that is after we saw the first shipment of cool docking after two years -- first shipment of coal docking after two years. most of the moves are really coming through with their treasury yield curve inversion that we saw. the deepening indicator, that twos tends curve, telling us perhaps that markets are nearing the end, or bracing for more of a recessionary outlook. that is playing into their mixed trading we are expecting this morning. japanese futures pointing to a weaker start. kiwi stocks edging higher. what could help is the move back into the csa 300, north asian

stocks in vogue again, given the expectation that central banks in other parts of the world could stay higher for longer. and a bit of breaking news crossing the terminal in the last few minutes from south korean company -- hybe. it is an entertainment company. it is about to buy a company, a deal that is worth over 422 billion won. that would make it the largest shareholder in the company. we are watching those stocks when they do open in seoul at the top of the next hour. shery: we have a rate decision out of the room the central bank -- out of peru. the central bank holding the rate steady at 7.75%. only one out of 11 economists surveyed had predicted this. we have seen the country struggling with social unrest for the past two months. it has actually sent inflation higher. annual inflation has accelerated to levels that are much higher than the central bank

target at around 8.6 6% last month. this is a surprising change of course for the peruvian central bank. . the bank saying it expects inflation to slow to a target range by the fourth quarter, to slow starting in march. we have seen the i.m.f. also coming out today saying the outlook for peru is uncertain. that the downside risks in this economy given the social unrest and economic concerns, potentially are being reflected in the central bank's decision, which surprised economists with a hold at 7.70 5%. take a look at u.s. futures. we had downside pressures given the hawkish rhetoric from the federal reserve. u.s. futures are muted at the open after wall street fell for a second session. we had recession signals coming from the bond space, the twos tends most inverted since the

1980's. the 10-year yield still holding at 3.66. that 2-year yield at 4.5%. we are watching that level very closely. crude prices are under pressure again, we had seen them fall in new york after the best reading again since december -- three day gain since december, those recession fears being felt across the energy space as well. let's bring in our global economics and policy editor kathleen hays, to discuss this yield curve inversion, the deepest since 1986. how powerful is this? kathleen: pretty powerful. the difference between the two year note and the 10-year note, it means it is much higher. they are not supposed to be that way. if the economy is healthy, you want to sell the 10-year note. if that yield goes up, you want to buy the two year. this chart, what it tells you is

that when there is an inverted yield curve, particularly and extremely inverted one, the biggest, as you said, since 1986, it is followed by a recession. there have been some that were not followed by recession, but in every recession, that is what has happened. that is why it is important. one story that got a lot of attention is about the senior matt microstrategist from macro hive -- senior macrostrategist from macro hive, she says that the fed funds rate will have to go up to 8% to get inflation down, that is where the fed will have to take it. right now the market is pricing in something like 5.2%. the fed consensus has been 5.1%, but they have opened the door to pushing it higher. that may sound extreme to a lot of people, although two fed officials, charlie plosser and

jeff lacker have said between the two of them that the fed funds rate may have to go to 6.5% and 8%. . the richmond fed president said they have to stay the course, he is not ready to pull them back, but it is interesting, haid i how much the fed was going to start cutting rates. now it seems they are turning around and saying maybe they are going to over tighten. haidi: what a week it has been for central-bank communications, and it's not done yet, we have two major central banks in the spotlight today. the rba is said to reveal why it was hawkish. it was supposed to be the last hike of the cycle. how things have changed. the boj is also close to getting a new governor. do we expect a big revision to inflation expectations from the rba? kathleen: we will have to see. since they did 25-basis point

hike up to 3.35%, which is widely expected everybody expected shortly after their decision that they will say, yes, we think we have done enough, or signals to that effect. instead it is that well, inflation is still high, more rate hikes may be coming. that is what surprised the markets. usually this time of year when the ripping out, for low is coming -- phil lowe is speaking somewhere. he is not speaking today. we will certainly be watching that. it will be all over it. for the bank of japan, this is the time of year, every five years when there has to be another boj governor appointed, when this announcement would be coming. a major broadcaster saying today it will happen on february 14. three people in contention. you have heard masayoshi amamiya's name several times.

two more deputy governors behind him also being looked at. the third one, yamaguchi, we have reported here that there are some in the democratic already who are against him because he is to hawkish. we could get that announcement within two days. haidi: global economics and policy editor kathleen hays there. let's get to vonnie quinn with the first word headlines. vonnie: mexico shucked markets by raising its key rate to a record 11%, matching its half-point hike in september. . the move surprised all 24 economists surveyed who had expected the bank to slow the pace of tightening to a quarter-point. the board says it could deliver a smaller hike on its next meeting. south africa has declared a state of disaster to respond to an ongoing electricity crisis. president ramaphosa said in a state of the nation address that the electricity shortage has caused immense damage to the

economy. he has appointed a minister to focus on boosting power supply and handling the outages known as load shedding,. >> our most immediate task is to dramatically reduce the severity of load shedding in the coming months, and ultimately, to end load shedding altogether. now, under these conditions, we cannot proceed as we usually would. vonnie: commodity trader trafigura says it is facing more than a half billion dollars in losses after finding metal cargoes did not contain a nickel they were supposed to. the company has started legal action against an indian businessman and companies connected to him, alleging systematic fraud. bloomberg news is seeking, from its suppliers. 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 am vonnie quinn. this is bloomberg. haidi: the u.s. says the chinese balloon shot down last weekend was capable of

collecting communication signals and was part of a worldwide intelligence-gathering effort. john, what was this report that was presented to lawmakers, and what did we discover about this chinese balloon that has captivated the attention of the world? john: what we discovered is that u.s. officials are saying that this balloon had the ability to collect electronic communications as it was flying through the air, and also to geo-identify them, to know where those communications are coming from. in addition to that, we are hearing about the u.s. have identified a chinese company that was providing manufacturing berlin's for the chinese military and that there are likely sanctions coming. also that there were some components of the balloon that had english writing on them so potentially were produced by a western company, so again, probably some limitations coming on those components if there

were any eventually discovered. this, obviously coming under a lot of criticism from the republican party about how the biden administration handled the balloon. lawmakers saying the administration should have shot the balloon down much, much sooner. the question now is as this continues to boil, if it will result in secretary blinken not coming to beijing as he was initially planning to do. shery: yes, i was going to ask what more are we expecting in terms of reaction coming from beijing? john: obviously what we have seen so far is the chinese defense ministry has refused to take a phone call from the pentagon. we had some commentary overnight, the chinese saying that the conditions were not right for dialogue at this moment. obviously, that coming after the u.s. shut down the balloon, which sparked a bit of a condemnation from beijing saying that that was outside international normal.

so as the situation continues to boil, at least the rhetoric does seem to be getting amped up. shery: bloomberg's senior china editor jean-luc. our next guest tells us why they think that music industry has little accountability when it comes to that metoo movement, that is coming up later this hour. after a strong start of the year for equities, this company tells us why they seek more flows two words emerging markets, just ahead. this is bloomberg. ♪

shery: we have seen emerging markets stocks today gaining ground for a third session, really bucking the global trend. our next guest still sees more room for flows to grow to a broader ems, especially china. our next guest is pooja malik, from nipun capital. good to have you back. this reopening narrative now, you are seeing more upside, but the earnings picture in china still seems pretty weak? pooja: the first rally was definitely sentiment in reaction to the reopening story. in the past three months, chinese equities have been up 50%. em stocks are also being boosted by the fact that this seems to be a global recovery coming. i.m.f. raised global growth forecasts the first time in 18

months, so lots of support there for e.m. shery: how much of that comes from a more bearish view on the u.s. dollar? pooja: definitely, given the strength the u.s. dollar had last year, nobody is expecting it to show the same strength this year given where the fed is in the interest rate cycle. and comparatively, e.m. interest rates, across the board, most central banks in emr towards the end of the interest rate cycles, whether that is korea or even india. so there is room for local currencies to do better this year, which is another factor that would support e.m. equities. haidi: desk china and the yuan remain the main anchor when it comes to the e.m. complex or does the play an outsized role in this environment? pooja: the fed plays an outsized role, but that has shifted to china.

china is a big part of e.m. standalone, but given how much it drives e.m. economies in terms of trade, fundamentals and earnings. a lot of the covid reopening with china, we have seen the entire north asia complex rebound -- korea, taiwan, and interestingly enough, even economies like south africa that are tightly connected to china, have done well. i would say china has become the primary driver of this rebound, and going ahead also, they will play a key role when fundamental start coming in. that will drive the next leg up when it comes to emerging markets. haidi: when you look at the korean market the kospi being the top performer in asia so far this year, why are we seeing those so positive when earnings -- flows so positive when earnings look down, do you see that in any fundamental shift? pooja: the korea story

definitely has to do with where it is coming from. over the past 20 months or so, korea has seen extreme outflows, huge foreign selling of korean stocks. the first rally in has been driven by foreign investors buying deep value junk stocks as a way to get exposure to korean markets. we have not seen the fundamentals come back as of yet. what we have seen is a huge sentiment effect. keep in mind, markets are always looking ahead, right, fundamentals had been week last quarter for example, but markets are expecting especially in 2024, that korea will have the strongest recovery across e.m. that is what the market is pricing in in korea right now, which is what has led to the big move up. it is really value stocks that have driven the career recovery. shery: markets seem to be pricing in a lot of rate cuts or holds when it comes to central bank tightening across e.m..

same picture we have seen with markets in columbia racing in a rate cut, when we heard from the central bank that they want to keep rates higher for longer. same thing with chile. if you have the fed holding longer, what designee for e.m. central banks, and what the markets are pricing in right now? pooja: there could be more surprises to come. mexico is an example where the central bank hiked another 50 basis points. you could see further surprises. india is definitely one, inflation is still very strong there. australia you talked about earlier today. i think markets like china, there is so much room for them to continue easing monetary supply. in fact, in china, as we look forward to a fundamental recovery, the other thing that could propel markets higher will be more policy support. so, over the next few months we are keeping an eye on fundamentals, but also, more

favorable government policy in terms of cutting rates. shery: good catching up with you, partner at nipun capital, pooja malik. you can get a roundup of the stories you need to go to get your day going on today's edition of daybreak. bloomberg subscribers, go to dayb on your terminals. it is also available in the bloomberg anywhere app. you can customize your settings so you only get the news on the industries and assets that you care about. this is bloomberg. ♪ introducing the new sleep number climate360 smart bed.

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shery: carol has unexpectedly halted its steepest ever series -- peru, has been excitedly halted its steepest ever series of rate hikes. our guest joins us now from the country. was the calculation by the central bank governor here that the outlook has worsened given the unrest, despite the fact

that the unrest has also caused more information and supply chain disruptions? marcello: this is actually a unique situation from peru. much of what we're seeing around the world in terms of inflation, the unrest, the worst unrest in decades for peru has certainly driven up inflation in ways that were surprising and not in line with the rest of latin america. and it is also hurting economic growth. so for the central bank, that is a delicate dance, they are trying to tame inflation at the same time that the economy is slowing down because of the unrest. haidi: there is no real end in sight on that front, is there in terms of any respite from that element which is driving inflationary pressures higher? marcelo: exactly. we still only have limited information. we got the inflation numbers through january, which show

inflation has been rising on the back of social unrest. we are only going to get gdp figures for december next week, and that will be the first clear signal of how much of an impact it has had. but it has disrupted key industries including mining. the economic impact is significant. shery: the imf also talked about that, the uncertainty and the risk outlook in peru today. marcelo: yes, peru remains one of the few countries in south america with an investment grade rating. that being said, all three agencies currently have peru on a negative outlook. haidi: marcelo rochabrun in lima, bloomberg reporter. we are expecting their 19th straight hike, but it did not happen, they held steady at

7.75%. which is a contrast to the rest of latin america, especially given the surprise we got today from mexico, where they hiked much more than expected, to 11% from 10.5%. we continue to see inflationary pressures not only in mexico, but also brazil where consumer prices increased. so price pressures across the region. haidi: whether you are talking about mexico or peru, we have had a series of stunners from the world's central banks this week upending expectations. this company is betting on ev batteries to help its refining business. deals include adventure with a battering giant. korea zinc also expects president biden's landmark inflation reduction act to opportunities for the company. >> the inflation reduction act

creates opportunities for us and probably for other companies, too, which invents -- incentivizes people to develop projects in other parts of the road rather than other parts, in it we will definitely take that into consideration when we make investment decisions. haidi: activist investor nelson paul says his proxy battle with disney is over following the company's newly announced restructuring plan. he revealed his decision to drop a fight in an interview with cnbc. disney ceo bob iger plans to cap seven thousand jobs for cost savings. one billionaire has lined up banks including goldman sachs to bankroll a bid to invite manchester united. sources are prepared to back a takeover of the english premier

league football club. shares of the team surged this week on reports that investors from tar are planning a bid. the paypal chief operating office plans to retire by the end of the year. that volume of pigments slowed faster than in the last quarter, to just $357 billion, $8 billion short of wall street estimates. coming up next, the race for the back of japan's governorship continues. potential unrest in the ruling party over that decision. we have the latest, next. hi, i'm katie, i've lost 110 pounds on golo in just over a year. golo is different than other programs i had been on because i was specifically looking for something that helped with insulin resistance. i had had conversations with my physician indicating that that was probably an issue that i was facing and making it more difficult for me to sustain weight loss. golo has been more sustainable.

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haidi: take a look at what we are seeing and that markets, the three-year yields climbing 3.744

percent at the moment, as the treasury yield curve inversion is reaching the deepest gap since the 1980's. the 2's of attendance exceeded by as much as 86 basis points. we are getting the sense that investors are having flagging confidence when it comes to the global ability to withstand additional tightening from global central banks, including the fed and also the rva, coming out much more hawkish than had been expected in this week's decision. the rva is scheduled to release their dated economic forecast, as well as their policy outlook as to whether we will see a meaningful revision to the inflation outlook there. that is weighing on markets. vonnie quinn has your first word headlines. vonnie: thousands of aid workers are pouring into turkey and syria, where the death toll from monday's earthquake has risen past 20,000. in syria, the first you and

eight shipment -- first you and eight shipment has arrived. the road back will provide turkey nearly one point $8 billion for disaster relief and recovery. the u.s. state department says the chinese balloon shut down last weekend was capable of collecting communication signals, and it was part of a broader people's liberation army intelligence gathering effort across more than 40 countries. administration officials told lawmakers, the balloon had some western-based components. hong kong stock exchange says it is seeing a tremendous increase in investments from golf silver and wealth funds. we were told that stock connect linking hong kong with mainland china is a key draw. when asked about hong kong's pursuit of a secondary saudi aramco listing, the ceo said there is interest. >> a lot of areas where we can see investors from the middle east, which is a high investment base that is growing very high,

investing in hong kong and in china for chemchina through foul called. and then the other way around. vonnie: spacex has carried out a key engine test for its mammoth rocket igniting more engines than it ever had before. 31 of the planned 33 engines fired, but the ceo elon musk said that it's still enough to reach orbit. it has potentially moved the company's flagship spacecraft closer to its launch. 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 am vonnie quinn. this is bloomberg. shery: japanese media reports say we could know when the next -- who the next boj governor will be nymex tuesday. but there could be some division within the ruling party and the division goes a certain way. let's find out more with our korea economy editor.

paul, give us an update on the timing of the announcement in which way it could go. paul: the local media reports are suggesting that we have got valentine's day, a nomination of the bank of japan governor. if it is on that day, we expect it late-morning. remember, this is a nomination to the parliament and limit still has to approve the nomination. of course, prime minister fumio kishida has a majority in both houses, so it is almost certain that his pick would get through. there would be hearings with the candidate later this month, to hear what they have got to say on policy, and then they would take the helm in early april. now, we have got three leading candidates. we have got masayoshi amamiya,

deputy governor who has in the front runner for a long time, followed by hiroshi nakaso, format deputy governor. -- former deputy governor. and aroohi dheri among gucci, a bit of an outsider -- and hirohide yamaguchi , he is a former outsider and former official at the boj. we had a report yesterday indicating that a pick of yamaguchi could cause problems within his own party because the faction led by shinzo abe which is pro-reflation, they would see him as a candidate that suggests a strong pivot away from this huge stimulus that the boj has been pumping into the economy in the last decade. so that suggests that we are down to maybe two. amamiya -- the local media

reported that he had been approached by the government to take the post. but i think the comments by prime minister kishida mid-week saying that he is looking for a candidate that would provide stability to the markets on one hand suggested that again yamaguchi ,is less likely of a possibility. kishida also mentored the expertise, international connections, dealing with things like the global financial crisis. that sounded a bit more like hiroshi nakaso than masayoshi amamiya. haidi: ultimately, what kind of market reaction could we expect when it comes to policy consequences going forward? paul: well, we have two factors here. of the three, amamiya is closest to the continuity candidate. nakaso is a little bit more

hawkish and yamaguchi clearly more hawkish. you would expect the yen would weaken under masayoshi amamiya. bond pressure would go down. it would be the opposite if it was hirohide yamaguchi. probably a strong move if it was yamaguchi. and somewhere in between if it was hiroshi nakaso. but given what has been priced into markets, and it also if the nomination will come on tuesday, i am expecting local media reports to be putting out names before then, so we could already have the market move before the nomination comes. haidi: that was bloomberg's japan and korea economy editor paul jackson with a preview. we are getting closer and closer to that boj leadership decision. nissan struck to its profit outlook as benefits from a weaker yen continued.

bloombergs -- joins us with more details. what do we gauge from the announcement from nissan, and how does the outlook appear to be? guest: they are essentially keeping their outlook the same, which is perhaps a slight disappointment. they got a nice tailwind last year with the yen's weakness versus the dollar, which helped their bottom line. they are not so optimistic. but obviously that dollar-yen relationship has adjusted a bit. also the company is still being dragged down by a shortage of critical semiconductor chips which is hampering production and sales volumes and that is a limiting factor. on the other hand, the results were fairly positive, and much like toyota which really knocked it out of the park in its

earnings picture. these companies tend to be conservative with their forecasts, they like to under promise and over deliver, we saw that with toyota. nissan is likely the same, unlikely to get you far ahead of their projections of production capacity, and also the yen-dollar. shery: how much higher are the stakes when it comes to nissan's growth strategy now that we have the revamp of its alliance with renault yvonne: that is a good question. nissan for years has been the stronger partner in the alliance and this is a reflection of that fact. also the unwinding that was kind of put together by the former chairman, carlos ghosn. it has been a long time coming. he left the scene a few years ago. so i think nissan is in pretty good shape as it is. it comes at a time when it needs

to invest a lot of money in its electrified future. and not having the french as strong of a partner could be a potential weakness going forward, but as many have pointed out, the alliance never really worked the way it was intended. the benefits to both companies were often times something that looked a lot better on paper than in reality. i think nissan is in a pretty strong position coming out of it. it does raise questions about their global strategy in some ways, but all in all, it is not a bad deal for them. shery: bloombergs transport editor chester dawson. we will be watching nissan, toyota as well as other stocks at the open. annabelle: that's right, we are in full swing for japanese earnings. but we are watching this company, renesas, big chip

supplier, they announced a billion dollars share buyback. their numbers came back better than expected. another company to watch is tokyo electron. increasing its commands despite the more industrywide slump in chips. was a -- this company did disappointed in numbers. and toshiba. revenue came in largely in line with the company. let's change now to another sector we are watching today, any additions or deletions from the msci. these two are the top additions in japan. then a deletion in japan. finally, kakao corp being added. we are 20 minutes away from japan and korea and will be watching these stocks early in the open.

there is a deal with sm entertainment. we have learned that they are planning to increase the size of their holding in the company. the deal would make hybe the company's largest shareholder. they are offering to buy the stock at a premium, one hundred 20,000 won her piece. haidi: coming up we look at the music industry's failings in its response to the #metoo movement with a former atlantic records executive who has been sharing her own experiences of sexual abuse across the industry. that conversation is next. this is bloomberg. ♪

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haidi: women made history at this year's grammy awards, breaking records and winning in more than 13 categories. but our next guest says the music industry has largely avoided the #metoo movement and she is trying to change that. dorothy carvello was a record executive and she is founder of "face the music."

we appreciate you speaking with us today. we saw the way that #metoo engulfed hollywood and proceeded to encourage change for the better. there has been a lot of criticism that it has bypassed the music industry entirely. would you agree with that, and also, what are the factors driving that? dorothy: 100%. the #metoo movement has not affected the music business at all. the main factor driving that is that female artists are entrenched in these long-term recording contracts, and if you are an executive or a female artist and you speak out, you face harsh repercussions, and i am living proof of that. haidi: so you are talking about structural institutional ways that the industry is set up for women to be taken advantage of, for the transparency to not be there, for the ability to deal with these cases not to go

forward? dorothy: 100%. there is no transparency in the music business at all when it comes to allegations of sexual abuse or harassment. the women, i have never met more terrified women. if you speak out, your career is over. they are managers also that don't encourage the women to speak out. kesha is a prime example. when she did speak out about abuse, she was severely punished. not released from her recording contract even though she wanted to be. there is example after example of punishment for women which deters them from coming forward. shery: is that because of the nature of how these contracts are structured? and what can be done, then? dorothy: the contracts are structured horribly, not just for keeping the artists tied to these companies forever, but

there is also the issue of nonpayment of artists due to these contracts. what has to be done is a complete overhaul of these three music companies -- universal, sony, and warner. it's time for change. the whole idea of institutionalized racism in these companies and misogyny, it is 2023. it is time to give artists their right to be paid with the streaming services, and stop punishing women for coming forward with sexual abuse allegations. the whole business needs a revamping. we currently have business run by three white males, which goes to show you just how out of touch they are no matter what they say, with what is going on in american society right now. shery: do you see at least a

focus, and understanding of these issues coming forward? after all, we are having this conversation. dorothy: i think that the media has been slow to cover the music business and what is going on, in terms of female complaints of sexual harassment on the metoo side. the music media covers hardly anything, because they are beholden to the record companies for source material and for artists appearing in their magazines. again, the music business has gotten a complete pass. i wrote a book and some of the men in that book that i accused are still working in the music business, so i don't know what more you could say, how tone deaf people in music are. haidi: are you planning to try again to nominate a seat at warner music, and do you think

activist investors have a significant role to play in this? dorothy: 100%. i will try again next year for the board seat. i was not able to be nominated due to a petty technicality. that shows you what the board is focused on, readiness it's not going to stop me. i need institutional investors from warner music group to step up, read my book. read the other two books that were written on the warner music group about their institutional abuse and nonpayment of artist royalties, and really step up and clean up like they say they are going to do. these institutional investors say that they want to be a part of change and a new culture and fairness and equality for everyone. then put your money where your mouth is. i will not stop and i will keep using the investor route to get things done. shery: dorothy carvello, good to

have you with us. "face the music now" founder. you can see part of this conversation on our interactive tv function, tv . you cannot dive into these or any other bloomberg functions that we talk about. this is bloomberg. ♪

shery: data on price pressures

in japan when it comes to producer prices, a year and your gain of 5.5%, which is slower than what analysts expected -- 9.5%. it is in easing from november when inflation presses were above 10%. month-on-month, flat. no price acceleration. we are watching those inflation numbers from japan closely. the factory gate number, acceleration of 9.5% year on year for january. the world's largest zinc smelter in korea is betting on ev batteries and clean energy to help decarbonize a business. the push includes a joint venture between its affiliate. the chairman spoke extensively with bloombergs stephen engle. >> i think kimco in and of itself will need to make a significant investment in the near future in order to secure its position in the battery

industry and to actually improve its position which i think is necessary, especially given the fluctuations in risk and the uncertainties that are just laden in this market, right? in that process, it's not out of possibility that we will increase, korea zinc will increase its stake in kimco, but nothing really has been decided. stephen: your company sits at an interesting time. the world is affected with geopolitical stresses between china and the u.s., and the war in ukraine exacerbating all these things. do you feel you need to take a side in this global dispute, not saying you are doubling down on australia, but you are increasingly relying on australia and investing more there. is that because you are more wary perhaps about china restrictions, the export restrictions, that ira and the like?

>> a lot of our investments in australia are investments into renewable energy. we are not currently looking at any immediate investments in connection with battery materials and the minerals associated with battery materials in australia. not directly anyway. with respect to the ira and the geopolitical tensions you are talking about, especially impacting the world of battery materials and the supply chain, there is no arbitrary decision for us to take one country over the other. i think the ira creates an opportunity for us and probably for other companies, too, which incentivizes people to develop projects in certain parts of the world rather than some other parts, and we will definitely

take that industry consideration when we make investments decisions. stephen: zinc refining is high energy intensity and high costs involved with the energy input, so how important is it to accelerate the transition if you are making more of a transition into green hydrogen, for example? >> well, i think we are looking at various ways to accelerate or to pursue this strategy as aggressively as we can, as we speak. i am not really thinking in terms of how to accelerate this even more. battery-related materials, especially in connection with nickel, the market is crazy. right? >> so the challenge here i think is for us not to blindly accelerate our pursuit of finding a segment of the supply chain that we can be really,

really good at, and to manifest that plan into business. but to find a segment that can exist in five or 10 years time, but amidst this fast changing market. haidi: these are the stats we are watching as trade opens in korea and japan. korea zinc. korea electric. nsk gas, after trafigura announced losses over its metal cargoes it that did not actually contain that nickel they were supposed to. the market opens, up next.

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>> this is daybreak: asia. we are coming down to asia's

major market opens. we continue to see deeper recession signals in the bond space and even more emerging market economies signaling they are perhaps staying higher for longer. haidi: it really does feel like a concerted chorus of global central banks to try to reset expectations. we'll be looking ahead to the rba with their economic review to see if there are meaningful revisions given the hawkish guidance. what are you watching? annabelle: we are a few seconds away from the open of japan and korea and the start of trading for cash treasuries. we are going to be focused on where the two tens curve comes online. reaching the deepest level since the 1980's. that tells us economists are concerned about the impact the sustained period is having on

economies around the world. the 10 year yield sitting flat at the start of trading. in japan we are focused my central-bank action given the nomination for the next doj governor could come as soon as february 14. that would be this coming tuesday. the yen looking flat. we had seen yen volatility on a one-week basis around a three week high. japan says earnings season is in full swing. lots of companies reporting earnings. nissan, toyota among them. bearnaise sauce is another stock we are keeping an eye on because it is announcing it is going to be spending more than $380 million buying back some of its shares. changing now to what is happening in korea at the start of trade. two key companies in focus. we have headlines dropping now.

high v announced it was taking a nearly 50% stake. the company said it plan to acquire another new 25% stake in the company through a tender offer and it was offering to buy shares at 120,000 yuan. i 21.8 percent premium to yesterday's close. sm entertainment saying it opposes the hostile takeover attempt. we are still seeing hybe shares looking higher after the purchase. yet to see trading for sm entertainment. we are keeping an eye on the asx 200. just over one hour into the session. seeing most of the action coming through into the on yields. we have the rba quarterly statement to this hour. what is happening here is traders are anticipating we could see a re-duration of the hawkish tilt that came through the last rba meeting.

still seeing stocks lighting. that is down to the losses coming through in the i.t. market. haidi: we are just going to continue watching what is going on when it comes to hybe and sm entertainment. sm entertainment saying it opposes the hostile takeover attempth. ybe pumping as much as 9.2 percent. announcing the purchase as well as its attention to take as much as a 25% stake. bts agency jumping into this battle between cookout as well as sm entertainment. the founder to buy the 14 point in -- 14.8 sent stake. we are going to continue to watch how this plays out because hybe, the manager of bts is finding itself in the middle of what is a messy and fascinating corporate battle between the godfather of kapok and -- of

kapok and -- offering to buy another 25% of the agency from investors according to filings we have had this morning. jumping close to 18%. sm energy men after hybe joining the battle for a key stake. the deal is aimed at helping fight a proposed deal as an entertainment management has struck. three more details as this is a quickly developing story with a lot of market reaction we are seeing but let's get more analysis when it comes to the broader markets. a resetting of expectations and a away we have seen from many central banks. also watching to see what the next developments are. let's get some more from the head of asian equities at bnp paribas asset management. great to have you with us.

if you take a look at china, i don't know if you characterize this as a breather, a chance to reassess or whether investors are waiting for a fresh catalyst be at another move from the pboc, bmr policy action from the government or a meaningful recovery in property. what do you think is going to be the next driver if we are going to see further upside for chinese equities? >> we have seen as you said a fast and furious reaction to the chinese equity market post november of last year and continuing into this year. taking a step back the biggest change we observed and the three months has been a sharp have it by the chinese regulators and authorities. they basically took over zero covid they rolled back their previous measures on property markets.

over self-inflicted policy controls. at the same time we have also seen a very sharp rally. in all the major indices. we have gone from a point where valuations are very depressed to a where valuations are i would not say fair value what investors are saying we need to see some improvements on the fundamentals be at revenue growth or guidance from here to push it to the next level up. the initial phase of catching up and unwinding some of the over bearishness we saw in october of last year is done at this point. haidi: we have also seen an eventful start to the year when it comes to emerging markets. there was so much optimism and then a little bit of

reconsideration depending on the direction of the fed, the u.s. dollar and the path of the china reopening. what do you like across ems at the moment? korea is obviously a top performer. do you think there is further upside there? >> i think right now in terms of sectors we like industrials and financials within the asia context. part of it is we still believe the chinese drivers, our outlook is going to be decent going into the rest of this year. we are going to be hearing from of the companies in the coming weeks as they announced their year end. and give forward guidance into the future. i think what is happening right now is we are all checking closely the reopening's. we will not get the official numbers until bubbly march

because -- until probably march. the indicating factors we are seeing on the mobility side is pretty good. we are seeing hotel bookings in domestic china has recovered to a pre-pandemic level of 2019. india and macau being a lot better than expected. in korea the bounce back we have seen so far has been good. a lot of it has been a focus on the tech sector where we have seen results from tech giants like samsung. at the same time we are seeing stock prices are in longer reacting to poor earnings in terms of losses that have been reported. the inventory cycle is more or less done for shery: the concentration in tech stocks is something that worried investors.

we also heard from goldman sachs earlier korea is no longer a mike play. it is a mike -- a macro play. are those the sectors you're going after at this point or has the rally already been priced in? >> we are still positioned in those stocks because we find them to be the best position to ride out the inventory cycle. i'm not saying the cycle is done but we are at a point and time where the inventory levels are pretty close to historical highs and the risk reward is probably unlikely. could happen but it is unlikely. shery: what happens if inflation in the u.s. does not come down as expected if we get a stickier core pce on top of very strong jobs numbers we have. how does that affect picture for the rest of asia?

>> i think is the trillion dollar question for equity investors. particularly on the inflation front. we now have a competing narrative between wall street investors. the fed is focused. chairman powell has reiterated that in the recent speech. the confounding data we are getting is very strong labor data we are seeing from the u.s.. friday's data was out of anyone's expectations and that has led to concerns we have a decline in inflation on a wide basis. but we are going to get core pce's. the fed has indicated they want to push this back to levels they are comfortable with. as you can see from forecasts they are expecting this to persist for a much longer time

basically through the end of 2024. that leaves the final conundrum we have where investors believe the fed has done too much in conditions have into restricted and we go into a recession. we are probably near a pause don't expect it to cut quickly. certainly not this year i think that is the biggest debate right now on the macro side. shery: we are seeing in the market is well with the inversion should good to have you with us for head of asian equities at bnp paribas. you are following big moves today in korea. annabelle: this is a fascinating and extremely messy corporate battle going on here. what we understand this morning is the manager of the pop sensation hybe buying a 15% stake in sm entertainment from the founder. it has offered to buy another 25

cents date from the agency from investors according to filings that came through this morning. they wanting to buy shares at 120,000 yuan a piece so you can see share prices are rocketing because it was a 21.8% premium to yesterday's close. the deal is aimed at helping the founder of sm entertainment fight off a prose deal the management had struck with cookout which is the operator of korea's most popular social media service. the deal would have made them the second-biggest shareholder in sm entertainment. a lot of details into this. i think we will be getting a report later this hour. the state of play for both of these companies moving higher. other companies where focusing on is what came through in the

rebalancing from the msci. a few deletions and delete -- and additions here. finally in the midst of earnings season in japan still. we saw tokyo electron. raising its profit outlook. it is planning to buy back $380 million worth of shares. that stock is rising. toyota nissan getting more conservative. haidi: let's get you to vonnie quinn in new york. vonnie: mexico stunned markets by raising its key rate 50 basis points to 11% matching its have hike in december and outpacing the fed. the move surprised all 24 economists surveyed by bloomberg who expected the bank to slow the pace of tightening to a quarter-point. the board says it could deliver

a smaller hike at its next meeting. thousands of aid workers are pouring into turkey and syria were the death tolls for monday's earthquake has risen to 20,000 shared in syria the first u.n. sheet -- u.n. shipment has arrived to give people temporary shelter. the world bank will divide -- will provide turkey one point -- the u.s. to government says the chinese balloon shutdown last week and was capable of collecting communication signals. it says the balloon was part of a broader people's liberation army intelligence gathering effort across more than wonder 40 countries. commodity trader said it is facing with a half $1 billion in lawsuits after finding metal cargoes it ought did not contain the nickel they were supposed to. the company has started legal action alleging systematic fraud.

bloomberg news is seeking comment from suppliers. global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. shery: still ahead, expecting inflation in china to rise moderately. the chief china economist explains that view later. plus an interview about a new artificial intelligence development. this is bloomberg. ♪

shery: we have seen the deepest yield curve inversion in the 2/10 since 1986. that has signaled perhaps a recession to come which has

pressured equity markets in the u.s.. let's bring in our global economics and policy editor kathleen hays. how strong a signal is this? kathleen: historically it has been a big signal. it is interesting how this conversion has caught everybody's attention so much. i head -- any interviews with recent officials it is not stressed very much the deepest yield curve from two year to 10 year bond since 1986. what this chart depicts is the fact that those recession bars have always been preceded by an inverted yield curve. there have been a few recessions that did not happen. if you are selling to your notes and yield is rising it is because you think you're going to lose money when the fed raises more. they are worried about inflation. if you buy 10 year note that is because you think the economy is

going to slow down so much and get that recession i am going to make money because field is going to fall further and the price is going to rise. there is a macro firm called macro hive where the senior market strategist put out a note today saying the fed funds rate which has been talked about going to 6% in the options market this week, she says it is going to go to 8%. the market is not anywhere near that. if the fed has a couple rights or so this year. it is not just macro hi talking about this. both charlie plosser and -- said it will have to go to six and a half to 8%. tom barking president of the richmond fed said nothing like that today. he did say the inflation flight is not over and they do have more to go. it is that course from the fed

that has gotten people realizing have an rate cuts probably not likely anytime soon and more of the concern going and the people who jump on these trades first making money making people more look in that direction now. haidi: after decades of waiting on the sidelines prime minister abraham has risen to the pinnacle of malaysian politics but not before facing two jail terms and being forced into a coalition with the party he blames for sending him to prison. haslinda spoke with him exclusively in his first international interview since being prime minister pin >> waiting in the corridors of power is of course an experience in itself because you observe the players like king lear with

cordelia. you learn from the strength and weaknesses of your photos. -- your foes. hopefully when you're in office you try to improve and do your best to serve. >> you have inherited a nation that is so divisive. we saw the first hung parliament. a country tainted by the long-standing one mbd scandal. how do you regain credibility? how do you regain investor confidence? >> it is not just one mbd but the corruption is systemic. it cuts across the whole spectrum of particularly the political elite. you have to set a good example. >> no more corruption you say and that is a pledge you have made over and over yet here you are tied up with the party chief who faces multiple charges.

is there a disconnect? >> he has been investigated and charged and undergoing trial. the court should decide independently. i made it very clear the courts are independent. > but this is a man who faces 47 counts of corruption. he is your deputy prime minister. >> i'm not here to discuss his case. i am here to suggest the court process must be independent and he must be given a chance to be relegated by an independent impartial court but you have to form a government, a viable strong government. as long as the policy is accepted and no more excesses, fine. i should be given a chance to conduct this. whom do i choose?

i choose party b or c in the opposition? whether they use a modern suit or a religious garb. they're the same when it comes to poor governance and corruption. shery: the malaysian prime minister speaking exclusively with bloomberg's haslinda amin. you can see the conversation in full and a special program from bank 6:00 p.m. friday hong kong. this is bloomberg. ♪

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shery: the world's largest zinc smelter says it is adding on ev batteries and clean energy to help decarbonizing its business. that push includes a joint venture last year between its affiliate camco and lg chem. the chairman spoke exclusively

with stephen engle. >> i think camco itself will need to make significant investment in the near future in order to secure its position in the e industry and to actually improve its position which i think is necessary especially given the fluctuations and risk and uncertainties that are laden with this market. in that process i think it is not out of possibility we will increase our stake in camco. nothing really has been decided in that regard. >> your company sits in an interesting paradigm at an interesting time. the world is being bifurcated by politics, geopolitical stresses between china and the united states and the war in ukraine a -- abating these things. do you feel you need to take a side in this global dispute? i'm not saying you are doubling down on australia you are increasingly relying on

australia and investing more there. is that because you are more wary perhaps about china restrictions, the export restrictions, the ira and the like? >> a lot of our investment in australia our investments into renewable energy. we are not currently looking at any immediate investments in connection with battery materials and rules associated with every materials in australia. not directly anyway. with respect to ira and geopolitical changes you are talking about especially impacting battery materials and the supply chain, there is no arbitrary decision for us to take one country over the other. i think ira creates an opportunity for us and for other

companies which incentivizes people to develop projects in certain parts of the world rather than other parts. and we will definitely take that consideration when we make investments. shery: coming up next, we preview china's january inflation numbers due out in about an hour. a chief china economist explains why we see factory gate prices remaining in elation. this is bloomberg. ♪

haidi: we are getting the breaking lines out of the rba monetary policy statement. talking about household balance

sheets are in a good state due to the level of savings we sold during covert good forecasts when it comes -- wages forecast has been raised as well as for next year they see upside risks. they have trimmed their inflation forecast for 2023 here the rba stating they are resolute when it comes to doing what is needed to get cpi back to the two to 3% inflation target. monitoring the trends when it comes to spending. citing uncertainties when it comes to the outlook and the level of rates needed but reiterating what we heard earlier this week about expectations for further rate hikes to bring down inflation. let's get more from paul allen who is here in sydney. the close focus is after what we

had was the upside hawkish surprise under the guidance. >> this reaffirms of lot of what we heard on tuesday particularly in terms of the story around inflation and employment should the employment, unemployment rising to 4.5% i-20 25. the wages forecast lifted to interesting to know these forecasts are also based on expectations we will see rates peak at three and three-quarter set in 2023 and dropping back 23 in 2025. the rba did spring a surprise on tuesday with this line they will be -- there will be further interest rates. probably two more by the time we get to easter. another 50 basis points of tightening at least. with 20 out these lines are dropping after the media has been in a locked up for a couple of hours so they tend to come in

firehose performance so we have to pick through them as we go. shery: australia's economy has been resilient so far. if we get those potential increases as you mentioned, what will be the impact on growth? paul: a few other key lines in the statement along those lines. household balance sheets remain in good shape because it is going to be a problem going forward. we talk about the mortgage cliff approaching. a lot of australians took phil lowe at his word in 2021 we would seek no rate rises until 2024. since then we have had nine in a row. those fixed loans put in place in 2021 are going to start rolling off this year and that is going to cause a lot of pain for households that went right up to the limit of their potential borrowing. house prices could fall and

property is such an important part of the australian economy. that is obviously going to have implications for growth. the rba optimistic saying export growth is strong particularly in terms of tourism, education bouncing back. we have had another sign today of chinese trade restrictions starting to ease with the arrival of the australian coal ship in china. perhaps some good news on that front but certainly in the near term more pain to come with the statement of monetary policy reaffirming what we heard on tuesday. shery: let's now turn to vonnie quinn in new york with the first word headlines. vonnie: the japanese government is reportedly planning to present its nominee for the next boj government to parliament on tuesday. they see chances of division in their party over division should

will face opposition if he is the prime minister's choice. hong kong stock exchange says it is seeing a tremendous increase in investments from sovereign wealth funds. the hkex ceo told us the stock connect looking hong kong with mainland china is a key drawl. when asked about hong kong's pursuit of a secondary listing he said there is compatibility in the two sides interest. >> areas where we can see investors from the middle east which is a high investment race growing very high investing in hong kong and china or in china through hong kong. the other way around. vonnie: spacex has carried out a key engine test for its heavy use to rocket igniting more engines than it has before. 31 of the planned 33 engines fired overall. ceo elon musk said in a tweet

that is still enough to reach orbit. the test potentially moves the starship spacecraft further in its launch. global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. this is bloomberg. shery: less than an hour we get china's january inflation data and our survey of economists adjust a slight easing of factory deflation. turning us now is the chief china economist at cricket -- at credit agriculture. we saw more demand coming from the lunar new year holidays. >> yes, if we look at cpi inflation we do expect a slight increase in the headline to 2% from december's 1.8%. the primary driver will certainly be the highest in inflation on the back of better demand for travel and for the

other consumption during the lunar new year. we have already seen a pretty positive lunar new year spending holiday data. tourism revenue up 22, 30%. the retail sales add -- and selected retailers up 30%. those are evident of coming back demand. on the other hand supply will take some time to get more accommodative of increasing demand. resulting in a slightly higher inflation for the month of january. shery: what's talk about consumer prices because if we see the upside does that mean the pboc has less room to maneuver? >> for this year we definitely see the cpi inflation will likely have a moderate increase throughout this year because of

the demand recovery we are expecting and core inflation would also be improving from the previous low below 1% level to a healthy level about four to 1.5 sent. that would likely ring the average cpi inflation in china to an average of 2.4 sent to if the cpi inflation was in the range of 2.4% for the large part of this year i think this will still leave the pboc sunroom to be staying more accommodative especially in the first half of this year before turning more neutral in the second half when there is more evidence showing a firming up and demand recovery and better growth. haidi: do you see a meaningful recovery for the property market or. -- or what does a new normal look like?

>> from the property market if we look at the data it still shows sluggishness from the property sector demand. if we look at home sales for the hundred developers in china it was still down a third in the year on year basis. after the lunar new year we do see some of the pickup in demand in home viewing for the new homes in some of the tier one and tier two cities. overall i think demand for properties sector is still quite weak and we will still take a flute -- a few more months to show signs of stabilization. the year on year basis has become increasingly lower showing the headline numbers could be improving. i will say the property sector will likely still remain a drag

even though it will become smaller compared to the year of 2022. haidi: how does that by extension impact broader providence and sentiment given that property is a source of household wealth and stability? >> that is right. we have seen some of the initial rebound of consumption demand especially during the lunar new year on a sequential basis and also in year on year basis. if we compare to pre-covid 2019 level it is still 10 to 30% below. after the initial release of pent-up demand china's consumption demand, if we are expecting a sustained recovery

we still need to rely on better expectations of the labor market conditions and improving income growth to support that because property prices could be still on a nationwide basis may not provide the boost through wealthy fact like previous years. haidi: chief china a con to most -- chief china economist. more to come. this is bloomberg. ♪ three nights, esg... the broker will take your bonds. -diversification, futures, options. fiduciary. leverage. [whispering] -frothy markets. psst. virtual real estate is a lock.

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shery: the agency which manages k pop group bts is looking to take in your 40% stake in a some entertainment for $900 million stock in both companies soaring on the news. get details. you can see that kakao is jumping 40%. tell us what is happening. >> this has been a real korean drama unfolding the k pop seemed this week. it said this morning it will give a tender offer for sm entertainment shares and agree to buy sm entertainment founder

stake in sm. the announcement comes as earlier this week bsm founder who was seen as the godfather of k pop has said he will block a deal between sm entertainment and executive and cookout -- and kakao that would make kakao the number two shareholder. this high development has been interesting because there were speculations about which ally the founder would be looking for since he was going to block the deal between kakao and entertainment and now it turned out hybe which manages bts is going to stand behind is truly an order to take over sm entertainment. if the offer goes successfully hybe will be able to control 40% in sm which is one of the oldest

k pop agencies in south korea. haidi: what is next because we know this is a battle. what are the developments we are watching for? >> what investors will be watching will be the reactions from kakao whether kakao will come up with a higher offer and launch another tender offer that could boost the share prices of sm entertainment which has been rising quite a lot so far this year amid this speculation over who is going to take over sm energy mentored another interesting player to watch is kakao entertainment. in the agreement between kakao and sm entertainment kakao entertainment can become the buyer in sm entertainment stake. kakao entertainment has recently received backing from saudi arabia and it has secured enough money for another mna. what kakao or kakao and

attainment do next will be an interesting move investors will be watching. haidi: bloomberg's asia stock reporter with the latest. we have seen renewed focus on ai technologies since the chat gpt bought became an internet phenomenon. annabelle is taking a look at implications for the wider crypto sector. annabelle: it has been one of the interesting developments. we have seen a lot of interest building on a digital assets that focus on the or ai technology. tokens that have linked to this area have been posting huge moves to the past couple of weeks. there are other developments going on at a sector beyond what is going on with chat gpt appeared our next guest is the founder of tron blockchain network which launched a $100 million fund focusing on ai. just consign as the ambassador and permanent representative of grenada to the wto. tell us about this fund and what

the benefits are of blending blockchain technology with ai. >> definitely. we want this fund to be an incentive to build the tron network. i believe ai is definitely the next very important trend for blockchain because blockchain provides decentralized technology which is easy for ai to receive payments in the first place. even today chat gpt is still a free version. they are going to introduce a premium version for u.s. users very soon. i think right now ai application is lacking for a payment solution. that is why we want to provide enough resources for the developers in the space that

there are several helpers already on the tron network for their application should in the future all of the developers can have a reliable payment solution for the application. haidi: you have been focused on where you see is the catalyst for growth moving forward. that could be in hong kong and mainland china. i want to talk about your plans. you took on an advisory role last year. will be your strategy for adding more users and what incentives are you offering? >> thank you. first off it is about ai again. we will be focused on ai. we lease lots of ai-related tokens. we create ai segment for crypto trading should witches very -- crypto trading which is very important.

hong kong recently has been a buzzword for crypto developments. hong kong is trying hard to compete with singapore in terms of crypto hub in asia. planning to expand our office and operation in hong kong which i believe is an important crypto hub opportunity in asia. i think this could be a big potential opportunity for crypto general development in china since right now hong kong has been seen as one of the experiment zones for crypto development in china so that is one of our biggest reasons to expand in hong kong. annabelle: what would you say the key countries you're looking

to expand to and why? >> i think generally speaking recently still focused on different region. we have hong kong, malaysia and also caribbean right now has been the key region we have developed our business on for different reasons. caribbean is because of the regulatory friend and honk -- revelatory friendly and hong kong is asia focused. malaysia i think is very chinese friendly so that is why we put lots of our resources. annabelle:annabelle: in january you said huobi was losing around $10 million a month. what would you say the run rate is looking like now? >> yes, i think recently for even last time i think it is only a month ago before lunar new year but after a month i think we are doing way better

than a month ago because that is crypto. i think we have done around 20% of the labor costs and since we have seen a very good market in january. i think we have tripled our revenue i think in january. hopefully for the next two months going to be the same. i think we will end up being profitable in q1. annabelle: what is your plan because you have two stablecoins controlled by users. which one will you be letting die a natural death or are you looking to revive both of them? >> we are generally focused on the u.s. dd. so actually u.s. d is held by

the previous founder. we don't have any tied. for the u.s. ed i think this year is going to be a big year since we already have seen the u.s. government is going to take action on stablecoins. that is why i think the decentralized stablecoin is going to be a big option for traders if they want to trade crypto in a decentralized and safe way. it is fully decentralized not controlled by me or any centralized entities. we have no rights to freeze or have impact on transaction. it will be a good option for traders if they want to trade. annabelle: how are you planning to stabilize and what would be your reason for steering clear of the dollar peg for so long?

>> currently it already trades 99 comparative u.s. dollars. it is already i think back to the pack compared to the lunana and ftx space. i would not worry too much about the peg about the u.s. dollar. i think this year we will take more actions to introduce psm stable mode. try to be more tight u.s. dollars. this year i would say less than $.10 probably. what are we going to do? annabelle: thank you for your time. founder of tron and permanent

representative of granada to the wto. claymore head on daybreak asia. this is bloomberg. ♪

haidi: this is what we are seeing across the asia-pacific has trading gets underway for this friday's session. quite a lot of volatility.

heading for declines. looking more mixed with some upside being seen across japan. the kospi, the region's top performer this year is down by just about 1%. seeing downside pressure when it comes to sydney stocks with new zealand posting tepid gain spirit u.s. equities falling for the second day. yields climbing as investors are starting to adjust to the reality of the prospect of higher rates for longer as global central banks continue to battle inflation. we have the height of the inflation. shery: let is it from daybreak asia. our markets coverage continues. this is bloomberg. ♪

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>> good friday morning from hong kong.

9:00 a.m. in the